Ratan Tata, Chairman of Tata Group seems to be running out of patience and West Bengal Chief Minister Buddhadeb Bhattacharjee seems to be fighting a losing battle. But it is not just Singur, protest over land acquisition have been widespread from West Bengal to Orissa and from Goa to Maharashtra. If Tata Motors chooses to exit, will it set a precedent for other investors?

Minister of State for Industry, Ashwani Kumar said that a land acquisition and land rehabilitation law is in place, which is going to be soon implemented. He feels that the issue of rapid industrialization versus land acquisition has been brought into sharper focus because of these scales of acquisition and because of what transpired in the wake of acquisition. According to him, it was not merely a question of land being taken but the way the farmers were sort to be repressed by the state administration at that time gave a new twist to the whole thing in Singur.

Chief Mentor of the Confederation of the Indian Industry (CII), Tarun Das feels that this is very strange that all efforts have been made but the law has not gone through because states are run by different political parties. Each state and each political party in a state wants economic, industrial and manufacturing industry development, he added. So, he believes that in their own interest everybody needs to come together and support a transparent, clear, long-term legislation with rules and procedures laid down. He said that seeing the example of Tatas, other industry and investors will run out of patience with India.

Excerpts from CNBC-TV18’s exclusive interview with Ashwani Kumar and Tarun Das:

Q: This is no longer an issue about Tata Motors and West Bengal; this is an issue of land acquisition that could possibly shake investor’s confidence. We have had problems in Orissa with Posco and in Goa with notified Special Economic Zones (SEZs) being denotified. We have had problems that the Ambanis faced, the Mittals have faced in the Jharkhand. What does this really do to investor’s confidence when we do not have land rehabilitation and a land acquisition policy in place?

Kumar: We have a land acquisition and a land rehabilitation law in place, which is going to be soon implemented. That was precisely the reason why it had become necessary for us to revisit the archaic land acquisition laws. We brought in a piece of legislation that would combine the imperatives of compensation for acquisition of land to the farmers along side a comprehensive policy for rehabilitating them in terms of livelihood.

Q: Both these bills are still pending in front of Parliament and have not been passed. Those amendments haven’t come through that is why we are faced with the situation. What is the message that is going out to international and to domestic investors?

Kumar: It is an unfortunate reality. I cannot escape the reality that the vagaries of coalition politics did not make it possible for us to have these laws passed by Parliament. As far as the United Progressive Alliance (UPA) government is concerned, it actually went through with the motions with extremely responsive and sensitive approach to the entire legislation. We have a blue print of the law but land always had a kind of intense emotion and sentiment attached to it throughout the ages.

The issue of rapid industrialization versus land acquisition has been brought into sharper focus because of these scales of acquisition and because of what transpired in the wake of acquisition. In Singur, it was not merely a question of land being taken but the way the farmers were sort to be repressed by the state administration at that time gave a new twist to the whole thing.

Q: Are you optimistic that when Parliament re-convenes we could possibly see some action, some forward movement in terms of both these bills, which are pending?

Kumar: These bills are fairly important according to the urgency. I do know the parliamentary calendar and will not be able to comment on it but this law should be seen through the day as soon as possible. These unseemly and unnecessary controversy between industrial development and farmers’ rights is sort to be diluted if not put to rest.

Q: You have written about the Tata-Nano issue. The Tata versus Mamata Banerjee issue is really going to be bad for West Bengal. The Chief Minister has gone as far as to say that it is going to be disastrous for Wes Bengal. But Tatas are running out of patience in Singur. If the Tatas cannot do it, can anybody else think about going forward with their investment plans?

Das: All efforts have been made but the law has not gone through. This is very strange because states are run by different political parties. Each state and each political party in that state wants economic, industrial and manufacturing industry development. So in their own interest everybody needs to come together and support a transparent, clear, long-term legislation with rules and procedures laid down.

Q: We are waiting for that legislation. We are hoping that the amendments and the blueprint that Mr Ashwani Kumar was talking about will make the process a lot more transparent. In terms of investor’s confident, in terms of investor’s sentiment how much is India going to lose?

Das: The people who are already going through this difficulty have become brand names for delays in land acquisition around the world. I went to Korea addressing business people on investing in India and the questions kept coming up about Posco. So this is an issue out there. So we need to resolve it in our own interest because we need these investments.

Q: Do you think Posco, LN Mittal etc are now going to run out of patience with India?

Das: I cannot speak for specific companies but I can speak for industry and investors generally and the answer is yes.

Q: Is there a change as far as mindset in corporate India is concerned because this is the first time that we have actually seen a corporate house taking on a political force and say if you cannot deal with us, we want out. Is there a change in mindset?

Das: People are now losing patience. A company can do so much; they are going down the road of rehabilitation, down the road of training the local people, giving jobs to farmers' families, paying compensation or whatever. At the end of the day, if you still do not get the land then what do you do? You have to call it a day and go somewhere else.

Q: You have just heard the captain of industry talking about how patience is running thin, how sentiment is very low. As the Minister of State for Industry are you a worried man today?

Kumar: I am certainly worried because I do believe and accept that one cannot expect major investments and industrial developments in an atmosphere driven by discord, violence and conflict. No industry can ever progress, survive or make profits if the people in that area are not supportive of that industry. But I do not think that Tatas with all their commitment ever wanted to take on any government. Tatas have gone along with the government, they have tried their best to ensure that there is some kind of settlement with all stakeholders but at the end of the day they are answerable to the board, shareholders and to the corporate culture. Therefore, all stakeholders must so conduct themselves that this unseemly discord or seeming contradiction between industrial development and the farmers' sensitivities is actually addressed without further delay.