Crores invested, Nano suppliers worried over pullout talk

NEW DELHI: Will the lakhtakia car lose its way? While the aam aadmi is still waiting to ride his first Nano home, Tata’s one lakh car is facing a rough ride so far. And after Ratan Tata’s threat to pull out of Singur, Nano suppliers are feeling unsettled too. Most have invested crores in their units already, their buildings are ready, machinery has been shifted. But after yesterday, their mood has turned grey.

“Our unit has been ready for the past two months and we were looking to start production two months back,” says Lord Swaraj Paul. Paul’s company Caparo which will supply body parts to the Nano is waiting for a green signal from the Tata’s to start production.

About 20 of the 56 suppliers for Tata Motors Nano, who have been allotted land at Singur, have started construction of their plants at the vendor’s’ park, some of them in advanced stages of completion, their machinery in place. But after Ratan Tata’s comments about pulling out from Singur, they are worried Water Obstacle.

Sona Koyo Steering System, which will supply the steering unit to Nano has put in Rs 27 crores to set up a unit at the vendors park. ”We are concerned and hope the situation will normalise soon,” says Kiran Deshmukh, COO, Sona Koyo. The company is waiting and watching to see how things shape up.

Aurangabad-based Endurance Group, too, is in a similar dilemma. The company is investing Rs 45 crore in its unit in Singur. Their building is complete and 75% of the machinery has also been shifted. But Mamata Banerjee’s agitation has dampened their spirits.

”We are following the time schedule so far, but production will depend on Tata Motors’ future plans,” says Yogi S Krishna, VP, Casting Business. The small unit is expected to hire 150 locals and the company is willing to scale up operations depending on future demand.

Endurance will supply 17 different kinds of castings and window balance to the Nano. Krishna says the mood among all the vendors is not so upbeat anymore. Most say a pull out by Tata’s means losses for them as they will have to move out too.

”We will have no option but to move out, since our plant is meant to supply for the Nano unit only,” says a vendor who did not want to be named.

In fact, everyone will be a loser here – Tata Motors, the vendors, aam aadmi, the locals, the state of West Bengal and of course, India. The agitation which has become centrestage in the past two days, has grabbed international headlines as well. Experts say, if Tata’s do pull out of Singur, India’s brand image will take a beating globally.

”If Mamta Banerjee does manage to push Tata’s out, it will send out wrong signals. The image that will go out is that any politician can whip up emotions and turn an agitation against an investor. Everyone will think twice before investing after this,” says adman Prahlad Kakkar.

With roadblocks like these, it may be some time before the people’s car vrooms on to India’s roads.

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