The incentive package being offered by the government of West Bengal for the Tata Motors for setting up the small car project in Singur would take into account the concessions offered by the Uttaranchal government for the project in that state and reflected in the cost of the project, including cost of land.
The largest offered by the Uttaranchal government for the project included the excise and income tax holidays.
However, it would not have been possible for the state government to offer sops to match those offered by hill states under a Central government package.
WBIDC, the state's nodal industrial promotion agency, did not have resources to fund the incentives.
Under the present incentive scheme of the state government a part of the fixed capital investment is subsidised.
Therefore, the incentives for the project would include the extra cost required by Tata Motors to set up the project in the state, Sabyasachi Sen, principal secretaryof the Bengal commerce and industry department, said.
"Tata Motors is also a listed company and it has to report to shareholders. The state has to consider the shortfall as a result of the offer in Uttaranchal for the project," Sen said.
He claimed this was not the first time such incentives were being doled out to get a project.
Such incentives were also offered to Haldia Petrochemicals Ltd, South Asian Petrochem and other projects. Sen said the legal team of Tata Motors was working on the agreement, which would be signed shortly.
The Tata Motors factory was essential for developing the automotive industry in the state and the state's efforts were in view of this potential.
Without disclosing the amount of incentive, Sen said the entire agreement with Tata Motors would be made public as soon as it is signed.
Meanwhile, Trinamool Congress activists staged a demonstration in front of Tata Centre in Kolkata's Chowringhee area on Wednesday and smeared the gate of the building with coal tar.
The incident occurred a day after construction work for the Tata Motors small car plant took off at Singur.
Police Commissioner Prasun Mukherjee said some women demonstrators suddenly into the Tata Centre building from the Birla Planetarium and threw coal tar at the gate.
It was also thrown on policemen who were on duty at the spot, he said.
The police picket there had been strengthened and investigations were on. The incident came close on the heels of Trinamool Congress chief Mamata Banerjee's stinging press statement accusing the state government of going back on its promise of holding dialogue with her on the Singur issue.