The two heavy engineering companies along with several others in West Bengal fell victim to policies and actions of the union government during the last four decades. Burn, Jessop & Co and Braithwaite were India's earliest heavy engineering companies catering to the needs of the infrastructure industry, manufacturing railway wagons and coaches, heavy railway equipment, giant gantry cranes for port trusts, overhead cranes, rigs and road rollers among others. The railways were the number one customer, followed by port trusts and central and state PWDs.

They were pre-Independence era companies and run under respective managing agents. Four decades ago, the abolition of the managing agency system, with a sole purpose of breaking private monopolies, by the then Prime Minister Indira Gandhi gave the first jolt to Braithwaite, Burn and Jessop, which were subsequently taken over by her government. As many as 26 sick companies with some 45 units in West Bengal, including giant Indian Iron, Hindustan Copper, Andrew Yule, Inchek Tyre, IBP, National Jute, Balmer Lawrie, Banga Lakshmi Cotton, Raleigh Cycle and Hooghly Docking and Engineering, were taken over by the union government. Until mid-1960s, they were all market leaders in their respective areas of business. The industrial take-over, followed by nationalization of a majority of these companies through act of Parliament, did not improve the fortune of these enterprises. It was because the government did not or could not invest funds for their technological revamp and product upgradation. The corporate management, controlled by bureaucracy, became weak and indecisive. Resultantly, most of them fell further sick.

However, it was the vindictive action and petty parochial measures taken by successive railway ministers, barring the late A B A Ghani Khan Chowdhury, that choked the order supplies by the Railway Board on Burn, Braithwaite and Jessop and broke the pivotal status of these companies as railway equipment manufacturers. The railways went on setting up new departmental undertakings in other parts of the country and even resorted to imports. The railways went up to the extent of setting up a wheel and axle plant in Bangalore which was about to lead to the closure of the giant wheel and axle unit of the public sector Durgapur steel plant, several years ago. The railways were entirely responsible for the sickness of Braithwaite, Burn and Jessop. These companies, along with private sector manufacturers of wagons and bogies such as Texmaco and Bhartia Electric Steel, all West Bengal based, used to lobby strongly with the railway minister and members of the Railway Board before every railway budget, every year. Jessop & Co, once the country's leading railway coach manufacturer, was ultimately denationalized by the government and sold to a private party, only a few years ago. The fate of Burn and Braithwaite was hanging in balance until Mamata stepped in. During her first stint as a railway minister representing the Congress party, she could do little to save these companies as she could not muster support among her cabinet colleagues and did not enjoy a political bargaining power as she wields now.

It may be too early to conclude if Mamata's action will save Braithwaite and Burn Standard and help them regain their past glory, but one thing is certain that this will immensely help lift the grass-root Bengal campaigner's political image before the forthcoming state assembly election. The viability of the two companies will ultimately depend on the level of commitment by the Railway Board to turn these engineering units into world class railway equipment manufacturing enterprises. That will require pumping of fresh funds and injecting latest technologies for modernization, product diversification and expansion. The attitude of future railway ministers will also hold key to the survival and success of these two companies. There is no guarantee that another railway minister at another time will not make attempt to sell off these units, which hold great value to real estate developers for their prime locations. If the government can denationalize Jessop & Co and sell it to a little known local businessman having multiple interests, including realty, the railway take-over holds no assurance to the business continuity and prosperity of Braithwaite and Burn Standard. For now, however, full marks should be given to Mamata Banerjee for the bold step to bring the two principally railway equipment manufacturing public enterprises under her ministry.

In a somewhat contrary fashion, a closed Durgapur-based green-field public sector unit known as Mining & Allied Machinery Corporation (MAMC), originally set up under Russian collaboration, was taken over by a PSU combine, led by Bangalore-based Bharat Earth Movers Limited (BEML), out of a High Court auction in the same week. MAMC was under liquidation for quite some time. The other members of the combine are Coal India and DVC, holding 26 per cent each. BEML will hold 48 per cent. MAMC was set up by the union government with the novel intention to manufacture mining equipment, mostly for the coal industry, and to cut on imports. MAMC performed well till mid-1970s. Bad days set in after that when the management of Coal India, the holding company for over half-a-dozen coal mining firms, in collusion with the coal ministry, preferred equipment procurement from private suppliers and through imports. MAMC was under the union industry ministry, which did not protest the evil design of the ministry of coal and mines. Even the union cabinet was a silent spectator to the slow and painful death of MAMC. Several of MAMC's promising engineers and technologists left the country to join the US energy technology giant, Bechtel Corp. Ironically, BBUNL too was under the union industry, which played no positive role to influence the government to intervene into the autocratic manner in which the railways took its purchase decisions in detriment to the interest of the existing public enterprises and the nation.

The creation of too many ministries in the government and lack of co-operation and co-ordination among them led to the collapse of many PSUs between 1977 and 1988. Both agriculture and public sector fertilizer industry suffered because of the unscientific division of ministerial responsibilities of these functions, ignoring the complementary factor. For many years, the drug industry was part of the chemicals and fertilizer ministry, which ensured the death of once prized public sector units such as IDPL and Hindustan Antibiotics. Since shipbuilding was under the department of defence production and not shipping or surface transport ministry, merchant marine industry chose to import vessels instead of placing orders with the public sector shipyards. This is despite the fact that Indian shipyards are equipped to built vessels up to 75,000 dwt . Illogically though, the union commerce ministry has a greater say on domestic iron ore production and trade than the steel ministry, the user. While Tata Steel was free to own and manage its coking coal mines, the public sector Coal India controlled coking coal production for the Steel Authority of India Limited, the principal user of metallurgical coal.

Almost cent per cent of non-metallurgical and non-steam coal goes for thermal power generation. Yet, the coal production and power generation are under two different ministries, fighting all the time with each other about the coal quality, supply schedules and payments. The tradition goes on and industry continues to suffer as ministries operate in silos as rivals. The 18th-year-on economic reform had little impact on the working style of the government and the efficacy of the union cabinet, resulting in losses of economic value and business opportunity worth tens of thousands of crores, every year, to the nation. (IPA Service)