Tata Group caught in election crossfire

Vol 10, PW 8 (10 Aug 06) News in Brief

Bangladeshs ruling BNP party is using the Mumbai-based Tata Group as a pawn in pre-election games.

Plans by the Tata Group to invest up to $3bn in three gas-based projects in Bangladesh have been put on hold pending resolution of outstanding issues relating to gas supply and price. The BNP wants the Tatas to accept the governments terms and then publicise it in the election campaign as a major victory, says a source.

Once the Tatas are committed to investing in Bangladesh, the BNP will use this to pressurise the Indian government to support them and not the (opposition) Awami League in the elections. We are told that the BNPs argument (to the Tatas) is that once they are back as rulers it will be easier to give them more concessions.

Publicly, the BNP thrives on its anti-India image. By contrast, the Awami League is more pro-India.

A caretaker government takes over from the BNP in October, ahead of elections, which must be held by January 2007.