West Bengal’s long slide into economic irrelevance has now been institutionalised into law. The Trinamool Congress (TMC) government, led by Mamata Banerjee, has executed what industry veterans are calling the biggest betrayal of investors in independent India the Revocation of the West Bengal Incentive Schemes and Obligations in the Nature of Grants & Incentives Act, 2025.
Passed quietly in March, with minimal debate and no consultation with industry stakeholders, the law retrospectively cancels all industrial incentive schemes announced in Bengal between 1993 and 2023. Three decades of solemn promises by successive governments written into policy, codified into agreements, and even upheld by courts — have been swept aside with the stroke of a pen.
The fallout is immediate and devastating. Giants like Dalmia Bharat, Birla Corp, UltraTech, and many others who invested thousands of crores into Bengal’s fragile economy are now staring at losses exceeding Rs 3,000 crore. These firms made long-term commitments based on formal government assurances — assurances that the state now claims are “null and void.”
“This is nothing short of a sovereign betrayal,” said an industry executive on condition of anonymity. “If a government can revoke three decades of commitments overnight, why would any serious investor ever consider Bengal again?”
BJP IT Cell chief Amit Malviya minced no words, “Mamata Banerjee has sent a cold, calculated message to industry your money is not safe here, our promises are worthless.”
West Bengal’s great industrial betrayal is now official. The TMC government has passed a draconian law — the ‘Revocation of Incentive Schemes Act, 2025’ — unilaterally canceling 32 years of industrial promises made to investors since 1993.
Major companies like Dalmia Bharat,… pic.twitter.com/I9jJvxtf12
— Amit Malviya (@amitmalviya) September 23, 2025
Behind this assault on Bengal’s industrial ecosystem lies the TMC government’s fiscal crisis. With debt nearing Rs 6 lakh crore and unpaid DA arrears of Rs 44,000 crore, the state is teetering on bankruptcy. Instead of fiscal prudence, Banerjee has chosen the path of default stealing from job creators to bankroll pre-election populism ahead of 2026.
The government has packaged the move as a “pro-poor” reallocation of funds, a cynical attempt to pit subsidies for industries against welfare schemes. But economists warn this is a false dichotomy. Jobs come from industry, not perpetual doles. By killing the very foundation of industrial employment, Mamata is ensuring Bengal’s youth remain trapped in a vicious cycle of dependency, poverty, and mass migration.
This betrayal is not an aberration it fits a long-standing pattern of hostility to industry. In 2008, violent agitations orchestrated by Mamata Banerjee in Singur forced the Tata Nano project to flee Bengal, a turning point that destroyed investor confidence. Since Mamata came to power in 2011, over 6,600 companies have left Bengal, citing political hostility, corruption, and lack of infrastructure. With the Revocation Act, she has escalated the hostility from street protests to legislative sabotage.
“First they scared away new investors with violent land agitations,” noted a Kolkata-based policy expert. “Now they are punishing existing investors with retrospective laws. It is the same DNA of anti-industry politics, institutionalised into legislation.”
The most dangerous aspect of the Act is its open defiance of judicial authority. The Calcutta High Court had repeatedly directed the state to honour its industrial commitments. Instead of complying, the TMC government has passed a law designed to override court orders.
“This is a direct assault on the judiciary and the rule of law,” warned a retired High Court judge. “It sets a precedent where any state government can nullify court-enforced obligations simply by legislating them away.” Such a move not only violates the principle of legitimate expectation and contract sanctity but also places Bengal outside the pale of credible governance in the eyes of global investors.
The reputational damage is already severe. No credible domestic or international investor will trust a state that has legislated away three decades of promises. Even if future governments attempt to woo investors with new policies, the shadow of this betrayal will loom large.
Policy experts describe the Act as a “poison pill” a self-inflicted wound that ensures Bengal’s industrial revival remains dead for decades. Youth unemployment will rise, educated talent will continue to flee, and the state will sink deeper into a debt trap. “This is not misgovernance; this is an economic assassination,” said a senior economist. “The deindustrialisation of Bengal is not accidental. It is a political strategy to destroy long-term prosperity for short-term electoral survival.”
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