Written by Prof Pravin Sheth and Dr Pradeep Mallik Tuesday, 15 May 2012 11:33
You are stupid if you are not in Gujarat,’ Tata Group Chairman Ratan Tata had famously said, while announcing the shifting of the Nano plant to the state. Going by the rush of investors to the state, it seems none wants to be left behind, write Prof Pravin Sheth and Dr Pradeep Mallik.
Sick of procrastination and political opposition in West Bengal, the Tata Group decided to shift to Gujarat. For years the group could not get going at Singur whereas at Sanand it got the land in three days, something of folklore in the industrial circles of India. The first micro car rolled out of the facility within months. Impressed, Ford, Maruti Suzuki and Peugeot decided to set shop in Gujarat, and they get the land needed in weeks. General Motors were already there. And, now Nissan has concluded that this is the state to do business with. "You are stupid, if you are not in Gujarat," said Tata Group chairman Ratan Tata while announcing the shifting of the Nano plant shed, stock and personnel to Gujarat. Indeed, none wants to look stupid, it seems.
Congress is vehemently opposed to the ruling BJP and its poster boy CM Narendra Modi's political and social outlook, but its own think-tank Rajiv Gandhi Foundation had rated Gujarat, under him, among the states that offered the highest degree of most economic freedom. That Bibek Debroy lost his job in the think-tank only goes to show how petty rivalry has made India's growth march a circus of too many political pygmies under the canopy.
That Bibek Debroy lost his job in the think-tank only goes to show how petty rivalry has made India’s growth march a circus of too many political pygmies under the canopy.
"So many things work properly in Gujarat that it hardly feels like India ... Chinese-style, big-ticket projects are part of Gujarat's formula, including refineries and ports, but so are networks of smaller firms and foreign companies which have now achieved critical mass in industries such as cars and pharmaceuticals. The state government uses the usual tricks to try jumpstart growth, including special economic zones. But more important, it has provided the bog-standard things that businesses pray for across India but often do not get – less onerous labour laws, passable roads, reliable electricity and effective bureaucracy," wrote The Economist in July, 2011. Describing Gujarat as India's Guangdong, the magazine said that the state offers a glimpse of a possible industrial future for India.
5% OF POPULATION, 22% OF EXPORTS
Gujarat accounts for just 5% of India's population, but has a massive 16% share of the country's industrial production and an even more impressive 22% of exports. So many things indeed work exceedingly well in Gujarat. So much so that the Union looks up to it, along with a few states like Maharashtra and Karnataka, to power India's growth story. Over the years the Planning Commission has given Gujarat a growth target higher than the rest of India. And Gujarat has achieved it.
At the meeting to finalize the state's plan size this financial year, the Planning Commission praised Gujarat's development plans and projected a growth rate of 11.2% as against the nation's 8-9 %.
The commission increased Gujarat's plan size for the current financial year 2011-2012 by 26.67% to Rs 380 billion, which is higher than Rs 371.52 billion originally decided. Planning Commission deputy chairman Montek Singh Ahluwalia and other members of the panel praised Gujarat's development models, strategies for financial management, GDP and per capita growth rates, besides other achievements. Appreciating the Planning Commission's gesture, Modi assured it that Gujarat would justify the hike in its annual plan size. He also exuded confidence that the state would achieve the 11.2% growth rate during the current fiscal as mandated. The CM said the increased layout will help Gujarat launch projects like Rs 147 crore for scientific management of animal husbandry and improving the cattle breed, starting next generation day schools in tribal areas on the lines of 'ashram shalas' bringing boys from nearby areas in mini-buses, connecting remotest areas in the Dangs and Dahod with roads and drinking water facility, augmenting drip irrigation and upgrading health and hygienic facilities in 159 municipalities.
Efficient conservation and management of water have been a continuing challenge for Gujarat's agriculture as only a quarter of its land is irrigated. The Plan panel has been quite supportive of the state and this is evident from the push three major programmes received since 2000: watershed development, Jal Kranti and micro-irrigation.
Watershed development programme added about 100,000 hectares every year. By 2009, nearly 2000 projects covering 2 million hectares had been completed and 900,000 hectares more were under execution. Jal Kranti programme ensured rain water did not run away into the sea. Instead it got trapped in check dams, recharged wells and revived village ponds. Micro-irrigation through drips and sprinklers spearheaded by Gujarat Green Revolution Company helped cover about 200,000 hectares, benefitting almost equal number of farmers.
Gujarat has set high benchmarks for the 12th Five-Year Plan in Human Development Index (HDI), management of water resources, urban infrastructure, environment, solid wastes and waste water, besides desalination plants to be run on solar power. On the social front, too, Gujarat has included 225,000 children from the religious minority communities for pre-matriculation scholarships meant for tribal, dalit and other backward classes. Minority population in Gujarat is 9.6%, but its school enrolment is 8.5% excluding madrasas.
The Centre has made relevant laws, but left the onus of financing and implementing the projects on Gujarat.
Gujarat has implemented 'Sarva Shiksha Abhiyan' since 2003, has appointed 145,000 teachers, built 19,000 classrooms and spent a whopping Rs 160 billion, but has not received corresponding funds from the federal government. Under the Rights to Education Act, Gujarat has appointed close to 90,000 teachers and built 80,000 classrooms at an additional burden of Rs 80 billion. More than 90% of private schools in Gujarat running on PPP model get government grants, for which the Centre has allocated just 1% fund under National Secondary School Abhiyan. The Centre has made relevant laws, but left the onus of financing and implementing the projects on Gujarat.
The Centre adopted some of the success stories of Gujarat such as decentralization of administration up to taluka level (ATVT), the Rs 50-billion 'Mission Mangalam' project for 200,000 sakhi mandals (women's self-help groups), and setting new benchmarks in poverty alleviations, empowerment of people for the larger benefit of the nation.
Praise from ex-Prez Kalam to SC judges
Praises have come for Gujarat from all quarters: UNESCO, former President A P J Abdul Kalam, the Supreme Court and high courts, CM's political opponents, independent think-tanks, news magazines, visiting experts and industrialists. Let us look at some of these.
We may begin with what has become perhaps the most sensitive concern in the country today when it comes for facilitating industrialization. Land acquisition is an emotive subject across the nation, something that forced Tata Group to eject itself from West Bengal and plant its micro car project at Sanand in Gujarat, notwithstanding the Land Acquisition Act. The Supreme Court praised Modi government's handling of the issue, and asked other states to learn from it.
Forcible acquisition of land has turned the 117-year-old Act into a "fraud", the Supreme Court had said in September, 2011, as reported in the magazine, Business World. While calling the piece of legislation a handiwork of "sick" minds with no concern for welfare of the poor, the apex court praised the Gujarat government saying no case of farmers or the poor being uprooted from their land had come to the Court from the state.
Union law minister Veerappa Moily praised Modi for his effort to make available e-library at even taluka level.
"The Act has become a fraud. It seems to have been devised by people with a sick mind who had scant regard for the welfare of the common man. It is time the Act is scrapped," a bench of Justices G S Singhvi and H L Dattu observed, while hearing petitions by farmers from Hapur in Uttar Pradesh who had lost 82 acres to a leather industrial complex.
The Supreme Court compared states where "forcible acquisition" using an emergency clause under the Act had almost become a norm to Gujarat. "But there is one state from where we do not receive any such complaints. Look at Ahmedabad which is developing but there are no complaints from that place. They have the same officers of the same cadre as in the rest of the country," the court said, adding officers from other states can train under their Gujarat counterparts.
The court even directly addressed Additional Solicitor General Harin Rawal, who hails from Gujarat, to say that the law officer would "vouch" for the court's remarks about his state's policy on land acquisition.