Nano drives into Gujarat

Gujarat has industrial peace, a relatively efficient civil service, quick decision-taking on economic matters and success in attracting investments without bending over backward by doling out incentives.
From West Bengal to Gujarat is a long drive for a small car. Bumps and breakdowns are normal events in India. But what the Tata Nano episode shows is that politics matters — mostly for the worse, but sometimes there’s good in it as well.

Less than a week after the Tatas pulled out of Singur, they found a new site in Gujarat. The chain of events can be disputed and it can be argued that it was chief minister Narendra Modi and his senior civil servants who induced Ratan Tata to come there.

Illustration: Jayachandran Nanu / MintIn a sense, Gujarat is the antithesis of a “normal” Indian state: It has industrial peace, a relatively efficient civil service, quick decision-taking on economic matters and success in attracting investments without bending over backward by doling out incentives. How does Gujarat manage that? Why can’t others replicate its success?

In most states, chief ministers confront numerous problems. Usually, the opposition is too strong to permit any concessions to industrialists. In West Bengal, for example, the ruling Left Front (which won 227 seats in a 294-member assembly in 2006) was no match for one politician: Mamata Banerjee. There are other, more pernicious, sources of opposition, usually within the ruling party. Then there’s the bureaucracy to handle. Interest group politics takes away whatever is left of economic dynamism. Finally, if the state is anywhere near elections, one can say “tata” to projects: A small incident can derail electoral fortunes.

Gujarat has none of these problems. Modi brooks no opposition within or outside his party. That’s where the paradox lies. If Modi is plain bad news in liberal eyes, he’s doing a whole lot of good to the economy of his state. In terms of the usual indicators of success (such as per capita income growth and economic growth rate), Gujarat is way ahead of most states. For a country with perhaps the single largest pool of poor in the world, the choice ought to be growth and not the politics that one individual practises. But then, that’s another story.

Tatas’ effusive yes to Gujarat does not take away the odium of political violence unleashed against minorities there in 2002. But equally, that single but awful episode ought not to damn Gujarat forever. The relocation of the Nano project does not imply a yes to the Gujarat brand of politics. Such mixing of economics and politics is of Leftist origin. If India is to power ahead, it’s best that such notions are discarded quickly.
source:livemint