Hunting out scapegoats for governance failure
18 Jan 2014 11:51 PM GMT
The UPA-II’s countdown has begun. Once again, Rahul Gandhi seems to be in his unpredictable best. BJP’s prime ministerial candidate Narendra Modi’s ‘Jayanti tax’ jibe at disgraced former environment minister Natarajan apart, it was probably one of the most politically puzzling decisions by the prime minister and the party leadership to dump veteran Tamil Nadu Congress leader Jayanthi Natarajan stigmatising her solely for environment clearance delays most large core and infrastructure sector projects, just ahead of the Lok Sabha election. Natarajan’s exit was apparently prompted by the Congress vice-president’s open vitriol against the environment ministry’s negative attitude towards development at a recent apex industry body meeting in Delhi. Gandhi’s outburst not only maligned the minister in public, but also made the government officially accept the opposition criticism of policy paralysis at its highest level. Ironically, Gandhi’s latest angry reaction against the style of functioning of the UPA government likens to his similar open condemnation at an impromptu press meet of the union cabinet recommendation for a Presidential promulgation of an ordinance in September last year to protect tainted politicians. The ordinance was soon ‘trashed’. The prime minister, an author of the ordinance, did not resign.
It would not be wrong to assume that whatever Natarajan did as a union minister had full support and approval of the union cabinet and the prime minister. Curiously, it could not have been a matter of coincidence that most of the delayed projects are meant to be implemented in Opposition-ruled states such as West Bengal, Bihar, Odisha, Jharkhand and Karnataka (until recently both under BJP rule), Odisha, Madhya Pradesh, Uttar Pradesh, Punjab, Goa and Gujarat. The political design to block large investment projects in these non-Congress ruled states was too obvious. In fact, the entire Congress leadership, including its vice-president, might have had a hand in it. Few will deny that Jayanthi Natarajan has been one of the Congress party’s few trusted lieutenants and defenders of development policies since the time her legal, political and administrative talents were first discovered and recognised by the late prime minister, Rajiv Gandhi over 25 years ago. She would be the last one to flout the party’s policy directive to arrogate herself with the task of stalling scores of large projects purely on ecological grounds. Projects were all given political colour and became a big source of corruption involving party underlings and babus in the department.
In fact, it was Natarajan’s predecessor in the department who initiated a political hard line on environment clearance to projects in these non-Congress states. And, he might have had approval of the prime minister since most of these ultra-large projects had a strong bearing on the national economy as a whole. The projects, each involving investment of several thousands of crores, covered wide-ranging areas such as coal, iron ore, bauxite, lignite, dolomite and chromites mining, ports development, power generation, steelmaking, aluminum smelting, cement manufacturing, highways, industrial corridors and pipelines construction. They were hanging fire for almost five years, and, some even more. The gross investment was estimated at Rs. 7,00.000 crore. The foreign direct investments involved totaled around $100 billion. South Korea’s Pohang Steel alone was ready to invest some $ 30 billion, including in a joint venture with Steel Authority (SAIL).
It was the biggest opportunity loss for the nation under the UPA-II government. Such a gigantic investment programme would have generated a massive employment and income across the country. Other related sectors too would have expanded to meet the demands from the new projects. Industrial housing and rural development would have gotten a big push. It would have brought a big boon to the manufacturing sector. Production of various consumer goods, automobile, home appliances, etc, accelerated and bolstered the entire economy under a multiplier effect. The projects in the pipeline would have made the Indian dream of a double-digit GDP growth within reach, if not absolutely possible, ensuring a sustainable growth through the 12th and even 13th plan period due to spillovers.
Therefore, it would be totally unfair to blame Jayanthi Natarajan alone for stalling those development projects as they involved several other ministries and the Prime Minister’s office (PMO). Maybe, one may say Natarajan was less subtle in her ways than her US-educated predecessor Jairam Ramesh who, rightly or wrongly, managed to create an impression that he was close to the soon-to-be-named-Congress prime minister-in-waiting. As an environment minister, Ramesh even managed to take Rahul Gandhi on board to stop a potentially world’s largest integrated aluminum project by a London-based NRI group, Vedanta Resources, seeking to invest in phases a whopping $ 11 billion. Gandhi went right up to the proposed bauxite mine site near Odisha’s Niyamgiri Hills to address a motley crowd of tribal men, women and children to support their politically-orchestrated agitation against mining by the non-ferrous metals giant. Surprisingly, the same Gandhi now says he was upset with the working of some of the ministers whose actions held back several development projects. What a travesty of justice!
Industry is not amused. Gandhi’s support for speedy clearance of pending projects has come too late. Industry is certain that nothing is going to change until the next government is installed in May. It has been a long wait for an already stagflation-hit industry. With a possible composition of the next government is still unclear, there exists a larking fear about the fate of many projects.
Industry is also afraid that forthcoming Supreme Court rulings on coal block allocation and iron ore mining may put the clock further behind. No amount of sincerity, speed and exuberance by the next government may be able to put the pending projects back on track before the end of the current year. This means that almost another precious year is lost. Resultantly, Indian economy is destined to reel under the current slow growth syndrome for a longer period and come under continuous scanner of international rating agencies affecting external fund flow into projects and the crucial health of Rupee which received the worst battering in 2013 losing almost 30 per cent in value.
There is no painless path to development. However, pains can be minimized with proper plans and rehabilitation programmes. In an era when nations are fighting in international waters to establish right to exploit underwater deposits of minerals and hydrocarbon, it is unthinkable that India should ban mining, infrastructure creation and industrialisation inside its own territory on grounds which are purely petty political and lack scientific logic. Manmade forests can replace decaying natural forests in mineral-rich hills. Between Bilaspur and Chirimiri in Chhattisgarh, manmade forestry initiated by Coal India several years ago has provided a better environment and forest cover in the region than what existed before the public undertaking started mining in the hills. Environmentally, Bastar is much richer today because of some well thought out plans and rehabilitation programmes adopted by Bhilai Steel Plant, the biggest iron ore miner in the region.
There are many such examples. It was the rampant corruption under the UPA rule and the latter’s strong anti-Opposition bias that had led to prolonged policy paralysis, economic downturn and, finally, the rise of Aam Admi. Scapegoating Natarajan for the entire government failure was, at best, a farcical act which none is prepared to take seriously.
IPA
It would not be wrong to assume that whatever Natarajan did as a union minister had full support and approval of the union cabinet and the prime minister. Curiously, it could not have been a matter of coincidence that most of the delayed projects are meant to be implemented in Opposition-ruled states such as West Bengal, Bihar, Odisha, Jharkhand and Karnataka (until recently both under BJP rule), Odisha, Madhya Pradesh, Uttar Pradesh, Punjab, Goa and Gujarat. The political design to block large investment projects in these non-Congress ruled states was too obvious. In fact, the entire Congress leadership, including its vice-president, might have had a hand in it. Few will deny that Jayanthi Natarajan has been one of the Congress party’s few trusted lieutenants and defenders of development policies since the time her legal, political and administrative talents were first discovered and recognised by the late prime minister, Rajiv Gandhi over 25 years ago. She would be the last one to flout the party’s policy directive to arrogate herself with the task of stalling scores of large projects purely on ecological grounds. Projects were all given political colour and became a big source of corruption involving party underlings and babus in the department.
In fact, it was Natarajan’s predecessor in the department who initiated a political hard line on environment clearance to projects in these non-Congress states. And, he might have had approval of the prime minister since most of these ultra-large projects had a strong bearing on the national economy as a whole. The projects, each involving investment of several thousands of crores, covered wide-ranging areas such as coal, iron ore, bauxite, lignite, dolomite and chromites mining, ports development, power generation, steelmaking, aluminum smelting, cement manufacturing, highways, industrial corridors and pipelines construction. They were hanging fire for almost five years, and, some even more. The gross investment was estimated at Rs. 7,00.000 crore. The foreign direct investments involved totaled around $100 billion. South Korea’s Pohang Steel alone was ready to invest some $ 30 billion, including in a joint venture with Steel Authority (SAIL).
It was the biggest opportunity loss for the nation under the UPA-II government. Such a gigantic investment programme would have generated a massive employment and income across the country. Other related sectors too would have expanded to meet the demands from the new projects. Industrial housing and rural development would have gotten a big push. It would have brought a big boon to the manufacturing sector. Production of various consumer goods, automobile, home appliances, etc, accelerated and bolstered the entire economy under a multiplier effect. The projects in the pipeline would have made the Indian dream of a double-digit GDP growth within reach, if not absolutely possible, ensuring a sustainable growth through the 12th and even 13th plan period due to spillovers.
Therefore, it would be totally unfair to blame Jayanthi Natarajan alone for stalling those development projects as they involved several other ministries and the Prime Minister’s office (PMO). Maybe, one may say Natarajan was less subtle in her ways than her US-educated predecessor Jairam Ramesh who, rightly or wrongly, managed to create an impression that he was close to the soon-to-be-named-Congress prime minister-in-waiting. As an environment minister, Ramesh even managed to take Rahul Gandhi on board to stop a potentially world’s largest integrated aluminum project by a London-based NRI group, Vedanta Resources, seeking to invest in phases a whopping $ 11 billion. Gandhi went right up to the proposed bauxite mine site near Odisha’s Niyamgiri Hills to address a motley crowd of tribal men, women and children to support their politically-orchestrated agitation against mining by the non-ferrous metals giant. Surprisingly, the same Gandhi now says he was upset with the working of some of the ministers whose actions held back several development projects. What a travesty of justice!
Industry is not amused. Gandhi’s support for speedy clearance of pending projects has come too late. Industry is certain that nothing is going to change until the next government is installed in May. It has been a long wait for an already stagflation-hit industry. With a possible composition of the next government is still unclear, there exists a larking fear about the fate of many projects.
Industry is also afraid that forthcoming Supreme Court rulings on coal block allocation and iron ore mining may put the clock further behind. No amount of sincerity, speed and exuberance by the next government may be able to put the pending projects back on track before the end of the current year. This means that almost another precious year is lost. Resultantly, Indian economy is destined to reel under the current slow growth syndrome for a longer period and come under continuous scanner of international rating agencies affecting external fund flow into projects and the crucial health of Rupee which received the worst battering in 2013 losing almost 30 per cent in value.
There is no painless path to development. However, pains can be minimized with proper plans and rehabilitation programmes. In an era when nations are fighting in international waters to establish right to exploit underwater deposits of minerals and hydrocarbon, it is unthinkable that India should ban mining, infrastructure creation and industrialisation inside its own territory on grounds which are purely petty political and lack scientific logic. Manmade forests can replace decaying natural forests in mineral-rich hills. Between Bilaspur and Chirimiri in Chhattisgarh, manmade forestry initiated by Coal India several years ago has provided a better environment and forest cover in the region than what existed before the public undertaking started mining in the hills. Environmentally, Bastar is much richer today because of some well thought out plans and rehabilitation programmes adopted by Bhilai Steel Plant, the biggest iron ore miner in the region.
There are many such examples. It was the rampant corruption under the UPA rule and the latter’s strong anti-Opposition bias that had led to prolonged policy paralysis, economic downturn and, finally, the rise of Aam Admi. Scapegoating Natarajan for the entire government failure was, at best, a farcical act which none is prepared to take seriously.
IPA
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