16.1.11

Modi's Gujjarstan

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Is it time to acknowledge the Gujarat ‘miracle’ ?

Swapan Dasgupa of the TOI blog.

It is a commentary on the bizarre priorities of our information order that investment commitments totaling $450 billion, equaling nearly one third of India’s GDP, are either ignored or put on par with anodyne political statements.(!!!!!) This, however, is not the occasion to lament the lack of even-handedness in the treatment of anything remotely connected to Gujarat chief minister Narendra Modi. It is the time to celebrate something that is fast becoming undeniable: the emergence of Gujarat as the economic powerhouse of India.

(I thought Maharashtra was still the richest, most productive state in India....with the stock exchange situated there, Mumbai as a strategically located port...etc, Maybe the Siv Sena with its petty political party provincialism parochialism focus...with corruption is causing Mumbai and the state by extension long term harm...and staging false flag terror ops for Israel )

Last week, there was a stark contrast between a Gujarat bubbling with optimism and the rest of the country despairing over economic mismanagement and missed opportunities. It is not that all the MoUs signed at the fifth Vibrant Gujarat summit will be translated into reality. Many will remain paper commitments . But when the who’s who of Indian industry line up to proclaim their faith in Gujarat as a wholesome place for investment, having already put their money where their mouth is, neither India nor the rest of the world can afford to be in denial.

The proclamations of faith in Gujarat are all the more meaningful because they have been made despite the Center's unremitting displeasure with anything that could bolster Modi’s credentials. Modi doesn’t usually win awards for being the “Reformer of the Year” or for innovative governance. In fact, he doesn’t even make it to the shortlist. But he has invariably secured an unequivocal thumbs-up from those who have a real stake in the emergence of India as a world economic power.


The skeptics, who insist that the rise and rise of Gujarat has little to do with the state government, are partially right. Entrepreneurship and business are part of the Gujarati DNA, a reason why Mukesh Ambani stated that Reliance Industries has always proudly cloaked itself in the Gujarati business ethos. But Gujaratis have been under no obligation to sink their money into Gujarat: from Dholera to Durban, the world has been their karmabhoomi.

The reason Gujarat has registered the highest, double-digit GDP growth in the past decade owes much to the targeted, business-friendly approach of its government.

Four features stand out:

1) The first is quick decision-making—what Modi has dubbed the “red carpet, not red tape” approach. Ratan Tata, for example , recounted how the land allotment for the Nano project was completed in just three days, a quick-fire decision that has fetched Gujarat some Rs 30,000 crore in Tata group investments and direct employment for some 50,000 people.

2) The second feature is the curious phenomenon of the near-absence of political corruption at the top. Even Modi’s worst enemies will not deny that the chief minister’s fanatical personal integrity has had a salutary trickle-down effect. Irritated by politically inspired extortion , industry has identified Gujarat as a place where it is possible to do ethical business.


3) Third, Gujarat since 2002 has been marked by social peace. Particularly important for industry is the absence of rural unrest, which unseated Tata Motors from West Bengal and is now so marked in Maharashtra and Karnataka . This is because Gujarat has bucked a national trend and is witnessing high growth in agriculture—last year the sector grew by 9.9%. This means that farmers now have a stake in the larger prosperity of the state and aren’t swayed by populists and Maoists.


4) Finally, the growth of Gujarat has been spurred by a philosophy of “minimum government and maximum governance”. In plain language , this means that the state government has concentrated on creating the infrastructure for growth and left it to the private sector to get on with the job of actual wealth creation. In Gujarat, politicians don’t talk the language of class conflict; they too mirror the preoccupation with dhanda (business). So all-pervasive is the respect for enterprise that even the children’s amusement park in Ahmedabad has created kiddie games centered on the use of virtual money!

(The model works excellently for Gujarat under Modi, but many parts of India don't have that business culture, so whilst Like Gujrat other Indian states MUST also pour money into infrastructure, and reign in Red tape, corruption.....I believe following the Japanese government model since 1950, specific industries must be targeted and helped with investment and growth in partnership with the private sector first, rather than leave the initiative for industrial growth just to promising entrepreneurs to simply "emerge")


The extent to which this vibrant Gujarati capitalism will benefit Modi’s national ambitions is difficult to predict. But one thing is certain . As Gujarat shines and acquires an economic momentum of its own, more and more businesses will find it worthwhile to channel a major chunk of their new investments into Gujarat.

(Modi as BJP leader will be problematic, as he faces certain challengers from that party. He was unwanted in the Bihar elections recently given his divisive politics. Modi elected as a leader of a coalition government in India will be an even bigger challenge........given his record of 2002, and on-going revelations of that event, and recent developing revelations by RSS insiders.

Modi, after all is said and done might just be a very ardent Gujarati nationalist, who is very effective and efficient at running his patch, and his area of the country.....nothing more. Hitler created 6 million jobs in Germany in short order, after the Great Depression with the help of Jewish bankers in Zurich, London and NY, and everybody in Europe and especially the right admired his achievements.....naturally. He became a demagogue. Ditto to a lessor degree Mussolini....who everybody said made the trains in Italy run on time etc. We must marvel and learn from Narendra Modi, but his very essence of aggression and tribalism must be rejected by multiracial cosmopolitan India, which if given a national platform with all the resources of the security state can turn everything inside India upside down)


The Centre may not like the resulting uneven growth but the alternative is not to thwart Gujarat by political subterfuge—such as preventing public sector banks from engaging with the state government and the whimsical use of environmental regulations. (Orissa...POSCO among other massive projects left wanting) Gujarat has shown that accelerated and sustained growth is possible when the state plays the role of an honest facilitator, rather than a controller.

Modi didn’t create the Gujarati character; he was moulded by it. He merely gave it a contemporary thrust and an ethical dimension. If politicians focused on these, India will be a much better place.