Gujarat has received several awards for ‘good governance’ from media and corporate foundations. It is now projected not only by the chief minister and his party but also a section of media that Gujarat under Narendra Modi’s leadership is the best governed state, and provides a model for India. The question we address is: Does ‘good governance’ refer, in holistic sense, to all aspects of the government; or only to certain sectors of governance? Prof Ghanshyam Shah examines:

Gujarat is one of the industrialized states of India. It has on average 11 per cent industrial growth as against 9 per cent of all India; and contributes 14 per cent in India’s export. Not only in common parlance but also in academic discourse the term Gujarati (person) is synonymously used as a business entrepreneur; though vast majority of the population in Gujarat is not engaged in trade and commerce. Capital has been well-organized earlier in the form of guild and now in the form of modern associations. The state has a history of weak and fragmented socio-political movements of labour and deprived communities.

The Congress was in power till 1995 with a brief break—Janata Morcha (alliance of non-Congress parties, 1976–1980) and Janata-Bharatiya Janata Party (BJP) alliance (1989–1990). BJP rules the state since then. Approach to economic growth in the state has by and large remained the same irrespective of the party in power.

Pre-neoliberal phase: During the pre-neoliberal policy the state government evolved, what Aseema Sinha calls a ‘bureaucratic-liberalism’ model of strategic interaction with the central government to attract investment in Gujarat and also to guide investors. The actions of Gujarat’s bureaucracy unlike several other states embodied the classic developmental role of ‘guiding markets’.

The bureaucrats had a free hand to find out ways and means with the central government so as the state gets more licenses and private investment. They were functioning like entrepreneurs, taking initiative, risk, collecting and collating data related to market and industrial production. An autonomous agency for industrial promotion, Industrial Extension Bureau, called iNDEXTb 9 ‘i’ is small representing small ego, so is ‘b’ for bureaucracy, indicating de-bureaucratic approach (Sinha) was formed in 1977. Its financial source has been made independent of state budget to keep it free from bureaucratic and political constraints.

The Government of Gujarat (GoG) had set up offices not only in Delhi, but also in Mumbai, Kolkata, Chennai and South Africa to attract capital. The officers wooed the businessmen and encouraged them to invest in Gujarat. In several cases the officers worked on behalf of investors to expedite the process of procuring license from the Union government. In some cases to expedite the process, bureaucrats used to take first a license in the name of the GoG and shift it to the joint sector. Later, its full ownership was transferred to the private party.

Within a decade of its formation, Gujarat ‘made striking progress in its industrial economy’. Between 1974 and 1990 it was second highest in receiving the letters of intent. The state attained third position in terms of number of industries and production in 1984–1985. In 1984–1985, among the 200 top giant industries of India, 24 were located in Gujarat. Madhavsinh Solanki, the then Chief Minister, as media often reported, had an ambition to turn Gujarat into ‘mini-Japan’. Under his stewardship ‘Gujarat became the second most industrialized state in India, as his government, in cooperation with the private sector, launched many projects in power development, electronics, fertilizer and many other industries.’

Neo-liberal phase: Anticipating the change in the Government of India’s (GoI’s) economic policy in 1991, the GoG announced ‘Incentive Policy’ for the industries by executive order in the early 1980s, and repeated the same with modifications in 1986 and 1990. Later, three industrial policies (2000, 2003 and 2009) have been announced. The first policy declared its target to compete with Southeast and East Asian countries. In the post-2002 communal riots, under the Modi government, industry policy got blended with cultural uniqueness and pride: Gujarat has ‘cultural base’ where you ‘sow a rupee, reap a Dollar’. To boost up spirit of enterprising dominant Gujaratis, the state declares: ‘to provide business leadership to entire world’. The policy also announces, ‘Good Governance (is) a way of life for Government in Gujarat’.

All the three policies promise: (a) to remove all bottlenecks presumably obstructing investment, (b) to simplify procedures, speeding of process and develop single window system for clearance and other related matters; (c) to change rules and laws to facilitate transferring agriculture land to non-agriculture land for industrial purpose; (d) to reorient administration to take up new challenges of globalization and attract more investment throughout the world; (e) to strengthen e-governance, data bank and dissemination of information for selection of projects; (f) to develop physical as well as human infrastructure (roads, power, water etc., and skilled human-power) to meet the requirements of the industries.

These policies provide subsidy varying from 25 to 40 per cent to industries. Besides reducing their sales tax, the exemption in sales tax from six to ten years has been offered. The government promises ‘to reform the tax regime’ so as to make the state globally competitive. Number of categories in tax concessions increased from the first to the third policy period. Infrastructure development Act was passed in 1999 to facilitate private investment and to ensure co-ordination among various Government agencies a Board was setup. The Act has been amended in 2006 empowering the Government to extend the concession period beyond 35 years and to approve financial assistance up to 20 per cent cost of the project.

The state is actively engaged in acquiring land for industrial development. Gradually it has amended laws related to agriculture land to facilitate industries. First, restrictions on purchase of agriculture land for non-agriculture purpose were removed in 1994. Rules for converting agriculture land to non-agriculture purpose were relaxed. Second, with government order in 2005 the state began to offer public land—waste as well as grazing land—to ‘big industries and individual progressive farmers’. They were expected to develop that land for productive purpose with the use of technology. Such land was given not only on lease without any rent for the first five years but beneficiaries are also permitted to mortgage it to banks for loan. Third, under the Land Acquisition Act 1894, the state also acquires land from private farmers for ‘public purpose’, and hand over that to industries.

In Kutch and Saurashtra several hundred thousand hectares of government and private land has been given to big industries like Reliance and Adani. In fact, a few investors in the SEZ who got land on lease or at throwaway price have sold that land to others with high price. Moreover, besides cheap water and electricity, a few industries received gas from the Gujarat State Petroleum Corporation, at rates below its cost price. Such favours, according to Comptroller and Auditor General (2012) cost the state Rs 5,000 crore. Not only that, the government has violated environmental laws, converting a protected wildlife sanctuary Kutch for industry. It has also manoeuvred around Coastal Regulation Zone laws for a private port to be built for the export of cement.

The officers in the state industries department and different industrial corporations of GoG have been always business friendly. During the license-quota-raj they found out ways and means to woo investors. Their enthusiasm increased under the neo-liberal policy. Most of them come from upper strata of society; hence they can very easily build rapport with entrepreneurs. Money power and social networks of the entrepreneurs match with bureaucrats’ mindset. Businessmen believe in keeping the bureaucrats in good humour. On the whole the investors, in the past and today, are very happy with Gujarat’s bureaucracy and appreciate its efficiency.

Environmental concern: In the 1960s, Gujarat was known for production of textiles. At present Chemicals and Petrochemicals have become major industries with 62 per cent share in the total industrial production of the state. Medium and large industries have increased nearly eight-fold between 1980s and 1990s. In the last decade, on an average more than six hundred new projects were sanctioned to launch. The Industry Policy 2000 admitted that ‘the requirement of sustainable development entails the need to tighten the pollution control measures and environmental safety in the State’. It declares that ‘Along with strictly implementing the pollution and environment protection measures, the State would be striving to set right the irregularities in this regard, which has taken place in some industrial clusters’.

In the 1990s the government initiated and encouraged industries to develop Common Effluent Treatment Plants (CETPs). These plants are largely supported by the public funds: 25 per cent of the cost was state subsidy; 25 per cent central government subsidy; 30 per cent loans from the financial institutes; and remaining 20 per cent paid by the industries. Most of the plants do not meet the norms prescribed by the Ministry of Environment and Forest of Government of India.

CAG Report 2010–2011 noted that ‘treated’ waste water out of CETPs had four to ten times more toxic than Government’s own norms in terms of biological oxygen demand (BOD) value, three times higher in case of chemical oxygen demand (COD) values and four times higher in terms of total dissolved salts (TDS). This has caused ‘large-scale death of aqua stock in the rivers’ in the recent past. On 7 May 2004 the Supreme Court observed, ‘…due to indiscriminate dumping of hazardous waste due to non-existent or negligent practices together with lack of enforcement by authorities, the ground water and, therefore, drinking water supplies have been effected/damaged’.

Not that the government is unaware of increasing adverse and deadly effects of pollution on the vast population. But it does not have courage to displease industrialists. It has a fear that strictly enforcement of the pollution control norms would go against the interest of the factory owners. And, it is feared that they would go away from Gujarat and may also discourage new investors to come to the state. The government which is obsessed with high economic growth and to become front-runner in the market is caught with contradictions of its own making.

Like industry, agriculture in Gujarat is increasingly becoming capital—and technology—intensive. With infrastructure development in irrigation and power, agriculture production has increased. But small and marginal farmers are further marginalized and farm sector employment has declined. Rural labour is moving to non-farm sector where job opportunities have increased.

Neglect of labour: But as the industries are capital-intensive rate of employment in manufacturing sector is slow and erratic. Employment per factory has significantly declined, from 99 workers per factory in 1960–1961 to 62.40 persons in 1990–1991 and to 59.44 per cent in 2005. Whereas average invested capital per factory has increased 2.5 times in less than a last decade.

To attract investment the State has overtly and covertly undermined the existing labour laws which provide some protection to workers. The government has amended labour legislations to provide freedom to industry to employ labour on contract basis. Consequently, Ahmedabad has the lowest labour costs among the major cities in India, with labour costs less than 50 per cent of those in Delhi and 40 per cent below those in Pune. The wage bill for industry in Gujarat constitutes only 2.42 per cent of the invested capital. The same figure stands at 4.04 for Karnataka, 4.4 for Maharashtra, 4.94 for Andhra Pradesh, 5.42 for Haryana and 5.5 for Tamil Nadu.

Sizeable labour force is in informal sector without social security and other benefits under the labour laws. Stipulated minimum wages by the GoG are lower in all occupations in Gujarat than Maharashtra and several other states. Not only that but the Labour Commissioner’s office, whose responsibility is to implement labour laws and protect labourers’ interest, has been reduced in its strength—both in number and power. Its functioning is further weakened.

Under the neo-liberal economic reforms Gujarat was the first state to declare its industrial policy to increase incentives and support structure to private investment for industries. Inducements have been multiplied in the last two decades.

In the institutional structure capital investors are treated as the only stakeholders for industrial growth. They are involved in decision making and monitoring process. Labour has no place therein. Administrative procedures have gradually minimised. Bureaucrats are generally benign towards capitalist class. They are now professionalized and geared to follow the best practices of the corporate world into the government to accelerate economic growth euphemistically called ‘development’.

Nevertheless, from the perspective of neo-liberal economy such governance may be qualified as ‘good’. Gujarat however is not the only state with high growth trajectory. Maharashtra, Haryana and Andhra Pradesh are at par or even ahead of Gujarat in GDP, investment and per capita income. Tamil Nadu, Karnataka and Punjab are not far behind.

Nature of growth in Gujarat has led to deterioration of natural resources and environment. Gujarat has polluted areas affecting water and air, plantation, animal life and human health. The GoG has been ineffective in controlling the industries for violation of pollution control laws. In fact the government itself has violated its own environmental laws. In the pre-reform period the industry policy was in favour of both capital—as well as labour-intensive production. Several laws protecting interests and well-being of labour have been scrapped or made ineffective. As investment in industry is largely capital-intensive; rate of creating employment is slow. Moreover, regular employment has declined.

Social sector programmes are increasingly getting privatized under the garb of PPP. The objectives of the government and the private agencies in such partnership are not the same. The former focus on well-being of the people and for the latter the main concern is private profit. Moreover, the approach of the government towards people is that of ‘beneficiaries’, and not citizens having rights. Policymakers soft pedal with private partners. No effective mechanism to monitor the functioning of the private agencies has been evolved. The mainstream civil society in Gujarat is not geared to raise the issues of poverty and exploitation. And the civil society segments which have expertise and active engagement in health, education and livelihood issues are side-tracked or harassed by the government bureaucracy. Performance of GoG in social sector is poorer than the states with similar high growth trajectory.

(Abridged version of  Prof Shah’s article. For full article please click  http://inp.sagepub.com/content/1/1/65)

Courtesy : JULY 24, 2013; http://counterview.org/2013/07/24/good-governance-in-gujarat-is-synonymous-with-removal-of-bottlenecks-like-investment-in-labour-environment-or-social-sector/

Category :- English Bazaar Patrika / OPED

Sleeping with the enemy

Ram Puniyani

Should minorities get lured by the invitations of Modi And Company ?

From 2002 Gujarat carnage Gujarat in particular and India in general has seen the rise of Narendra Modi on the political firmament. His propaganda machinery has given him the image whereby he is regarded as the ‘development man, non corrupt, strong and all that. A substantial section of society has bought this propaganda uncritically. Modi asserted himself within BJP to be named as the Chairman of their election campaign committee of 2014 and in turn giving the overt hints that he is the Prime Ministerial candidate from the side of BJP-NDA. Pursuing this path he has begun organizing conclaves to woo the Muslim community. He has been advising the BJP people that they should try to reach the minorities. As a step in that direction a conclave was organized in Ahmadabad with nearly 200 activists, scholars of different persuasions (June 2013). Thirty of these were Muslims. Many a Muslim leaders/activists/scholars were invited but many of them turned down the insistent invitations from the organizers arguing that it is an attempt by Modi to get credibility by inviting the Muslim leaders to his meeting. No community and group are uniform. Some of Muslim leaders turned up for the sessions, one of them Syed Zafar Mahmood attended the meeting and gave a detailed presentation. Before the meeting when Mahmood was asked how come he is attending the meeting as he has been critical of the policies of Modi? He replied that this question should be asked after he has said what he had to say in the meeting. Mahmood has been the Officer on Special duty for Sachar committee and is currently the chairman of Jakat Foundation of India.

His argument in attending the meeting might have been that it is an opportunity to present the plight of his community to Modi and use this space to articulate the grievances of his community. The presentation made by Mahmood was comprehensive, well researched and gave the picture of the community and criticized the BJP for its various policies. He also advised the BJP as to what they should be doing in coming times. In nutshell he said that the BJP’s is ideologically opposed to Muslims. For Mahmood it was not just a question of asking for justice and constitutional rights for the deprived Muslims of India. He quoted from BJP website to show the anti Muslim stance of BJP at various levels. For example, he pointed out that one of essays on website of BJP titled “Hindutva: The Great Nationalist Ideology” was “full of hate and provocations against Muslims.” Then, he pointed out another essay, with headline, ‘Give us this day our sense of mission’ written by MV Kamath was a “call to Muslims to adopt Hindu names and [for] Muslim women to wear the mangal sutra (a black thread with ornaments to show that a women is married, worn by hindu women in some parts of India).” The third one quoted by him titled `Semitic Monotheism’, saw Muslims and Islam as a problem. This essay posits “We must realize that we have a problem on hand in India, the problem of a stagnant and conservative Islamic society. A national effort is called for to break Islamic exclusivism and enshrine the assimilative Hindutva.”

So far so good all these points are valid as they are blatantly anti Muslim. Presenting the plight of Muslim community, he demanded for implementation of schemes and measures for alleviation of the condition of Muslim minorities. He asked Mr. Modi to implement various demands the major one of which has been implementation of Sachar Committee recommendations. It is to be noted that Gujarat is one of the states which has been returning the scholarship for Muslim students. Incidentally another BJP Chief Minister has declared that he will not implement these recommendations. Mahmood also presented the plight of Muslim community, in Ahmadabad itself.  

One concedes that the points made by Mahmood are on the dot. The issue lies somewhere else. Whatever he said is a common knowledge. Many an activists, writer has been pleading from roof tops about the worsening plight of Muslim community in Gujarat. The ghettoisation of Muslim community, the lack of access to banking and educational facilities and pushing them out from the common stream of society have all been well documented. Many reports, articles and books devoted to this topic are struggling to grab the attention of society and political leaders as such. Modi, more than others is aware of this all round marginalization of Muslim community. His Sadbhavna fasts also showed his refusal to accept the diversity of India, the cap offered by Muslim cleric was refused while he adorned all multi designed head gears given by others. His discrimination against Muslim community is too well known.

Irrespective of the claims that Muslims in Gujarat are comparatively better off, the truth is that Gujarat was a state where the condition of Muslims had been better than in other parts of India. What one observed with the ascendance of Modi and his iron like grip over the matters of Gujarat state is the worsening plight of Muslim in particular and also of Christians to some extent.

Muslims of Gujarat have known Modi too well for the last twelve years. They are the victims of Modi’s fascist and communal policies. Modi led the 2002 genocide from the front. So what did Mahmood achieve in telling Modi what he inherently knows and what the Muslim community is suffering. One understands that while Modi apparently told Mahmood that he will consider Mahmood’s points, Mahmood’s speech was blacked out. On the contrary Modi has been the victor in his attempt to gain legitimacy from the section of Muslim leadership. Dr. Bandookwala, one of the foremost human rights activists from Gujarat, who has been the victim of carnage itself, points out “Right now he (Modi) is obsessed with becoming Prime Minister. That is not possible with strong Muslim opposition. And so there is desperation to appear in public with prominent Muslims, to showcase his acceptability to all Muslims. Sadly our leaders have given him a golden chance, in the naive belief that he must be told what the community feels. Does Zafar Mahmood think we Gujarat Muslims have not spoken on these issues in print and on TV, repeatedly over the last eleven years?”

Modi’s choosing of this time to hold these meetings with a section of Muslim leadership should have alerted the likes of Mahmood, whose naïve approach that it is chance to express our demands is of no use as the real trick being played by Modi is to gain credibility and to win over elements from Muslim community, the way he lured Zafar Sareshwala a businessman who is now serving the cause of Modi in a most loyal fashion. While Mahmood seems to have done some homework by going to the website of BJP and picking up some of the essays with anti-Muslim tone, what else did he expect? The practice of BJP, the political child of RSS, has constantly shown its anti Muslim orientation through the issues which it has taken up all through, the ones’ like Ram Temple leading to demolition of Babri demolition, the one like cow slaughter ban, the ones like freedom of religion bills. One has to know BJP is a part of RSS; the BJP is manned by the swayamsevaks trained by RSS, Modi being one of them. What does RSS want, Hindu Nation. What was its role in freedom movement-a total absence and criticizing the freedom movement as being merely anti British! What type of Constitution does it want? Why did BJP led NDA went for review of Constitution?

There are stark observations and ample literature on the agenda of RSS and its progeny. Modi’s temporary mask of trying to reach to Muslim community is the chameleon like behavior. It is an attempt with the elections of 2014 in mind, a mask is being tried to woo over the minorities. Giving importance to these attempts and to attend their conclaves and meetings may give a moments fame to the one’s attending them, few TV appearances and interviews, they can also be satisfied that they have made their point, but it is an extremely retrograde step for the community. It is like the leaders of Jews calling upon Hitler and telling him that they are being subjected to gas chambers and expecting that they have made the point. It is time that minority communities go beyond the obvious and introspect about the agenda of RSS, which is out to intimidate and subjugate minorities and other weaker sections of society. Some readings into the books like, ‘We or Nation Hood defined’, which praises Hitlers methods vis a vis minorities or Bunch of Thoughts which label Muslims, Christians and Communists as internal threat to Hindu nation, by the ex- RSS Chief Golwalkar may work as an eye opening stimulus for those who still think that BJP can change its long term agenda and that making a point at Modi conclave will change BJP policies towards religious minorities!  

Issues in Secular Politics, I July 2013


Category :- English Bazaar Patrika / OPED