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Getting Down To Business In UP

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[In 2004, Uttar Pradesh Chief Minister Mulayam Singh Yadav created the UP Development Council. It was a new body that had mostly industry leaders as members. The Chairman was Amar Singh, MP, and then a confidante of Mulayam Singh Yadav. The first few meetings were attended by Adi Godrej, KV Kamath and Anil Ambani. Other business leaders were given key responsibilities to create framework for inviting investment in several sectors. The names were pretty impressive. For Agro and food processing it was Vindi Banga (then CEO of Hindustan Unilever) and Adi Godrej. For  IT and communications Nandan Nilekani was roped in. Ramdas Pai was to handle Education sector, healthcare by Prathap Reddy of Apollo Hospitals. Amitabh Bachchan was to take charge of media and entertainment while KV Kamath would handle industrial infrastructure. Anil Ambani who had to take charge of energy needs of the state announced the 3500 MW gas based power plant in Dadri. It was billed as the world largest such plant. Mulayam Singh Yaday even laid the foundation stone for it. The council was a the biggest effort by any UP Chief Minister to industrialise the state with the involvement of corporate leaders. But little came out of it. A combination of personal, political and policy myopia led to an early demise of the council. Anil Ambani's project still awaits gas from elder brother Mukesh company. It's time now for Mulayam Singh Yadav and his son Akhilesh to relaunch their effort to industrialise UP. Other states where election results were announced this week already have a culture of industry and development. Punjab, Goa and Uttarakhand are far ahead of UP in industry friendly environment. It would not be out of place to say that UP is among the last states any business would want to invest in. UP is pulling down the growth of India. Even Bihar and north eastern states like Assam are on the growth path. Here are some issues that the new government in UP must focus on. The Yadav father-son duo have a rate opportunity to reverse the decline of the state. Remove Power shortage Even though most of India has a power shortage, it is most acute in UP. There is a 35% loss in theft and transmission. New power projects have not been planned or announced. Per capita consumption of power in UP is half of India.  Encourage Job Creation The only sector where job creation has happened is sugar industry. Between 2007 and 2011, only about 50,000 jobs were created where the demand is for lakhs. Jobless youth are now registering in employment exchanges to get govt relief as private sector jobs remain scarce. Govt is promising higher allowance, may not have income to support such allowances. Ensuring employment generating projects get off the ground should be a priority. Create a New industrial policy The UP government makes money mostly from sand mining,  real estate and liquor sales. The state needs a new investment focus which will bring in money and jobs to the state. Noida cant be the only earner for UP. Focus on small industry alone will not help. Each big project automatically creates business and growth for ancilliary industry. This has been seen in states like Tamil Nadu. Improve Road connection Internal road connectivity from towns to villages has to be improved. If there towns and villages are connected then migration remains local and regional. Otherwise all jobless come to cities like Lucknow and Allahabad, further choking it. About 30 per cent of the population is still not connected by road. Invest in Education The primary school completion rate of 42 per cent is among the lowest in the country. Private sector should be encouraged and government schools made more accountable. Boost Business infrastructure The spread of banks, post office, phones are much below country's average. Quality of life is very poor. Economic activity can improve only if such facilities improve. There are only about 250 cars per lakh of population compared to national average of 700. Per capita income growth is just 2.6% compared to close to 7 per cent for Haryana. Politics should be allowed to come in the way of policy. If some positive change can be implemented in the next 5 years, the Yadavs could well return to power for another term. Bihar has shown that. (Pranjal Sharma is a senior business writer. He can be contacted at pranjalx@gmail.com)