It is exactly a year since Uttar Pradesh chief minister Mayawati stunned everyone with her amazing electoral victory. A victory which gave the state its first single-party government in more than a decade and a half, a big relief from the days of shifting coalition compulsions.
Though one year is too short a time span to prepare a report card on the hits and misses of a government which rules over a state as big as Uttar Pradesh, it is nevertheless time to see the early trends set in by it, especially from the point of industry.
And, very much like any other state, infrastructure development is seen as the key pointer for sustaining growth and progress of the industry; the first and single-most important yardstick to judge whether a state is conducive for industrial growth or not. Despite taking the first few steps in this direction, it is on this count that the Uttar Pradesh government seems to slump. Political stability has given Mayawati government the moral strength and political will to carry forward many development projects. But as they say, ‘politics governs governance in Uttar Pradesh’, in this game of politics, building infrastructure doesn’t find much space.
Mayawati has been talking about improving infrastructure, with her government going in for the much-touted public-private partnership (PPP) model in a big way. Agreements have been signed with private investors for building and maintaining; not only roads, bridges, power generation, but also hospitals and educational institutions.
The industry has lauded the present government’s efforts at boosting private investment in the state. According to Amitabh Nangia, head of Confederation of Indian Industries’ UP State Council, “The government has started off with infrastructure projects, with the Ganga Expressway being a great one. But, this cannot be a one-off effort but a continuous process. A lot can still be done, especially in road and power sectors, which are abysmal at present.”
Talk about the power sector and Uttar Pradesh’s situation is the worst among all northern states. Added to this is the fact that its peak hour power demand is rising to 8500 mw with a deficit of around 2500 mw. “Power has always been the bane of UP. The most important reason why industry has been forced to keep away from investing in the state, despite its multifarious benefits, is the fact that it is unsure of the power and roads conditions,” said Nangia, adding that the scope for PPP format in development of infrastructure is very bright in UP. “Private players are always willing to help develop the state but the government’s commitment is also very important for things to improve. The system has to be simplified and the bureaucracy must be transparent and concerned about the industry.”
It is to address the twin problems of abysmal power situation and poor road network that the government has, of late, gone on an overdrive and paved the way for major private sector investment. It has identified power, road, transport, industry, health, education, irrigation and drinking water sectors in its priority list. While announcing the new middle path economic policy for the state last year, the chief minister had stated that the public-private partnership model would be an important ingredient of the policy and it is with the help of this model that her government is aiming to ride the development wave.
Following this, the government has initiated setting up the first two mega power projects in the state, the 1980 mw Bara and the 1320 mw thermal plants in Karchchana, in Allahabad district, by the private sector. “The combined power generated by these two projects would be 3300 mw of power, which is around 1/3 of the state’s target of producing 10,000 mw electricity for the 11th Five Year Plan. This, alongwith the two private projects, the 1000 mw Anpara C and the 660 mw Rosa project, would fulfill almost half of the target for the 11th plan would be met by the private sector. The rest of the 5000 mw is being done jointly in the public and joint sectors,” said a highly placed government official.
However, all these projects, alongwith the Ganga Expressway would see the light of the day only at the end of the 11th plan period, thereby leaving the industry very little to cheer about in the present scenario.
Apart from this, the other major bottlenecks that are yet to be addressed by the government are, to come up with a new industrial and energy policy. The present energy policy is continuing since the last regime of Mulayam Singh Yadav and needs major changes for the private sector to be lured into it.