Result fails to cheer industry

The prospect of yet another coalition government in the Jharkhand assembly has raised only a glimmer of hope among corporates struggling to get their projects going in the mineral-rich state.

The prospect of yet another coalition government in the Jharkhand assembly has raised only a glimmer of hope among corporates struggling to get their projects going in the mineral-rich state.

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In the nine years of its existence, the eastern state has signed 71 memorandums of understanding with industry, ensuring investments of Rs 2.96 lakh crore (Rs 2.96 trillion).

But only 14 of these have been able to see some action on the ground and most of them, including steel majors ArcelorMittal and Tata Steel’s greenfield projects, are still stuck in red tape.

“The verdict is hung but it promises to be a lot more stable than the last time,” said a senior ArcelorMittal official not authorised to speak to the media. “However, we would have preferred a single party rule and more decisive verdict. That way, we would have been sure if the ministers we are dealing with will last a full term or not.”

Jharkhand is one of the most politically unstable states in the country with as many as four regime changes in the last four years. It has the largest production and reserves of iron ore, copper, mica, kainite, uranium and asbestos and is the third largest in coal and bauxite.

“Issues like land acquisition and mining leases are state subjects and hence it is very important to have political stability in a state like Jharkhand,” said another industry insider.

An unstable legislature has a direct impact on the bureaucracy. A World Bank report in June 2007 had said the average tenure of a secretary in the state is 15 months and that of a deputy commissioner is 12 months.