UP Invester’s Summit 2018: When politics throws a spanner in the works
THE CRUX: Change of regimes affect investment climate. Besides, there have been accusations that successive governments have tried to stall projects of their rivalslucknow Updated: Feb 14, 2018 15:47 IST
Politics and investment go hand in hand. Change of governments have affected the state’s industrial environment in the past and led to the flight of capital. Settling political scores has also not helped matters.
Sample this. The Uttar Pradesh government had ordered closure of Reliance Fresh stores when Bahujan Samaj Party supremo Mayawati took over as the state chief minister in 2007.
- Mayawati government ordered closure of Reliance Fresh stores in 2007 and scrapped Uttar Pradesh Development Council set up to bring investment to Uttar Pradesh.
- Mayawati government delayed giving land for Rail Coach Factory in Rae Bareli, the Lok Sabha constituency of the then Congress president Sonia Gandhi.
- Mayawati government withdrew concessions that Mulayam government had announced for the industry in pursuance of the Uttar Pradesh Industrial Investment Promotion Policy 2006.
- Amethi’s Jagdishpur Industrial area that remained in focus during late Rajiv Gandhi’s tenure as Prime Minister faced neglect and many industrial units set up there closed down while some disappeared after taking advantage of incentives given to them
- Modi government denied permission for Shaktiman Food Park in Amethi.
Soon, all the Reliance Fresh stores that had opened during the tenure of her predecessor Mulayam Singh Yadav had to be shut down. A few years later, a number of industrial units threatened to shift out of state if they were deprived of the concessions that the Mulayam Singh Yadav-led Samajwadi Party government promised to them in pursuance of the Uttar Pradesh Industrial Investment Promotion Policy 2006.
The industrialists took this stand after the Mayawati government in 2007 decided to withdraw the concessions.
Tata Motors was among the major companies that wanted to shift operations out of state.
A group of ministers was constituted to consider their problems following after the Akhilesh Yadav-led SP government assumed office in 2012.
Minister for industry Satish Mahana says: “Yes, there has been a flight of capital from Uttar Pradesh and leading industrial houses have not been willing to invest in the state due to some past experiences. Some met me in Mumbai and Kolkata recently and said they had decided not to invest in UP. All of them are now coming to Uttar Pradesh.”
“There should not be any politics in attracting investment. We are pursuing a policy of giving equal treatment to all the investors, even if they are close to or are affiliated to a political party. We are giving the investors the respect that they did not get even during the tenure of governments they considered close to them,” Mahana says.
There have been accusations that successive governments have tried to stall development projects of their political rivals.
The Mayawati government had refused to allot land for Rail Coach Factory in Rae Bareli in 2007-2008. Although, the land was subsequently given for the coach factory, the state by this time had witnessed a lot of politics over the issue.
The Congress has consistently accused the Modi government of indulging in the politics of vendetta when the Centre refused permission for setting up of Shaktiman Mega Food Park in Jagdishpur in Amethi.
Amethi MP Rahul Gandhi had sought union home minister Rajnath Singh’s help in seeking revival of the Shaktiman Mega Food Park project that he said was cancelled on account of ‘politics of revenge’.
“I sincerely hope that with your profound experience, you will help protect the farmers of Uttar Pradesh, a state which you have also served as chief minister, and ensure the revival of the project,” said Gandhi in his letter dated May 14, 2015 to Singh.
Accusations have also been made about neglect of the Jagdishpur industrial area that was in focus during the tenure of the late Rajiv Gandhi as Prime Minister.
“The Uttar Pradesh State Industrial Development Corporation (UPSIDC) had developed the Jagdishpur Industrial Area in Amethi during tenure of late Rajiv Gandhi as Prime Minister. About 300 small and big industrial units were installed there. After Congress was voted out of power in 1989, successive governments failed to take care of problems of investors and denied uninterrupted power supply and other basic facilities to them. All the governments have their focus areas for investment and the Yogi Adityanath government is not an exception,” said District Congress Committee (DCC) president Yogendra Mishra.
“The Yogi Adityanath government is holding UP Investors Summit 2018 to attract investment. It should also work to bring back the projects that have been shifted out of Uttar Pradesh for political reasons,” said Congress MLC Deepak Singh while listing projects of Amethi that have been shifted out of UP.
The UPSIDC has vacant plots in most of its industrial areas. A list has been uploaded on the corporation’s website. Ahead of UP Investors Summit-2018, the state government had asked all the district magistrates to work out a list of plots/land available for industrial units. Mahana said there was no politics around attracting investment and the investors were welcome to invest anywhere in Uttar Pradesh. “I am often asked about the focus area of the present government for investment. I tell the investors they are welcome to invest anywhere in Uttar Pradesh. We will provide facilities wherever the investors want to invest,” said Mahana.
Infrastructure and industrial development commissioner (IIDC) Anoop Chandra Pandey says all the heads of department (HoDs), the principal secretaries and secretaries have been asked to remain available at designated points to provide on-the-spot solution to the problems of investors. Pandey says besides traditional sectors, the state government has identified defence manufacturing and bio-fuel as the new areas for investment.
Others in the government also stress about the need for taking care of investors’ problems or else there may be problems in implementing the MoUs after the summit.
The state government may also have to look into the strategic issues that companies have in continuing operations. This came into focus when the Tata Consultancy Services recently hinted at shutting down its operations in Lucknow. As the TCS move had come when chief minister Yogi Adityanath had begun making efforts to attract new investment, he decided to constitute a high level team of officers to convince the company’s bosses against shifting the company’s operations out of Uttar Pradesh.