Author: Balbir K Punj
Publication: The Pioneer
Date: January 31, 2003
As the Republic Day parade rolled
on, it was time to go over the last 10 years and count our blessings, tracing
them back to the time Dr Manmohan Singh audaciously dumped the Nehru-Indira
line of the command and control economy to install a market mechanism.
The market economy got further impetus with the Atal Bihari Vajpayee Government
since 1998. The benefit to the public since then has been multi-dimensional.
It was the Vajpayee Government that gave prominence to infrastructure and
committed large funds for key sectors such as roads, railways, energy,
telecommunications and ports and airports.
There is no hyperbole in this claim.
The weakness of our infrastructure has been phenomenal, which restricted
the growth rate of the economy to three per cent per annum whereas it could
have possibly crossed eight. Bokaro is a steel-producing centre. The major
rail and road junction near Bokaro is Dhanbad, less than 60 kilometres
away. But it takes more than three hours to cross the road connecting the
two because it is in tatters. Goods move across the country over national
highways and other roads. Factories in the interior have to move goods
to ports in record time if they are to catch the ships that would take
them worldwide. Along these roads the sights we have are of trucks abandoned
due to breakdowns, roads the strength of which is unreliable for moving
heavy machinery and so on. Again, till recently, in no place were telephones
available for the asking.
Who will invest in our country if
roads are so awful, communications at a primitive level, and power supply
unreliable both in quantitative and qualitative terms? While we were receiving
not more than two billion dollars in foreign direct investment, China has
been attracting over $ 40 billion annually.
This was the situation that the
Vajpayee Government faced when it took charge in 1998. Since then, the
number of telephones has jumped from less than 20 million to over 40 million
today. Most of these telephones are now connected with optical fibre cables,
the latest technology that enables not just voice but transference of data
and images at a high velocity and economic price. Instant countrywide connectivity
is now available almost anywhere, and the scene is changing even more rapidly
with multiple operators competing to provide world-class services.
The Vajpayee vision has envisaged
the development of over 13,146 kms of expressways that would girdle India
with world-class roads. There is the 5,846 km Golden Quadrilateral, linking
Chennai-Kolkata-Delhi-Mumbai. There is under construction the North-South
corridor-connecting Srinagar to Kanyakumari and the East-West corridor
linking Silchar to Porbandar-stretching over 7,300 kms. With links to all
major ports, the entire project would cost Rs 54,000 crore and bring India
to the level of the best available in advanced countries in the field of
connectivity and communications.
The expressways would have most
modern information highways alongside, to ensure continuous communication
as the trucks and cars move cargo and people. Their surface would have
cement and the best materials that would reduce wear and tear of motor
vehicles. The six and four-laned highways would facilitate faster movement,
enabling manufacturers to move their goods to ports in time for shipments
and guarantee timely delivery. This is an essential part of boosting our
trade.
What is more significant is not
just the drawing up of the vision. It is the implementation. Already works
of the order of Rs 20,000 crore have either been completed or are nearing
completion. The quadrilateral and the corridors will come into existence
within one more year. There is no record so far in the country's history
of such a huge road-building project having been completed in such short
duration and without a whiff of scandal around its contracts. The contracts
have been given in the most transparent way possible, with all the parameters
available on the Government website, and the actual building is being done
by well-known global contracting firms that have been given a tight time
frame to complete the job.
The Vajpayee Government has also
envisaged a Rs 8,000 crore railway quadrilateral parallelling the road
quadrilateral. This would ensure maximum-speed movement of goods between
the four centres of Mumbai-Delhi-Kolkata-Chennai. Together, the two quadrilaterals
and the corridors would remove a major grievance of investors on the one
hand and of people on the other.
People in the East and North complain
that their development is stunted by their distance from the prime port
of Mumbai. Also, the road web would ensure that there is a more balanced
distribution of cargo between the four metros, including air cargo. For
Kolkata, this would be a transfusion of lifeblood, since its shipments
have been declining over the years-this trend would be reversed, thereby
boosting the engineering industries of the eastern sector and the economy
of West Bengal, Bihar, Assam and Orissa collectively.
As with FDI, we have a great gap
to cross compared to our major competitor China. Just as China gets over
$ 40 billion a year in FDI while India gets only two billion dollars, China
had exports of $ 322 billion in 2002, while India's may not exceed $ 40
billion in 2002-2003. Surely we cannot remain complacent. Road, rail and
other infrastructural projects, like improving cargo-handling capacity
in ports, have to fructify early enough to make a difference to the competitive
ability of the goods and services we could trade. Besides, by enabling
our industries to move their inputs from ports to factories faster, these
projects would also impact on manufacturing costs and thereby improve our
competitive ability.
More airports will now be constructed
and existing airports expanded or modernised. The final decision on leasing
our airports to private parties for expansion is being taken. Together,
the massive improvements already made in shipping ports and about to be
implemented in the airports network should place India on the trade fast
track even as the world enters the new trade regime. More so, since for
the first time we are also entering the area of foodgrains export on a
massive scale: Five million tonnes of wheat this year, for instance. There
will be a direct impact on the prices of agricultural commodities that
are depressed today. To the millions of farmers who are now facing a fall
in the prices of agricultural commodities and surplus stocks, this should
come as a boon.
Surprisingly, the main Opposition
party, the Congress, is not speaking of this transformation, even though
it has a good claim to fame as the originators of the reform-oriented shift
from the command economy to the market economy. Dr Manmohan Singh, the
originator, is the leader of the party in the Rajya Sabha. Why is he no
longer wearing the reformer's mantle and tending to shrink back and ride
with the Laloo Yadavs and the Harkishen Singh Surjits, opponents of economic
reform who have seen States like Bihar sink further?
Obviously the Congress is facing
a dilemma. If Dr Singh and Mr Narasimha Rao's reform agenda has to be projected
as a party achievement, it also has to admit that the Nehru legacy of the
command economy had some serious faults that had kept the country backward
for years and was also the cause of our slower growth in comparison to
China, Korea, Taiwan and other Asian tigers. To avoid this, they are not
coming forward with an agenda of more reforms unlike the BJP, which has
latched on to reforms and has taken the country to its second phase despite
many internal and external difficulties.
