Monday, May 17, 2010

[ZESTCaste] Three years of Mayawati rule drives investors away from Uttar Pradesh

http://www.dnaindia.com/india/report_three-years-of-mayawati-rule-drives-investors-away-from-uttar-pradesh_1383913

Three years of Mayawati rule drives investors away from Uttar Pradesh
Deepak Gidwani / DNA

Monday, May 17, 2010 1:47 IST

Lucknow: When recently celebrating three years in office, UP chief
minister Mayawati had proudly proclaimed that the state's growth rate
during this period had averaged over 7%, while it had remained just
about 4% during the preceding regimes. However, investors are not
impressed with the Dalit icon's governance.

Industrial development in UP, as per government statistics, indicates
that investor confidence has been at an all-time low and investment
proposals and actual investments have fallen sharply. Statistics show
that the downtrend has drastically hit the employment generation.

Industrial development department officials explain this downtrend as
a fallout of the global downturn.

However, industrialists and economic experts say power shortage,
procedural delays, threat to personal security, corruption and
overbearing political interference are the major reasons for investors
giving UP the pass over in favour of other states, like Gujarat,
Haryana and Maharashtra. The government is now bracing to take some
crucial decisions soon to reverse the trend, said sources.

"UP lacks basic atmosphere for industrialisation… Governments have
refused to work on it as their top priority. Every CM makes lofty
announcements which are not followed with action and implementation,"
said RK Jain, secretary, Western UP Chamber of Commerce and Industry.
Jain feels lack of co-ordination between different departments is also
a problem in UP.

It's no wonder then that UP could not achieve even one-fourth the
target of the Rs50,882-cr investment under the public-private
partnership model in 2009-10.

Another indicator is the failure of the special economic zone (SEZ)
scheme. Even though the state has got the permission for 15 SEZs, only
three are functional. And as things stand, there is no hope of a new
one coming up in the near future.

"The UP bureaucracy doesn't work in a time-bound fashion… This is a
big deterrent for any investor," said Indian Industries Association
president Anil Gupta.

Gupta cites the example of Tata's Nano project being shifted from West
Bengal to Gujarat "in record time". "Every investor works to a
time-table as to when his project can start and by when he can expect
to break even and earn profits… Here, a file lies pending for months.
Undue delays mean cost over-runs and a host of other complications,"
he said.

A senior official on condition of anonymity said: "To some extent,
this trend can be attributed to the wait-and-watch approach. It's
largely the sarkari way of functioning which drives investors away."


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