What will it take to transform Uttar Pradesh?
Hardnews Bureau Lucknow
Hardnews, along with German foundation Friedrich-Ebert-Stiftung (FES), organised a roundtable discussion on July 28 with the purpose of looking at the possibilities for “Transforming UP”. The event was held at the Taj Vivanta in Lucknow and was put together keeping in mind elections in the state next year.
It goes without saying that elections in Uttar Pradesh, the most populous state in the country, are hugely significant in terms of their impact on national politics. Of the 282 seats held by the BJP in the Lok Sabha, 73 came from UP in 2014, a major surprise from a state that has not seen a BJP government since 2002. Political parties have begun turning up the heat in the run-up to the 2017 polls that will decide who takes control of the 404-seat Assembly.
With UP taking centre stage in the national discourse, Hardnews and FES felt that the need of the hour was to put the spotlight on the issues that are central to the state. While the impact of stable governments on the economy since 2007 has been good, with some years witnessing stunning growth rates, have they transformed Uttar Pradesh from the human development perspective? The state contributes 20% of the country’s food grains and stands 3rd in terms of GDP, but what about unemployment, which is set to hit an astronomical number of about 1 crore by 2017? Can a land locked state really create jobs? Problems of power supply and access, which are fundamental to growth, have plagued the state. Its crime rate is head-and-shoulders above the rest of the country's. Despite being a fertile and productive area, urban water services are inadequate, and wastewater management even more so. The same goes for the quality of the state’s road network, which, although extensive, suffers from a lack of maintenance. Education and health have seen major improvements in recent years but are still below the national average. There are so many issues relating to the economy that need urgent answers.
Keeping these in mind, it was decided to bring together stakeholders from the state and national capital to weigh in on what is holding UP back and what is needed to take it forward in an inclusive and viable manner. Speakers included eminent personalities from the civil services and civil society like Saurabh Chandra (former Petroleum Secretary, Government of India), Rajat Kathuria (Director, ICRIER), Navneet Sehgal, Principal Secretary, Information, Anup Chandra Pandey (Principal Secretary, Medical Education), Sudesh Ojha, Director Information, UP, Kiran Bhatty (Senior Fellow, CPR), Nishi Pandey (Chief Proctor, Lucknow University), Arvind Mishra, Rakesh Ojha, Kanak Rekha Chauhan (Founder, Lucknow Literature Carnival), Khan Masood (VC, Khwaja Moinuddin Chishti Urdu, Arabi-Farsi University), Arshita Das (Acting Principal, La Martiniere Girls’ College) and Mehru Jaffer (author and journalist). Arvind Mohan (Professor of Economics, Lucknow University) and Ramesh Dixit (former Professor of Political Science, Lucknow University), Rakesh Kalra, an entrepreneur, Dilip Awasthi, Editor of Dainik Jagran, Ashok Krishna, Kamal Khan of NDTV, Ruchi Kumar of India TV were also present in the round table discussion.
Rita Bahuguna Joshi (Congress MLA), Madhukar Jetley (Samajwadi Party MLC), Atul Kumar Anjaan (CPI National Secretary), and Sanjay Lathar (Samajwadi Party MLC) pitched in with their insights to make for a multifaceted discussion.
Things were kicked off by Archana Kapoor, the Director of Hardnews Media and SMART, a New Delhi-based NGO, and Sanjay Kapoor, Editor-in-Chief of Hardnews Magazine. Following a short introduction to the kind of issues that Hardnews has been organising events around, including the energy crisis, digital transformation and Save Our Tigers campaign, as well as the overlap in areas of interest for Hardnews and FES, both of which ‘look at democracy through the prism of people, governance and development’, they welcomed everyone to what they described as an effort to initiate a discussion on what was important for UP as election season approached.
It was the turn of Marc Saxer, Representative of FES in India, who walked the gathering through the global context and climate within which India assumed importance for his foundation, which promotes social-democratic thought, policy-making and development around the world. Saxer’s was an incisive analysis of the Indian economy: ‘To understand India, you need to understand just one number: in India, for the next four years, 1.2 million jobs need to be created every month. So, the question is, how do we create these jobs?’ He marveled at the variety of economic models that ‘this laboratory you call a country’ had experimented with and wondered whether ‘export-led, manufacturing-led growth’, which had ‘worked for Japan in the 60s, for Korea and Taiwain the 70s, for Malaysia and Thailand in the 80s and China in the 90s’ could work for India today, given that Make in India was the new name of the game.
‘The first thing we need if you want export-led growth is an open market ... [but] globalisation has not worked for the working classes and the middle classes … and Brexit showed that for the first time they are the majority, they are basically taking a gun to their heads and saying, “We’re no longer willing to listen to your experts, we're no longer willing to listen to you explain to us why it will be better; it's not, and we're willing to burn the house down if you don't take care of us." ... So that means for India, open markets, the free movement of goods, people and ideas, can no longer be taken for granted.'
He also remarked on how the cost of labour in the old industrial countries has fallen dramatically in the wake of huge advancements in artificial intelligence and robotics that have resulted in even the textile industry, 'the cheapest industry you have', returning from China to the United States. These symptoms of 'premature deindustrialisation' put a premium on 'quality, skilled workforce, how well your supply chain works, [and] governance'. Although 'the global economy is very friendly for India today', with the USA having instructed its south-east Asian allies (Japan, South Korea, Taiwan) to look India-wards for investment, FDI in absolute terms is going down. Moreover, it isn't creating jobs because of increasing automation. To conclude, in a sense, he posed the question: 'If manufacturing will not be the job engine that was hoped for, can services create those jobs? And if international markets do no create demand for industry, can domestic markets do the job? And what needs to be done to ensure this kind of development?'
Picking up where Saxer left off, Saurabh Chandra offered a number of possible solutions: 'The problem is meaningful jobs. Agriculture - the bulk of your population is on agriculture. What do you do there? Why don't we go into area subsidies and cut out all the other subsidies? Give subsidies on per-acre basis - the West does it. In the entire country, you have 137 million holdings. In 3 months, the number of people who got money straight into their accounts on account of LPG subsidies went from 30 million to 150 million. Today you have the accounts, you transfer subsidies straight into the farmers' accounts. It'll eliminate all the middlemen. We have to get rid of market distortion for agriculture production like the APMC Act. Between farm to fork, there are 5-6 middlemen and the prices go up accordingly. Can we get a better deal for the farmer? Let's take cutting of trees. I'm allowed to cut eucalyptus and poplar trees, but to transport it I need a permit - why? There is a formula which is applicable: c = d + m - a (corruption = discretion + monopoly - accountability). This is where ease of doing business comes in: web-enabled, everything to be done without human contact. You have to ease business.
'We have a lot of labour involved in agriculture. What did China do? Transport 80 million of them to non-farm jobs in rural areas. How do you create non-farm jobs in rural areas? Why should there be a permission to change land? It's my land, why should I need permission? The first factor of production that you have ease is land. Let's move on to labour. Why can't MNREGA be used to subsidise wages of labour which is working in the rural industry? The most critical thing is, you have to give them electricity. Today electricity is going a-begging in this country at Rs 2-2.5 a unit, but there are no buyers, because the discoms are broke. Set them in order.'
Madhukar Jetley and Sanjay Lathar were asked to respond to these suggestions, as politicians from the ruling party in the state. Jetley established with the aid of comparisons with Washington, DC, Indonesia and the southern states of India that in terms of per capita GDP, UP was 'punching below its weight', but also stated that, under the Akhilesh Yadav-led Samajwadi Party government, 'electricity generation has gone up ... there are several new power plants functioning today, that were not there before.' However, although he spoke with optimism about addressing the 'solution lying within UP', the question remained: why are businesses not coming to the state? 'You talk about employment, but when there are no businesses, how do we salvage the situation?' asked Archana Kapoor.
(L to R: Arshita Das, Nishi Pandey, Genreal Ashok Mehta, Rita Bahuguna Joshi, Kiran Bhatty, Rajat Khaturia)
Rita Bahuguna Joshi attempted to answer that question by locating the problem in the friction between the Centre and the States at the level of policy implementation, political character and bureaucratic culture. 'The policies that the central government brings in certain reforms and policies, but they are not implemented properly at the state level. The Centre also sometimes squeezes the funds so that the state government does not take advantage. I think the first thing we require when we are talking about transforming UP ... is the political will to enforce whatever provisions we make for the people. ... When we talk about India, yes FDI is important, but in which sectors? India specialises in small- and medium-scale industries and UP is one state where these can grow. Look at all the textile products we make in this state, right from chikan to Benarasi. People come here to do things, but they get stuck. Development can only take first priority when it is the determining criterion for political power. But in UP, it is all about caste and community. Caste is the biggest problem of this state.' She went on to state that bureaucrats 'behaving like feudal lords' was a major part of the crisis, a point that was touched on repeatedly throughout the session, by many other speakers as well. 'In UP, the bureaucracy has become pawns of the political parties. They only think about important positions and there is corruption at every stage. The people seated here can give all sorts of brilliant theories, but the ground reality is the biggest impediment.'
A different line was taken by Sanjay Lathar, who praised the work of the Akhilesh Yadav government in promoting the distinctive indigenous industries of the zilas of UP (e.g. pottery) and increasing the budgetary amounts spent on electricity generation and modernising the police force respectively. It was a figure-laden and fiery defence, which failed to explain only one thing: why were these efforts not translating to perceptible development and transformation?
Rajat Kathuria was asked to bring an economist's perspective to the table in addressing this chasm. He identified that 'the situation in UP is more dire than in the rest of India', but also reminded everyone that the Indian model of development had taken a direct route out of agriculture into services, bypassing manufacturing altogether, which effectively meant that the country had 'never actually industrialised.' What was adding to the problem, he continued,' was the fact that 'traditional cultural industries are dying. Political patronage used to keep them alive, but the market doesn't recognise them anymore. If we are to generate growth from them, we need intervention.' At the same time, the problem with an interventionist approach boiled down once again to 'license raj, corruption and law and order problems; basically, when it comes to policy, we know what to do, but we don't do it.' In a departure from the point of view furthered by Ms Joshi, he stressed that 'the action is moving to the states, so we need to promote competitive federalism, with administrative and institutional reform from the centre down as well as capacity building.'
(L to R: Hamida Habibullah, Sanjay Lathar and Rajesh Ojha)
On the matter of industrialization, Ramesh Dixit had a similar opinion: it was the small industries that needed attention in a state that hadn't seen industrialisation. Development hinged on advancing them, but such development was impossible in a state where 3 Chief Secretaries had been imprisoned on charges of corruption. He also pointed out that the excitement around National Highways was one that blinded people to the toll this kind of development exacted from farmers, whose lands were taken from them to make way for roads. 'The common man's pain needs to shape policy,' he demanded.
At this juncture, the discussion turned to politics. Asked what he thought would determine voting behaviour in 2017, Atul Kumar Anjaan argued in a roundabout but revealing manner that it was time for UP to begin caring about itself rather than, on the one hand, being used by the country and, on the other, lacking internal cohesion. He historicised the state's afflictions by drawing attention to the fact that UP found itself in its current situation in spite of having provided 8 Prime Ministers to the country, which suggested that 'they did not care about UP.' In addition, he claimed to 'have not once heard the UP CM call for a meeting of UP MPs.' As far as business goes, 'we have 132 sugar mills, but all the offices are in West Bengal or Maharashtra, so the revnues go there. Even Allahabad Bank has its headquarters in Kolkata! The people of UP save the most in the country, but do not spend it in UP.' While he believed that 'the representatives of the people represent only their castes and communities and not the people', he also tried to downplay this angle, stating that by and large UP would be seen to have gone past caste discrimination if it were compared with other states like Tamil Nadu.
Perhaps the most dramatic intervention of the evening's was Kiran Bhatty's, which began with a demand for more constructive thought. 'Not one person has mentioned education, even though it is fundamental to everything that we have been talking about. Not one party has given any thought to boosting education. 25 per cent of UP is absolutely illiterate; 40% of the children do not even have access to primary education; 48% of schools do not have electricity; 10% are single-teacher schools ... The Kothari Commission said that 6% of a country's GDP must go into education, but we as a country are still happy with something between 3% and 4%. States are still not giving any priority to it, with teacher vacancies in lakhs. Nowhere has universalisation of education happened through privatisation, but massive privatisation is happening in UP. Other states are doing so much more, like Himachal Pradesh.'
The response to these assertions was mixed, with more or less everyone agreeing that Ms Bhatty's concerns were important but some felt that she was resorting to 'sweeping statements'. Ms Joshi felt that the real problem was once again implementation, as policy decisions like the Right to Education and the Midday Meal Scheme had been put in place under the Manmohan Singh-led UPA government. However, Ms Bhatty refuted this with the claim that the same government had not allocated enough money in its budget for its own policies. It was inadequate allocation that was responsible for many teachers receiving less than minimum wage. Furthermore, Saurabh Chandra contended that the blame was being disproportionately heaped on the bureaucracy, whereas an equally significant question was, 'Who appoints the corrupt Chief Secretary?' He was clearly hinting at the role played by politicians.
On this note, it was the turn of Nishi Pandey and Arshita Das to weigh on what was afflicting the education sector. Ms Pandey was even-handed in accusing both the political and bureaucratic establishments for working hand-in-hand when it came to university admissions: 'If you are a politician, you will take more, if you are a babu, you will take Rs 10.' She also outlined larger institutional problems in higher education: 'Budgets are such that most of the central government's allocation for education goes to central universities and whatever comes to the state is then further divided, with the majority of it going to state-run degree colleges or the colleges run by political bigwigs. Mind you, Bombay University is not central, Madras University is not central. The state capital universities are flagship universities though they are not funded by the centre; they are given special status. This has not happened in UP yet, with the result that Lucknow University does not get enough grants for reasonable salaries. Quality assurance in higher education is just not happening. Money needs to come in, or you're left with teachers who are demotivated. When I ask for funds, I'm met with bureaucrats asking me, "Why do you need so much money? You don't need this, you don't need that."'
She also drew a connection between the law and order problem and the kind of criminalisation that was on the rise in schools and colleges because of the influence of political parties. Her demand that political interference be removed from campuses was, however, met with some opposition from the politicians present, although the root of that disagreement lay in a misunderstanding; Sanjay Lathar and Atul Kumar Anjaan took her statement to mean that students should not be politically involved at all, but, as Ms Pandey clarified, her plea was for party-funded student politics, which translated to arms, ammunition and vehicles on campus, to come to an end.
Arshita Das emphasised the need for the emerging generations of private-school children to be apprised of the ground realities of the country so as to create a situation in which they would be able to appreciate how lucky they were and feel the motivation to 'reach and help' those in need. This, she added, required a change in the mindsets of parents and society as a whole.
(L to R: Kiran Bhatty and Rajat Kathuria)
When Anup Chand Pande was asked to step in to respond, as Principal Secretary of Medical Education in UP, to the variety of problems that had been raised vis-a-vis education in the state, the terms were once again reset. He asked what could be expected of bureaucrats when, in the name of increasing access to education, understaffed schools were proliferating. According to him, implementation could not be separated from planning, and it was at the source of the planning that the problems lay. In this connection, he also raised the point made by Saurabh Chandra earlier, about appointments to important posts being politically motivated, resulting in upright candidates being sidelined and later having to hear that the entire bureaucracy was corrupt in spite of their best efforts. Bringing the discussion back to employment, he observed that the statistic that Marc had highlighted (number of jobs that needed to be generated in the country) was not being met in the formal sector, but in the informal sector, with 'third-rate, indecent jobs.' It was necessary, he said, to stop 'looking at jobs in the industrial sector. Why can't we have jobs in the agricultural sector? Why can't we reinforce our agricultural economy? You can't, in the short term, shift people from agriculture in rural areas to urban areas.'
Among the last to speak was Ashok Krishna, who spoke at length about the unfriendly business environment in UP that was forcing him to move his head office to Bombay. A project that had been indefinitely stalled in UP since 2003 despite several tenders having come out was already underway in 6 different states. One of the reasons noted by him was, predictably, the attitude of the state's bureaucrats, who, in stark contrast to those of other states, refused to work by their own schedules.
The discussion was wrapped up on a positive note by Arvind Mohan, who spoke of bright prospects ahead for industry and employment UP as the National Highway was extended through the state. It seemed that in his opinion it was the lack of connectivity that was largely responsible for having held the state back. While this did not address all the issues that had been brought up over the course of the evening, that was always going to be a difficult task, given their number and scale.
All in all, it was a highly informative and charged exchange of viewpoints at the end of which it could fairly be said that everyone walked away with a holistic idea of the change that UP needs: a better business environment with a focus on small and indigenous industries as well as increased connectivity for employment generation, which can be facilitated by a more responsive bureaucracy free from the influence of politicians who represented narrow community interests and undergirded by according greater importance to education. For the state that has housed so many of the ancient civilisations and empires of the subcontinent, it is now these issues that will be crucial in the coming years. What remains is for the events leading up to and following 2017 to bring them to the fore. Pradeep Kapoor proposed a vote of thanks.