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Can Maharashtra Change India’s Destiny?

Monday, February 16, 2015
By Mayura Shanbaug

Maharashtra has been leading the pack of most industrialized states of India for many decades. It has remained one of the most preferred destinations for FDI as well as domestic investment across many sectors. Although Maharashtra continues to attract investment across manufacturing and service sectors; the contribution of manufacturing over services has remained comparatively low over the years. Can that be reversed? Can Maharashtra once again become the backbone of India's development? Can Maharashtra Change India's Destiny? Yes, is the clear answer. But it requires tremendous amount of will and determination and that seemingly is being reflected in Chief Minister Devendra Fadnavis' approach to fulfilling that dream...

Maharashtra's manufacturing sector at present contributes 14% to the GDP, and the Government of India aims to take it up to around 25% in the next 10 years with the support of its national programme “Make in India” and create 100 million additional jobs. Similarly, in Maharashtra, there is an urgent need to focus on a “Make in Maharashtra” Initiative, and bring policies, which will ease the norms for doing business in Maharashtra and bring double digit growth. This is what was discussed at a seminar organized by FICCI last week.

Chief Minister Devendra Fadnavis recently announced that his government is about to enact a ‘Right to Services Act’. “I feel that the government is a service provider and when you look at the reasons for the people’s anger against the government, it is because they don’t get services on time without costs or undue favours,” said Fadnavis.

 According to the chief minister the Right to Services Act will require every single government department and office to specify what services they will provide along with the time frame and the application procedure; once an application is made in accordance with the stated procedure, it will become the duty of the concerned department to provide the service within the stipulated time.

There is another initiative in the form of a portal called 'Aaple Sarkar' where citizens can log in and provide suggestions. The portal has already been launched, and will soon reach the tehsil level, so that the e-platform becomes widely accessible.

Land reforms are also being reviewed. Fadnavis said that since the British left India no new land survey was done in the state. His government has decided to carry out an e-survey and digitize records of every parcel of land in Maharashtra and make it available in the public domain.

Labour laws are being amended so that laws that benefit neither industry nor labourers will be removed. “The current stringent labour laws see the labour market expanding into the informal sector, denying labourers’ jobs in the formal sector, and also affecting investments,” he said. “The new laws will make the exit policy simple, increase compensation for the labourers and ensure that more of them can be brought into the formal sector,” he added. These initiatives suppose to benefit a lot of industries, especially medium scale ones.

Fadnavis's government is fast-tracking a number of infrastructure initiatives. These include 72 km of metro rail and the Navi Mumbai airport. “The first flight from the Navi Mumbai airport will take off by 2019,” he promised.

Clearances for a coastal road that will aid in decongestion are expected shortly; a trans-harbour link from Mumbai to Navi Mumbai is being fast-tracked, with most permissions in place. Attempts are being made to decongest the bottleneck at the Bandra Kurla Complex, and even create five more such complexes in the city.

A development plan has been sanctioned for a logistical hub at Bhiwandi to integrate 4000 godowns and create an entire ecosystem for logistics. His government also plans to double the state’s port capacity in the next two years. There are also plans of connecting Dighi and Jaigarh Port to Konkan Railway.

Moreover policies for the IT, retail and tourism sectors are being reviewed so that the aspirations of investors can be synchronised and blended with the development framework. “With these new policy initiatives I feel that Maharashtra would be a preferred destination for the industries and services sectors,” he said.

According to Subhash Desai, Minister of Industries, Government of Maharashtra, the State Government has already started proactively taking steps to ease the norms of doing business in Maharashtra.

From 76 permissions required to set up a business, the number has been brought down to 25. The state’s river regulation zone has been removed totally; however, the government is still committed to protecting the river waters. “The government will ensure that proper controls are in place to ease pollution but will also see that no industry suffers from this regulation zone anymore,” said Desai. While improving roads and drainage around industries poses many challenges, the government promises to be doing its best to give it the attention it deserves. “The Maharashtra Government will also act towards giving more support to the small and medium sectors,” he added.

“Maharashtra has the highest contribution towards the GDP growth, but its share of manufacturing saw a steady decline during the last fiscal,” said Dr Jyotsna Suri, President, FICCI, and Chairperson & Managing Director, Bharat Hotels.“Hence there is an urgent need for Make in Maharashtra,” she said.
As Subhash Desai puts it, rightly... “Make in India cannot be achieved without trying to realise our dream of Make in Maharashtra.”

And there is wholesome support coming from the centre. “The country’s growth is an agglomeration of what each state achieves,” said Piyush Goyal, Minister of State with Independent Charge for Power, Coal and New & Renewable Energy. Goyal said that though Maharashtra is the numero uno state in the country, in recent years, “the state’s development cycle could not take off at the desired speed,” he said.

According to Goyal there are three factors that need consideration at this level. Firstly, he said that the world is looking for a stable and tax friendly regime for investment. “Both the Centre and the State of Maharashtra are trying to ensure that investors don’t have to worry about “what could happen in the future,” stated Goyal.

Goyal feels that as the world is watching Indian industry, unless they hear the voices of confidence from Indian industry, they will hesitate to come in. “They want to know that you have faith in your government. That will excite them to put their money into the Indian growth story,” he advised.

Goyal insisted that investors are not looking for supernatural returns. “They are happy with steady-state, decent returns, but “what bothers them is our integrity levels,“ he added. He warned that crony capitalism will deter investors from coming here. “Pointing fingers at each other won’t work. Team India is an organic entity,” he said   

As leadership expert John Maxwell puts it "People buy into the leader before they buy into the vision." The current leadership in the state is hailed as full of dynamism and unblemished record of integrity, which seems to work in the state's favour.

There are lots of initiatives and policy decision that the current government wishes to put forth, furthering the cause of 'Make in Maharashtra'. Many ideas may not sound new but the passion to implement the ideas seems to be new. The new Maharashtra regime promises to be investor and citizen friendly.
And that could change India's fortunes.

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