AP investment boost throws a fresh land challenge to CM

TALKING POINT

smr new

Madhusudhana Rao S

There is every reason for Andhra Pradesh Chief Minister to smile self-indulgently after the end of the second Partnership Summit in Visakhapatnam. The two-day meet organized by the Confederation of Indian Industry for the second time in the port city has brought together some of the top industrial giants in India and from abroad. Also held simultaneously on January 27 and 28 was Sunrise Andhra Pradesh Investment Meet to facilitate more personal and face-to-face discussions with the State government officials and ministers and private players.

If we go by the astronomical figures of investment that is said to have been promised by Indian and international companies, and if the pledges translate into actions  sooner or later, Andhra Pradesh would see a radical transformation  of  its profile from  being the rice bowl of India to an industrial and manufacturing hub. 

The AP Government is reported to have signed 665 preliminary agreements (MoUs) worth over Rs 10 lakh crores at the summit for setting up various industries with potential to generate more than 23 lakh jobs in the State.

Industry-wise, the food processing sector has netted the highest number of 177 MoUs, followed by the industrial sector with 91 and the AP Capital Region Development Authority 62. Together, they account for nearly 700,000 crores, with the Economic Development Council getting half that promised investment. In fact, a careful look at the investment promises made at the summit reveals a substantial flow is from the Government of India and public sector units. Most of the forthcoming investment is directed towards developing infrastructure like roads, ports and airports. Among other investment proposals were, mega projects like an oil refinery in Kakinada, Vizag-Kakinada petro corridor, industrial corridors and Special Economic Zones (SEZs).

The investors’ interest in Andhra Pradesh is understandable. Until the united Telugu State was bifurcated in 2014, Hyderabad and its surroundings had been growth areas for IT, manufacturing, pharma and ancillary industries. The city is also the nerve centre for a number of R&D units in aeronautics, space, nuclear and missile technologies which have spawned hundreds of small units that manufacture components for the civil and military industrial establishments. To boot, Hyderabad can boast of a world-class airport, excellent rail and road connectivity. Cosmopolitan character of twin cities, tolerable weather and plenty of non-farm land to set up industries are other natural advantages Telangana has after the bifurcation.

On the other hand, the residual Telugu State is hamstrung on all these counts. The main problem is land, followed by infrastructure. AP Chief Minister Chandrababu Naidu’s struggle to get thousands of acres of fertile land in Krishna Delta to build a brand new world-class capital city is well known. Land acquisition under the land pooling scheme and the alleged unfulfilled promises and irregularities in distribution of land plots to farmers who surrendered their lands to the government in the Capital Region are some of the issues for the Opposition to attack the TDP government’s policies in the State Legislature and outside of it.

In other words, land is the critical criterion for Andhra Pradesh’s industrial development. Strangely –and ironically – none has factored in this issue while looking at the bright prospects of pumping lakhs of crores of rupees  into various industrial projects. Nobody has calculated the cost of compensation to be given to farmers and others whose lands are to be acquired and how much time does it take.

For example, Union Minister for Transport Nitin Gadkari had promised Rs 1 lakh crores for road networks in the State, particularly linking Amaravati. He had also promised Rs 20,000 crores for the two coastal economic zones at the Vizag meet. Similarly, GMR Infra is eyeing an investment of Rs 47,000 crores in Kakinada SEZ. Likewise, every district in Andhra and Rayalaseema regions is expected to have small, medium and mega industries.

While it may not be difficult to acquire non-agricultural land in arid and semi-arid areas under an attractive compensation package, getting swathes of land for giant industries can prove a herculean task. In fact, when a mega industry is set up, several ancillary units need to come up in tandem to support the major industry. When we take their land needs, including housing, roads, schools, recreation grounds, etc. the land requirement will expand exponentially. If the State government glosses over these taken-for-granted developmental issues in its over-enthusiasm to industrialize Andhra Pradesh as quickly as possible, the government may turn the rich green lands into hundreds of slums.

Of course, there is no guarantee that all the MoUs signed at the Partnership Summit and the Sunrise Andhra Pradesh Investment Meet would result in setting up factories all over the State. Generally, the realization rate is around 50 per cent. At the last Partnership Summit, the total number of committed projects was 328 with a potential to employ nearly ten lakh people. Of the committed projects, only 38 units have gone into production while six are on trial run, 16 had their machinery erected, 29 have begun civil work, 13 have got approvals and eight have been allotted land. These figures add up to 110. That means only one-third of committed projects have some semblance of taking off the ground. If that is any indication, AP could hope to see around 200 projects out of 665 committed taking shape in the next few years. Even that many industrial units can change AP’s landscape forever. Surely, in the coming days, nature lovers and farmers will be pitted against the government as the preliminary deals move to blueprint stage.

Industry is essential to create jobs but it should not destroy the environment and rob thousands of small farmers of their source of income and make them live at the mercy of officials and local political leaders.

Chandrababu’s efforts and campaign to turn Andhra Pradesh as No 1 State in the country are welcome and should be lauded. But in his eagerness to meet all the targets he set for himself and the government before the completion of his first term, he should not have a blinkered view of massive industrialization in a predominant agrarian State. The challenge before him is balancing farmers’ interests and industrialization to create jobs for a generation of aspirational youth. That means the green campaign should be part and parcel of the Chief Minister’s industrial drive.

Leave a Reply

Your email address will not be published.