‘Emerging Kerala’ drive: Need for a proper follow-up mechanism need of the hour

T HE last United Democratic Front (UDF) government had organised a Global Investors Meet (GIM) in 2003 with the proclaimed aim of turning the industrially-backward state into an investment destination by attracting an investment of Rs500 billion. Although it elicited 96 projects involving an estimated investment of Rs260 billion, very few of them crystallised.



The present UDF government is gearing up for a similar exercise again. The event titled “Emerging Kerala” to be held in the state’s commercial hub of Cochin in April next year has not enthused captains of industry as did the GIM, which was organised after a lot of homework, including concerted efforts to change the perception of investors over labour and other issues that impeded investment in the state.

However, the projects could not be made a reality due to lack of proper follow-up. Some of the measures taken prior to the GIM were not implemented at all while a few like a new law seeking to curtail corrupt and extortionist practices by the laboureres were diluted by the subsequent Left Democratic Front government. Though the Communist Party of India (Marxist) later denounced these practices, it has not been able to restrain the labourers belonging to the party unions. .

A study by the Confederation of Indian Industry revealed that the state was suffering a production loss of Rs6.5 to Rs7 billion a day due to shutdown strike. The state witnesses about 100 such strikes a year on an average at the regional or state levels now. These strikes have been affecting the companies’ export obligations/delivery schedule, resulting in customers choosing alternative suppliers outside and export orders being cancelled.Apart from this, the state also has many inherent disadvantages like lack of physical infrastructure, including good roads and quality power.

The red tape prevailing in government offices and the negative approach of bureaucrats and a vast section of people towards investors is another serious concern to the investors. Captains of the industry feel any attempt to woo the investors without solving these basic problems may not yield any result.

Many of the existing companies have been finding survival difficult. In fact, as many as 2,000 companies, including nine public sector undertakings, were shut down during the last financial year. The trend is continuing even during this year. As per the records of the Registrar of Companies, 30 companies stopped operation last month alone.

The ‘Emerging Kerala’ seeks to position the state as an investor-friendly destination and to transform it into a major business hub of South India. The government intends to cerate a business development framework, which will enable such a transformation. The state government has put in place various committees for the activities. A committee chaired by the chief minister has been constituted to monitor and review the progress of the campaign. The council of ministers and government secretaries are members of this committee.

Besides, project committees headed by ministers are being formed for finalising policies and projects, identifying priority areas, preparing project profiles, and initiating discussions with prospective entrepreneurs with respect to each department. The project committees will be responsible for follow up and implementation of the projects finalised as part of ‘Emerging Kerala’.

Investors feel that these efforts may succeed only if the government focuses on improving the investment climate first. Unfortunately, the ‘Emerging Kerala’ campaign has missed this vital aspect. — news@khaleejtimes.com


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