UP investors Summit 2018: Will Yogi create history?
The recently-concluded UP's Investor Summit was a glitzy marketing spectacle. What's more, industrialists promised investments worth Rs. 4.28Lcr by signing about 1,045 MoUs. Reportedly, this is five times the value of new investment projects announced during SP's five-year rule. CM Yogi Adityanath said that he will personally monitor the implementation of these projects. So, is this summit a watershed moment in UP's development history?
To begin with, what was the UP Investor Summit?
The two-day UP Investor Summit, inaugurated by PM Narendra Modi, saw the participation of over 5,000 delegates. This included industry leaders like Reliance's Mukesh Ambani, Adani Group's Gautam Adani, etc. and Union ministers like Rajnath Singh, Nirmala Sitharaman, Ravi Shankar, etc. International representatives from Mauritius, Japan, Thailand, etc. also participated. Also, Lucknow got a face-lift of over Rs. 650mn for this jamboree.
But, do all MoUs translate into investments?
State-level summits like these follow the template of Vibrant Gujarat, former Gujarat CM Modi's brain-child. However, even he could manage an MoU conversion rate of only 10%. So, though MoUs worth Rs. 4.28Lcr were announced with possible additional investment of Rs. 4Lcr, how much of this will translate into investments? Besides, UP is known for a mismatch in projects announced and their completion.
Does Yogi's government have a plan for implementing MoUs?
It seems Yogi's government realizes that this is the main challenge. Industry Minister Satish Mahana claimed that they have begun sorting the MoUs department-wise and are in the process of completing all the necessary formalities. Moreover, these MoUs indicate that UP will get maximum investment in infrastructure (about Rs. 1.63Lcr), followed by renewable energy (Rs. 65,250cr) and food processing (Rs. 26715cr) sectors.
What are the challenges for UP to attract big business?
MoUs aside, UP faces a lot of challenges. It is one of the worst performers in meeting electricity demands. In April-June'17, it faced a 4.1% demand-supply gap, higher than the all-India average of 0.9%. Additionally, until Centre's promises of nine new airports, up-gradation of key stations around Allahabad and Purvanchal/Bundelkhand expressways materialize, UP's connectivity-issue also hangs in balance.
Yogi promotes better law and order, ease of doing business
So, to woo investors, Yogi claimed his government's USP has been the "repaired, reformed" law and order apparatus. PM Modi and Home Minister Rajnath Singh also lauded the "zero tolerance" to criminalization. But, communal tensions have sparked intermittently and it is unclear whether police encounters will improve crime indices. Interestingly, UP's ease of doing business index improved from 27th to 18th rank in April-November'17.
Meanwhile, what is the problem with UP's development?
Despite the hoopla surrounding the Investor Summit, UP's problems are much more basic. It lags behind in health-care; deaths of children in Gorakhpur (70+) and Farrukhabad (49) signify its appalling state. In education too, it ranks second-last among 36 states and UTs, counting population aged 6-17 attending educational institution. Moreover, it is witnessing skewed regional inequality, with the richest districts concentrated in the west.
Can this vicious circle be broken?
Concisely, any change in UP's performance would require serious pragmatic targets and accountability rather than mere optics. For instance, the crackdown on unfair means in board exams generated high praise. But, despite UP's poor education scenario, government reduced its 2017-18 education spending by 1%. Yogi also might have to fix UP's bureaucracy, stalled by inaction and casteism.
