OommenOommen ChandyChandy seeks to draw industry to seeks to draw industry to KeralaKerala

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Kerala has the attributes that could have Kerala has the attributes that could have turned it into an economic powerhouse, turned it into an economic powerhouse, but some of those very characteristics but some of those very characteristics have scuttled its aspirations. have scuttled its aspirations.

At best, the state has earned a reputation At best, the state has earned a reputation as one of the biggest suppliers of as one of the biggest suppliers of manpower for the rest of India, West Asia manpower for the rest of India, West Asia and elsewhere, as most young people are and elsewhere, as most young people are unable to find local jobs that are good unable to find local jobs that are good enough. enough.

Industry has fled the state, driven away by Industry has fled the state, driven away by an aggressive labour regime that an aggressive labour regime that businessmen complain is extortionate, businessmen complain is extortionate, making the economic system dependent making the economic system dependent on remittances that have had a skewed on remittances that have had a skewed effect on development. effect on development.

Kerala chief minister Kerala chief minister OommenOommen ChandyChandy, , 68, wants to change this perception and is 68, wants to change this perception and is trying to persuade investors that the trying to persuade investors that the labour force is no longer as militant as it labour force is no longer as militant as it used to be. used to be.

““Gone are the days of trade unionism,” Gone are the days of trade unionism,” Chandy said in Mumbai at the World Chandy said in Mumbai at the World Economic Forum’s India Economic Economic Forum’s India Economic Summit recently. Summit recently.

““Even the opposition parties are changing. Even the opposition parties are changing. We are taking a series of steps to make We are taking a series of steps to make Kerala an emerging destination of Kerala an emerging destination of investment.” investment.”

According to the Kerala State Industrial According to the Kerala State Industrial Development Corporation (KSIDC), the Development Corporation (KSIDC), the state has targeted more than Rs.89,000 state has targeted more than Rs.89,000 crore investment through public-private crore investment through public-private partnerships in the next five years for partnerships in the next five years for various large projects, including the Kochi various large projects, including the Kochi Metro rail project and an industrial Metro rail project and an industrial corridor. corridor.

Chandy may find his ambition impossible Chandy may find his ambition impossible to achieve in his five-year term, which to achieve in his five-year term, which began in May. Kerala traditionally switches began in May. Kerala traditionally switches its electoral allegiance between the its electoral allegiance between the Congress-led United Democratic Front Congress-led United Democratic Front (now in power) and the Left Democratic (now in power) and the Left Democratic Front headed by the Front headed by the Communist Party of IndiaCommunist Party of India (Marxist), or (Marxist), or CPM. CPM.

The Left parties are, however, The Left parties are, however, unapologetic about the labour situation in unapologetic about the labour situation in the state. the state.

““The trade unions are here to stay and The trade unions are here to stay and investors have to cope up with that,” said investors have to cope up with that,” said Thomas Issac, an economist and finance Thomas Issac, an economist and finance minister during the 2007-11 LDF minister during the 2007-11 LDF administration. administration.

He also said that nearly all the projects He also said that nearly all the projects announced by Chandy had been initiated announced by Chandy had been initiated by the last government. by the last government.

““The Left parties are for acceleration of The Left parties are for acceleration of industrial growth in Kerala, but industries industrial growth in Kerala, but industries that are suitable for Kerala,” Issac said. that are suitable for Kerala,” Issac said. “There are three conditions for any “There are three conditions for any industrial growth proposals for the state. industrial growth proposals for the state.

Firstly, the social security of the poor in Firstly, the social security of the poor in the state is ensured, social infrastructure the state is ensured, social infrastructure shall always be under the government, shall always be under the government, and democratic rights will never be and democratic rights will never be compromised.” compromised.”

Apart from labour militancy, the state is Apart from labour militancy, the state is infamous for innumerable strikes, infamous for innumerable strikes, prompted by fuel price increases, prompted by fuel price increases, privatization initiatives and even the privatization initiatives and even the execution of former Iraqi leader execution of former Iraqi leader Saddam HusseinSaddam Hussein. .

Since the Kerala high court has Since the Kerala high court has banned banned bandhsbandhs because of the disruptions because of the disruptions they cause, these are known as they cause, these are known as hartalshartals, , although there is little difference in the although there is little difference in the impact they have on public life. impact they have on public life.

Chandy is trying hard to eradicate some of Chandy is trying hard to eradicate some of the more pernicious practices in the state, the more pernicious practices in the state, recently declaring Thiruvananthapuram recently declaring Thiruvananthapuram district the first to be “liberated” district the first to be “liberated” from from nokku koolinokku kooli. .

This is a fee that’s paid to unionized This is a fee that’s paid to unionized workers in an area for allowing an workers in an area for allowing an individual or company to load or unload individual or company to load or unload cargo.. cargo..

This could range from the effects of This could range from the effects of someone moving house to heavy someone moving house to heavy machinery that can only be handled with machinery that can only be handled with sophisticated lifting equipment.sophisticated lifting equipment.

Businessmen involved in local Businessmen involved in local manufacturing and other labour-intensive manufacturing and other labour-intensive sectors haven’t yet seen enough of a sectors haven’t yet seen enough of a change in the industrial climate that would change in the industrial climate that would convince them to increase their convince them to increase their investments in the state. investments in the state.

But Thomas George Muthoot, director at But Thomas George Muthoot, director at Muthoot Fincorp Ltd, a Muthoot Fincorp Ltd, a non-banking financial company non-banking financial company of the of the Muthoot Pappachan Group, holds a Muthoot Pappachan Group, holds a different view, backing up Chandy’s different view, backing up Chandy’s assertion that the environment is assertion that the environment is conducive for investment. conducive for investment.

““The real investors will vouch for the The real investors will vouch for the change,” Muthoot said. “The state is very change,” Muthoot said. “The state is very much up the ladder in terms of much up the ladder in terms of investment.” investment.”

Apart from trying to address the labour Apart from trying to address the labour environment, the state government is fast-environment, the state government is fast-tracking decision making so that Kerala tracking decision making so that Kerala becomes a viable destination for domestic becomes a viable destination for domestic and foreign investment, the chief minister and foreign investment, the chief minister said. said.

The state has several things going for it, The state has several things going for it, apart from high social indicators and being apart from high social indicators and being one of the top-rated global travel one of the top-rated global travel destinations. destinations.

It is home to the new International It is home to the new International Container Transhipment Terminal, which Container Transhipment Terminal, which will eventually become one of the largest will eventually become one of the largest such facilities in the world. such facilities in the world.

It also has one of the best natural It also has one of the best natural harbours in the world at Vizhinjam, near harbours in the world at Vizhinjam, near the state capital of Thiruvananthapuram. the state capital of Thiruvananthapuram.

Chandy said the state will seek to rope in Chandy said the state will seek to rope in Sam Sam PitrodaPitroda, chairman of the National , chairman of the National Innovation Council, as chief mentor for Innovation Council, as chief mentor for Kerala’s planning and development Kerala’s planning and development agenda. agenda.

Pitroda is an adviser to Prime Minister Pitroda is an adviser to Prime Minister Manmohan Singh and is credited with Manmohan Singh and is credited with leading a telecom revolution that has leading a telecom revolution that has turned India into the world’s second turned India into the world’s second largest mobile phone market. largest mobile phone market.

An email sent to Pitroda did not elicit any An email sent to Pitroda did not elicit any response, but his official and personal response, but his official and personal websites had links to the Kerala chief websites had links to the Kerala chief minister’s announcement that he was minister’s announcement that he was being named adviser. being named adviser.

While the chief minister himself struggles While the chief minister himself struggles with a lack of charisma and an inability to with a lack of charisma and an inability to communicate effectively with the communicate effectively with the Congress central leadership, he thrives on Congress central leadership, he thrives on keeping in touch with the electorate. keeping in touch with the electorate.

For instance, after assuming office, For instance, after assuming office, Chandy launched a 24-hour webcast that Chandy launched a 24-hour webcast that shows how his office functions. The site shows how his office functions. The site also allows petitions to be filed and people also allows petitions to be filed and people to submit ideas for a Vision 2030 Idea to submit ideas for a Vision 2030 Idea Bank. Bank.

In November, Chandy and a group of In November, Chandy and a group of ministers and bureaucrats held a ministers and bureaucrats held a publicpublicdarbardarbar in Thiruvananthapuram in Thiruvananthapuram where complainants could get themselves where complainants could get themselves heard and officials would make spot heard and officials would make spot decisions. decisions.

Chandy has also taken his 19 ministers to Chandy has also taken his 19 ministers to spend a day at the Indian Institute of spend a day at the Indian Institute of Management, Kozhikode, for a “learning Management, Kozhikode, for a “learning and unlearning” process. and unlearning” process.

Kerala should be clear about what kind of Kerala should be clear about what kind of enterprises it wants to attract, said Amit enterprises it wants to attract, said Amit Kapoor, honorary chairman of the Institute Kapoor, honorary chairman of the Institute for Competitiveness. for Competitiveness.

It should have a 20-year programme and It should have a 20-year programme and ensure the policy framework and talent ensure the policy framework and talent availability that will allow the state to availability that will allow the state to achieve this, he said. achieve this, he said.

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