“You need to understand that unless we mess up on governance, nothing can stop the rise of India. If you have bad governance then you’ll have to pay for it. About 2,000 years back, India and China accounted for 50% of the world’s GDP. Then, there was an aberration for 200 years; now the top three out of four economies belong to Asia. India and China are all set towards having more than 50% of the world’s GDP. So happy days will be here again”
Scholar, analyst, academician, administrator, manager, a bureaucrat and even a politcian. Architect of the Gujarat’s industrial policy even before liberalisation became a fashionable term. Foremost a water expert, he’s accredited with the implementation of the Sardar Sarovar project. That’s Jay Narayan Vyas, a man of many parts. Corporate Citizen spoke to Vyas when he recently received the Jal Mitra award for his stellar work in water management. He speaks here on the general scenario of the Indian economy and the water crisis
Jay Narayan Vyas is a politician, scholar, analyst, academician, administrator, manager and a public life functionary from Gujarat. He was the Cabinet Minister for Gujarat’s Health & Family Welfare department from 2007 to 2012. A graduate in Civil Engineering from the Indian Institute of Technology Bombay (IIT-B), he is also a post-graduate in Marketing Management and Law.
Vyas has teamed up with Bakul Dholakia, former director of the Indian Institute of Management Ahmedabad, and Mukesh Patel, an eminent tax expert, scholar and columnist, for an annual post-budget discussion. The session conducted by the trio has been happening over the past three decades and attracts a huge participation from people in trade, industry, commerce, academics and the bureaucracy.
Vyas is a water management expert. He headed the Sardar Sarovar Dam project and was responsible for its implementation. It was one of the largest multipurpose water management projects in India. He subsequently guided the implementation of this project as Minister-in- charge of Sardar Sarovar and other major irrigation projects. He has had a long and effective contribution as a bureaucrat in the State’s Industry department followed by a political career spanning more than 20 years.
Jay Narayan Vyas: It was a slow transformation. After I graduated from IIT, I taught for two years in an engineering college in Vadodara and then switched over to government engineering Services. After which, it was a lateral entry into the State Industry Administration. I became the first non-IAS chief of the Gujarat Industrial Development Corporation (GIDC). That was in April 1975. That was the real turning point, as even if had I been an IAS officer, I wouldn’t have progressed so far, so fast in the state service. Three years later, I was posted as Managing Director of the Industrial Exchange Bureau which was equal to the rank of secretary. I held that position for a good 12 years. This gave me an opportunity from 1975 onwards, to work with all the chief ministers directly. Modi was nowhere in the picture at that time. He became active from 1985 onwards. When I was in the government, none of these forerunners today had entered politics. One day I thought I should hang up my boots. It was stupidity, but no, I am not repenting. But before I left, I wrote industrial policies for almost 15 years. When Gujarat was formed, it was the 8th industrial state in the country. By the time I left it was at the first position and I’m happy to say that I played a vital part in that success.
That was the time of a tightly licensed industrial raj. There was a spineless organisation called the Director General of Technical Development (DGTD) which used to ration the production of various industries. It would severely limit production capacities of cement industries and so on. There was also a draconian law called the Foreign Exchange Regulation Act (FERA). So, to counter these, I founded this organisation called the Industrial Extension Bureau in 1984. It became the model of industrial promotion in the country. The first thing I offered was the single-bank conceptualisation and the single window concept. I also introduced the concept of inviting investors to the state instead of doing the reverse. Lalit Mansingh was the Ambassador to the UAE at that time. So, he organised a delegation of 30 probable investors from Dubai and they landed in Mumbai. From there I took them to Gujarat’s major industrial locations like Umbergaon and Vapi. And ultimately brought them to Ahmedabad for a meeting with the chief minister.
The Reserve Bank of India later sent me a notice, stating that I had violated Section 8 of the Act, questioning me on expenses on the transportation, food, travel and passports of the invitees. I convinced the central government that we need to change this attitude, else forget about foreign investors. They agreed. Subsequently, I was a part of the Foreign Exchange Management Act (FEMA) committee which directs on how NRIs can invest in India. Finally, the change of heart in terms of a liberalised economy happened during Rajiv Gandhi’s time and was perfected during Manmohan Singh’s tenure as Finance Minister under Prime Minister Narasimha Rao.
Basically, the idea of one country, one tax, is good. The taste of the pudding lies in its implementation, though. Nobody would say the idea is bad. It will add to the GDP by at least 2%. Any new policy is initially resisted. You are accustomed to a certain system and the administration is also new to it. There are many doubts and queries in the minds of stakeholders. The remedy lies in settling them down. The government also should have an open mind, willingness to walk that extra mile and come to some compromise. Stakeholders should not have any wrong apprehension.
The government has promised that it will compensate all the stakeholders for the next five years, which, according to me, would be a big loss to it. They say industry will take care of that aspect but these are all assumptions. Friction is the greatest destroyer of energy. But then without friction, you and I can’t walk. There will be some anxiety in the beginning but ultimately it will settle down.
The first thing is processional anxiety. Traders have been protesting because this will create problems for them. Because nobody wants anything that makes them answerable to the officers or open their dealings to government scrutiny. On the other hand, if there are genuine mistakes, the government should rectify. The government cannot afford to overlook the stakeholders. There will be a solution. These are all initial reactions.
The malaise goes far deeper. Nobody has understood this problem correctly. This is what I humbly believe as an analyst. If waiving the debts of farmers helps in overcoming the problem, then I am all for it. However, this will not end it. Basically, you have to accept the fact that these are not caste agitations like the Patidars, Jats or Gujjars. These are the agitations of the farmer who is increasingly finding agriculture a non-remunerative business. There are a few reasons for the same:
I have written to the PM on this issue. I am sure it’s been attended. But if a person like Dr Swaminathan is frustrated, then what should I say about this country?
It’s a vicious circle. In any country bureaucracy is very important. The main problem is that the present agricultural institutions are not top -grade. You'll have to think about high-tech agriculture.
It will not decline. It’s temporary. The composition of the GDP has changed. Earlier, it was 50% industry - 50% agriculture. Today it is more or less 18% agriculture, 22 % industry and 60% service. This 60% will slowly move up to 80%.
You need to understand that unless we mess up on governance, nothing can stop the rise of India. If you have bad governance then you’ll have to pay for it. About 2,000 years back, India and China accounted for 50% of the world’s GDP. Then, there was an aberration for 200 years; now the top three out of four economies belong to Asia. India and China are all set towards having more than 50% of the world’s GDP. So happy days will be here again.
In 1977, George Fernandes came up with an idea that any foreign country that wants to do business in India should bring down equity to below 40%. Coca- Cola and IBM left. Why did they come back? Because now, only in India there’s retail aplenty. India is the largest free market in the world. And the size of the middle class is only growing. So India can rule the world in the near future, provided it takes care of the following issues:
“There was also a draconian law called the Foreign Exchange Regulation Act (FERA). I founded this organisation called the Industrial Extension Bureau in 1984. It became the model of industrial promotion in the country. The first thing I offered was the single-bank conceptualisation and the single window concept. I also introduced the concept of inviting investors to the state instead of doing the reverse”
The positive side is that laws which the earlier administration was not able to pass, have been passed, like the Land Acquisition Act or GST. There is no policy paralysis. However, we need to see how effective the implementation is.
We need to understand that wherever there is misuse of water, it must stop. If we keep the tap running while brushing, 5-10 litres of water gets wasted. While using your face wash, you could be wasting somewhere between 8-15 litres of water. Don’t leave the tap on while shaving, instead use a tumbler. You’ll save around 10 litres of water. When I was the Water Resource minister, I had taken a bold step of restricting water supply in Ahmedabad and diverted that excess water to 4,000 villages who were drinking chloride- contaminated water. I gave them a source, now they are blessing me. But that day, people threw stones at my house.
Most of the water, almost 80% is used by agriculture. But when it comes to saving water, we who use 20% need to take the step. Industry cannot use a lot of water. They have started going in for waste water circulation within their premises. Farmers should understand that even they cause wastage of water. The ground needs moisture but it need not be flooded with water. But unfortunately political parties encourage such wastage to lure voters. So they do not take a harsh stance against any potential or consolidated vote bank.
In a democracy, the success of the government depends on how much an individual contributes to it. If you keep your surroundings clean, the whole country will look clean. People will change slowly. That doesn’t mean you stop doing it. A good beginning has been made. Unclean water will create havoc. It’s scary. 70% of deaths in the last two years were due to water borne diseases.
It is not a very good idea to keep your money in fixed deposits as fixed-time investments are going to be less and less remunerative. We are living in a declining-interest regime. So if you can’t be competent to deal with the stock exchange then go for other instruments that are available, like mutual funds. I’ll always insist that we should invest 20% of your savings in gold. It will not let you down. For the rest 80%, keep 50% in SIP and 30% for short-time investment.
Whenever I get time, I keep writing. My next book is on a very different topic, about friendships in the epic, Mahabharata. You know about the war, but if there wasn’t friendship in it, it wouldn't have happened. There are many friendships in the Mahabharata—Draupadi and Droncharya, Krishna and Sudama, Krishna and Kunti, Karan and Duryodhana, to give a few examples. The book will be in Gujarati.
Enjoy your life.
By Vinita Deshmukh
