Building on investment

When it comes to attracting investment, States now need to sprint hard and Assam is no exception. The Central government is still the prime driver of economic growth, so it has to perforce tighten purse strings to maximise returns. With the days of Planning Commission largesse a distant memory, as well as the junking of special status for Central funding, States like Assam in Northeast region are now hard put to generate resources on their own. It is therefore imperative to solicit investment from the private sector if the State government is to raise growth and create jobs. Now that the dust has settled over ‘Advantage Assam’, the first ever investment summit organised by the State, it is time to look hard at some issues. First of all, it is indeed creditable that the State received investment commitments totalling Rs 1,00,000 crore with the signing of some 200 MoUs during the summit. This success can be compared to West Bengal maging to land investment proposals to the tune of Rs 2,19,000 lakh crore last month in its global business summit, primarily in manufacturing and infrastructure. The country’s fourth largest State, West Bengal already has a manufacturing base. However, it has maged to fructify barely half the investment proposals received in the three earlier business summits from 2015 to 2017. Economists point out that the real challenge is to translate higher proportions of investment proposals into Industrial Entrepreneur Memorandums (IEMs) filed with the Department of Industrial Policy and Promotion (DIPP) of the Central government and also to move into the implementation phase. So the Assam government has its task cut out to convert the investment proposals received in its maiden effort into a meaningful stage. Prime Minister rendra Modi while iugurating the ‘Advantage Assam’ summit stressed on speeding up the functioning of official machinery so that all programmes are completed before target under the Centre’s Act East policy. This greater seriousness has been evident in the Centre’s strategy of ‘transformation through transportation’ to develop the NE region. The present Assam government has trumpeted its efforts towards ‘Ease of Doing Business’, but has not made much headway on the ground. Unless the powers-be in Dispur make significant improvement on this front, investors cannot be expected to firm up their initial commitments.

However, this government deserves support for its endeavour to improve the industrial profile of the State by shunning polluting industries like coke oven units, tobacco products and goods requiring only peripheral activities like cleaning, packing, re-packing, labelling or re-labelling, sorting and alterte retail sale. Surely, Assam government has to look ahead if the State is to be built up as an exporter to ASEAN countries. This explains the thrust to sectors like information technology and IT-ebled services, handloom and textiles, agriculture, bamboo, food processing, pharmaceuticals, inland water transport, civil aviation and power. It is therefore encouraging for the State to receive investment proposals from leading PSUs like ONGC, OIL and BPCL, developing smaller airports and starting flights by private operators like Air Asia and SpiceJet under Udaan scheme, Tata Trusts in cancer care, Reliance in sectors including retail, petroleum, telecom and tourism, Infinity Infotech in IT parks and real estate, Essel group in infrastructure, Ola in river taxi services, Star and Dalmia groups in cement, and other leading corporate besides. However, the Assam government needs to push for an appropriate industrial policy from the Centre — with the North East Industrial and Investment Promotion Policy (NEIIPP) remaining in limbo. Assam and other NE States cannot be expected to compete on a level playing field with other States without such a policy. There is the need to create a credible development roadmap, as pointed out by Union Commerce and Industry Minister Suresh Prabhu. There are also questions about Assam having its own roadmap to generate adequate power to make a success of new units, as well as about its ability to skill sufficient number of youths considering an unimpressive track record. The earmarking of land along tiol highways 31 and 37 as industrial zones should also not involve suspect conversion of agricultural land. In its urgency to lay out the red carpet to investors, the State government should also ponder whether it is doing enough to nurture and encourage local entrepreneurial talent.