The Vibrant Gujarat Summit was a show that will long be remembered more for the fact that it brought together on one platform United Nations Secretary-General Ban Ki-moon, World Bank president Jim Yong Kim and US secretary of state John Kerry, among others. Only Prime Minister Narendra Modi could have pulled this off with the panache that he did. But this is probably the last time that one will see such a gathering for a function billed “Vibrant Gujarat” but turned into a “Vibrant India” forum.
The world has bought the India growth story after Mr Modi’s hard-sell of the country’s economic potential during his various world tours; now, everyone is waiting for the implementation of the lofty promises made by him. Since he raises the bar at every big-ticket meet, it is getting more and more challenging. For instance, on Sunday he said India would be “the easiest place to do business”. This is a huge challenge since India currently is 142nd out of 189 countries in the ease-of-doing business rankings. If Mr Modi is true to his word, India would have to ascend into the top 50. It is also routine now to hear almost the same group of industrialists announcing billions of rupees in investments.
Memoranda of understanding (MoUs) for intended investments totalling Rs 10 lakh crore were announced on Sunday. One does not know, for instance, whether the Rs 1 lakh crore investment announced by one businessman for Gujarat alone is new or recycled. One will have to wait some time to know how much actual investment will come. In the case of investments announced up to the 2011 Vibrant Gujarat summits, for instance, there were MoUs totalling Rs 42 lakh crore signed but the actual investments made were less than 10 per cent of the promised total. It is always Maharashtra that seems to have the last laugh. From April 2000, when the economy opened up, to July 2014, Maharashtra has, without fanfare, received 30 per cent of the total inflow into the country.
This is not to deny that India is the most attractive place in which to invest. Even the World Bank chief referred to India as the “bright spot in an otherwise mediocre global economic outlook”. But, and this is a huge but, investors are still waiting for the infrastructure, permissions and processes — which would make it easy to do business — to be put in place. The government has taken several steps towards this, but these are piecemeal and do not give the desired outcome. Besides, as several people, including economist Jagdish Bhagwati, have pointed out, Mr Modi has to come out against the extremist elements in the Sangh Parivar who threaten to destabilise his vision to put India on the path to economic glory.
