We need to create industrial clusters to decongest cities

Interview/ Nitin Gadkari, minister of MSMEs; road transport & highways; & shipping

Nitin-Gadkari-2 Nitin Gadkari | R.S. GOPAN

Nitin Gadkari has been a man with a mission amid the Covid-19 crisis. Every day, he holds videoconferences with various stakeholders, listening to their concerns and offering them hope.

The micro, small and medium enterprises (MSME) sector has been the worst-affected by the lockdown. Several measures Gadkari had proposed have become part of the Union government’s Rs20 lakh crore economic stimulus package.

Gadkari spoke to THE WEEK on a range of issues—from highways and industrial clusters to politics and China. His mantra in these gloomy times: Be positive and self-confident to emerge victorious. “Kadam se kadam milakar chalna hoga. Koshish karne waalon ki kabhi haar nahi hoti (We should march together. Those who try, will not lose),” Gadkari said, reciting lines from a poem written by former prime minister Atal Bihari Vajpayee.

Excerpts from the interview:

Q/ You are very optimistic in your interactions with industry bodies. Has it rubbed off on the industry?

A/ I have spoken to a lot of people, ranging from those in the entertainment sector and hair salons to restaurant waiters and owners. This is not the first crisis we are facing. Our country has always faced disasters like earthquakes, floods and diseases. There is an urgent need to build positivity and self-confidence in people. If this happens, we will win.

[This crisis] is a blessing in disguise. The industry needs foreign investment and technology upgrades. Countries with better facilities and good foreign relations will benefit.

Everyone is facing problems. Some state governments don’t have enough funds to pay salaries. The government of India has seen its revenues drop. The banking system is facing challenges. Migrants are facing a jobs crisis.

My first suggestion is that everyone should face this grave problem with self-confidence. The government has given a package amounting to 10 per cent of the GDP—Rs20 lakh crore. Still, there may be problems, for which we have opened a website called Champions (champions.gov.in) to redress grievances of MSMEs. Over 50,000 grievances have been addressed.

Q/ You had suggested liquidity of Rs50 lakh crore for the economy. Could you elaborate?

A/ I had said that there is a need to increase liquidity in the market. We have given a package of 020 lakh crore. Economists say there will be a Rs10 lakh crore budget deficit in the state and at the Centre. Now, [with] the funds available from the budgets of state governments and the Centre, the current economic package, and Rs10 lakh crore from public-private investments, the Indian economy would get a boost of Rs50 lakh crore.

Q/ MSMEs say government departments owe them money, and that there are still problems in getting loans.

A/ Public-sector units and government departments owe some money to MSMEs; a decision was taken that [the money] be released in 45 days. I had also written to chief ministers to release payments that were pending with state departments.

The Reserve Bank of India had issued orders and guidelines for banks to smoothen the [lending] process. If someone still faces an issue, he can go to our new portal, Champions, and register a complaint. We will address it quickly.

Q/ The country witnessed a humanitarian crisis as migrants were forced to leave cities. What should the industry do?

A/ There is an impression that the entire industry is dependent on migrant labour. There are only 10 to 20 per cent migrant [labourers]; [the rest] are local workers. Now, up to 70 per cent of the industry has restarted, and most of the migrants want to return. I suggested that [industrialists] coordinate with district collectors to bring labourers back.

The ideal state is that people need not travel. MSMEs account for 29 per cent of the economy and 48 per cent of exports, and have created 11 crore jobs. The rural industry has a turnover of Rs88,000 crore. We have decided to increase this turnover by involving agro-industry, handloom, khadi, honey and biofuel. We will encourage them to become a 05 lakh crore industry in the next two years, so that people get jobs where they were born.

We want to create industrial clusters in Delhi, Mumbai, Noida, Gurgaon, Pune, Kolkata and Chennai to decongest cities. For instance, 1.5 lakh people in Dharavi work in the leather industry. I told the Maharashtra government that we should create a leather cluster along the Delhi-Mumbai highway so that they could work and stay there. [The leather industry’s] turnover is Rs1.45 lakh crore, of which Rs85,000 crore is from the domestic market. The workers will get homes and their condition will improve. The clusters will also decongest big cities and help stop migration.

Q/ The government is pushing for self-reliance and is trying to attract business from China to India. Some say it is easier said than done.

A/ Many countries do not want to do business with China. This has created an opportunity for us; we should take advantage of it. We have skilled labour, infrastructure, ports and raw material. For example, we have a textile cluster in Nagpur, Orange City, which makes Peter England shirts. I asked them to make PPE (personal protective equipment) kits. Now five lakhs PPE kits are being made in India and getting exported. This happened in just two months. Before that, we had to get a planeload of PPE kits from China.

Similarly, sanitiser used to cost Rs1,200 per litre. But we gave permission to sugar mills to make it, and it now costs Rs160 per litre. And we are ready to give it to the world. [This crisis] is a blessing in disguise. The industry needs foreign investment and technology upgrades. Countries that have better facilities and good foreign relations will benefit.

testing times: An automobile parts shop in Prayagraj | AFP testing times: An automobile parts shop in Prayagraj | AFP

Q/ You gave the example of creating industrial clusters and moving people out of Dharavi. But how different is this model from the United Progressive Alliance government’s failed special economic zones?

A/ We are constructing the Mumbai-Delhi highway—a 14-lane, concrete road that starts from Sohna in Gurgaon and passes through Sawai Madhopur, Jabua, Ratlam and Vadodara to reach Mumbai. It will reduce 220km between Delhi and Mumbai. As it passes through tribal and backward regions of Rajasthan, Gujarat and Madhya Pradesh, our acquisition cost has been reduced from Rs3 crore per acre to Rs10-20 lakh. We have saved Rs16,000 crore in land acquisition. Our plan is to develop roadside facilities like industrial clusters, smart cities and smart villages.

This road passes through Thane district, so I told the state government that we would acquire land and create rail and airport connectivity. I suggested that the state government give power and water supply and arrange transport. Through this joint venture, we can create the leather cluster. People who move to the cluster can get houses through the PM Awas Yojna and claim benefits under 16 different schemes. If three lakh people move from Mumbai, it will help the city. And help other saturated cities.

Q/ You had set an ambitious target for highway construction. Will you need to rework it?

A/ Till March, we had been building around 30km every day. The target is 40km. Work has been very slow in the last three months. It has re-started, but now it is monsoon time. But we have not changed the target. In the six months after the rains, we will work day and night to achieve it.

I have tried to get foreign funding as the National Highways Authority of India has AAA rating. Our toll income is Rs28,000 crore. We had expected it to reach Rs40,000 crore by year-end. Now, I don’t know what we will earn. But we will get investments from banks like Asian Development Bank, BRICS, investors and pension funds. We are trying everywhere.

Q/ The opposition says the BJP has restarted political activities even before the pandemic is over, and that it has been focusing on destabilising state governments and trying to ‘buy’ MLAs.

A/ We never indulge in horse-trading. This is a wrong allegation. We are using technology to reach out to people. The Congress can also do so. We have followed all health protocols, including social distancing norms. This opportunity is available to all political parties.

Q/ Some economists say social harmony is necessary for economic growth. They say the Centre’s ideological policies will discourage foreign investors.

A/ Some people have been making these allegations because we have impacted their business. We don’t do caste- or religion-based politics. In the past six years, we have not taken any decision that is against anyone. [Those who do] vote-bank politics think that they cannot win elections unless they play the minority card. They try to create fear in the minds of the minority; and when they fail, they confuse them. That is their strategy. We believe in Sabka Saath, Sabka Vishwas.

Q/ The Bihar assembly elections are round the corner. Do you think it would be held on time? Will campaigning be impacted?

A/ You have put the right question to the wrong person. I was BJP chief, but now my responsibility is the MSME ministry. My policy is to focus on the task at hand. [BJP president] J.P. Nadda is the right person to answer this question.

Q/ The government’s response to China’s border incursions appears to be muted.

A/ [Defence Minister] Rajnath Singhji will be the right person to reply.

Q/ What are the lessons from this pandemic?

A/ There are people who convert problems into opportunities. And there are people who convert opportunities into problems. We should deal with this crisis with self-confidence. Together, we will fight the coronavirus and win the economic battle.