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Why Modi needs to be Modi’fied
Though crony capitalism is not the want, perhaps a modified model...
Nothing is right unless it gives results and nothing is wrong unless it fails to produce any results. There has been considerable criticism for state patronage in private business. It all started with the setting up Ratan Tata’s ‘prestigious’ Nano project in West Bengal. To encourage Ratan Tata, the West Bengal government agreed to provide a loan of Rs. 200 crore at a shockingly low interest rate of 1%. Tata (perhaps correctly) left West Bengal despite his “gun to the temple” theory; and entered straight into the alms of Gujarat. If the Left can do it right, the Right wants to do a Left it seems. This time, the Modi government has assured more gifts for Ratan Tata with a promise to provide a loan of Rs.9,570 crore (five times of what West Bengal promised) with an interest rate of 0.1% (whoa!!!) that is payable after 20 years. One wonders whether the Nano will also be made available on such lucrative rates to its customers. But wait, there’s more! Modi has also provided land worth another Rs.1,000 crore. Similar cases are strewn across (refer B&E’s Crony Capitalism issue, Feb 5, 2009). Eg, the Maharashtra government recently announced free land for all industrialists who agreed to invest in backward regions and hold 80% of the job for local people.
These incidences have drawn national attention and brought severe criticism for the government’s irresponsibility and lack of accountability. It is true that the government has spawned generations after generations of crony capitalists. But rather than blindly criticise the government and hack off the State’s connect with the private sector, this is a good time to ruminate and work out a better model of an efficient public-private partnership. Given the fact that leaving projects with government departments more or less achieves nothing, private companies should be provided support albeit on a commercial basis (rather than on the back of questionable subsidies).
By:- Akram Hoque
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