So the Centre is tracking the progress of every investment above Rs 1,000 crore to ensure that these projects go through. The National Manufacturing Competitiveness Council has asked all ministries to provide details of public sector projects above Rs 1,000 crore, prompting them ‘to indicate whether there are any sector specific issues such as environment and forest clearances which may be causing delays'.
From Kamal Nath (Road and Surface Transport) to Sriprakash Jaiswal (Coal), Dr Singh's ministers have been up in arms against the Ministry of Environment and Forests (MoEF) during the UPA's second stint in power. The Planning Commission has slashed the budget of the green ministry twice since 2011. The Reserve Bank singled out ‘environmentalism' to blame for a one-third dip in foreign direct investment (FDI) last year. The Prime Minister himself cautioned that green regulatory standards might bring back the dreaded licence-permit-quota raj. The build-up is finally complete. Now that the economy's animal instincts have sensed a second round of reforms, Team Manmohan has bared its claws.
But sarkari environmentalism is a myth perpetuated by Jairam Ramesh's relentless media posturing. During his tenure in the MoEF, the ministry cleared 99 per cent of the projects referred to it. His high-profile clash with Jaiswal over ‘go' and ‘no-go' areas for mining ended in Ramesh conceding 85 per cent areas to the go list. Since 1982, the MoEF approved 94 per cent of coal mining projects. Between 1982 and 1999, the average delay in project clearance was five years. During BJP rule, it came down to three years. The UPA-I further reduced it to 17 months. The UPA-II takes 11 months to decide on a project and its rejection rate has been just 1 per cent. Yet, the Government blames environmentalism for the sagging economy.
Beyond the reform-or-perish frenzy whipped up by the media, lie a few home truths. Yes, the stock market is sluggish but not more than 7 per cent of Indians hold any equity. The Prime Minister must worry because falling stock prices wiped out about a fifth of the total value of his country's 100 wealthiest citizens last year. But if his reforms jeopardise the already-compromised ecological security of the country, the livelihood and food security of hundreds of millions of Indians will be further at stake. If more people now go hungry after two decades of liberalisation, which is a grim fact, the economy cannot hardsell the trickle-down benefits of reforms.
Posco, for example, wants to invest Rs 52,000 crore in its Odisha plant. The Prime Minister himself has expressed strong commitment to see the project through. The 2005 MoU allowed the MNC to extract 600 million tonnes of iron ore over 30 years, and ship out 30 per cent of it. The MoU also conceded that Posco would source an additional 400 million tonnes of iron ore from India for its plants in South Korea through supply arrangements from the open market. There is a fat margin between the domestic open market (average Rs 4,400 per tonne) and the international price (average Rs 7,400 per tonne) of iron ore. For 400 million tonnes, it adds up to Rs 120,000 crore, more than double the proposed investment. Read the full report here.
Source: by Jay Mazoomdar, Open.
