Exclusive interview with Narendra Modi

On the eve of the second Vibrant Gujarat Summit, Gujarat chief minister Narendra Modi has shed his saffron image in favour of a far more suave one — that of a market-savvy CEO of Gujarat Inc. Just back from a whirlwind tour of several countries including Thailand and Australia while other ministers from his Cabinet toured the US, UK and African states in a bid to woo Gujarat, Modi is brimming with confidence that investors are eyeing “India and China as the next economic giants of the world.” In a freewheeling interview to FE’s Jyotsna Bhatnagar, the Gujarat CM speaks on a range of issues, from what prompted him to initiate the marketing of Gujarat through festival-linked summits to the state’s success in translating intent into actual investment. Excerpts:

How effective are such summits in marketing the state?

First of all, the main purpose of events like the Vibrant Gujarat investor summit is to focus on the opportunities, potential and prospects that the state has to offer. There are different ways of doing this. I deliberately chose to focus on the inherent vibrancy of Gujarat which comes to the fore through festivals such as the Navratri festival and Uttarayan because I wished to link with tradition, commerce with culture and entrepreneurship with entertainment.

Following Gujarat’s example, many states have started doing the same thing. For instance, former Karnataka CM S M Krishna decided to sell the state’s development by linking it with their annual Vijayadashmi festival.

When we decided to focus on the Navratri festival, we deliberately marketed it in a very western way by calling it the “longest dance festival in the world.” And let me tell you, several years from now, people across the world will make a special point to remember the Navratri festival in Gujarat in much the same way as the beer festival in Germany or the tomato festival in the US.

But in 2003, while we had pegged the Investor Summit to the Navratri festivities in the state, in 2004 we pegged the festival to promote tourism, particularly medical and eco tourism, while we linked the Uttarayan festival to the investor summit. That’s because our kite-flying festival is very unique too – India is the only place where kite-flying is a social event where kites are flown from rooftops of houses. Apart from that, it’s a Rs 100 crore largely in the hands of the below poverty line populace and we plan to make it a Rs 500 crore industry.

But there are many sceptics who accuse the Gujarat government of inflating figures for the MOUs signed last time. According to them, hardly any investment has actually materialised.

Let me make it clear that at the outset itself, we made no claims that we had set specific targets for signing MoUs by organising these summits. The fact that the approximately Rs 66,000 crore worth of MoUs were signed in Gujarat itself by investors who came and took a look at the prospects themselves shows the amount of interest we were able to generate. Even if 20% of these MOUs had been realised, it would have been considered an achievement for any other government. In Gujarat, I am proud to say that worth almost Rs 56,000 crore are being realised within a year of signing of the MoUs, which is a success rate of almost 85% but instead of kudos, all we are getting is large doses of scepticism.

How does Gujarat compare with other states in terms of attracting investment?

Compared to other states, Gujarat is once again number two to Maharashtra in terms of MoUs signed. But here I would like to say that there should be some changes in the evaluation criteria for investment in states. MoUs are no longer the best way of assessing the state’s ranking. Instead what should be taken into is the realisation.

For instance, if Enron were to be taken out of Maharashtra’s kitty, its ranking would be automatically lower than Gujarat. Second, parameters such as employment generation and growth rates should also be barometers of a state’s ability to attract investment.

For the year 2002-03 and 2003-04, the Centre’s data and labour ministry reports clearly show that for both years, Gujarat emerged as the largest generator of employment. Not only that, both Hero Honda and Bajaj sales figures show that rural Gujarat was the largest buyer of two-wheelers in the country which reflects the growth and prosperity in Gujarat’s villages.

When so many states are trying to attract FDI, what is Gujarat’s USP?

To begin with, here in Gujarat we don’t differentiate between NRIs, NRGs and FDI. For us, all of them are the community and our approach toward all of them is the same. Our USP is that there’s no red tape in Gujarat, only red carpets. Here we are committed to progress and progress is not based on the whims of any particular individuals. Our state is policy-driven, the policies are reform-driven, and the reforms are humanity-driven. This is the strength of our state.

Further we have a natural locational advantage. We have a 1,600-km coastline and my dream is to make Gujarat the SEZ capital of the country by capitalising on this. Each SEZ would be one Singapore.

Further, with our ports and our gas grid, Gujarat is on its way to becoming the petro capital of the country as well. We have two LNG terminals and I propose to have two more so that our whole is gas driven.

These would be our undoubted USPs in attracting FDI. We already have companies like GM, P&O, Mersk, British Gas, China Light & Power and Shell here and we hope to have many more MNCs through summits like the Vibrant Gujarat summit.