With Digvijay Singh, Chief Minister of Madhya Pradesh by Anupreeta Das.
In your eight years as Madhya Pradesh chief minister, the state has witnessed a high level of decentralization, an increase in levels of literacy and a relatively peaceful society. How do you review the implementation of policies and practices introduced by you?
When I took over in December 1993, the most challenging task ahead was to turn around the total lack of confidence between Hindus and Muslims because of the communal riots that had taken place. My first job, therefore, was to rebuild confidence among people and bring down levels of conflict, with the result that there has not been a single communal riot in the last few years. Even though the incident at Godhra (February 2002) was only 100 km away, MP did not see a single incident of communal violence.
Levels of literacy and health indicators were low, population growth was high and economic growth was stagnant. The public delivery system was highly centralized, so I went in for decentralization, with the aim of working for the empowerment of the people and the involvement of the community in the delivery system. In the last census, our literacy rate has shot higher than Andhra Pradesh and our male literacy rate exceeds that in Karnataka, Haryana and Punjab. We were able to achieve this by providing access to education to people in rural areas.
Madhya Pradesh is a very large state, and even after division, there are more than 51,000 villages, 40% inaccessible during the monsoon. You canít have a centralized delivery system. So we opened schools under the Education Guarantee Scheme. Communities could demand a school and choose the teacher from among themselves, and we provided the infrastructure and salaries. Within 18 months, 24,000 new schools were built. The enrolment went up and of the total increase in enrolment, 47% were girls and more than 90% were from the SC/STs, which itself is a major reason for the increase in literacy.
Our adult literacy programme too was successful. We provided an opportunity through the Padhna Badhna campaign. Because of the involvement of the family, we witnessed a multiplier effect with the result that more than 3 million people were made literate in a span of nine months. For us, it was a major breakthrough where, through decentralization and community participation, we were able to involve the entire family.
Weíve done a similar thing with health services. In every village, we have an educated girl or boy as a jan swastha rakshak, who is paid a stipend once he/she clears an examination. They are then free to become depot holders for non-scheduled drugs and can also do private practice. Basically, we are providing a facility for people in the villages so that they donít have to go to hospitals which are far away. These are locally rooted self-sustaining health workers and the government does not pay them any salary.
We also found that Madhya Pradesh had a very high infant mortality rate because of the centralized institutional delivery system. Even in a city like Bhopal, only 28% of pregnant mothers are going for obstetric and gynaecological consultation. The rest give birth with the help of local birth attendants, midwives or dais. We have now begun a major exercise to upgrade the skills of these midwives
Similarly, the other area we paid a lot of attention to was agricultural productivity. In the past 3-4 years our agricultural productivity growth has been one of the highest in the country. The other thing we did was to pay more attention to handicrafts, handloom and other cottage and rural industries rather than large heavy industry.
So basically in the last few years we have concentrated on system reform, peopleís empowerment and making them more aware of their rights. Because of womenís reservation, there has been a sudden spurt of activity among women, and now we are second only to Andhra Pradesh as far as the number of self-help groups involving women is concerned.
Another major problem has been to convert micro-credit facilities to micro enterprises. Because of the poor marketing system within the state, people were not able to sell what they produced. We have now involved Hindustan Lever to help us develop market strategies. The results have been very encouraging.
In the past eight years or so, the male female ratio has improved, the under five mortality rate has become lower and our population growth is stable. Through a series of aggressive family planning programmes, we are targeting zero growth by 2011. At the same time, we have been able to identify social groups and villages where the infant and child mortality rates are high due to the incidence of malnutrition, malaria, etc. We have been able to bring much clearer focus on, and therefore attention to, all these aspects.
Our GDP growth in the 1990s has been 6.2%, which Iím told is higher than other states. Our employment growth at 1.8% too has been higher than the national average. Basically, by employing a bottom-up approach, we have turned around a stagnant economy.
How has decentralization affected the exercise of democracy in MP?
People are more aware of their rights. They are more aware of government programmes. They perform their duties much more responsibly, and handle all schemes, including fiscal schemes, entirely on their own.
There are certain sections that criticize you and your government for neglecting the tribal and dispossessed communities, especially in the context of the dams. How do you react to that?
Work on both the dams began much before I took over. The investment had already gone in, so frankly I had no option but to carry on with the projects. We have a shortage of power, and we would like these projects to be completed, but at the same time would like to give people a better deal. Take the case of Sardar Sarovar. The tribals say they donít want land for land, but cash for land. We tried to convince the Supreme Court that in Sardar Sarovar, the quantum of water in the dam was doubtful, so the height of the dam should be reduced. But they didnít listen to us.
The only option open was to get a better deal for the people of Madhya Pradesh from the government of Gujarat. We didnít have land availability so we gave people a special extra package of more than Rs 1,250 crore. These people are getting extra money for purchasing land and by and large, the land oustees have accepted it. In short, weíve been trying to give the people a better deal.
Dams are a reality, and without going into the merits and demerits of big dams, let us not write off the dams concerned. Ultimately, we have to harness our natural resources and once you do, then everything else follows. If you see the cost-benefit analysis also, dams are worth this fight.
What remains to be done in Madhya Pradesh? One of the glaring shortcomings, for instance, is the poor performance of the power sector and infrastructure in the state. How do you plan to change that?
I would like Madhya Pradesh to be fully literate and to have health indicators that are above the national average. I would like the productivity of farmers to go up, as also divert farmers from farm to non-farm employment. I would like to see womenís self-help groups going into micro enterprise and business. All this would ultimately lead to more purchasing power in the hands of the common people, which would kickstart the economy in a way that isolated industrial ventures never can. The benefits would be much wider.
At the same time, however, I would not like to neglect infrastructure. When I took over, my generating power plant load capacity was 42%, now it is 68%. So we are generating more power from the existing plants. But my problem is that most of our power plants have gone to Chattisgarh. Though MP has more consumers, the better paying consumers have gone to Chattisgarh. Also, the realisation of power in the power sector in Chattisgarh was much better. In fact, MP was losing money and Chattisgarh was making money so we would cross subsidize. After the division of the state, MP is trying to cut its losses.
What ails the power sector? Underutilization, faulty billing systems and power theft. Now we are introducing prepaid electronic meters, like prepaid mobile phone cards. Once you run out, the power automatically gets cut. We are also working on cutting down losses. Initially we were losing Rs 180 crore a month, but now it is Rs 70 crore a month.
In the road sector, we have a large workforce that does not really work. If we are providing Rs 100 crore for maintenance of roads, Rs 85 crore goes towards paying the wages and salaries of the permanent workforce. This is a historical legacy and although we are retiring them, and not filling up vacancies, the problem will remain till the workforce can be trimmed to the optimal size.
The poor road infrastructure was because we subcontracted to local groups. The quality of construction was not maintained, therefore the poor infrastructure. Now we have contracts with bigger groups and maintenance for five years is built into the contract. We are also outsourcing our detailed project report preparation and quality control plans.
What kind of support do you get from the Centre for these activities?
The Centre under the Constitution appoints the Finance Commission, which decides the methodology of devolution of central taxes. Two, there are centrally sponsored schemes which are wholly funded by the Government of India. These are the two things that the Government of India gives to us. There are other rural development schemes, which have either 25-75% or 50-50% sharing with states. At the same time, fiscal discipline is maintained by the Reserve Bank.
As far as Iím concerned, Iíve run into no trouble with the Centre in this respect. Although the 10th Finance Commission gave us a raw deal, the 11th Finance Commission was good to us. I can tell you that Ė apart from Chandrababu Naidu who expects more than what other states get because of his political clout in the central government Ė by and large the Government of India has been fair to the states.
But wouldnít greater fiscal devolution give power and control to the states and bring about a more federal structure, instead of the Centre holding the key funds?
Naturally. In fact it is on the NDA agenda. At present, they devolve 28% of all central taxes to states, but the recommendation is to devolve 33%, so the commitment is there.
What modifications would you like to see? There has always been the fear of too much decentralization, where a truly federal polity with too many resources given to the states would weaken the Centre.
I donít think so. The total responsibility of development of infrastructure and the social sectors lies with the states. The GOI has little choice but to work together with us and help out in building infrastructure and improving the social sector. But in spite of the National Development Council passing a resolution that all centrally sponsored schemes should be transferred to the states, it has not been done. Even the devolution of 33% of central taxes has not been done.
So what in your view is needed?
Political will on part of the central government.
Do you think what youíve been able to do in Madhya Pradesh is replicable in other states? Is it the only route to development?
Certainly, yes. One has to realize that while agricultureís contribution to GDP as a percentage has gone down, the percentage of peopleís dependence on it has remained stagnant. That means lesser contribution of the agricultural sector to GDP, but the number of people in agriculture has remained the same. Thatís why the per capita income of people in agriculture has gone down. We must try to pull people out from the agriculture sector and bring them into the non-farm sector, so that their incomes rise. Until we do that it will be very difficult.
Within the ambit of present Centre-state relations guaranteed by the Constitution and in practice, what are the limitations that you face in your functioning as CM? What are the rigidities and constraints?
The biggest constraint is the mindset of the people. The bureaucracy has become sluggish. Accountability has reduced and lethargy exists in the system. We have tried to bring in more autonomy through decentralization and make the system more accountable to the people. My slogan has always been that people are not the problem, they are the solution. By keeping people focus, at the centre, we have been able to reduce the time lag in taking decisions. We have started IT for the masses, computer literacy and state-private partnerships where private parties are actually training people at 25-30% of the market rate.
One of the trends in Centre-state relations has been the increasing financial indebtedness of states to the Centre. Andhra Pradesh, for instance, has a huge outstanding debt burden. How can states tackle this?
There is no society that does not have debt. The issue is, take a loan that you can repay. In MP, our debt-GDP ratio is very low. We have been paying our debts on time and sometimes in advance. As far as MP is concerned, fiscal discipline has been maintained. But the GOI in its wisdom has changed the format of all our schemes such that most schemes are now 70% loan and 30% grant, and in some cases, 90% loan and 10% grant. The loan component of each state has gone up, and to that extent, fiscal discipline has to be maintained.
The other thing that state governments need to figure out is how to check the galloping increase in pension funds. According to a recent article in India Today, there has been a 300-400% increase in pension bills. In my own state, we have calculated that in eight to nine years, our pension bills will be more than our salary payments, which are already over 80% of revenue. So you can imagine, we will have to borrow money to pay pension and salaries! This kind of pension scheme is available only in India today. People who retired before 1996 are getting more pension than the salary last drawn by them. This is something the Government of India will have to consider as to how we can reduce this.
What powers would you like states to have that are currently lacking?
More than Rs 23,000 crore is spent in centrally sponsored schemes every year. For four years the Planning Commission tried to identify schemes that could be transferred to states and what did they find out? Only Rs 400 crore worth of schemes could be transferred to states. Obviously, the babus in the GOI would like to hold on to their strength and power so that states can come to them with their begging bowls. This does not augur well for the kind of federalism that we have in the Constitution. There must be more devolution of central taxes, more responsibility of providing infrastructure and institutions to states.
Two, we must be given more autonomy. For example, all residuary powers in the Constitution are with the Governor. Why should that be so? Either they should be on the concurrent list, or with the states. Iíll give you the example of the Right to Information Bill. Madhya Pradesh passed the bill, but when it came to the Government of India for consideration, they sat on it for three years and said itís not in your powers. Now, the right to information is desirable, and we issued orders to administrative authorities so that the right to information becomes a reality in MP.
Three, they have not yet given us the authority to tax the service sector, which is a growing sector today and a source of revenue. These are only few issues that I have mentioned and there are innumerable others.
You spoke of the need for political will on part of the central government to carry out developmental activities. Do you see the present leadership capable of delivering goals, and where do you see the next generation of leaders coming from?
Across parties, there is no dearth of good strong young leaders. In all political parties, there is a strong second rung which is bright.
What in your view is the mandate that India needs for the 21st century to harness the benefits of a globalizing world? What would you look for in a new leadership?
First, any new leadership must understand the Indian ethos. They must understand the ground realities where, even today, more than 65% people live in poverty and draw their bread and butter from the agricultural sector. These are the areas you have to concentrate on. People have to be given more purchasing power and to that extent, you have to inculcate the habit of savings. We must move from the primary sector to the tertiary sector to the service sector. We are moving, but the pace is not what it should be.
As far as industrial growth is concerned, the contribution of the US industry to GDP is about the same as the contribution of Indian industry, about 27%. But while the tertiary sector contributes about 75% to the US GDP, in India the main player remains the agricultural sector. It is the tertiary sector that leadership in India should develop, by diverting people from agriculture to non-farm employment.
In 20 years from now, where do you see India going?
I am an optimist. I strongly believe that because of the sheer numbers that we have, there is tremendous scope in harnessing our wastelands, our denuded forestlands and tremendous possibility for growth where we can harness our natural resources in profitable, growth-oriented ventures. Arunachal Pradesh, for instance, has the capacity to generate more than 20,000 MW of power. So do Himachal and Uttaranchal. If we can harness that, we can do a lot. We will have more money power. What we have to look at now is to drastically come down on our population growth and then target our resources more effectively and judiciously instead of spreading them too thin. We have to target our resources as closely as is necessary.
As far as foreign policy is concerned I am not too conversant because I have always been in state politics but, at a basic level, I think we have to improve our relationship with our neighbours and Pakistan in particular. Kashmir is a total drain on the Indian economy. We have to sit with Pakistan across the table and come to a resolution. But we also have to stand on our own and we must realize that Asia is one of the biggest markets today. We have to bring South Asia together into a common market, like Europe has been able to do Ė bury the hatchet and let economic issues come upfront and bring countries together. France and Germany were able to do it, and India and Pakistan and India and China can do that too. Why should we spend so much money defending our borders? The same could be used for better schools and colleges, better water facilities, and so on.
You seem to be an advocate of globalization, or at least more regional integration and the adoption of an EU type model for South Asia. Why do you see globalization as a positive process?
Economic globalization can be looked at in different ways. Liberalization, which is a shift from regulation to facilitation and more open policies, is desirable. At the same time, it is also important to safeguard the interests of the Indian economy against economic invasion by the developed countries. I think there are enough provisions in the WTO by which we are able to save Indian industry from the onslaught of foreign economies.
Take the example of agriculture. There is a provision that subsidies to agriculture should be reduced. Now, we donít even give one-tenth of what the US gives as subsidies to farmers. But if we can reduce the subsidies of the US to its farmers, our agricultural products will become more competitive in the world market. So it is in our interest to enforce the WTO provisions by pointing out that subsidies must be reduced. I recently learnt that the new American Farm Bill, which is now being considered by the Senate, provides for $700 billion in farm subsidies. How can you expect Indian farmers to compete?
But under a new dispensation, if we can enforce the provisions of the WTO, as also put up excise duties on imports so that farm produce can be protected, it will be good for us.
Youíve spent more than 30 years in state politics. Do you see yourself entering national politics anytime soon?
My mindset is more attuned to state politics rather than to national politics. State leaders who have tried to enter national politics have not been very successful. We get so involved in our own thinking and set ideas, it is tough to get out. Look at Deve Gowdaji Ė an excellent chief minister, but even when he became prime minister, people talked about him as prime minister of Karnataka. Wise thing that Chandrababu Naidu is not coming into national politics. As for me, there is a lot that remains to be done in Madhya Pradesh itself.