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G.K. Nair

Kochi , Dec. 29

CONTRARY to expectations, 2003 is coming to a close without any significant development on the economic front in Kerala, barring the Global Investor Meet in January last.

Low revenue realisation and increased spending resulted in the State's debts soaring to an estimated Rs 36,000 crore by the end of the year from Rs 31,060 crore as on March 31, 2003. The debts, which stood at Rs 10,113 crore in 1996, have multiplied more than three-fold in less than eight years, raising the interest burden per annum to Rs 3,150 crore from Rs 924 crore in 1996.

Many projects were conceived and announced during the year, but none of them translated into reality.

The improvement in natural rubber prices brought relief to over nine lakh rubber growers, while the rock-bottom prices of tea leaf continued to haunt tea growers, mainly from the small and medium segment. Pepper prices witnessed a declining trend, largely on account of the availability of imported pepper from Sri Lanka in the domestic market. Cardamom prices, however, maintained moderate levels.

"While in the case of natural rubber there is hope for revival, the tea industry continues to reel under the price crisis, which seems to deepen further. Coffee prices have shown marginal improvement, but the question is whether it will sustain. Cardamom, the only crop which has been spared the wrath of the price crash, has of late seen a fall in price and drought has hit production adversely. The situation calls for urgent steps," Mr A.E. Joseph, Chairman of the Association of Planters of Kerala, told Business Line.

Though the association had submitted a detailed memorandum to the Government on the need for bilateral wage settlement instead of tripartite settlements arrived at the Plantation Labour Committee, so far nothing has happened. Kerala's dependence on other states for essential commodities, such as food grains, pulses, vegetables and fruits, continued.

The construction sector witnessed some upward movement this year, with NRIs investing in residential property. Employment opportunities did not show any noticeable growth. The manufacturing sector remained in a state of neglect. However, the tourism sector witnessed some growth in the number of arrivals of both domestic and foreign tourists.

Meanwhile, the uncertainty on the future of several private and public sector units, such as Indian Aluminium Company (Indal) of the Aditya Birla Group and the Central PSU, Fertilisers and Chemicals Travancore Ltd (FACT), might cost hundreds of workers of their job.

The authorities' lukewarm attitude has cost Indal at nearby Eloor the permission to draw power from the Power Trading Corporation (PTC). If no decision is taken soon, it might result in the unit's closure, rendering around 800 people jobless, besides depriving the State of Rs 80 crore towards power charges and a revenue amounting between Rs 25 and Rs 30 crore from various taxes per annum.

Revival of the sick Travancore Rayons Ltd (TRL) at nearby Perumbavoor, is yet another example of the Government's lacklustre approach.

After discussions lasting over a year and submitting revised and revised proposals, it was decided that each government department concerned would hold discussions individually with the promoters. The future of about 1,200 workers, laid off for 17 months, will be known only after these discussions.

The proposal to set up a container transhipment terminal at Vizhinjam near Thiruvananthapuram is likely to torpedo the future of the proposed Vallarpadam Container Transhipment Terminal near Kochi port, which was included in the Central projects in the State announced by the Prime Minister in his inaugural address at the Global Investor Meet (GIM) here in January 2003.

Though the year began with the GIM throwing up hope that it would attract the much-needed investments in the State's industry, nothing concrete has emerged so far. Enthusiasm waned just after the event, which incurred an expenditure of around Rs 6 crore. The Government appears content with the "unprecedented hype it had created for the first time in the State, apart from removing the stigma that the State is an unfriendly business destination."

Hopes were sky high those days when investors surged forward to proclaim new projects involving a total investment of over Rs 31,000 crore. However, except for some small projects, none of the other projects could be translated into reality.

The fate of the Petronet LNG terminal here, proposed along with the Dahej terminal in Gujarat which would become operational this month, still hangs in the balance for want of an assured market, as the anchor customer NTPC, while talking about the expansion of its thermal plant, is non-committal on sourcing LNG from the proposed PLL terminal here.

Most of the State public sector enterprises/units are in the red, surviving on budgetary support, save a few profit-making units such as the Kerala Minerals and Metals Ltd (KMML).

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