The Hindu Business Line : Creative destruction?

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Creative destruction?

K.G. Kumar

Alongside the "destruction" Kerala has been witnessing of late, there is more than a modicum of creation as well. And that it is occurring in the potentially high-growth IT sector is something that ought to be welcomed.

The recent landmark in the journey of the Left Democratic Front (LDF) as it seeks to consolidate the mandate it received around a year ago from the people of Kerala was notably observed all over the State. However, as celebrations marked the first anniversary of the LDF Government, led by Mr V.S. Achuthanandan, some aspects stand out for their irony.

First, the anniversary comes on the heels of the demolition of illegally constructed buildings in the tourist resort of Munnar. An act of "destruction", not creation, thus seemed to bookmark the LDF's journey on the path of development. True, there can be no criticism of the government's attempt to enforce the law of the land and bring to book encroachers and violators of construction rules and norms.

While the government is entirely in the right in its Munnar demolition drive, metaphorically speaking, to be in the media spotlight for using earthmovers and excavators to reduce resorts and hotels to a mound of rubble, is not the sort of accolade fit for the anniversary of a rule that promised to propel industrialisation and employment.

Of course, charitably speaking, perhaps the Munnar demolition drive can be conjured as an act of "creative destruction", in the manner that economist Joseph Schumpeter meant - "the process of industrial mutation that incessantly revolutionises the economic structure from within, incessantly destroying the old one, incessantly creating a new one."

BAD PUBLICITY

Bad economics - and worse interpretation - notwithstanding, the fact that all this hullabaloo is occurring in the tourism sector in the full glare of the national and international media is another matter for concern. After all, tourism is the one sector in Kerala's industrial scene that has delivered on its potential to attract investments from the private sector.

The government now promises to design and implement a new tourism policy for Munnar, which may offset some of the damage done to the hospitality industry's image in the region.

The other irony in the first anniversary of the LDF is the signing of the agreement for the Smart City information technology (IT) project to come up in Kochi, the State's commercial capital. IT is the other wannabe growth sector projected to lift Kerala into a new orbit of industrial development, and the irony - mildly delicious this time around - is that the Smart City project was revived by the LDF which had opposed it when it was first mooted by the United Democratic Front (UDF), now the Opposition in the State's Legislative Assembly.

The LDF claims the terms of the project are entirely different from what was originally proposed and it will now result in a manifold increase in the number of employment opportunities to be created.

WELCOME AGENDA

Whatever be the truth of these claims, the return of IT to the centrestage of Kerala's industrial agenda should be welcomed. And that it coincides with the resurgence of Mr Achuthanandan as an assertive, "people-oriented" Chief Minister should also be seen in the context of the political struggles within the CPI(M). Should they intensify and spill out into the streets, as happened at the start of the LDF rule, that could well mean a fresh round of populist measures and symbolic announcements.

Among the very first meetings Mr Achuthanandan organised when the LDF came to power was with some of the heads of IT companies in Technopark, Kerala's first technology park.

And last week, a day or two after the first anniversary of the LDF Government, the Chief Minister was seen performing the "ground breaking" ceremony for the new Infosys campus at Technopark.

So it appears that alongside the "destruction" Kerala has been witnessing of late, there is more than a modicum of creation as well. And that it is occurring in the potentially high-growth IT sector is something that ought to be welcomed as the LDF Government enters its second year in power.

The writer can be contacted at kgkumar@gmail.com