It’s 7.30 am and there’s already a small crowd of people gathered at Cliff House, the official residence of Kerala’s Chief Minister Oommen Chandy, in Thiruvananthapuram. Security is light and every person seeking entry is allowed inside the sprawling compound. They’re here to present petitions to Chandy who hears each one out individually and then gives appropriate directions to his officers. This is a daily event according to his officers. As he emerges out of this interview with Business Line, Chandy is mobbed by the people but this day they would have to wait a little longer as he has to proceed for an official engagement. In this interview, the Chief Minister agrees that the Land Acquisition Act has made projects costlier and that GST is good for Kerala. But he is careful to add that he agrees with the Land Act as it now exists and that in a federal set-up Kerala’s interests on GST has to be subservient to the larger good of the country. Excerpts:

In an interview to this newspaper three years ago, you said infrastructure development is your topmost priority. How much of that agenda has been fulfilled?

We have achieved a lot on the infrastructure front. The Kannur international airport is coming up and we are expecting the first commercial flight will land there this December. We gave ourselves a deadline to complete the Kochi Metro work in 1,065 days. That is going on as per schedule. The Metro coaches will reach in December, trial run will start during January/February and services will start in May/June.

The Vizhinjam port was another big challenge for us. We’ve been trying over the last 25 years to get a move on with the project. It did not happen for some reason or the other. But now, we have reached a stage where the concession agreement has been signed on August 17 this year, the first year of the Malayalam year of Chingam, which is an auspicious time to get a start with such an enterprise. Chingam means the month of prosperity and happiness. The harvest festival of Onam also happens during this month.

Actually, we wanted to start the construction work on Vizhinjam on November 1, the Kerala Formation Day. But due to the local body elections in the State due in November, the code of conduct would come into effect by then. So, we have now pushed the inauguration of the work to early-December. We will also be inaugurating the SmartCity project in Kochi immediately after the local body polls in December.

In Kerala, big development projects materialise every 25 years. After Independence, our first great achievement was the Idukki dam and the hydel power project. That was in 1975. After that, we had to wait until the year 2000 for the next big project, which was the Cochin International Airport at Nedumbassery, the country’s first airport in the PPP mode. But, a number of developmental programmes are being pursued at a time, as we speak. Road development is a big agenda for us. Land acquisition has been a major problem though. But we are managing to get the land for the development projects. Last month, Union Surface Transport Minister Nitin Gadkari was here; he has announced Rs 34,000-crore worth of development in the national highways sector in Kerala.

Our government’s slogan has been “development and care”. We believe we will take up seriously these two issues. Then only we can have inclusive growth. Otherwise development benefits will go only to some sections of people, while others are left out of the development programmes.

I am getting more satisfaction from the second part of our larger development programme, which is care. In our society, a lot of people need special attention. So we are planning lot of programmes for that.  Karunya Benevolent Fund is one, which banks on the Kerala Lotteries, which is doing well. We have set up some lotteries for funding our care programme. During the last four years, more than Rs 700 crore has been distributed to 1,11,111 beneficiary families for treatment under the Karunya scheme. According to this scheme, up to Rs 2 lakh worth of treatment is offered to the beneficiary. More than Rs 500 crore has been disbursed from the Chief Minister’s Relief Fund during this period.

We are taking up lot of other similar programmes for the physically and mentally challenged people. Another important issue is healthcare. Health and housing are the two major sectors that require most attention in a State such as Kerala...which is true of others as well. As far as healthcare goes, we’re able to access world-class treatment here in Kerala. But that is not affordable to all, as it is prohibitively expensive. It is not only a health problem, but also a cause for social tension in the State. So, our main aim is to (make) healthcare available and accessible to every person. We’ve approached the Centre, I have raised this issue in all the Chief Minister’s conferences, I have requested the Prime Minister and the Central Government, both UPA and NDA, that, should we ever think of empowering people afresh by vesting them with a Constitutional right, it should be in the form of a right to good health. But because of the heavy financial burden that this might entail, we have not been able to do this. But we have started some programmes with this in mind. We are now giving free generic medicine to all from primary health centre to government medical colleges. We have also introduced a scheme, Thalolam, in which children up to the age of 18 years get free treatment. We have started another programme, Sukrutham, which offers free cancer treatment to BPL patients. We also carry out cochlear implant surgery for the hearing impaired.

Talking of infrastructure projects, both the GAIL pipeline to transport regasified LNG and the Vizhinjam port are mired in land acquisition issues. How are you planning to get them moving?

This [land acquisition] is the main problem we’re faced with in this context. But we are approaching the farmers and landowners with a good package and good compensation. We’re trying our best to convince them also. If they are not objecting to the project per se, we will find out a way. That is something we are quite sure of. We will give them the maximum possible package and a good compensation. But if they’re saying that they would not allow the project to go ahead at any cost, for instance the laying of pipeline in some area, then there’s a real problem. 

Here, we are happy that the mainstream political parties are not involved in any of these violent protests. (Those who oppose) are also facing some issues, which we are aware of. They want some deviation (in the alignment) of the pipeline, or maybe they want to avoid it running into some places of worship, or maybe they want more compensation or sweetening up of the deal...we’re ready to consider all these. Unfortunately, some extremist groups are involved in the protests against the pipeline project. They want to incite people and create some problems. They’re trying to scare people that there is a live bomb ticking away under their feet wherever the lines have been laid. These are unfound and unwarranted fears. This is the main problem that we’re faced with here. We hope to get around it.

We were able to complete the land acquisition smoothly at Kochi for the Metro. We’re trying the same thing with the national highways expansion project. Difficulties are there but we hope to manage these issues since the mainstream political parties are mostly on the same page.  

In this context, do you think that the Land Acquisition Act passed by the UPA government is a constraint in executing some of these projects apart from pushing up costs?

I agree with the second part of your question. It is pushing up costs. I accept that. The land owners are suffering for a common cause. They’re sacrificing land for the good of the society. We need to take care of their interests too. It may be pushing up the costs, but even then I agree with the UPA version of the Act because of this background. I have instructed my officers about two things — one, reasonably good compensation and in case their dwelling has to be shifted, a good package also. I direct them to pay the compensation before they are evicted. See, the people are very much upset because they’re not getting compensation in time. The landowner is getting the money after two years. (Then he does not gain any but only loses big when compared to the updated prices of the land given away as if in a distress sale.) So, he needs to be paid his due before he is evicted. These are the directions that I have given to my officers.

Tamil Nadu has amended the Land Acquisition Act to exempt certain categories. Are you planning something like that in Kerala to make it more industry-friendly?

We’ve already approved the land acquisition rules according to the UPA Act. Now, the Centre has agreed to have a separate law for each State. If necessary, we’ll discuss it and take a decision. But we will never reduce the compensation package. We’ll take that much care.

Would you reconsider the social impact assessment and the time period?

For Kerala, land is a precious resource and rare commodity. So, when we go for acquisition, it will be for those projects which are crucially inevitable. (So we will deal with them as they come).

The partial ban on liquor is affecting your revenues in a big way and also opening up avenues for spurious liquor. Why this ban, and how will you compensate for the revenue loss?

I am not at all worried about the revenue loss. My assessment is that revenue loss here is only on paper. True, we’re getting more than Rs 7,000 crore in revenue from liquor sale every year. When we implement complete prohibition, we will lose this amount. But here, we’re shutting down 10 per cent of the outlets in the first phase. So there’s no big-time revenue loss at one go. But I never consider this as a loss. We’re spending several times of that in social costs since liquor is creating a lot of difficulties for the society at large. These are not quantifiable in monetary terms. Damages wrought on families are also massive. I therefore do not consider liquor revenue as real income.

If you count out this money, how will you finance the ‘care’ (welfare) part of your agenda that is close to your heart but demands huge outlays?

As I said earlier, we’re not losing Rs 7,000 crore at a time. Now we’re promoting more business and more infra development projects and jobs. So we will manage. The liquor ban and the impact on government income is not at all a problem for us. We’re not concerned. The problem is there, admitted. But we’re not overly concerned. But the other part, illicit liquor…that’s something we have to deal with. It will be very difficult to manage. However, we’ve done it over the last one year since the ban.

Talking of revenues, GST should benefit for Kerala but yet your party is opposed to the Bill….

In a federal system, we’ve to take the interest of all States. GST is beneficial to some States. But it is affecting some others. So we’ve to find a way out. For Kerala it is good. We welcome it. At the same it is disadvantageous to Maharashtra, TN, etc. We’ve to find a solution and Mr KM Mani at the head of the panel is a very experienced person. Under his leadership, they’re planning some compromises.

Shouldn’t your party be supporting the GST Bill?

As a national party, Congress has to take the interests of all States. So, in a federal system, we’ve to be very careful. Decisions such as these must be built on consensus. There are some drawbacks in the GST Bill which we continue to oppose.

There is small but significant trend of reverse migration of Gulf NRIs to Kerala presenting a challenge on two fronts —remittances and creating new jobs within Kerala for those returning. How are you planning to address this?

Kerala has enough and more opportunities at home. But we missed out on lots of them in the past. Now we’re trying to make up for that. We’re trying to making good the new opportunities with the resources that we have. And that’s showing good results. In the last three years, our economic growth has been more than the national average. We’re one of the top States in this regard. With the infrastructure development now on, we’re expecting more investment, and more employment opportunities.

Kerala has been ranked 18th in the ease of doing business. What’s your reaction?

I read about it in the papers. The same morning I called the Chief Secretary and the Vice-Chairman of the Planning Board and conveyed to them my gut feeling, without seeing the criteria used to rank the States here, that the criteria would likely have been land-related issues, environmental issues, and some licensing issues. I was proved right. They brought to my attention the eight parameters that were used. We’re facing some problems here.

Earlier, we were pointing our fingers at the workers. To some extent that was correct. Now the working class is entirely changed. They’re very positive. Not only workers but their leaders too are well aware of the changing times. Now the whole world is a village and highly competitive. Competitiveness is important for survival. If the industry is not in a position to compete then it will lose. So the workers know this only too well as also their leaders who are a changed lot. 

We did face issues related to finance. Our State revenue is completely negative, because we’re spending large amounts on education and healthcare and the social sector. There is no reserve for the government to invest for development. But today money is not a problem. We’re getting lots of access to money now. Private sector is ready to invest. Institutional finance is also available. We’re also accessing World Bank, Asian Development Bank… But land is a problem for a thickly populated State such as ours. Land scarcity and costs are issues. So we’re not worried about that assessment (ease of doing business)…

What is the significance of your startup policy, the first ever from a State?  

The experience has been very, very encouraging. In September 2012 at the Emerging Kerala summit we had announced this student entrepreneurship policy. The response has been tremendous. The students have since started more than 600 startups in the State. And at least 1,000 ideas are waiting up in the queue for government approval and government assistance. The attitude of the youngsters has changed. During my college days, the average student expectation was to get a degree. After this, he wanted a government employment at best, if not manage a visa [to migrate to the gulf]. Nobody would think in terms of an enterprise. Even landowning families wouldn’t think of sending their children into agriculture. They would be ready to sell some of the property and use the proceeds to bribe somebody to get a government employment — be it a cooperative society or a school or a college. But now there’s a change towards enterprise.

Not just in favour of industry and IT but also tourism, agriculture, culture, education and even healthcare. They’re everywhere. We’re happy with the progress...go all out to encourage the youngsters. At the third anniversary of the announcement of the policy during this September, I had announced that entrepreneurship will be part of the curriculum for BTech.  

 

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