Vision 2023 for Tamil Nadu

True to the promise she made, while addressing the National Council of the Confederation of Indian Industry on July 5 last year, the Tamil Nadu Chief Minister, Ms J.Jayalalithaa, has brought out a Vision 2023 document embodying a Strategic Plan for Infrastructure Development for Tamil Nadu.

It seems to be the joint effort of the Asian Development Bank (ADB) and the State Government, without formally associating with the exercise, eminent experts in the respective fields covered by the plan, with knowledge and experience in handling micro and macro issues involved in framing and implementing similar plans in the past. Institutions such as the ADB tend to look at problems and prospects from an academic and theoretical mindset, and the officialdom of a Government is notoriously insulated and isolated from the ground realities.

The participation of high-profile economic players within the country in the preparation of the present document would have helped infuse into it a sense of down-to-earth realism born out of their mature study and reflection.

For, it is not enough, in the name of vision, to merely compile a long list of idealistic proposals, however desirable in themselves they may be. In a context in which resources are scarce and the State has to work the plan within the bounds of a federal system, laying down priorities becomes immensely important.

Nobody, for instance, can quarrel with any of the laudable approaches enumerated in the plan, whether it is giving a thrust to manufacturing, making SMEs vibrant, improving agricultural productivity, developing skills and the like. These, in fact, form part of the already established overall national strategy.

The signature projects such as developing 10 world class Centres of Excellence, setting up two medical cities, doubling water storage capacity, high speed broadband connectivity to every village, two supercritical and other power projects of cumulative 20,000 MW capacity, gas grid connecting ten large cities, construction of 2,000 km of 6/8 lane highways, industrial corridors, Greenfield ports and so on are also unexceptionable.

The objectives sought to be accomplished are equally fine. The Vision includes raising the per capita income of Tamil Nadu's residents to $10,000 per annum (at 2010 prices) from the present $1,628, bringing about a high standard of social development, with the Human Development Index of the state matching those of developed countries by 2023, providing high-quality infrastructure all over the state comparable with the best in the world, and making Tamil Nadu the knowledge capital and innovation hub.

FOUR SOURCES

The rub is going to be finding the Rs 15 lakh crore to be spent in the next 11 years on infrastructural projects encompassing all these goals. The average per year works out to Rs 1,35,000 crore, or ten times the annual expenditure of around Rs 14,000 crore by the State on capital account.

The Vision 2023 document envisages mainly four sources for the huge outlay: The first is “the fiscal space created within the fiscal deficit of 3 per cent of the State Gross Domestic Product”.

At the moment, these are mere words, as the document contains no evidence of any concrete steps having been worked out on this account.

The document hopes to make the infrastructure services self-financing and sustainable by carrying out appropriate sectoral reforms and ensuring suitable cost recovery. This hope, again, is rather vague, in the absence of any cash flow chart based on existing and projected parameters.

The State Government also proposes to enlist the participation of private sector (including FDI, domestic investments, and bank funding) under the private-public-partnership mode to the extent of one-third (or Rs 5 lakh crore) of the outlay at the rate of about Rs 60,000 crore from now on. One can only wish the Government all good luck on this score.

Finally, of course, as is only to be expected, the State Government intends to heavily lean on the Centre to fund the Strategic Plan “to the extent it can”.

The Vision document, for all its imperfections, still serves the important purpose of enabling the State to benchmark itself against the best that it owes to the people in terms of overall economic development, good and honest governance and different categories of services. From that standpoint, it deserves to be welcomed.

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