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Kerala told to do as Bengal does

Hindustan Times | ByRamesh Babu/Tanmay Chatterjee, Coimbatore
Apr 02, 2008 03:17 AM IST

With the 19th party congress laying out an economic policy guideline for its state Govt's, Kerala CM VS Achuthanandan will have to toe the Bengal line, report R Babu and T Chatterjee .

Kerala and West Bengal are both ruled by the CPM, but in policy and approach the two states have been poles apart.

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While Bengal has managed to evolve into a progressive state, with economic liberalisation, Kerala still carries a lot of ideological baggage.

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Now, with the 19th party congress laying out an economic policy guideline for its state governments, Kerala Chief Minister VS Achuthanandan will have to toe the Bengal line.

In Bengal, the process of reviving sick industries and inviting investments started in the mid 80s when Jyoti Basu was chief minister. Basu, however, had limited success since the state had earned itself a negative image thanks to militant trade union culture. But in the last three years, the Left Front headed by Buddhadeb Bhattacharjee has experienced some success as far as big capital investments is concerned.

In 2005, the assembly passed the West Bengal Land Reforms Amendment Bill that opened up nearly 41,000 acres locked in sick industrial units to recover and put to use for new ones or revive the old units.

Buddhadeb is not averse to letting investors deal directly with farmers. About 11 million hectares has been acquired and distributed among farmers under the Land Reforms Policy.

The party also has no objection to FDI in industry so long it guarantees employment and conforms to its land use policy. However, there’s stiff opposition to FDI in retail trade.

But in Kerala, there’s been no evidence of any clear-cut thinking on new policy formulations. In SEZ cases, retail giants’ entry, the Asian Development Bank loan and capital-intensive programmes, the party has been a divided house.

While the Bengal CM was busy breaking bread with the Tatas soon after his swearing in, his Kerala counterpart was heaping scorn on him.

Now that Bengal is the party’s official model for attracting foreign capital and economic liberalisation, Achuthanandan will have to scale down his hardline economic views.

Things will not be easy though. In the case of SEZs, ground realities pose a big challenge. Unlike in Bengal, densely populated Kerala does not have much land to spare. So the emphasis would be on service-based industries like IT and ITES.

“Most confusions and contradictions stand cleared now. Revolutionary changes would be visible on the economic front in next six months,” said a minister.

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