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FEB 13, 2005
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Cities On The Edge
Favoured business destinations Gurgaon, Bangalore, Chennai, Pune and Hyderabad could become, thanks to poor infrastructure, victims of their own success. Read in-depth articles on each city. Plus personalised travel logs. Only at www.business-today.com.


Moving On
Diluting stake in GECIS was like a child growing up and leaving home, feels Scott R. Bayman, President and CEO of GE India. In an exclusive interview with BT, he speaks his mind on a wide range of issues.

More Net Specials
Business Today,  January 30, 2005
 
 
Ending Metropolitan Escapism

 

If there's something worse than waking up one fine day as a giant beetle to find that turning around is an ambition of gigantic proportions in itself, it's waking up as the state of Bihar to find that turning around is an ambition so big that it cannot be entertained without going in for a sanity check.

If you agree with that, welcome to the club. The club of Metropolitan Escapists. You probably live in one of India's metros, watch confetti-laced news beamed live from Pennsylvania Avenue, and have 'Bihar' stored in the 'eeegad!' recesses of your subconscious, the part that's inhabited by other skin-peeling elements of what a psychoanalyst would term your repressed self. Well, sorry for this rudeness, but sometimes, you'll admit, India in all its actual starkness merits attention.

Bihar is India's poorest state in terms of income. It is on its way to the polls. Now, Patna may be the last thing on your mind. But India's success as a country, remember, will come to be measured as much by the lives lived by its worst-off as by the lives lived by the well-off. Pataliputra, and later Sasaram, may have held enormous administrative power hundreds of years ago, but current-day Patna holds power for a rather quaint reason: its quality-of-life gauge reflects on the entire country.

That should not be the case, you might protest, in a federalised system of governance, with each state guiding a sizeable chunk of its own economic destiny. Also, the idea of enhanced federalism is to allow inter-state competition to kick in, with the success models of leading states adopted by the laggards. Haryana, a relatively prosperous state that is also going to the polls, has pursued a fair range of market reforms: downsizing government, cutting local taxes, easing business investments and so on (even if tawdry power play and electoral populism have made a comeback, lately). Further reforms could make 'the green state' enviably competitive in attracting investment (proximity to Delhi being a bonus factor), and if it has any sense, Bihar should be busy noting down lessons.

Bihar, after all, is famously rich in terms of mineral resources, and boasts of tourist destinations that actually have something to show beyond the mere historical resonance of the sites. It is, in short, a state in which the world ought to be interested. Mobilising resources is the task, and if that scares some investors off, it also means that those who dig in stand to make better returns (the courage premium). This is also largely true of Jharkhand, which, since having been carved out of the larger Bihar, is still trying to find a way to make the most of its natural endowments.

Before any of that happens, however, the stand-offish stance of the federalists may have to be done away with. While the competition theory sounds good on paper, it does not address the issue of dropouts. Bihar, in all its anarchist glory, is something of a dropout from the development model urban India is pursuing. Metropolitan city slickers don't give a damn about the state, and the state tends to return the compliment. It expresses itself in the mutual caricaturisation. This could go on, but is not sustainable. At some point, as a matter of enlightened self-interest, India must engage the state in an earnest dialogue of prosperity-and this can only happen if the rest of the country drops its apathy and begins to engage Bihar instead of alienating it.

India needs to operate as a country greater than the sum of its parts, rather than the uneasy jigsaw it sometimes looks like. This is not a suggestion that India go back to an overweening Centre dictating the grand national agenda to every state. Regional reflexes tend to vary, and decentralisation of decision-making helps hold all of it together in a broad framework of national endeavour. This is a recommendation that every state get serious about talking prosperity and its democratisation, the sort that transcends the identity schisms of the past. This pressure must come from electorates all across.

 

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