'Gujarat development: Roads, electricity, water'

'Gujarat has learned from its mistakes,' economist Bibek Debroy tells Rediff.com's Sheela Bhatt in this eloquent interview.

Bibek Debroy is a distinguished economist whose opinions expressed through his newspaper and magazine columns, papers and through Twitter matter. The outspoken and succinct Debroy is a professor at the Centre for Policy Research, a New Delhi think-tank.

In 2005, he resigned as director (research) of the Rajiv Gandhi Institute for Contemporary Research. His colleague Laveesh Bhandari and he had then published a paper rating Gujarat on the top for economic freedom.

Gujarat Chief Minister Narendra Modi made good political use of Debroy and Bhandari's paper. The Congress party found it discomforting that an institution attached to the Rajiv Gandhi Foundation had published a paper strengthening Modi's claims as an architect of development.

Debroy travelled all over Gujarat this year to write a book, Gujarat, Governance for Growth and Development.

In his book, Debroy reviews the issue of resource distribution, bijli, sadak and pani, infrastructure, health and education in Gujarat. He examines Gujarat's governance template to become an 'upper middle class' state by 2020.

Interestingly, Debroy avoids mentioning Modi in his book while discussing development under the chief minister's tenure.

He believes a mention of Modi would have made some readers subjective about Gujarat's actual achievements! He makes a strong case for people to see Gujarat's data objectively and not through the prism of Narendra Modi.

The first of a two-part interview with Sheela Bhatt:

Congratulations on your book. Is Gujarat's template of governance, which you have discussed in detail, very different from the central government's template or the template of successful states like Tamil Nadu, Maharashtra, Karnataka and Delhi?

If one is looking at it as a template for development, then this is a template for development that every state should be implementing.

The question is how many states have implemented this kind of development template. I am not just talking about GSDP (Gross State Domestic Product) growth, because you can get GSDP growth even if you do a few things correctly.

Take Bihar. It has phenomenal growth rates based essentially on services, and based essentially on construction, but Bihar has still got problems with agriculture, you have still got problems with electricity.

So if you are talking about a development template, little bits and pieces have been implemented in other states also. There is a governance issue as well. But to the best of my knowledge, Gujarat is the only state where the development-oriented template has very largely been implemented, actually.

How would you define the Gujarat development template? What are its main ingredients?

I would probably say four or five elements make the Gujarat development template. Number one is private enterprise, the entrepreneur spirit, and linked to that, a degree of scepticism about the government.

Gujaratis don't look to the government for handouts and this makes it very easy for the government to do various things that is in the nature of public-private partnerships.

When I say public-private partnerships, I am not just talking about the corporate sector. I am talking about the NGOs, even in the social sectors.

One part of the Gujarat story is about entrepreneurship, which makes me wonder if this model is really completely replicable in every other state.

Second, something that often people outside Gujarat don't appreciate is that Gujarat has a very long tradition of Panchayati Raj. And many of the social sector things we are talking about are actually implemented by the panchayats.

The government involves the panchayats. Decentralisation exists here. Now to decentralise I need the capacity in the panchayats.

In most Indian states, we don't have the capacity in the panchayats, which is why governance in India is so very bad. But Gujarat has had this since the 1960s.

The third element, which, of course, is replicable in other states, is the improvement in governance defined as the bureaucracy's delivery capacity. And there are several elements that have gone into that.

There is decentralisation, there is empowerment, and there is an attempt to insulate it from political inference...

Now that part is certainly replicable everywhere else.

The fourth one is difficult to replicate elsewhere. I think Gujarat has been a little lucky. Gujarat is favourably located. Its geography helps. It has got speed with liberalisation happening, with trade opening up, you have a reliance on ports.

Of course, Gujarat has the foresight to recognise that it must do something about minor ports. Then, it got the Delhi-Mumbai trade corridor, the industrial corridor. These are favourable circumstances.

I would add to it the road network. Roads in Gujarat have always been good. Yes, they have improved over the last ten years.

The final one I would say, we all know that there are problems with the rigid templates of centrally-sponsored schemes. The Centre is very rigid. You cannot do this, can't do that with the Centre's funds, and yes there are some broader issues of changing those schemes, making them flexible.

Gujarat has been able to do many things because of the fiscal space it has created for itself. They are able to plug in their own money to make good use of central funds.

It