Vibrant Gujarat: High on promises, little on ground since 2003
Dholera SIR is a case in point — in 2019, 10 years after its launch, the Gujarat government continued to showcase the region as an investment hub while most projects signed in 2009 had not taken off on ground
The first Vibrant Gujarat Global Summit (VGGS) was held by the then Narendra Modi state government in 2003. Twenty years hence, while the optics around the biennial event have grown in magnitude, there is very little to show for actual investments and jobs.
The ninth edition of VGGS, a three-day affair, was held in Gandhinagar in January 2019. On the concluding day of the investment summit, then Chief Minister Vijay Rupani announced that 28,360 memoranda of understanding (MoUs) had been signed and that these were expected to generate 21 lakh jobs. Rupani, however, did not mention the total value of the proposed investments.
“The figures are not important,” reasoned then Deputy Chief Minister Nitin Patel. He told the media after the conclusion ceremony, “It (figures) is still being calculated. But the important thing is that the MoUs would lead to employment generation and give an impetus to the state economy.”
“A total of 28,360 MoUs were signed, out which 21,889 were for the micro, small and medium enterprises (MSME) sector, 408 in the agro and food processing sector, 548 in power and gas, 1,516 in urban development, 977 in mineral-based projects, and 197 in engineering and auto sector,” said Patel. Four years hence, very few of these have seen the light of day.
The 10th edition of the biennial VGGS was to have been held in 2021, but COVID played truant. It was postponed to January 2022. But just days ahead of the scheduled start date last year, the event was cancelled yet again. Now, the 10th edition is slated for January 2024.
Prized and extravagant event
VGGS was first organised in 2003 by the Modi government in Gujarat. Since then, it has been one of the most prized and extravagant events of the state, drawing national attention.
The first edition was held in Tagore Hall, a commercial rental space in Ahmedabad that housed around 700 people. Since then, both the cost to exchequer for organising the extravagant meet and the investments invited during the summit have surged over the years.
In 2018, Rupani informed the Gujarat Assembly that the state had spent ₹150.91 crore on VGGS in 2015 and 2017. There was no mention of how many MoUs fructified in those years.
Less than 50% realised on ground
According to the ‘Socio-Economic Report of Gujarat 2017-18’ report published by the Directorate of Economics and Statistics, Government of Gujarat, investments worth ₹2.75 lakh-crore from 1983 until mid-2017 have generated jobs for just four persons per ₹1 crore of investment.
The report further states that VGGS, since inception till 2017, saw MoUs signed for 76,512 projects. However, of the projects taken up until the 2015 summit, less than 50% had been realised on the ground by March 31, 2017, generating around 17 lakh jobs.
From January 1983 to July 2017, the state received acknowledgement of only 15,356 industrial memoranda, letters of intent and letters of permission filed by entrepreneurs, with a proposed investment of ₹14,30,178 crore, the report further states.
Of these, a total of 6,251 projects had been implemented, amounting to an investment of ₹2,75,880 crore, while 4,280 projects were under implementation, bringing the total investment to ₹9,96,458 crore until July 31, 2017.
Unemployment a major issue
Noticeably, unemployment has always been a pressing issue in Gujarat. About 3.64 lakh educated and semi-educated youth had registered with employment exchanges across Gujarat in December 2021, state government data suggest. The numbers were revealed when then Minister of Labour, Skill Development and Employment, Brijesh Merja, replied to a question asked by the Opposition in the Assembly.
Merja, in his statement, further revealed that the highest number of unemployed youths — 26,921 — were in Vadodara, followed by Ahmedabad, at 26,628.
Data collected by the Centre for Monitoring Indian Economy (CMIE) states that between May and August 2022, the unemployment rate in Gujarat was 2.83%.
In November 2021, Gujarat Chief Secretary Pankaj Kumar stated: “Over 70% of the MoUs signed at the VGGS get fructified over a period of time.” Claiming that to be a good success rate, Kumar added, “Fructification depends on the type of the project. Some projects have a very long gestation period. So, one has to analyse the numbers over a period of time.”
However, on ground, the progress of projects tells a different tale.
The Dholera case
In January 2009, the then Modi-led Gujarat government had announced the formation of an industrial city in Dholera, a town in Ahmedabad district about 100 km from Ahmedabad city.
The same year, MoUs were signed at the Vibrant Gujarat Summit 2009 for projects in the Dholera Special Investment Region (SIR), and the Gujarat Special Investment Region Act 2009 came into effect with the formation of the Dholera Industrial City Development Limited (DICDL).
Ten years later, at VGGS 2019, the Gujarat government showcased Dholera SIR as an investment hub while most projects signed in 2009 had not taken off on ground. Among those projects were an international airport, an expressway connecting Dholera with Ahmedabad city, and a 5,000-MW solar-power park developed by the Tata Group. These are still under construction.
Projects worth crores stuck in limbo
At the 2011 VGGS, NRI businessman Prasoon Mukherjee’s Universal Success Enterprise (USEL) signed MoUs for a township, a 10,000 MW power plant, and a port. The ₹80,000 crore investment proposals are still in limbo.
Another MoU worth ₹40,000 crore for a water city near Dholera, signed by Hindustan Construction Company (HCC) during VGGS the same year, has nothing to show on the ground yet. HCC has reportedly missed the deadline for down payment for the land allotted to the project in Dholera SIR.
These apart, a project with Jindal Steel and Power for a power plant worth ₹11,000 crore and another project signed with Gujarat Vittal Innovation City (GVIC) promoted by former bureaucrat-turned-entrepreneur N Vittal worth about ₹11,500 have also not taken off in Dholera SIR.