Arbitary powers a problem, says Rahul Gandhi

Admitting that corruption is the "biggest issue" that is "bleeding people dry", Rahul Gandhi today sought to reach out to the India Inc by saying that "arbitrary powers" were holding up projects.

Interacting with business leaders here and responding to their concerns, the Congress Vice President favoured rule-based system in clearances to correct the situation.

Asserting that the UPA government was committed to deal with corruption and push
growth, he outlined the steps taken by the UPA government, including enactment of Lokpal, to combat graft.

Gandhi talked about the problems of inflation, clearances, accountability and transparency while underlining the need for pushing the growth to alleviate poverty and making the country the largest economy by the time it turns 100 years old.

"I am in complete agreement with the need for regulatory system to be rapidly and radically modernised. Frankly, there are no excuses for the length of time required to clear some of these projects. We are fast-moving economy. We cannot allow you to be held back by slow decision-making. Accountability has to be clear, fixed and time-bound," he said addressing the FICCI Annual General Meeting.

"The biggest problem is absolute arbitrary powers at all levels of the system. This is what we face.. In India, there are lot of arbitrary powers. The Environment Minister or the Chief Minister can take any decision he wants," he said while responding to concerns of the industry that clearances were holding up projects.

"The real issue in all these things, whether land acquisition or environment it is arbitrary power," Gandhi said, while advocating the need for eliminating the system of arbitrary powers.

He said the "paradigm" in the country has changed and in this scenario, "we have to build rule-based structure... we have to get used to the new paradigm. We have to move away from the arbitrary idea that a Chief Minister and an Environment Minister can do anything."

Flagging the concerns over price rise, which Congress attributed as one of the reasons for the party's debacle in recent assembly elections, Gandhi said that beating inflation is top priority.

"High inflation on the back of high food prices is an immediate concern. It has stretched household budgets and constrained industrial growth. It hurts our people everyday. Beating inflation is our top priority.

"We must crack down on hoarding and profiteering. We must ease infrastructure bottlenecks and rapidly modernise the supply chain from field to plate," he said.

Gandhi also chose the occasion to claim that it was the UPA government which did the maximum to fight corruption, which he termed as an "unacceptable burden on the people of our nation".

"Corruption is bleeding our people dry. It is an unacceptable burden on the people of our nation. We must fight corruption with all our strength and determination," he said but asserted "this government has done more than any other government to combat
corruption.... The Congress Party has developed a framework against corruption."

Noting that the passage of Right to Information Act by the UPA has been the most powerful weapon in the fight against corruption, he said, "the power of information is finally in the hands of the people. This has created a paradigm shift. Few governments have had the courage to enact legislation that rendered their processes more transparent and open to scrutiny."

Gandhi added that he was proud to say that the RTI has shown all concerned "the writing on the wall and, in some cases, it has shown them the wall of Tihar Jail!"

He listed in this regard the steps like rejecting the Ordinance to overturn a court verdict that held that convicted criminals be kept out of Parliament and assembly and passage of Lokpal Bill but added "we need to go further."

Gandhi said that the passage of six anti-corruption bills is critical to fight corruption.
He felt that while the amendment to the Prevention of Corruption Act will protect honest officers and be much more effective against those who are corrupt, the Grievance Redressal Bill will ensure that every citizen has the right to timely delivery of goods and services by their government.

Noting the "frustration" of the industry with regard to environmental clearances delaying projects unduly, Gandhi acknowledged that "there is excessive administrative and judicial discretion. The loopholes are so big you can drive a truck through some of them".

Gandhi said that while environmental and social damage must be avoided, but decisions must also be transparent, timely and fair.

He said that the UPA Government is considering a Natural Resource Investment Special Purpose Vehicle.

"The idea is to obtain all clearances before auctioning projects to private players. This is a powerful and innovative idea," Gandhi said.

"Blocking is unacceptable but one cannot allow wholesale plundering of environment. There is a need for balance. So there is need for drawing the line... we need raw material but can't do it by destroying environment. There is a middle path," he said but significantly acknowledged that "one can be more aggressive than we presently are."

Seeking to ally impressions that the focus on social sector means ignoring industrial growth, the Congress Vice President told the gathering of business community that he has "absolutely no confusion" that "poverty cannot be fought without growth".

"I would like to state clearly that poverty cannot be fought without growth. There is absolutely no confusion in my mind.... Maintaining robust growth has enabled the UPA Government to invest in people," Gandhi said

He at the same asserted "there is a view that our investments in food security, employment guarantee and rural development are a drag on economic growth. I don’t believe there is a trade off between investments in the social sector and economic growth.

"It is today’s investments in people that create tomorrow's markets. It is today's markets that allow us to invest in our people's future."

Noting that accessing land is difficult and time consuming, he said, "The black market in land has got to go. We need to build a robust and open real estate market, so that businesses, especially small startups, have affordable access to land," he said.

Responding to a question about land acquisition bill acting as an impediment to growth, Gandhi said that there is also a "cost of not having land acquisition bill" and reminded the industrialists of the shutdown of TATA's Nano plant in West Bengal due to protests.

"Government has not abdicated its responsibility. There are large infrastructure spaces where acquisition is possible...there are costs of not having land acquisition bill, too. People will mobilise. In India there is competitive politics and people will use it.

"Take the TATA example in West Bengal. It was the absence of law, which allowed such a mobilisation. You have to respond to the issue....With increased transparency, you will see that it will protect you from hidden costs in acquisition.

"...Politics in this country is changing and there is transparency.We need to provide you a framework," he said adding that people from real sector also felt that it was a well-thought out bill, when they read it.

Underlining the "desperate need" for better knowledge and innovation systems, Gandhi urged India Inc to increase investment in Education and Research and Development saying that there is a need to get rid of the idea that academia and industry are separate silos.

"We need to drastically upgrade the skill level of our people and simplify our processes...India has the brightest youngsters in the world. But let me be blunt – our current education system does not do them justice. There has been a massive scaling up of investment in education and training. But we need to do much more," he said.

Gandi gave credit to the energy of the business community and the political stability and rational policy environment provided by UPA government for the country achieving the fastest economic growth in the last one decade.

"We believe that economic prosperity must include everyone. Poverty is neither befitting of human dignity, nor is it conducive to good business," he said adding that robust growth has enabled the UPA Government to invest in people and in ten years almost a third of India's poor have risen above the poverty line.

Reaching out to youths, Gandhi said the most important thing that the governments have to do is to create fulfilling and rewarding jobs for youngsters belonging to the poor, middle class and those among the 700 million people above the poverty line but below the middle class threshold.

He said for this India must become the global leader in manufacturing.

"This has to be one of our core missions. Let's target growing the manufacturing sector to 25 percent of GDP generating 100 million new jobs in the next decade. I sincerely believe that this can be done. The dramatic improvement we need in productivity demands that we provide the right enabling environment.

"This will require the political will to make difficult reforms in labour laws. Old labour laws have forced businesses to use contract labour. As you know, they are often underpaid and unprotected. India needs a modern and flexible labour market where labour has a fair share and is protected by international labour standards," he said.

Gandhi made a strong pitch to reform the power sector and ensure that businesses have reliable and affordable access to power.

"While absorbing the latest technologies from around the world, Indian manufacturing must also be built around Indian patents. We have to open up our manufacturing sector and foster competition," he said.

Gandhi also expressed confidence that the upcoming Industrial Corridors – Delhi-Mumbai, Mumbai- Bengaluru, Bengaluru-Chennai and Ludhiana-Kolkata – will revolutionise high value added manufacturing and provide millions of jobs.

Maintaining that agriculture is an equally high priority, the Congress Vice President said, "we are on the threshold of a second Green Revolution."

"Price realisation and improved productivity have raised farm wages significantly in the last decade. We have made greater investments in critical areas such as micro-nutrients, micro-irrigation, satellite weather forecasting and access to affordable credit to farmers.

Our efforts to raise productivity and farm income will continue unabated," he added.