Forbes India 15th Anniversary Special

Sukhbir Singh Badal: 'Punjab Can Become A Natural Investment Destination'

The state’s deputy chief minister talks about his plans to improve infrastructure and the state’s finances

Published: Jan 15, 2013 06:04:37 AM IST
Updated: Jan 15, 2013 04:30:44 PM IST
Sukhbir Singh Badal: 'Punjab Can Become A Natural Investment Destination'
Image: Amit Verma
Sukhbir Badal, Deputy CM, Punjab

On infrastructure
First we looked at our assets and liabilities. We are a landlocked state surrounded by others who get all the incentives from the government of India. One side is Pakistan border where we are facing aggression and the other side is Jammu and Kashmir. Keeping all this in mind, how do you attract people [read investments] to our state? We are an agricultural state, high consumption, high per capita; and people are entrepreneurial. We do not have a port to attract people. We do not have natural capital. So we are not a natural destination.

The only way we [Punjab] can become a natural destination is by having the best infrastructure; better than any state. Why do people go to Singapore or Dubai? Infrastructure. And the most important is power. End of 2013, we will be a power surplus state.

Then if you don’t have a port, the next is to have an airport. In Punjab, on every hour’s drive, you will have an airport [soon]. We will be the most well connected state in the country.

Once the problem of airports is solved, the next is road connectivity. We will connect every major town [about 50-60] with four or six-lane expressways in three years. The projects have been approved and are in various stages of implementation. All of these will be of world standards.

On urban and rural development
Can you imagine, since Independence [Punjab’s] towns did not have sewerage? They still don’t have. In the next four years, all small and big towns will have a sewerage system connected to treatment plants. We are spending Rs 9,500 crore on this.

We are coming out with a rural mission. Our aim is to develop basic infrastructure in every village (over 10,000 villages), that is, concrete roads with open drains and water supply. My basic funda [principle] is, do not do piecemeal. We will take up whole towns, look at all the problems and go for [solving] it. All of it through private participation.

Why did this not happen in 65 years?
Of the 65 years, more than 45 years [was under] Congress [rule]. It all depends upon who was heading the state at what time, their priorities and mindsets. I cannot talk about what happened in the past. I do not want to get into the criticisms and all that. When I got the responsibility, I looked at the functioning of the government for the first time. Governments in India function only till 31st March. Ask any secretary, before the budget is presented, what will happen on April 1—he will not know. They will know the plan for the next year only when the budget is out. How can a country run when your time frame ends on 31st March?

In our case I said let’s look at the next five years and set goals of what we can achieve. I do not want to make goals that we cannot achieve. Initially nobody believed me. Everything I said is now a reality. It may have been delayed by six months or a year but it is part of the process.
On education

When we took over, 67,000 teachers were not there. When there are no teachers, how can a state develop? So we recruited teachers. Education is my dad’s [chief minister Parkash Singh Badal] number one priority. He handles it. We want to provide the best education at the school level. We will take up, for example, 5,000 schools and divide them into five years and take up the first lot of 20 percent. We will look at everything that these schools need and provide it. In five years we will complete all schools.

On e-governance
Why do scams like 2G and others happen? These scams can be eliminated in a second. You don’t need a Lokpal to eliminate scams. You need reforms. The scams took place because you gave discretion to a minister. If the whole thing was e-tendering, do you think there would have been a scam?

In our state, every tender, every purchase is through e-tendering. No discretion with anybody. Every government contract, every small contract—even a pencil—has to be purchased through e-tendering. This is part of our reforms.

Our basic funda [principle] was that corruption happens when there is interaction between government officials and a private person. If I have to meet you, there will be corruption. But if I don’t meet you, where will there be corruption? Who will I give money to? So, we said eliminate this interaction. My aim is, by 2013 end, no citizen would need to go to the government.

What about lawlessness? In Patiala, a girl committed suicide because police did not take any action. In Amritsar, an assistant sub inspector of police was shot for asking an Akali Dal leader to stop harassing his daughter.
What was Patiala and what was Amritsar? Go to the depth of the matter. The incident in Amritsar happened on a road, between one person and another. But the police people who did not perform were immediately dismissed from service. I am not saying crime has been limited. America has the best police but every day you hear somebody is killing someone. You cannot stop crime. What is important is how effectively action has been taken after crime. You look at every incident. If it is the police’s fault, we have taken action against the policemen, dismissed from the service.

So what next?
To prevent these crimes, in the deputy CM’s office, I am also the home minister, we are setting up a central control room headed by ADGP [Additional Director-General of Police], law and order, where we will have a toll free number [for distress calls]. Anybody calls from anywhere; we are going to have a response system set up. Calls will be monitored and recorded. The time of the call and the time the police reached will also be recorded. We will have an external auditor to check if the responses were within the stipulated time.

Second, we are introducing night policing. It is nowhere in the country. We have the same police who work during the day made to work in the night as well. It is inhuman for anybody to work 18-20 hours every day. We are creating a dedicated night police. They will sleep during the day and will police in the night—on roads, roundabouts and highways.

Third, we are introducing, for the first time in the country, a rural rapid response system. By the end of this month, if you call from any village in any corner of Punjab, two policemen will reach you on a motorcycle within 10 minutes. So, we are using a lot of methods to make it [police] responsive and effective.

You will be surprised, in Punjab there was never recruitment of women in the police. We have about 400-500 of them, but all were appointed on compassionate grounds. But no professional police recruitment. I came in and we recruited 3,000 policewomen. Now we are going to recruit women inspectors and DSPs [deputy superintendent of police]. Now we are coming out with a policy that in any women-related case—rape or molestation—women will not go to the police station. The designated officer will go to the girl’s house, will record a statement there. And the officer has to be of minimum DSP level. A girl will never have to go to the police station in Punjab. That is a decision we have taken.

Where will the money come from for all these initiatives? You are a debt laden state.
If we look at debt, I think the highest debt will be of Tatas, and they are the richest people. Look at DLF’s debt and their assets. Look at how we have controlled debt. You should look at the whole story. When we took over n 2007, our debt was 46 percent of SGDP. Now we are at 31 percent in five years.

Look at austerity measures people talk about. What will you get by switching off one light? They say, don’t own a car. What difference will it make? Not even 0.000001 percent. What we need to do is look at the resources and if it is X, target to make it 10X. If you go the other way, you will de-accelerate the economy. If you have one egg instead of two, the demand for eggs will go down. If eggs don’t sell, the poultry farms will collapse, if the farms collapse the feed mills will collapse and if the feed mills collapse then the farmer will collapse. That means you are collapsing the whole thing. What you need is if you were having two eggs, now you should have three. Then the downstream goes up. That’s what we did.

My cousin Manpreet believed in band kar deo, band kar deo, band kar deo [shut it down, shut it down, shut it down]. He never thought of how to increase. We said we will increase our revenue base without additional taxes. It is scientific management. I have made excise paperless. My VAT revenue when I took over in 2007 was approximately Rs 5,000 crore. This year-end, my revenue will be Rs 16,000 crore. My target (at the end of my tenure) is Rs 40,000 crore. Now excise revenues. In 2002, Amarinder Singh came to power. The revenue was Rs 1,500 crore a year. When he left in 2007, the revenue was Rs 1,570 crore. My revenue this year will be Rs 3,600 crore. Land revenue has gone up three times. Transport revenues, which used to be hardly Rs 300 crore, is going to touch Rs 1,100 crore this year. All of it is scientific management.
But your expenditure is also increasing exponentially?

Yes. We have to accelerate the economy. We would have been a surplus economy if not for the pay commission. The annual outgo was Rs 4,000 crore [because of higher salaries].

We are borrowing to increase our infrastructure. If you look at our debt, it is only for infrastructure financing. We came only in 2007. To understand the game, you have to start from the beginning and cut it off in 2007 and then look at it. You see a drastic change.

I’ll give you an example. Every town is a profit centre in itself. It is only because of mismanagement that you feel you do not have funds. You do not have to increase any taxes in this country, but increase 20 percent compliance to 70 percent or 80 percent. Take Bhatinda, my constituency. Its revenues were Rs 35 crore and expenditure was Rs 30 crore. Just Rs 5 crore surplus. I said it cannot be. I sat down with the commissioner and made a plan. End of this year we will touch Rs 100 crore in revenue and the expenditure remains Rs 30-35 crore. Now I have told them, look at what you want to do with the town. If you need Rs 400 crore to revamp the town, take a loan from Hudco for 15 years. Now you have the cash flows to pay off the loan.

Now I am looking at Ludhiana. It has a revenue of about Rs 600 crore. My target in the next two years is Rs 2,000 crore from Ludhiana. This is the situation in the entire country. We do not have to keep raising taxes [of those who pay]. Our game is we keep on harassing those 10 percent who comply.

On agriculture
Punjab feeds the country. We asked the Centre Rs 3,000 crore to revamp our irrigation system. They didn’t give a penny to us. They don’t realise that the water table, which was 20 feet, has gone down to 600-700 feet. Three years ago when there was famine [read grain shortage] in the country, the prime minister thanked the people of Punjab for saving the nation. Within two years they are saying they will not procure from Punjab because the MSP [minimum support price] is too high. You can’t treat states like this. They should look at focused planning in the country. In India, it is the survival of the fittest. It is developing not because of the government but because of the entrepreneurship of the people.
What if the Central funds do not materialise?
We have a backup plan which I cannot reveal at the moment. We will raise resources. We have to rebuild the irrigation network.

This year there was rain shortage and Punjab had the highest at 40 percent. The government of India gave drought relief to other states and ignored Punjab. States are getting discriminated [against]. If you have one MP the prime minister won’t even give you time. But if you have 70 MPs, he’ll be waiting at the airport.
On industry and services
There is no point in asking everybody to come. We are looking at industries that can benefit the state and for which it is a natural destination. We are targeting textiles, sugar, food processing, IT, hand tools, engineering, etc. We are coming out with incentive packages for them. We are coming out with an industrial policy within this month (end of January). We are also making a list of all the top players in each segment. We will approach them. Earlier government used to be king. Now industrialists are kings.
On the changing political discourse, even though caste, religious equations play large part in politics.

In Punjab these factors do not matter much. Yes, maybe in some rural or urban seats. There is a wrong impression that Akali Dal is rural and BJP is urban. The biggest urban party in Punjab is Akali Dal, not Congress, not BJP.

There are approximately 1,300 municipal corporators. Akali Dal has about 800 MCs, Congress has around 300 and BJP about 200. So the perception of rural and urban is wrong.

Traditionally, Akali Dal was considered an only-Sikh party.
Dominated by Jatt Sikhs?

Yes, you can say dominated because most of the people in rural areas are Jatt Sikhs. But there is no difference between a Jatt Sikh and others. In Punjab you will never see discrimination. It is not like Bihar or UP. Here there is no politics like that. In the Punjab assembly today, the highest number of Hindu MLAs are of Akali Dal, more than even Congress. We also have a Muslim MLA. How can I justify ruling a state when I am siding with one community? We are not limited to one community.
You have dynastic politics as well. Four of your family members are ministers.
Dynastic politics is a world over phenomenon. It [Badal] is a brand. Why do you like Mercedes? Because it is a brand you trust. If somebody buys a horse, they will look at how many races did its mother win, its grandmother win. If they have won races, that means it will be a winner. If a person’s family has served the people, they trust that person. It is all over the world. Bush. They ruled the country [US]. There are so many examples all over the world. This is a wrong notion of family.

If there are four ministers (yes, they are family) in the government, every one has an individual identity. It is not that somebody has been denied or just because he is family he is there. Each one has individual qualifications. Adesh Kairon is the grandson of Partap Singh Kairon, former chief minister. They have a legacy, a dynasty. Just because he is married into our family doesn’t mean that he is cut out of politics. The Majithia family—Sundar Singh Majithia was the first SGPC [Shiromani Gurdwara Parbandhak Committee] president. They have a legacy. What I am asking is, if an Ambani gets married to a Tata, then does one of them have to quit business?

(This story appears in the 25 January, 2013 issue of Forbes India. To visit our Archives, click here.)