Maharashtra is indeed fortunate in having greater transparency in its dealings. It is also blessed in the sense that the educational level of the population here is fairly good. Well-qualified outsiders, who have settled down here, have also contributed greatly towards creating a good talent pool in the state. A series of governments with stable industrial policies have made Maharashtra an industrialised, progressive stare and I believe this will continue to be the same in the coming years as well.

Let us also not forget that Mumbai is the financial capital of the country and its port is the largest and busiest in the country. This is significant when, today, exports and imports for the backbone of a liberalised economy. So Maharashtra has been fortunate in that sense. This rapid industrialisation has also become its bane. Basic infrastructure development – be it power, roads and education – has not kept up with the rapidly evolving needs of the industry. The power situation, particularly, is very alarming. My fear is that this growth will slow down unless someone tackles this on a war-footing, keeping politics aside.

Also the cost of growth for individual companies will be higher because the cost of generating one’s own power is a very costly affair. And it is not the right thing to do, anyway. Large-scale power projects are more efficient and cheaper ways of generating electricity than individual, small-scale captive power units.

HUGE IMPETUS

Having said that, all major OEMs which will give an impetus to the automotive growth of India are setting up base in Maharashtra. It is fair to assume that they gave due consideration to other parts of the country before deciding on this state. This is a fantastic opportunity for Maharashtra to broadbase growth. It is a well established fact that the auto industry has been the hub of rapid economic growth worldwide. And having already established a significantly huge automotive industry, there is no way that Maharashtra as a state cannot grow and prosper even further.

What is needed is political pragmatism which must ensure that the sector is provided the right infrastructural framework within which it can do its job. I would advocate that no time is lost in pandering to petty squabbles among the bureaucracy and politicians. I would also like more attention being paid to establishing a proper protocol in assimilating the landowners into the mainstream. This is critical because land is becoming a major issue thanks to the focus on SEZs.

THINKING GLOBAL

Going forward, I would think that alongside power and road, the availability of land at a reasonable cost will also decide how rapidly the auto sector grows in Maharashtra. The OEMs and big Tier-1 suppliers may be able to factor in the high cost of land but the ancillaries and SMEs may find this a hindrance to expansion and growth. And this growth is inevitable because a component supplier to a global OEM in India automatically qualifies to become a supplier to that OEM anywhere in the world. The high cost of acquiring land could well blunt the cost advantage to an extent, and affect growth prospect. In the light of what is happening with SEZs, land is an issue that needs to be addressed in ways that is acceptable to all parties.