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August 27, 1999


The Rediff Business Interview/E K Nayanar

'AP's CEO has surrendered the state to corporates'

Kerala Chief Minister E K Nayanar recently spoke to Shobha Warrier on his Leftist coalition government's plans to industrialise the southern state, socialism, capitalism, development in other states, his counterparts in other states, etc. Excerpts from the pre-election interview.

E K Nayanar, Kerala Chief Minister Kerala has achieved high standards in healthcare and education but when it comes to industrialisation, it is far behind many other states. Why does this happen?

Because the central government has constantly been ignoring Kerala. I do not have to give an answer to your question, as statistics are enough to prove what I say. We do not have a single public sector organisation with 1,000 employees.

Email this report to a friend Twenty-five years ago, we were given a share of three-and-a-half per cent from the Plan outlay but now we get only one-and-a-half per cent. If you look at the statistics of centralised planning, you will know that Maharashtra gets 16 per cent more now but our share has been reduced to one-and-a-half per cent.

Is that the only reason why Kerala is lagging behind?

Listen to me. The neglect by the Centre is a major reason. Of course we have some private firms here. That is why we carry on. But do we have any big public sector organisation here? We did not create unemployment.

The number of unemployed in India was 7.5 million when the first Plan was drafted. By the time we had the eighth Plan, unemployment was 8.6 million. Why did this happen? Because the government of India follows a capitalist economy. And that is why we had been opposing their policies from that very day.

Has India not been following a socialist economy?

What socialist economy? We have a capitalist economy here. We had been opposing the Congress's capitalist economic plans from the very beginning. Only a socialist economy can reduce unemployment. Take the case of China, Kampuchea, Vietnam, North Korea and Laos. Unemployment is very less there. Unemployment will be more in a capitalist economy and employment will be more in a socialist economy.

Unemployment is not much in the USA, which is a capitalist economy.

No. Unemployment is increasing in countries like America, Italy and Britain. In India also, unemployment is increasing because we are a capitalist economy. From 1991 onwards, India has been following globalisation and privatisation and unemployment has risen even more after that. Unofficially, we have 11 million unemployed people in India. But we had only 7.5 million in the beginning. How did it increase to 11 million? I'm asking you.

Kerala Chief Minister E K Nayanar When our population has risen to 970 million, won't the number of the unemployed also increase?

If population increase is the reason, why is it that a state like Kerala has more unemployed people? Population has not increased much here. Kerala has 370,000 unemployed people but we have the lowest population rise in India. We have so many unemployed people because in Kerala also we follow a capitalist economy.

But then, the Left Democratic Front has been in power in Kerala for several years.

The LDF also is within the Indian framework. We have no authority to change anything in the Constitution. I know you've no idea about either the socialist economy or the capitalist economy. That is why you are asking me these questions. If you know what a capitalist economy is, you will also know that unemployment runs along with that. It is not the case of India alone, this phenomenon is there all over the world. What is the situation in West Bengal? Unemployment. Why? Because in India, we follow capitalist economy.

Do you know why our share was reduced in the Plan? Because the planning is done by the central government. We asked for Rs 50 billion but we got only Rs 32 billion.

If you are against capitalist economy, why are you wooing private investors to Kerala?

Yes, we are also inviting them. All the big industrialists are here.

They are capitalists and you will be encouraging capitalist economy by inviting them.

Let them also come here. But what we need is more public sector organisations.

Almost all our public sector organisations are sick. Who is responsible for this?

That is why we are against the policies of the central government. Why is it that we do not get any public sector organisations here? You also ask them.

Most of the existing public sector units are sick. The ones that are there in Kerala also are sick.

The Centre should have started more public sector units here in Kerala. Our share has been reduced to one-and-a-half per cent. You ask the central government why our share was reduced and why we are neglected. That is what we have been fighting for. They tell us that the Indian government is in debt. Why? Even after 50 years of independence, the Indian government is in debt. Why?

You mean, the Congress party, which ruled the country for nearly forty years, should be blamed?

No. We are in debt because we had been following the capitalist economy. We are subservient to the World Bank and the United States. It is not because the Congress had been ruling. If they had followed socialist economy, we would have succeeded.

Then why does your LDF government invite private investors, the capitalists, to Kerala?

That is because the Indian economy encourages both private and public sector units. That is the nature of the Indian economy. But what we say is, we should change that system and have only the public sector. Tell me who rules India actually? Ninety-eight monopoly capitalists rule India now. They rule all of India. Do you know that?

Your industries minister was in Madras at the Indo-US summit promoting Kerala and inviting private investors....

All that will be there. Why? If we need a loan of Rs 10 billion, will the Indian government give us at least 70 per cent of it? No, they give us only 30 per cent. The World Bank may give us Rs 10 billion as loan, but the Indian government takes 70 per cent of it and we get only 30 per cent from the loan and mind you, we have to pay 14 per cent interest for that 30 per cent. The Indian government should change its policies first.

So, you would not invite any private investors if you were to get more loans from the Centre.

They will not oblige. So, the question does not arise at all. And we the Left Democratic Front also have to follow the policies of the central government. We cannot have a different policy here. They will not let you. We follow the industrial policies of the Indian government. We follow the agricultural policies of the Indian government. We follow the educational policies of the Indian government. The LDF is trapped within the Indian framework. If we had the freedom to have our policies, we would have surged ahead.

But other southern states like Tamil Nadu and Andhra Pradesh are moving ahead. Last year, Tamil Nadu got more industries and their industrial growth was more than even that of Maharashtra.

That is because they had five central ministers. They hijacked all the industries to the state. I mean Maran and Co.

It was not during the United Front period, sir. The Tamil Nadu government had the maximum industrial growth last year.

No, no. In the last 13 months, nothing has happened. They got all those industries when the UF was at the Centre. Don't you know they had five ministers from Tamil Nadu then? They hijacked all the industries. In fact, we lost a few offers in the bargain.

Chandrababu Naidu also is successful.

What successful? Is unemployment less in Andhra Pradesh? Do you know where are the maximum number of unemployed people? In Chandrababu Naidu's Andhra. The economic crisis that Andhra faces is terrible. It is because he has surrendered the state to corporates. You will see where he is after the elections.

If a multinational company is interested in investing in Kerala.

No, we will not give in to any imperialist company and that is our policy. We will not surrender ourselves to imperialist forces. We may allow some foreign companies to invest here in Kerala but not imperialist companies. We will not follow the policy of the Indian government. We do not have the habit of surrendering ourselves to the forces of imperialism. It is like surrendering India's independence. No, we will not follow that policy at all. All these big people are monopolies and we will not surrender our state to such multinational corporates. We are only trying to get some Indian industries, Indian capitalists, that is all. Like China does. Like Cambodia does. Like Kampuchea does.

But several multinationals have invested in China.

Do you know the laws of China? I know. I have been there two times. China has very strict laws and they invite capital from the USA and Britain without even deviating from their rules. After 20 years, they have to surrender the capital and leave the country. Yes, China gives them land and other things but they have to leave the country after 20 years. Do we give anything free here? I have been to the communist countries and I know their laws. That is the law of the socialist countries. What is the law of the Indian government? Surrendering. This is the difference between the socialist world and the capitalist world.


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