MC Interview: Would be disappointed if Congress gets less than 2/3rd majority, says Chhattisgarh Deputy CM Deo

Chhattisgarh Deputy Chief Minister TS Singh Deo

Poll-bound Chhattisgarh, which is estimated to grow at 8 percent in 2022-23 and is looking at a fiscal deficit of 2.99 percent in the current fiscal below the mandated target by the Reserve Bank of India, is witnessing a heated battle over welfare or freebies. Deputy Chief Minister, TS Singh Deo defends this move terming it as “empowerment of people” while articulating his thoughts on luring investment in the state. “We are cautious about big industry where it is based on mining for raw material,” Deo says, adding that since the state has a large forest cover there is a lot of resistance from the villages as well as from the government to not overexploit the state's mining resources.

“We are not in a position today as far as even people are concerned to make all our land available to whoever wants to come and put up an industry. We would like to be very selective,” Deo adds.

Ahead of the first phase of voting on November 7, Deo speaks on a range of issues from the state’s take on industry to the decision to switch back to the old pension system.

Excerpts from the interview with Moneycontrol:

Be it lower inflation than the national average or containing the fiscal deficit, Chhattisgarh has done better than most states. To what extent do you see the economic strides made by the state government playing into the electoral mandate?

Very few people look into these facts though this is the basis on which any developmental work or social sector responsibilities can be rolled out. We have not overdrawn or overborrowed. We do not have too much debt and we do not have a level of debt that cannot be paid from regular recurring revenues. We have been targeting spending towards that section of the people who need the most help. Chhattisgarh has done far better than it is probably acknowledged nationally or otherwise.

A lot of global companies have expressed their interest in setting up shop in India. Would you like to pitch Chhattisgarh as a candidate for industries looking to do so the way Karnataka has?

We are cautious about big industry where it is based on mining for raw material. We have a large forest cover, about 41-42 percent of the geographical area of the state is forest cover. There is a lot of resistance from the villages as well as from the government side to not overexploit mining resources from forest land. We also see that industry prefers cheap land and the cheapest land is probably government land, and among government land, it is probably forest land. Whether it is coal, iron or bauxite, whenever it comes to mining from forest areas there is a lot of resistance from villages. And even in forest or private land, the big industry has not accommodated the interests of the local people even though they should prioritise who they are displacing in the first place. The industry seems to be not keen on making it their priority.

We are not in a position today as far as even people are concerned to make all our land available to whoever wants to come and put up an industry. We would like to be very selective. First, build confidence among people, and once the people are ready to partake in industrial development activities then only a state like Chhattisgarh will be in a position to move ahead in that direction.

Congress seems to be banking on welfare schemes or what many call doles to clinch a victory in Chhattisgarh. Does the state have the fiscal wherewithal to pay for it and what will you cut back on to do so?

I do not consider it as a dole. If you look at the economic situation of Chhattisgarh even during the pandemic the GST (goods and services tax) collection in the state did not drop. There is money in the hands of the people. What we are seeing in Chhattisgarh is the bottom-up effect where there may be a trickle-down effect with larger industrial units also contributing. To a large extent, the government has invested in the bottom section of the population – from farmers to forest dwellers. Around 40 lakh people have been pulled out of poverty, so that is where we have succeeded in providing purchasing power to that section of the people who are at the bottom. We are concentrating on the bottom-up model with opportunities being offered for those who want to set up industry as well.

What is your take on offering ‘freebies’ ahead of elections?

At election time you present to the people what you would want to do for the people in the next five years. This is what we would like to do for the people in the next five years. Some people may call it a freebie, we call it and I call it empowering the people by deepening the pockets of the section of the people that needs most assistance. If you provide a subsidised cylinder it is going to support the middle-class housewife too. if we are providing education, including technical education then we are empowering people by preventing that money going out of their pockets to educate their children.

Has Chhattisgarh implemented the decision to switch back to the old pension system (OPS)? And what according to you is the fiscal impact of this move for the state?

We have implemented OPS. And in the reasonably immediate future in the next 20-30 years, it will not have a negative impact on the finances of the state, in fact, it will have a positive impact. What is happening in the NPS (National Pension System), you are contributing 14 percent of your salary to a national fund, of which the state government gets nothing to use, and the central government takes loans against that and uses it for projects. Now economists are projecting this as a healthier model, but we see it as a negative model for the state where the resource of the state, the direct public money that is salaries – 14 percent of it – is being taken away from the spending capacity of the states’ citizens and being put in a fund that will be used by the central government.

Second, in OPS we are paying a lumpsum amount at the time of retirement, which means we are not paying 14 percent on the entire government staff today, we are going to therefore save up to around Rs 2,000 crore per year. So today there is a saving, in the coming decade or two there will be savings. Three or four decades down the line, some say in 2060 or 2070, maybe the number of government servants would increase a little more and then you have to pay a lumpsum amount at the time of retirement. So, balancing it out and seeing things as they are today the state government is in a plus. And instead of giving this money to the Centre we can put it in a state fund and use it for the development of the state.

What according to you are the three key economic steps that could help Congress win elections in Chhattisgarh?

Three is too little. But, if you limit me to three, I would say, first, what we are doing for the farmers with regard to the purchase of paddy, sugarcane, maize and other produce, among others. Farming is 75 percent of the population in the rural areas and we are knowingly targeting them because of their numerical dominance. Next, youth which are two-third of the population, about 40 percent of them are non-voters, below the age of 18. So, for students, we have provided good quality education via Swami Atmanand English and Hindi medium schools, which has been a major turnaround. And now we have announced that more schools will be raised to that standard, so that is a major pitch we are making. Linked to education is the KG to PG plan aimed at providing free education, including technical, to the economically less endowed, and we have also introduced a stipend for unemployed youth in the state. Third, women, which are 50 percent of the population in the state. Through self-help groups we are facilitating the purchase of raw materials at a Minimum Support Price that will add to the income of the families. We are targeting three major groups of the population based on their demographics and empowering citizens of Chhattisgarh economically. This is what is showing up as well with the state doing better than most others as far as economic management is concerned.

Experts say the Congress should comfortably win Chhattisgarh. How many seats do you expect the party to win?

The first mistake the Congress would make is to think it is in a cosy position and become complacent. That is the first step into a pitfall. Never, ever should you presume you are very comfortable. Every fight is a tough fight, every game is a new game. This is a new game. The party in front is not a pushover. They have a presence. They have maintained a vote share of 30-32 percent over many elections, which both Congress and BJP have been maintaining, and the vote differential deciding elections is between 0.75 percent or up to around 2 percent. Last time there was a 10 percent differential, which gave Congress a landslide victory. But there should not be any place for complacency. Chhattisgarh has done well over the last five years compared to the governments of the last many decades when it comes to actual work done on the ground overall. I would be disappointed if Congress gets less than two-thirds of the vote, which is 60 out of 90 seats.