Maharashtra used to be considered the engine of India's development. Today, the state is drowning in debt, its farmers committing suicide and its children dying of malnutrition. What's gone wrong? That is the critical question that Karan Thapar shall put forward in an exclusive interview with the Chief Minister of Maharashtra Vilasrao Deshmukh.
Karan Thapar:Hello and welcome to Devil's Advocate. Mr Deshmukh, let's start with the big picture. Maharashtra was considered the engine of India's development. Today your state is drowning in debt and in almost every respect Gujarat has gone ahead, is this proof of misrule?
Vilasrao Deshmukh: No, I don't agree with this. Maharashtra has always been number one. And if you go by the latest CII survey, Maharashtra still continues to be at the number one spot.
Karan Thapar:Let's look at that debt situation that confronts you. According to the CAG, Maharashtra’s debt is 2000-01 was Rs 63, 000 crore. In 2004-05, its doubled to a Rs 121,000 crore and now, your own Finance Minister is hinting that next year it could increase by perhaps as much as 33 per cent more, that is a terrible situation.
Vilasrao Deshmukh: The point is that if you see a state like Maharashtra, our potential is such that we can carry on this kind of a burden. But for the development, I think any load on any state government, I think that this is not a reason to be worried about.
Karan Thapar:But the reason people are worried is because today your liabilities are three times your revenue. How can that continue?
Vilasrao Deshmukh: We have to increase our revenue side and we are mobilising many resources and as VAT has now come into play, things are improving.
Karan Thapar:But far from increasing your revenue side, infact the slide is getting worse and worse. In the early 1990s, Maharashtra was considered to be amongst the top 14 states, the lowest in terms of its fiscal deficit, the second lowest in terms of its revenue deficit. The situation has eroded completely from there.
Vilasrao Deshmukh: The point is that it has a history. You must go back to the government run by the Shiv Sena and the BJP in 1995 and since then, this thing started.
Karan Thapar:You mean, the rot started with the Shiv Sena?
Vilasrao Deshmukh: Yeah, because they started borrowing the loans.
Karan Thapar:But Shiv Sena was succeeded by you. We have had the Congress government for five years and you have been the Chief Minister for almost three of them.
Vilasrao Deshmukh: I do admit that, but once they began incurring a lot of loans from the market and then they started the schemes, we had to fall in the same deathtrap.
Karan Thapar:Chief Minister, you are blaming your opponents, that is an easy and convenient thing to do. The problem is that your debt hasn't actually fuelled growth. Maharashtra's growth during the 85-95 period, before the Shiv Sena came to power, was 7.5 per cent on an average a year. Since 95, the average is 4.5 a year, it has collapsed.
Vilasrao Deshmukh: It was there earlier, but now, for the past three years, the growth rate of Maharashtra is above 9 per cent.
Karan Thapar:Let's just look at the comparison of Maharashtra with Gujarat and in every single particular, your state is performing less well. Since the mid-1990s, your per capita income is growing at 3 per cent, Gujarat is growing at 5 per cent; your state GDP is growing at 5 per cent, Gujarat is growing at 7 per cent; your industry is growing at 4 per cent, Gujarat is growing at 7 per cent. In almost every respect, Gujarat is doing better than you.
Vilasrao Deshmukh: During 1995 and 1999, the things had deteriorated and because of that gap, we had to fall in that same dead trap.
Karan Thapar:You have had six years of Congress government, you have had three or four years of government under your personal leadership, the reversal is not obvious to anyone.
Vilasrao Deshmukh: One must understand that I am riding a coalition government and a coalition government has its own limitations and its own complications.
Karan Thapar:Is that a problem?
Vilasrao Deshmukh: Yes, this is a problem because so far as finance and disciplines are concerned, we have to take some hard decisions. And when we run a coalition government, it is very difficult to take hard decisions.
Karan Thapar:So, you are saying that the coalition allies that you have will not let you take hard decisions.
Vilasrao Deshmukh: It is very difficult, as I said.
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Karan Thapar:What is the problem? Are they stopping you?
Vilasrao Deshmukh: No, they are not stopping me. But to take a hard decision, it also reflects on the people at large. Initially, when I took over as the Chief Minister, I took so many hard decisions. We stopped recruiting the new people.
Karan Thapar:Let's come back to the problem you are talking about. You are saying that in a coalition government, it is difficult to take hard decisions. Is the problem that as Chief Minister, you don't have the strength?
Vilasrao Deshmukh: There is no question of strength because as a single party government, you enjoy full powers at your command. But once you lead a coalition government, the agendas are different, the priorities are different and the one has to please the people.
Karan Thapar:So, you are saying that your allies, the NCP, will not let you to take hard decisions. Is that what you are saying?
Vilasrao Deshmukh: No, it is not that. In this particular government, NCP and the Congress has its own majority. I am talking about the earlier government, when we have to depend on the independent and the smaller parties. From 1999 to 2004, it was a very difficult period. From 2005 onwards, things are much better.
Karan Thapar:You say that the things are better. Let me quote to you what the Maharashtra State Development Report, commissioned by the Planning Commission, has actually said: They are calling for drastic cuts in government expenditure, they want severe reduction in subsidy, they want major restructuring of PSUs, are you committed on that?
Vilasrao Deshmukh: Of course, we are working on that, especially to curb these PSUs, we have taken some good steps.
Karan Thapar:What exactly will you do to these PSUs?
Vilasrao Deshmukh: We have already taken a decision to close down the PSUs which are not running profitably.
Karan Thapar:You are going to close them down?
Vilasrao Deshmukh: Yeah.
Karan Thapar:What about the workers?
Vilasrao Deshmukh: the workers will be rehabilitated, they will be given their due.
Karan Thapar:You mean you will give them payment in lieu of the jobs that they lose? Will your allies let you go ahead?
Vilasrao Deshmukh: That is a decision taken unanimously. We have appointed a separate committee to evaluate each and every PSU and they must submit their recommendation to the government.
Karan Thapar:When do we see the first PSUs in Maharashtra closing down?
Vilasrao Deshmukh: I think very soon. There are quite a few which have been recommended and they are under process.
Karan Thapar:When you say "very soon", will we see them closing this year, in 2006?
Vilasrao Deshmukh: Yes. In fact, maybe one or two of them will close down by the endof 2006.
Karan Thapar:What about cutting on public subsidies? When will you start cutting back on subsidies?
Vilasrao Deshmukh: Cutting public subsidy is a bit of a difficult decision. It is the most unpopular decision.
Karan Thapar:Absolutely, but those are the decisions you are called upon to take as Chief Minister.
Vilasrao Deshmukh: It requires a political will.
Karan Thapar:Do you have the political will?
Vilasrao Deshmukh: Personally, yes I do. But I have to take everybody into confidence.
Karan Thapar:You mean to say that you - Vilasrao Deshmukh - have the will but your party and your allies don't and as a result, you cannot act?
Vilasrao Deshmukh: At the same time, i will also have to take my own party into confidence.
Karan Thapar:So, your own party too is not supporting you in terms of cutting subsidies?
Vilasrao Deshmukh: To cut down on subsidies is a national issue, it is not a state issue.
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Karan Thapar:Do you know what the people of Maharashtra say? They say that this government is not interested in development, instead it is interested in things like wardrobe malfunctions and dance bar girls. Are your priorities right?
Vilasrao Deshmukh: Dance bar is a separate issue and it cannot be linked with development.
Karan Thapar:You have spent a lot of time on dance bars, you have also spent a lot of time on wardrobe malfunctions, you don't seem to have the time to take tough decisions to out Maharashtra back on its feet.
Vilasrao Deshmukh: It is our commitment to bring Maharashtra back on its feet.
Karan Thapar:Do you know what BN Yugandhar of the Planning Commission said in February about your state? 'Maharashtra is an example of a failed state'.
Vilasrao Deshmukh: I was there in the meeting , Yugandhar was critical, there is no doubt about it. But then, why did the same Planning Commission increase our outlay by 34 per cent?
Karan Thapar:Because they can't afford to let you fail. Nonetheless, they say in administrative terms, in terms of tough decisions, you aren't taking the decisions.
Vilasrao Deshmukh: Yugandhar told us that there are certain gray areas.
Karan Thapar:He said that Maharashtra is a 'failed' state.
Vilasrao Deshmukh: He must have expressed his views, but at the same time we explained that there are gray areas. As you said, there is an electricity problem, malnutrition problem and farmers committing suicides, we admit to all these problems.
Karan Thapar:Chief Minister, the Prime Minister says he wants to make Bombay like Shanghai, the great danger is that you may make Maharashtra like Bihar.
Vilasrao Deshmukh: No, of course not. We will try to fulfill the dream of our Prime Minister and we have planned accordingly.
Karan Thapar:Before the end of your term, will you turn Maharashtra's finances around?
Vilasrao Deshmukh: Of course.
Karan Thapar:Is there a commitment?
Vilasrao Deshmukh: Yes.
Karan Thapar:But what about the necessary support from your allies and your party to take tough decisions?
Vilasrao Deshmukh: As far as bringing back the financial condition to the original position is concerned, I think my allies will 100 per cent support me.
Karan Thapar:And will your party support you?
Vilasrao Deshmukh: Of course, they will support me.
Karan Thapar:But then, will you get the necessary support to cut subsidies? That is a major test.
Vilasrao Deshmukh: Subsidies are a separate issue. It is not that only the cutting down the subsidies will bring back the financial position.
Karan Thapar:But it is a test of your ability to take tough decisions. People are looking for a test, they are looking for a proof that Vilasrao Deshmukh has steel in his back.
Vilasrao Deshmukh: I will prove and I will try to be up to their expectations.
Karan Thapar:Do you realise that this is perhaps the greatest critical test of your chief ministership?
Vilasrao Deshmukh: Of course.
Karan Thapar:Do you accept that?
Vilasrao Deshmukh: I accept that. It is a great decision and it requires courage and it requires support.
Karan Thapar:And it requires personal strength from you as a Chief Minister?
Vilasrao Deshmukh: Definitely, I am committed to that.
Karan Thapar:And do you have it in you?
Vilasrao Deshmukh: Yeah.
Karan Thapar:You are confident of that?
Vilasrao Deshmukh: I am 100 per cent sure.
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Karan Thapar:This is not just easy glib talk.
Vilasrao Deshmukh: I know it is not that easy, but if you have a political will and if you are in a position to move forward, I think that things will change and they will support you.
Karan Thapar:So, you are saying to me that Vilasrao Deshmukh, as Chief Minister, will turn Maharashtra around?
Vilasrao Deshmukh: This is my personal commitment.
Karan Thapar:Chief Minister, let us turn to the agrarian crisis in Vidarbha. According to the Vidarbha Jan Andolan Samiti, there have been over 450 farmer suicides in June, over 322 since November, over 77 in March and they are increasing at the rate of three per day. As Chief Minister of Maharashtra, ho embarrassed are you by this?
Vilasrao Deshmukh: Things are very unfortunate as far as Maharashtra is concerned. In a state like Maharashtra, if the farmers are committing suicide, it is not going to add to our glory.
Karan Thapar:So, are you embarrassed that this is happening while you are Chief Minister?
Vilasrao Deshmukh: Absolutely, I am totally embarrassed as my own farmers are committing suicide.
Karan Thapar:Let's just for a moment, as you a simple question - Do you accept the figures put out by the Vidarbha Jan Andolan Samiti.
Vilasrao Deshmukh: I don't want to contest over the figures.
Karan Thapar:Do you accept them?
Vilasrao Deshmukh: The question is that any suicide cannot be termed as a farmer suicide.
Karan Thapar:But let me repeat the figures because they are critical. Over 450 since June, over 322 since November, 77 alone in March and they are increasing at three a day. You accept those figures?
Vilasrao Deshmukh: As far as my figures are concerned, they are reaching about 350.
Karan Thapar:Even Sakal, a newspaper tightly owned and controlled by your allies, puts the figure at over 400. How can you say it is under?
Vilasrao Deshmukh: Newspaper figures and the figures calculated by our own officers, the government figure...
Karan Thapar:What's your official figure?
Vilasrao Deshmukh: I just said, nearly about 350.
Karan Thapar:Since when?
Vilasrao Deshmukh: I am talking about this whole year.
Karan Thapar:So, in other words, your official figures since June is nearly 350 and the Jan Andolan Samiti says that it is over 450.
Vilasrao Deshmukh: I don't want to contest with the figures.
Karan Thapar:You will happily accept the Jan Andolan Samiti figure?
Vilasrao Deshmukh: I am telling you that the help that we give to each and every family of the deceased person...
Karan Thapar:Let's come to the help that you have given in a moment's time because many people contest whether you are helping. Do you accept that the agrarian crisis in Vidarbha is the biggest challenge you face?
Vilasrao Deshmukh: Absolutely.
Karan Thapar:You accept the size, the scale and the significance of the problem and you do not contest it?
Vilasrao Deshmukh: Yeah. I don't contest it because I don't see that if a farmer is committing suicide for any reason, a Chief Minister should be happy over that.
Karan Thapar:Let's come the manner in which you've tackled the problem since you came to power in June 2004. One of your loudest promises in that election campaign was that you would increase the procurement price of cotton to Rs 2,700 per quintal. On the basis of that promise, you won critical votes in Vidarbha, yet you have done nothing to fulfill that promise.
Vilasrao Deshmukh: A year before last year, we gave full price to the farmers till the suicides were much more. The cotton price and suicides have no correlation.
Karan Thapar:Before we go into details, can you accept that one of your election promises, loudly made to the people of Vidarbha was that you would increase the procurement price of cotton to Rs 2,700 per quintal and you haven't done that? Do you accept that?
Vilasrao Deshmukh: Yes.
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Karan Thapar:So, you have broken a promise you made at the election?
Vilasrao Deshmukh: There are so many promises that are given at the time of the elections, but it is very difficult to fulfill them because financially, it takes time.
Karan Thapar:It is very easy to make a promise and it is very difficult 'financially' to fulfill it, I accept that. But the problem in this case is that not only did you not fulfill your promise, last year in October you scrapped what is called the advanced bonus effectively reducing the procurement price from Rs 2,200 to just Rs 1,700, which is what the price used to be way back in 1994.
Vilasrao Deshmukh: You cannot forget one thing that the Monopoly Procurement Scheme is only in one state, which is Maharashtra.
Karan Thapar:But this is where the farmers are dying, Vidarbha is the region worst affected.
Vilasrao Deshmukh: The cotton growing area is not only Vidarbha, it is also Marathwada and Khandesh. Please take into accaount that area also.
Karan Thapar:Just look at the situation - you won an election promising a 22 per cent increase. Do you know what you did? You have cut the price effectively by 22 per cent by scrapping the advance bonus. That is precisely what you have done.
Vilasrao Deshmukh: Maharashtra government has a Procurement Act passed by the Assembly way back in 1972.
Karan Thapar:Do you know what the Jan Andolan Samiti says? You have scrapped the advanced bonus in October and since November, over 322 fresh suicides have happened. They say these suicides are directly related to your decision to scrap the advance bonus.
Vilasrao Deshmukh: I don't agree. They are not at all related to the decision because we have examined each and every case. Our whole team had gone over there, met the family members and got their statements. There is no correlation.
Karan Thapar:Let's move on beyond the correlation between the suicides and price. The problem is that it is not just over price that you have broken your promise, it is not just over price that you have actually done the opposite of what you promised, the Maharashtra government has even withdrawn from procurement effectively.
411 official procurement centres have been reduced to just 141. And today, there are more private procurement centres than government centres and those private centres pay a lot less than Rs 1,700 per quintal. So, once again, you have left the farmer in the hands of the private sector.
Vilasrao Deshmukh: I don't agree with that. The prices are fixed by the government of India, the Minimum Support Price for any agricultural commodity. We have to protect the farmer.
Karan Thapar:But you are not protecting the farmer.
Karan Thapar:There are only 141 official centres, there are 210 private centres and the private centres are paying a lot less than Rs 1,700 per quintal.
Vilasrao Deshmukh: Your figures do not match with the government figures.
Karan Thapar:Let me tell you that my figures come from Mr NP Hirani, Chairman, Maharashtra State cotton Cooperative Grower's Manufacturing and Marketing Federation quoted in The Hindu on February 25. He is an official of your government.
Vilasrao Deshmukh: You must also take into account the amount of production. This year, the production was low as compared to the last year.
Karan Thapar:So, you have cut the price even further.
Vilasrao Deshmukh: There is no question of cutting the price. we have given the price declared by the government of India.
Karan Thapar:But look at the cumulative situation. First of all, you promise a price hike, in fact you cut the price, then you withdraw your state from actually procuring, you leave the procurement to the private sector, who are paying even less than the official procurement price - the farmer is left unprotected.
Vilasrao Deshmukh: Nobody can procure any commodity at less than the price announced by the government of India. One has to give the Minimum Support Price compulsorily otherwise you will be penalised.
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Karan Thapar:Let's take another aspect of the problem. In December, you promised a debt release package of just over a Rs 1,000 crore. You said that the compensation for every farmer who took his life would be one lakh. Your own newspapers, in your own state say that four months later, no money has been paid whatsoever.
Vilasrao Deshmukh: I don't agree with that. As I said, we have already paid about 344 farmers, to their families.
Karan Thapar: Many of the farmers, according to the papers, have received cheques of just Re 1 or Rs 2.
Vilasrao Deshmukh: No, no. How can that happen?
Karan Thapar: It has been in the papers.
Vilasrao Deshmukh: No, that is a different story. Those were the old dues.
Karan Thapar: So, you accept it?
Vilasrao Deshmukh: No, no. One or two rupees as per their accounts.
Karan Thapar: Ahhh. One or two rupees as per their accounts. Why bother to pay them if it's one or two rupees?
Vilasrao Deshmukh: No. And we have already stopped that as I have said this is wrong system because some person down the line must have issued a cheque of one rupee or two rupees, which I also read in the newspapers.
Karan Thapar: So, now you are accepting it?
Vilasrao Deshmukh: We read in the newspaper.
Karan Thapar: Chief Minister, let me quote to you DNA. Four months have passed and farmers haven't got anything. Neither the compensation nor the benefits of the package.
Vilasrao Deshmukh: No, I don't agree with that.
Karan Thapar: Your own paper. And the same story is there in The Hindu as well.
Vilasrao Deshmukh: No you can't rely on them. Papers can give the information. But you can't rely on them. Every newspaper printing a story, how can you believe in that?
Karan Thapar: Do you know what's the most cruel thing that's happening? Far from giving compensation, far from giving debt relief, your administration is organising Bhajans and kirtans to build up the morale of farmers. Are you playing a cruel joke with them?
Vilasrao Deshmukh: No, no. Not at all. Because you see, you must go into the deep cause of these suicides.
Karan Thapar: Farmers don't. Farmers need help, they need loans, and they need assistance. They don't need Bhajans and kirtans.
Vilasrao Deshmukh: Look, psychologically also, we have to do something.
Karan Thapar: Are you mocking their spirituality, are you mocking their misery?
Vilasrao Deshmukh: No, no. Not at all. You see, after discussing about it with all our important people from various fields, we decided that this kind of a thing is required.
Karan Thapar: You can't give them the support price you promised. In fact, you cut it. You are going to give them Bhajans and kirtans?
Vilasrao Deshmukh: No, we have given them the support price, we have given them the best package available, and we have already started distribution. We have also repaid their old dues, which were to be paid by the government.
Karan Thapar: Chief Minister, on the 24th of April, you announced certain fresh measures for farmers. Let's turn to those. You have offered them concessional loans. Do those concessional loans also apply to farmers who are already unable to pay back earlier loans? Because if they don't, 90 per cent of Vidarbha farmers, where the suicides are happening, will not benefit because they are already in debt.
Vilasrao Deshmukh: This new decision is applicable to all the farmers of the state.
Karan Thapar: Including those who are already in debt?
Vilasrao Deshmukh: Everybody.
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Karan Thapar: So, farmers who have outstanding loans can still take fresh loans?
Vilasrao Deshmukh: Definitely.
Karan Thapar: That's a commitment and a guarantee?
Vilasrao Deshmukh: Yeah, definitely.
Karan Thapar: A commitment and a guarantee?
Vilasrao Deshmukh: Yeah, it's a guarantee given by the government.
Karan Thapar: What about something else? In the same package that you announced on the 24th of April, you said that your government would consider - and only consider by the way at this moment, it's not a decision - concessions on electricity bills. The problem is, in 2004, you won an election promising free power to farmers. You didn't deliver, you revoked that immediately. Why should they accept this promise now? Why should they believe it?
Vilasrao Deshmukh: No, no. I haven't said anything. I said we will make a survey how many are the farmers who were not paid their dues.
Karan Thapar: You said you will consider electricity concessions? How seriously considering are we doing?
Vilasrao Deshmukh: Until and unless we get the survey done, it is very difficult to say anything at this point of time.
Karan Thapar: So it's a promise, an easy promise that you can go back on.
Vilasrao Deshmukh: No, no. There is no question of going back. We really want to help the farmers. How can you do that at this time of distress?
Karan Thapar: So then, will you give electricity concessions or not?
Vilasrao Deshmukh: Well, I will get the report how many farmers are there those who could not pay their dues because of their poverty and all.
Karan Thapar: So this is just a thought, it's not a commitment? This is not a decision?
Vilasrao Deshmukh: No decision until and unless we get the correct figures. When we get them, that will be put before a committee and the committee will decide.
Karan Thapar: The problem, Chief Minister, is that Vidarbha is just a microcosm of what's happening in Maharashtra all the way across. According to the ministry of agriculture's situational assessment survey published out of Delhi 89 per cent of Maharashtra farmers are in debt and the quantum of debt has increased by an astonishing 232 per cent in the last 10 years. Almost 50 per cent of them are, in fact, indebted to money lenders, who charge exploitative rates of interest. You are sitting on a time bomb.
Vilasrao Deshmukh: I don't agree with that. Because the total loan portion for the farmers, facilitated by the crop loan, is about Rs 6,000 crores if the whole state is taken into account. And with the new concession in the interest rates, it might even go up.
Karan Thapar: 89 per cent of your farmers in debt. And 50 per cent of their debt are in the hands of money lenders. You think it's not a major problem?
Vilasrao Deshmukh: Money lenders are different. I am talking about the loan from the cooperative and nationalised banks.
Karan Thapar: Money lenders charge interest in 20s and 30s. That's the problem.
Vilasrao Deshmukh: And that's is the reason that we have already waived whatever loans they had taken from the private lenders.
Karan Thapar: So, you are confident that you can control the problem?
Vilasrao Deshmukh: Hundred per cent.
Karan Thapar: What about the problem in Thane, of little children? The Hindu newspaper says that in the last one year since April, 1,100 have died. Other newspapers put the figure at 1,700. You are losing in Thane to malnutrition three or four young children every single day.
Vilasrao Deshmukh: I know this problem is very crucial problem. And that's the reason we have appointed a special mission to tackle this particular issue.
Karan Thapar: How serious is this mission?
Vilasrao Deshmukh: We have appointed a special secretary-level officer as a chairman of that particular mission and things are now improving.
Karan Thapar: Are they? Because The Times of India says that your district officials in Thane refused to accept that these are malnutrition deaths. They say that the deaths are due to tribal ignorance.
Vilasrao Deshmukh: When we have appointed an officer, we appointed a scheme, we have given a special attention to that particular area. I think the situation will improve.
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Karan Thapar: Things will improve no doubt. In the meantime, children are dying at the rate of three or four a day.
Vilasrao Deshmukh: I don't agree with that.
Karan Thapar: It's a fact.
Vilasrao Deshmukh: No, that is your information, not mine.
Karan Thapar: You mean the newspapers are wrong?
Vilasrao Deshmukh: Could be.
Karan Thapar: You know, Chief Minister, what the Congress party's slogan is: Congress ka haath, aam aadmi ke sath? Why are the farmers of Vidarbha and children of Thane excluded?
Vilasrao Deshmukh: No, they are with us, nobody is excluded. As I said, it's unfortunate as far as farmer deaths are concerned, suicides are concerned.
Karan Thapar: What about children's deaths?
Vilasrao Deshmukh: That too. But things are improving. It's not that we are not giving full attention to them.
Karan Thapar: Farmers are dying at three a day, children are dying at four a day, where is the improvement?
Vilasrao Deshmukh: No. I think, it will take some more time.
Karan Thapar: So, how many more will die before things improve?
Vilasrao Deshmukh: No, no. I don't think so. We need to have a proper dialogue with the farmers. Why, what are the reasons? Indebtedness is not the only cause of their death. There could be some other reasons.
Karan Thapar: So you are confident that you are capable of handling suicides and children's malnutrition deaths?
Vilasrao Deshmukh: I am 100 per cent confident. And we will tackle this issue and a day will come that one day you will again come and tell me that things are improving.
Karan Thapar: Chief Minister, let's hope that they happen very soon. Thank you very much indeed.
Vilasrao Deshmukh: Thank you.
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