One year on the path of reform

Interview with Chief Minister Amarinder Singh.

As an accomplished military historian, Chief Minister Amarinder Singh is more familiar than most people of the cut and thrust of battle, of the subtleties of tactical manoeuvre, and of the need for a strategic vision. In the past one year that he has been in power, the former Indian Army soldier has had to bring all his battle skills to bear in running the State of Punjab. Nearly ruined by five years of Shiromani Akali Dal-Bharatiya Janata Party (SAD-BJP) rule, Punjab faces a multiple crisis. Fiscal indiscipline had depleted its coffers, its power sector had almost bled to death, industry was in decline, and years of neglect meant that its agricultural sector was wholly unprepared to face the challenges of the future. In this interview he gave Praveen Swami, the Chief Minister describes his road-map for a resurgent Punjab.

When you took power, you inherited a State in an administrative and financial mess. How much of the damage do you believe you have been able to undo?

When my government assumed office on February 27 last year, we discovered that Punjab's fiscal situation was far worse than we had imagined. The State was virtually on the verge of collapse and teetering under the burden of an unprecedented level of debt as a direct consequence of the policies pursued by the Shiromani Akali Dal-Bharatiya Janata Party government. We were consequently faced with a situation where salaries, pensions and debt servicing together amounted to 131 per cent of the total State revenues.

Fiscal mismanagement by the previous regime also extended to the Punjab State Electricity Board (PSEB). During the past one year, we have worked tirelessly to rescue the State administration as well as the PSEB from the verge of disaster. This has been possible collectively through cost-cutting, enhanced revenues and improved fiscal management. Despite the fact that it was considered politically unwise to do so, my government withdrew free supply of power and irrigation water to the farm sector. We have been able to ensure instead assured supplies of nine to 10 hours of quality power to our farmers. This has been very well received. In contrast, the Prakash Singh Badal government had promised our farmers free power but in fact it was unable to provide more than two to four hours of uninterrupted electricity per day, and this supply too was highly erratic and completely undependable. As a result, farmers throughout Punjab were forced to spend huge amounts of money on diesel in order to water their fields. According to expert calculations, it is estimated that each farmer spent Rs.3,500 per month on every 5 horsepower diesel engine during the five years of the Badal government! We, however, do recognise that we have a great distance to go before we can truly take the State out of the red, and stride ahead.

Administrative and political reform has obviously been one of the thrust areas for you, particularly the issue of corruption. How satisfied are you with the results of the anti-corruption campaign in Punjab? And what is your response to critics who say the campaign is just political vendetta?

Rooting out corruption was a promise I made to the people of Punjab well before they voted the Congress party to power, and I am personally committed to ensuring that no one, however influential or powerful, is spared. In the past year, starting with former Punjab Public Service Commission Chairman Ravi Inder Pal Singh Sidhu, the State Vigilance Bureau has initiated prosecutions against 216 people. These include nine former Ministers, four Indian Administrative Service (IAS) officers, two Superintendents of Police, several Deputy Superintendents of Police and other gazetted officers.

Although I am personally not fully satisfied with the progress of our campaign against corruption, I am aware that legal procedures have to be followed and all this can take some time. Nonetheless, we are keeping up the pressure and I am confident that no credible complaint against corrupt public men and officials will be allowed to go uninvestigated. I am aware that my opponents are keen to dismiss our anti-corruption campaign as political vendetta. But I can assure you that there is not an iota of truth in this allegation. Badal has been going around threatening that he will also open cases against our people if he returns to power. I can only say that if there is any substance in corruption charges against Congress men or officials in my administration, I will myself go after them and will not wait for Badal to take notice.

A second major concern for your government has been agriculture. You have been pushing for farmers to move away from the traditional paddy-wheat cycle, and have been arguing that the agricultural sector needs to become market driven and internationally competitive. How confident are you that farmers in Punjab will in fact be able to cope with the vagaries of the global market?

About 68 per cent of our people live in the villages. We are the grain belt of India. Despite having only 2 per cent of the country's land, we have been producing 50 per cent of India's food. We have remained a predominantly agricultural economy, but now it is time to change all that. With the world market opening up, we must diversify from traditional grains. Today Australian wheat can be bought for as little as Rs.460 a quintal, which is less than the Government of India's minimum support price of Rs.640.

To tackle the emerging situation, we have proposed to the Central government an innovative crop adjustment programme. Under this we will initiate alternative cropping patterns, initially over one million acres, if the Central government undertakes to pay us Rs.1,280 crores. While this seems like a huge amount, we must remember that we are already losing Rs.5,000 crores a year on foodgrain storage costs. We have told the Centre that they will in fact profit from such a scheme while at the same time actually getting the farmers to diversify into other crops. While the Centre is yet to take a decision on this, we have independently initiated the process of diversification of agriculture on a smaller scale. We have also permitted contract farming by large private groups such as Rallis, Mahindra, UB and Tropicana. The idea is to transform Punjab's agriculture into one that specialises in high value crops. Though the Central government's support will be crucial, we cannot wait for it to make up its mind. We must and will press ahead with preparing our farm sector for the new market scenario.

Power sector reforms in Punjab have attracted opposition from some public sector employees, as well as farmers' organisations. Some have criticised the decision to do away with the supply of free power to the farm sector; employees have been concerned about the impact power sector reforms will have on them. What is your response to these concerns?

Quite frankly, we are without a choice in the matter of reforming and restructuring our power sector. When we came to power, the PSEB was burdened with a huge debt of Rs.12,000 crores on which they are paying Rs.1,300 crores annually. In 1997, when the Congress demitted office, they left the PSEB in operational profits. In 2002, when the SAD-BJP government demitted office, it left the PSEB with a Rs.2,000-crore deficit in operational costs. The average cost of supply of electricity per unit to the PSEB is Rs.3.69 per unit for metered supply, and Rs.212 per Brake Horse Power (BHP) in the farm sector. Today, the farmer is paying just 0.57 paise per unit for metered supply and Rs.60 per BHP, as a flat rate for tubewell connections. The Punjab government is subsidising the farm sector to the extent of Rs.1.43 paise per unit for metered supplies and Rs.152 per BHP for tubewells. The total annual cost of these subsidies to the farm sector is Rs.1,000 crores for the Punjab government. To subsidise the poor in both the rural and urban areas, our government is giving 50 units of free power every month. This is costing us an additional Rs.50 crores annually. Despite these subsidies, the cost of power and the high interest burden that the PSEB is saddled with, is such that during 2002-03 the PSEB suffered a loss of Rs.2,600 crores, and during 2003-04 the projected loss is Rs.1,800 crores. This state of affairs cannot be allowed to continue. If it does, Punjab will be a State without power. I am certain that no one wants a situation when the lights completely go out in Punjab.

Finally, Punjab has historically had serious social sector problems. While the State is affluent, education and healthcare levels have been areas of concern, as has been the status of women. What do you plan to do to address these issues?

My government is very keenly aware of the host of problems that are afflicting Punjab today. Much of this situation has arisen because of the problems Punjab was forced to bear with during the years of terrorism.

We have 12,486 primary schools but do not have enough teachers. The situation is similar in middle and senior schools. The present curriculum is also not adequately designed to prepare our children to compete well. We are taking steps to ensure that an environment is created where both teachers and students remain within the class-rooms. Attempts are also being made to improve facilities and redesign syllabi. For instance, I am emphasising the need to introduce information technology in the curriculum.

In the health sector, we are now attempting to involve the private sector in a big way so that the government can concentrate its resources on primary and secondary healthcare. The Punjab Health Systems Corporation, which was set up with support from the World Bank, is also being revamped. The falling numbers of women in our population is also a major cause for concern. We propose to strengthen and impose existing laws against foeticide and women's exploitation. Here, however, non-governmental organisations and other social and religious organisations must play a more significant role. The government will support them in every possible manner.