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Indian ministers compete for overseas affection

Published by The Straits Times, Singapore on 2004-08-20

NEW DELHI - The colonnaded red sandstone buildings that Sir Edwin Landseer Lutyens and Mr Herbert Baker raised in the heart of this green city between 1912 and 1929 have witnessed so much history - from the glories of the British Raj to the globalisation of modern India - that the entire area has been declared a "World Heritage Site" by the United Nations. Deep inside these sprawling buildings, political intrigue has always been the currency of the realm.

Intrigue is precisely what's occurring these late summer days in one of the sandstone edifices occupied by the Ministry of External Affairs. Prime Minister Manmohan Singh has awarded one of the ministry's choicest constituencies -the 22 million Indians who live outside the country, many of whom are wealthy - to the newly created Ministry for Non-Resident Indian Affairs.

Mr. K. Natwar Singh, the External Affairs Minister and an accomplished writer and scholar, is in high dudgeon about this. The NRI minister, Mr Jagdish Tytler - a veteran politician who's India's longest serving cabinet minister - shrugs off Mr. Singh's antagonism and promises that overseas Indians, who are said to possess more than US$365 billion in assets available for investment, will find his ministry a one-stop shop for their projects.

Their money is much needed by India, which currently gets a puny US$3 billion annually in FDI, including barely US$300 million from NRIs. In order to sustain a yearly economic growth rate of seven percent - which would be barely adequate to cope with the rising expectations of a rapidly modernising society - India must attract at least US$10 billion a year in foreign investment. Neighbouring China gets US$53 billion, some 60 percent of it coming from overseas Chinese.

Even as he battles his colleague Mr Singh, Mr Tytler has lost no time in persuading NRIs to open their wallets. He's received a commitment for a US$2.7 billion industrial park in the southern city of Bangalore, which has become a technology hub for India. A Singaporean of Indian origin has pledged US$400 million for developing indigenous medicines. A Malaysian, also of Indian origin, is pouring US$40 million into a shopping-centre complex. Since Mr Tytler's ministry was created in May - when the Congress-led United Progressive Alliance came to power - more than 3,000 NRIs have contacted the minister expressing interest in investing in India.

During an interview with The Straits Times, the minister proudly displayed e-mails and letters from these NRIs. While the missives were laudatory, many contained specific investment proposals.

"They aren't looking for concessions - they just don't want to be harassed," Mr Tytler said. "They don't want to have to run from pillar to post for permissions and approvals. My message to them is: 'My ministry has been created specially for you. I will be your protector in India.' These overseas Indians don't want to bring their money just out of sentiment for India. They want good returns - and contemporary India is a very good place for business investment."

The minister said that under the longstanding "licence Raj" dominated by socialist ideology and Statist bureaucrats, foreign entrepreneurs were either barred from investing in India, or were subjected to years of applying for permissions for which bribes were required. But now, under Prime Minister Singh's market-oriented administration, the buzzword is economic liberalisation.

"Indians are fed up with being jerked around," Mr Tytler said. "Either we are serious about rapid economic progress, or we aren't. But although I like to think that we are committed to faster economic growth, it still takes time to change old ways of thinking. The atmosphere for an open economic is still not there."

Along with changing the national mind-set anchored in socialism to free-enterprise, Mr Tytler said, India simply had to improve its infrastructure dramatically in order to better compete with neighbouring nations for foreign investment.

"You can have all the big plans you like, but unless the system is capable of handling the load, everything will collapse," he said.

His feud with External Affairs Minister Singh is widely considered unseemly, even though Mr Tytler contends that it's not of his making. Like Mr Singh, Mr Kamal Nath, India's Minister for Commerce and Industry, has expressed reservations about Mr Tytler's mandate, privately arguing that the new ministry may well create more confusion for potential foreign investors instead of clarifying matters.

Beyond personality differences, however, the feud points to how regionalism affects politics in India, a nation of 15 major languages, 874 dialects, 29 states and seven federal territories. Mr. Singh is a Jat from a Rajasthan princely family; Mr Tytler was Sikh-born in Punjab; and Mr Nath is from Madhya Pradesh, a poor but resource-rich state where the wealthiest class consists of dacoits who roam at will. Prime Minister Manmohan Singh - who's not related to the External Affairs Minister - is a Sikh, the first minority-class member to become chief executive in a nation of 1.1 billion people, 80 percent of whom are Hindus.

In forming his cabinet, therefore, the prime minister had to contend with competing regional claims for choice spots. Mr. Tytler had been part of several earlier Congress administrations, variously holding portfolios like civil aviation, labour, food processing, coal, shipping, and transportation. He's considered a skilled bureaucratic in-fighter, and a smooth politician.

"Let's face it - being a minister means that you have to be good at administration, and you have to be adept at politics," Mr Tytler said. "But most of all, you have to serve the people. My new ministry serves overseas Indians, and it serves the national objective of getting more foreign investment. I'm not one for making unrealistic promises. But this much I can say, I do promise: Overseas Indians who want to bring their money to India can expect total efficiency and honesty from my ministry - and from me."

Timely words. But Mr Tytler will be the first one to acknowledge that there are those who're hoping he will fail.

Pranay Gupte,
Senior Writer and Global-Affairs Columnist

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