Tamilnadu Economy

Opinion: Why the BJP’s rise in Tamil Nadu is a boon for the state Opinion: Why the BJP’s rise in Tamil Nadu is a boon for the state Chandrasekaran Balakrishnan March 2, 2022 Tamilnadu Economy Compared to 2011, the BJP has doubled its vote share and got more seats.  Read in : தமிழ் The recently concluded urban local body polls in Tamil Nadu had the BJP going alone for the first time since 2011. Elections in TN often generate much attention. Regional identities, welfare politics and Dravidian ideology rule the narrative in them. Every election comes with a distinctive feature. This time it was the BJP’s move. The party was roundly criticized and made fun of for not aligning with the AIADMK. The BJP has won two consecutive terms at the Center but here the narrative has been that Tamil Nadu voters have rejected the party for its anti-minority stance. For long, BJP cadres have been demanding that the party should face elections alone in Tamil Nadu to test the pulse of the people and build strong local networks. This demand makes sense especially now since the AIADMK is on the verge of losing its voter base due to leadership issues. Further, for decades, it has been the unquestioned dictum that national parties cannot dare to dream of facing elections in the state without an alliance with regional parties. The classical example is the Congress with a declining voter base. Yet, the state leadership surprised many by announcing it will go alone. Must state presidents of the BJP had age factors working against them and they had other baggage. They could never take the risk. The current state president, K Annamalai is younger and can plan for the foreseeable future. The BJP’s campaign themes included NEET, Hindu girl suicide, inferior quality produce in the Pongal hamper, coal scam, arrest of social commentator Maridhas and so on. Since Annamalai became BJP TN president, the narratives it has created in the state are bold and don’t hesitate to expound the party’s ideology. Young people are seeking for clarity and like a clear stance that is based on facts, not vested interests. It must be acknowledged that five decades of Dravidian welfarist politics needs to be countered and it would take some time. The BJP was taking on the entire DMK front across the state in most places in the urban local body polls. Its campaign themes included NEET, Hindu girl suicide, inferior quality produce in the Pongal hamper, coal scam, arrest of social commentator Maridhas and so on. The BJP was able to turn voter attention to some of these issues. The elections have proved that the BJP has bright prospects if it can move forward in creating a positive narrative with local support for the policies and development and welfare programmes of the Union government. Some have maliciously compared the BJP performance with the Congress. But BJP’s voteshare was 2.1 percentage points higher which amounts to a million votes. The rise of the BJP cannot be ignored. The Congress has been crowing that it is the third largest party but its performance comes from riding piggyback on the DMK. A section of the media has backed the Congress narrative while the facts speak otherwise. Compared to 2011, the BJP has doubled its vote share and got more seats. The BJP tally of 308 is spread across several districts including in northern Tamil Nadu. With dynamic leadership, the BJP has come to be a dominating force in Kanniyakumari district. Though the contests were multi-polar, the results in these elections have been largely uni-polar. The Congress is in historical decline across the country. It lost the plot more than five decades ago and has been unable to reclaim it. In the last seven years, Tamil media has confused the people and hidden the facts about the schemes of the Union government. The impact of schemes such as Mudra loans, tap water for individual households, housing for all, Rs 5 lakh medical insurance for a family of five, free cooking gas scheme, girl child scheme, income support to small farmers, direct cash transfer scheme and so on have helped BJP gain a foothold in the state. Future local body elections should be fought on relevant issues. Effective decentralization should be on the agenda. Sections of the media have been pandering to the vested interests of the two main parties. They have helped to indoctrinate young people in Dravidianist ideology. Negative sentiments are being created against the BJP, the Union government and its leaders. In a functional democracy like India, elections need to be fought on improving the governance structure so services and facilities are delivered to the people without bias. In the recent polls, however, national issues were made talking points. Future local body elections should be fought on relevant issues. Effective decentralization should be on the agenda. Only then the common people were get their due from the government apparatus without having to pay bribes. Otherwise elections will be dominated by cash bribes and irrelevant issues. There is a danger that the state’s expanding educated class will be highly knowledgeable without feeling responsibility towards society. This should be averted. (The author is an economist and public policy expert) ClickHere:https://inmathi.com/2022/03/02/opinion-why-the-bjps-rise-in-tamil-nadu-is-a-boon-for-the-state/42611/ Facebook Instagram X-twitter

High time Tamil Nadu walked the talk on decentralization, devolved power to local bodies High time Tamil Nadu walked the talk on decentralization, devolved power to local bodies Chandrasekaran Balakrishnan February 22, 2022 Tamilnadu Economy Tamil Nadu has 21 city corporations, 138 municipalities, and 489 town panchayats. Do they have the funds and power to address the civic issues that the residents are facing every day? Read in : தமிழ் The concept of the elected village administration is perhaps more than a millennium old in Tamil Nadu. But the Dravidian political parties, which have often raised the demand for more state autonomy from the union government, have for decades refuse to honor the principles of federalism when it comes to its urban local bodies (ULBs) Tamil Nadu has the third-largest economy and it is also the most urbanized state. As much as 54% of its people live in urban areas today, compared to 34% in 1991. In 2002, the state had only 6 city corporations, 102 municipalities, and 611 town panchayats. Now, there are 21 city corporations—after 6 corporations were added in 2021—138 municipalities, and 489 town panchayats. In the urban local body elections whose results are due today, 12,607 representatives would have been elected by 2.79 crore voters, after a gap of six years. But will this mean anything for local governance, will it empower your elected representatives to improve the facilities in your cities and town? Or is it just a process to get over with? Unfortunately, even in the recent urban local body election campaigns, Dravidian parties have hardly raised civic issues, instead indulging in political slanging matches. They don’t talk about a master plan to address traffic, air, soil and water and pollution, solid waste management, sewage wastewater management, discharge of industrial effluents and so on. PMK leader Anbumani Ramadoss has rightly blamed the Dravidian parties for not paying due attention to urban challenges. In its campaigns, Dravidian parties have hardly raised civic issues, instead indulging in political slanging matches. They don’t talk about a master plan to address traffic, air, soil and water and pollution, solid waste management, sewage wastewater management, discharge of industrial effluents and so on. To bring about a major change in the way cities and towns are administered, local representatives must be given funds and autonomy to carry out plans according to what their wards’ people want. But despite legislation passed three decades ago to give local bodies autonomy, successive state governments have kept a choke-hold on funds and decision-making powers. The 73rd and 74th Constitutional Amendments were passed in 1992, which armed urban and rural local bodies with much-needed autonomy in administrative and financial matters. The amendments aimed at giving the power of decentralised governance to the people themselves to build institutions, to deliver services and to improve standards of living. The state then enacted the Tamil Nadu Panchayats Act, 1994 to replace the earlier Act of 1958. It paved the way for the creation of a district planning committee and the state finance commission (SFC) to aid local bodies. Laws on urban local bodies date back to 1919 and several Acts covering 21 cities now exist. According to Article 243 (A) of the Constitution, the Gram Sabha (village panchayat) has authority equal to the State Legislative Assembly as far as the village administration is concerned. But in reality, state governments have been stifling local self-governance in Tamil Nadu. For example, village panchayat meetings are restricted to just three times a year. As per Schedule 12 of Article 243 (W) of the Constitution, urban local bodies have 18 responsibilities. Of these, they now have a semblance of authority over only 8 issues. In the past, city corporation commissioners in Tamil Nadu had the power to sanction building plans but now that power has been given to the country- and town-planning authorities and the development authorities of cities. A 2011 study by MIDS states: “Devolution of funds to ULBs continues to be a major challenge. Despite recommendations of all three State Finance Commissions and the Central Finance Commission, several grants and assigned revenues have not been transferred to the ULBs or have been inadequately transferred.” Another report, Innovative Resource Mobilisation Practices: A Case of Urban Local Bodies in Tamil Nadu, 2004, states that while the constitutional amendments had mixed results at the national level, Tamil Nadu fared particularly poorly. Comparatively, neighboring Karnataka and Kerala have implemented far better devolution of administrative and financial powers to local bodies. Since 1994, six State Finance Commissions (SFC) have been constituted by the state government. The 6th SFC formed in 2020 had its tenure extended up to December 2021 but its final report is yet to be made public. Tamil Nadu is supposed to provide 10% of State-owned tax revenue (SOTR) to local bodies, of which 56% is to go to village panchayats and 44% to urban local bodies such as corporations, municipalities, and town panchayats. Though successive state finance commissions in Tamil Nadu have recommended for a greater devolution of funds to local bodies, they have been ignored. Tamil Nadu is supposed to provide 10% of State-owned tax revenue (SOTR) to local bodies, of which 56% is to go to village panchayats and 44% to urban local bodies such as corporations, municipalities, and town panchayats. States like Kerala devolve 24% of SOTR to local bodies and Karnataka provides 30%. A 2009 RBI study found Tamil Nadu to be the one of the worst performers when it came to fiscal decentralization. The actual expenditures in local bodies on services and developmental activities continue to be abysmally low. While states like Kerala devolve 24% of SOTR to local bodies and Karnataka provides 30%, even states like Uttar Pradesh and Maharashtra are devolving more funds than Tamil Nadu. A study on Functional and Financial Autonomy of Local Governments (2017) found that “the two fast reforming states, Andhra Pradesh and Tamil Nadu, are strengthening the state-level governments but the same does not seem to happen with decentralization downwards (to local governments).” There is no organic

Opinion | Tamil Nadu’s parties oppose NEET over vested interests, not social justice Opinion | Tamil Nadu’s parties oppose NEET over vested interests, not social justice Chandrasekaran Balakrishnan February 10, 2022 Tamilnadu Economy A protest against NEET organized by the CPM after the suicide of Tamil Nadu student Anitha in 2017  Read in : தமிழ் Indian medical education and medical practices date back to ancient times when vaidyas (physicians) in dominant communities and tribal healers in other communities have been treating illnesses. The modern medical profession began to take shape in the nineteenth century in British India. Healthcare personnel were trained in medical courses as apprentices, basically to help treat wounded soldiers during war. From that era to the current times of NEET, there hasn’t been much progress in medical education, even in Tamil Nadu which has one of the highest number of medical colleges. Formal medical education began only a century ago. After independence, India did not witness the same kind of progress in medical education as it did in engineering, law, accountancy and the arts and sciences. Those fields produced thousands of professionals year after year for industry and public services. The global demand also grew as technological advances began being made in the second half of the twentieth century. According to Statistics of the Union Education Ministry (2019-20), Tamil Nadu has a total of 59 universities (6%), of which only 4 are medical institutions. The state has a total of 2,610 colleges which is 6% of colleges in India. Arts and Science, engineering & technology, teachers’ training, and nursing account for 79% of colleges in the state. A total of 2,251 (86%) colleges are in the private sector and only 375 (14%) are government managed. There are 455 engineering and technology colleges in Tamil Nadu which is 17% of the total in the country. Tamil Nadu has two law universities with 44 colleges (6%). Politicians have been misguiding students into thinking that NEET is not a fair process to assess whether they are eligible for medical education. They use the social justice principles of Dravidianism to portray NEET as being elitist, only because they seek to hide the collusion of political parties with vested interest groups who own medical colleges and universities. However, in the past seven decades, medical education, administration of institutions, and regulatory authorities in the country have not grown in the same way that other fields have. Though India’s pharmaceuticals sector has broken the shackles of systemic challenges and achieved significant progress especially in research and development, the same cannot be said about medical education. Medical education slowly but steadily came fully under the control of a few highly influential people. Their nepotism and the vested interests of politicians and greedy business groups eventually deprived millions of students the opportunity to become doctors. Reforms pursued in the last decade, however, have brought hope, especially to first-time learners from rural and economically backward areas and communities across the country. The biggest reform has been the establishment of the National Medical Commission (NMC) in 2019. While piloting the NMC Bill, the then Union Health Minister had said that “the Medical Council of India (MCI) was plagued by corruption”. There was a need to overhaul the corrupt, inefficient and opaque MCI. In 2001, Delhi High Court ordered the removal of Dr Ketan Desai who was then president of MCI over large-scale corruption and malpractice. The court order said, “We are now certain that MCI is a den of corruption”. Further, in 2018, there were CBI cases registered against officials of MCI. It is against this background that one must understand the debate on National Eligibility-cum-Entrance Test (NEET) in Tamil Nadu. NEET is being used by politicians as a tool to accuse the Centre of being against federalism. Politicians have been misguiding students into thinking that NEET is not a fair process to assess whether they are eligible for medical education. They use the social justice principles of Dravidianism to portray NEET as being elitist, only because they seek to hide the collusion of political parties with vested interest groups who own medical colleges and universities. The present ruling party in Tamil Nadu, the DMK, has promised in its election manifesto of 2019 assembly elections that they would get rid of NEET, knowing fully well that they can point to the Supreme Court judgment favoring NEET as an excuse for their failure. The Supreme Court said that NEET ensured a level playing field in medical education for government, private and minority educational institutions in the country. Despite the Supreme Court verdict, the DMK government went ahead and constituted an expert committee to examine the need to exempt Tamil Nadu from NEET, only to serve their own interests. The AK Rajan committee report has been criticized for not providing any data to support the claim that NEET was against social justice. The present ruling party in Tamil Nadu, the DMK, has promised in its election manifesto of 2019 assembly elections that they would get rid of NEET, knowing fully well that they can point to the Supreme Court judgment favoring NEET as an excuse for their failure. Tamil Nadu has one of the highest number of medical colleges in India, 69, with the total seats standing at 10,375. Of these, 37 (54%) are government medical colleges with 5,125 seats (49%) and 32 (46%) are private colleges and universities are with 5,250 seats (51%). The State also added 11 new medical colleges in the government sector with 1,450 seats. Thus, now Tamil Nadu has a total of 6,575 seats in the government sector which accounts for 12% of medical seats in India in 2021. The Governor of Tamil Nadu did the right thing by returning the NEET Bill 2021 passed by the Tamil Nadu Assembly to The Speaker for reconsideration. The Constitutional head is well within his rights in ensuring that only laws in the interest of the people are implemented. The governor said that the proposed Bill is “against the interests of the students, specially the

Tamil Nadu power sector urgently needs reforms, should use budget clause on fiscal deficit Tamil Nadu power sector urgently needs reforms, should use budget clause on fiscal deficit Chandrasekaran Balakrishnan February 2, 2022 Tamilnadu Economy Tamil Nadu has great potential for power generation, including renewable energy such as wind and solar power. Private power generators who have invested in wind and solar energy projects during the last few months of the previous regime in Tamil Nadu are now facing challenges in completing the projects and commissioning them. This is something that the DMK government should resolve soon.                                                               Read in : தமிழ் After independence, two of India’s larger states namely Tamil Nadu and Uttar Pradesh had the same per capita income around the year 1957. Since then, the two states have diverged over the years on major development indicators. Now, the prosperity of Tamil Nadu is three times that of Uttar Pradesh. Moreover, there is a sharp contrast between these two states on every parameter of social, economic, environmental and developmental growth. The key transformative role played was the power sector which has far-reaching multiplier effects on economic activities. But at present the power sector is in need of reforms. One of the major drivers of Tamil Nadu’s growth was the social and economic awareness to get support like free power from the government for the welfare of the people across the segments. As a result, in the year 1999-2000, Tamil Nadu, had the highest per capita power consumption in entire South India with 484 kWh, much above the national average. In a 2004 research analysis, Mathew Joseph noted that Tamil Nadu’s prosperity increased due to “the advanced stage of industrialization in the state. The low pricing of electricity to agriculture and domestic sectors and high pricing of industry, over the years has led to the share of the former sectors rising while the share of the latter sector falling particularly as the industrial sector has been moving to captive (sources of power generation).” Now, it is well known that the electrification of the entire state of Tamil Nadu was achieved much before most states in the country. Part of the reason is that the state was able to get capital investments from the private sector for power generation and has built a robust and competitive environment over the years. In a 2004 research analysis, Mathew Joseph noted that Tamil Nadu’s prosperity increased due to “the advanced stage of industrialization in the state. The low pricing of electricity to agriculture and domestic sectors and high pricing of industry, over the years has led to the share of the former sectors rising while the share of the latter sector falling particularly as the industrial sector has been moving to captive (sources of power generation).” However, the state is losing its sectoral advantages in the power sector in recent years entirely due to a lack of vision, political leadership, and poor institutional governance structure. This has affected sectors across the economy. For example, it was reported last year that Uttar Pradesh had overtaken Tamil Nadu in becoming the state with the second highest GSDP. To mitigate the power sector crisis in the country, the Union Finance Minister has announced in her Budget Speech that “in 2022-23, in accordance with the recommendations of the 15th Finance Commission, the states will be allowed a fiscal deficit of 4 per cent of GSDP of which 0.5 per cent will be tied to power sector reforms, for which the conditions have already been communicated in 2021-22.” The announcement made in the Union Budget 2022-23 only reinforces the need for long-overdue power sector reforms especially the unbundling of states’ power distributions agencies, which are mostly debt ridden due to outdated modes of operation and services. General users are suffering due to frequent power cuts in Tamil Nadu. The recent CAG report on performance of power sector in Tamil Nadu has criticized the state for incurring thousands of crores of losses every year and for the purchase of poor quality coal, and so on. The present DMK government has noted in its “White Paper on State Finances” that it is imperative to undertake reforms in the power sector in the state but there has been no progress so far to speak of. The State government has promised to bring out a sector-specific sector-wise White Paper on issues and challenges to overcome, but there is nothing yet with regard to the power sector. There are incidents in the state where private power generators who have invested in wind and solar energy projects during the last few months of the previous regime in Tamil Nadu are now facing challenges in completing the projects and commissioning them. This is something that the DMK government should resolve soon. The announcement made in the Union Budget 2022-23 only reinforces the need for long-overdue power sector reforms especially the unbundling of states’ power distributions agencies, which are mostly debt ridden due to outdated modes of operation and services. The recent CAG report on performance of power sector in Tamil Nadu has criticized the state for incurring thousands of crores of losses every year and for the purchase of poor quality coal, and so on. Another aspect where reforms are needed are with regard to transmission and distribution (T&D) losses. It was 18% in 2021-22 in Tamil Nadu, which is higher than that prescribed by international best practices and also more than that of other major states in India. For the current year, a total provision of Rs 19,873 crore has been made in the Revised Budget Estimates 2021-22 towards subsidies for free supply of agricultural power, domestic supply, and for the takeover of losses made by Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO). Tamil Nadu has already borrowed up to 3 % of GSDP value to bridge its fiscal

New Chief Economic Adviser Anantha Nageswaran, a right-wing economist, is a Madurai man New Chief Economic Adviser Anantha Nageswaran, a right-wing economist, is a Madurai man Chandrasekaran Balakrishnan February 1, 2022 Tamilnadu Economy Finance Minister Nirmala Sitharaman attends the book launch of ‘The Rise of Finance’ by V Anantha Nageswaran (extreme right) and Gulzar Natarajan on November 10, 2019, as the Chief Guest in New Delhi. Chairman of the Economic Advisory Council to the Hon’ble Prime Minister Bibek Debroy is also present. (Photo Credit: Twitter @nsitharamanoffc)                                                                                                                                    Read in : தமிழ் As the economy recovers from the shackles of the COVID-19 pandemic, the upcoming Union Budget will be looked to as a sign of hope for the year ahead. Along with the Union Budget 2022-2023, the Economic Survey 2021-22 gives the country a chance to improve its economic indices based on the assessment of the previous year through critical data analysis and in-depth research on public policies. In this background, the recent appointment of Dr Venkatraman Anantha Nageswaran as the next Chief Economic Adviser by the Union Finance Ministry is significant. The post had been lying vacant for a month and a half since Dr KV Subramanian demitted office after his three-year term ended December 17, 2021. Anantha Nageswaran is a native of Madurai in Tamil Nadu and is rooted in Indian culture despite having a career that took him across the world over many decades. He is a graduate of commerce from American College, Madurai, who then completed an MBA from the Indian Institute of Management, Ahmedabad in 1985. He has a doctorate from the University of Massachusetts, Amherst, USA. His PhD thesis was on the empirical behavior of exchange rates (1994). Inspired by C Rajagopalachari, B R Ambedkar and B R Shenoy, Anantha Nageswaran subscribes neither to the idea of excessive state control nor unfettered free market systems. He is known to be a pragmatic economist who believes in integrating public policies with Indic ideology. Until recently, he was a part-time Member of the Prime Minister’s Economic Advisory Council from 2019 to 2021. Prior to that, he was the Dean of the IFMR Graduate School of Business, Chennai, and a visiting professor of economics at Krea University, Chennai. He taught financial economics at several business schools and institutes of management in India and Singapore.  He is a member of the Board of Directors in several companies in India, including TVS Logistics and Aparajitha Corporate Services (P) Limited. He co-founded Aavishkaar Venture Capital, an investor venture in Social Enterprises.  He is a co-founder of the Takshashila Institution, a centre for research and education in public policy. The new CEA brings several competencies to the highest level of policymaking in the country, especially at a time when the economy has been fractured by the pandemic, and attempts are being made to stabilise the financial systems with long-lasting governance structures. He comes with optimism about India and its economic fundamentals. Anantha Nageswaran has extensively written about what has been plaguing the Indian economy for years, from the perspective of planning of public policies as well as taking regional economies into consideration. According to Anantha Nageswaran, “The state capability constraint is serious, pervasive, and endemic even as the role of the state remains indispensable to achieving economic prosperity and social stability.” Inspired by C Rajagopalachari, B R Ambedkar and B R Shenoy, Anantha Nageswaran subscribes neither to the idea of excessive state control nor unfettered free market systems. He is known to be a pragmatic economist who believes in integrating public policies with Indic ideology. In 2019, Anantha Nageswaran co-authored a research paper with Gulzar Natarajan titled ‘India’s Quest for Jobs: A Policy Agenda’, published by the Carnegie Endowment for International Peace. “The implementation of any reform is likely to remain suboptimal without a paradigm shift in the way the Indian state views and engages with the private sector,” the paper said. “Instead of taking an adversarial and regulatory-oriented approach, it needs to highlight partnership and facilitation. The anti-big bias reflected in the government and public policy is a problem that has yet to be tackled effectively”. In an article in The Indian Express in November 2020, Anantha Nageswaran wrote: “Demonetization led to formalization of the economy, acted as a catalyst for digitization of financial transactions, stirred a debate about entrenched informality in the economy, and led to re-classification of MSME enterprises and the decriminalization of violations of many penal provisions of the Companies Act.” When many were critiquing the present central government policies, Anantha Nageswaran wrote with optimism in The Indian Express that, “Demonetization led to formalization of the economy, acted as a catalyst for digitization of financial transactions, stirred a debate about entrenched informality in the economy, and led to re-classification of MSME enterprises and the decriminalization of violations of many penal provisions of the Companies Act.” In 2016, he had co-authored a research paper titled “Can India Grow: Challenges, Opportunities, and the Way Forward”. In it, he wrote that “The Indian government should pursue reforms in the areas of higher and lower education; urban governance; housing, land, credit, and labor markets; and infrastructure contracting. It should also seek to shrink the informal economy and expand the tax base, while also improving state capacity and personnel management.” Further, he also stressed the importance of governance at the ground level focusing on district-level delivery mechanisms. This is something most economists ignore. In his analysis, Anantha Nageswaran said, “The district-level bureaucracy, administered by district collectors, has remained virtually the same, both in structure and in personnel deployment, since independence. During the same period, there has been a dramatic expansion in the government’s responsibilities, including development and welfare interventions,

Why TN should fix power sector before shooting for trillion dollar economy Why TN should fix power sector before shooting for trillion dollar economy Chandrasekaran Balakrishnan January 10, 2022 Tamilnadu Economy                                                    TN has to fix its power sector first                                                                    Read in : தமிழ் India as a nation entered the trillion-dollar economy club in 2007. India set a goal in 2018 to become a 5 trillion-dollar economy by 2024-25. Amid this, a few states in India have set a vision of becoming trillion-dollar economies. But this seems overly ambitious even though it is a reflection of the scale of economic activities in India that states can aspire to this goal. Among major states which have set this goal are Uttar Pradesh by 2024, Maharashtra by 2025 and Tamil Nadu by 2030. States like Gujarat, Andhra Pradesh, West Bengal, Karnataka, Rajasthan, Madhya Pradesh are also marching towards the same vision. In the case of Tamil Nadu, in 2020-2021, the state economy stood at $300 billion or approximately Rs 22.2 lakh crore. The state would need investments of an additional Rs 23 lakh crore to reach the trillion dollar mark by 2030 which is double the current size of the economy. A key factor driving economic growth is power generation, distribution, and transmission, which has been in crisis across the country during the last two decades. Despite the efforts of the Union government to address some of the core issues, the states have not recognized the existence of structural flaws and anomalies in their regional economies. In Tamil Nadu, for instance, Technical and Distributional losses are far higher compared to other major states.  In the case of Tamil Nadu, in 2020-2021, the state economy stood at $300 billion or approximately Rs 22.2 lakh crore. The state would need investments of an additional Rs 23 lakh crore to reach the trillion dollar mark by 2030 which is double the current size of the economy.   Tamil Nadu has been a pioneering state in the country in providing power to all sectors. It achieved 100% village electrification much earlier than other states, besides being among the top 10 states in per capita power consumption. In 2018–19, the power sector subsidy in Tamil Nadu was the second largest with 21.1 percent share after food subsidy which was 36.8 percent. Similar magnitudes have been continuing since then. In recent years, there have been several studies that pointed out the importance of the power sector in lubricating regional economies like Tamil Nadu which is the second-largest economy in the country. A study by Delhi-based TERI institute (2017–2030) found that in Tamil Nadu economy “not only did total electricity consumption have high correlation with total GSDP—industrial and agricultural GSDP—but consumption from different sectors was also correlated with the GSDP of the respective sector.” During the last ten years, the cost of power production has increased many fold. Despite several measures, Tangedco’s losses continue to increase on high costs and low recoveries due to a lack of structural and institutional reforms. As Of March 31, 2021, Tamil Nadu’s outstanding debt of power utilities – Tangedco and Tantransco – and STUs was Rs.1.99 lakh crore. The state-owned power generation company’s outstanding debt was Rs.1.24 lakh crore (62.31 percent) (excluding State government loan) and Rs 1.34-lakh crore (67.33 percent) (including State government loan of Rs.4,582.45 crore and UDAY Loan of Rs.4,563.00 crore). Metering farm power The agriculture sector gets free power which is one of the structural flaws in the state. Small farmers are the main losers of most subsidies which only reach big farmers. Also, the domestic sector and the two water boards losses are on a huge scale due to several issues. There is an urgency to set priority to rationalize these sectors as per the guidelines of the Union government which has proposed a robust reform through amendments in the Electricity Act.   The present DMK government’s “White Paper on Tamil Nadu Government Finances” has stressed that public sector undertakings (PSUs) in the State especially the power generation and distribution companies have huge outstanding debts, in the order of 36 percent of GSDP which is significantly higher among major states and greater than the permissible limit of 25 percent. Thus, power sector reform is inevitable if the state doesn’t want to go bankrupt. So far, the state government has been directionless and has no conviction to work towards the vision. Keeping in view of the above aspects, it would be interesting to look at the status of the power sector in Tamil Nadu. As per the Central Electricity Authority, by the end of December 2021, the total installed capacity of power (in MW) of 20 percent is with the State government, 56 percent is with the private sector and 24 percent is with the Union government The State’s share of installed capacity is 9 percent in the country and its share in the southern region is 32 percent. The private sector share is one of the highest in the country and is three times that of the State’s capacity. The State has the largest wind and solar power generation capacity in the country. It would be folly to aim for a trillion-dollar economy without pondering over reforming the institutional governance structure of the power sector which is driving the economy but has not been given enough attention. In any case, the Tamil Nadu government does not seem to be sincerely pursuing the trillion dollar vision. In the two-day Assembly session, out of the dozen bills passed none is related to the trillion dollar vision. Recently, the State government directed all district collectors to identify government land for setting up solar parks to generate

Maridhas arrest: DMK’s poor record in free speech continues Maridhas arrest: DMK’s poor record in free speech continues Chandrasekaran Balakrishnan December 23, 2021 Tamilnadu Economy Maridhas has been an outspoken person commenting on a wide range of public policy issues                                                                                                                                            Read in : தமிழ் Healthy dissent and public debates are key elements of a vibrant democracy. Bad governance or misgovernance can mar this. Misgovernance is a slow reveal which means that only a few grasp quickly what is going on. Democracy is not a recent import as some believe but has been part of the country’s long history. Unfortunately, in the last two hundred years, the governance model has gone against the decentralized democratic ethos of India. Freedom of expression in a democratic spirit is an important institution as the founding pillar for meaningful debate and discussion. Best-in-class democracies accommodate the views of both sides of the coin without any curbs. In actual practice, elected governments invariably deviate from established constitutional mandates. The outright stifling of freedom of expression in a state like Tamil Nadu is a serious concern. Whenever the DMK has come to power, it has been obsessed with how to manoeuvre laws regulating obscenity, hate speech against one or more communities or religion. The DMK has perfected the methods of influencing the media. The DMK’s interventions in debates have not helped to create consensus. They have abetted rancour. Their nationalist credentials are suspect and they are not committed to the integrity of the country. The newly elected government of Tamil Nadu is no different. The recent arrest of the nationalist writer and commentator Maridhas is an illustration of how power can be predatory. As noted by Prof Arudra Burra (2018) “the discussion of political speech concludes with an account of the 16th amendment in 1963. The amendment made it constitutionally permissible for the state to restrict speech in the interests of protecting the sovereignty and integrity of India: its ostensible aim was to allow for curbs on the advocacy of secession in India, made at the time primarily by the DMK in Tamil Nadu for a separate ‘Dravidistan’. (The advocacy of secession was made officially unlawful only in 1967, which the passage of the Unlawful Activities (Prevention) Act.)…the amendment passed with huge majorities in both houses of parliament, with the sole vote against it from C.M. Annadurai, representing the DMK in the Rajya Sabha”. During the previous tenure, too, there were many attacks on media freedom. News headlines talked about how DMK rule was curbing freedom of expression. Attacks on Thuglak and Kumudham magazines highlighted this. Questions posed by Maridhas related to the political beliefs of then News18 journalists remain unanswered In the last decade, Tamil Nadu has seen a big spurt in street protests instigated by those with Dravidianist agendas. Their main motive is to depolarise the state in the name of protecting Tamil identity. People have the constitutional right to question the affairs of the elected government and its malfunctions. Maridhas was defending the best of our Constitutional mandates in protecting the integrity of the country. He was giving fitting replies to those who were insulting the memory of the martyrs who died in the chopper crash in Nilgiris. Support from court Maridhas had posted a day after the chopper crash that Tamil Nadu is “becoming another Kashmir under the DMK regime” and it gives “freedom to form groups that can do any level of treason against the country”.The tweet added that “in such a state, any kind of conspiracy can be plotted” and that such “separatist elements should be destroyed”. For the above, the police arrested him. However, the Hon’ble Madras High Court Madurai Bench quashed the FIR registered on him by saying that the provisions of sections 153,504, and 505(2) and Section 153 A of IPC were illegally framed. The Madras High Court said that “since the petitioner has been an acerbic critic of the ruling party, he has been falsely implicated”. Further reading the comments of Maridhas, the High Court said that “reading of the petitioner’s tweet only indicates that the petitioner has given a call in favour of national integrity and security. He has taken serious objection to the act committed by certain persons who are undeniably anti-national. The petitioner has called upon the State government to suppress the separatist forces.” The court further went and said that “the petitioner’s intention is that the separatist tendencies must be nipped in the bud…. the petitioner’s tweet was never intended to subvert the Government. On the contrary, it calls for strengthening the foundations of government.” Maridhas has been an outspoken person commenting on a wide range of public policy issues. Maridhas counters the extreme positions taken by the DK and the DMK and“has attacked the ‘holy duo’ of Tamil Nadu relentlessly — Dravidianism and Marxism. With elaborate chart-based presentations, he explains the concepts to his audience. He has become a phenomenal hit among social media users. As of now, Maridhas has been freed from only one case. It is an instance of political vendetta that the ruling government in the State is still chasing him and has registered two more cases in Tirunelveli and Thoothukudi. One case is related to the News18 controversial debates which took place some seventeen months ago. The DMK’s interventions in debates have not helped to create consensus. They have abetted rancour But questions posed by Maridhas related to the political beliefs of then News18 journalists remain unanswered. Another case is related to the spread of COVID-19 in the initial phase when a few people resisted complying with the government’s public health instructions

Amit Shah language row a needless distraction, non-issue Amit Shah language row a needless distraction, non-issue Chandrasekaran Balakrishnan December 7, 2021 Tamilnadu Economy Union Home Minister Amit Shah said at the recent Southern Zonal Council meeting that all home ministry files are being written only in Hindi.                                                                                                                                           Read in : தமிழ் Languages evolve and spread when a common cultural norm is created among communities due to social cohesion. This is true of all languages and of Tamil also. No one person or community can claim ownership for the creation and diffusion of languages over time. One may have passion towards a language but obsession is not healthy. This will make people devalue other languages. No language is good or bad. Every language is unique in its own form. People cherish the choice they have to learn and use the language. During the Independence movement, India’s leaders were mostly multilingual in speaking and sometimes in writing as well. But today’s milieu is not conducive to learning one or more languages than the mother tongue. Some crude public debates and discourses have been lingering for several decades now in Tamil Nadu that narrowly propagate one language over others. This goes against the legacy and ethos of the very languages that are promoted. The Tamil vs Hindi or the Tamil vs Sanskrit controversy is doing injustice to the makers of the Constitution of India and its values and principles. The Constitution provides equal opportunities to every citizen to learn their choice of languages without restriction across the country. However, the predatory nature of regional polity is such that one language is mocked. Votebanks are sustained and the media is used to inflame public opinion. These political agencies time and again utterly ignore that Indian society is multilingual and multicultural.   No language is good or bad. Every language is unique in its own form. People cherish the choice they have to learn and use the language The case in point is the reference to the recent remarks made on Hindi language by the current Union home minister at a Southern Zonal Council meeting held at Tirupati. The meeting was attended by southern states’ political representatives and government officials primarily to sort out the underpinning regional and inter-state issues and challenges.Several important aspects were taken up for discussion and were reported that many were resolved (40 out of 51 issues). Unfortunately, the media was interested more in sensationalism to create news and controversy. In a multilingual and multicultural society such as ours, stances on language are bound to be misinterpreted. And the media takes advantage of this to sensationalize. The Indian media has played a key role in sustaining our democracy but in recent times the actual purpose of a vibrant media has got muted. The 29th meeting of the Southern Zonal Council chaired by the Union Home Minister comprised all the southern states and UTs. Today there is a need for a strong Centre-State and inter-state relations in the true spirit of federalism emphasized under the Constitution of India. Five Zonal Councils were set up in 1957 under Section 15-22 of the States Re-organization Act, 1956. The Home Minister is the Chairman of all the five Zonal Councils and the chief ministers of the host state (to be chosen by rotation every year) are the vice-chairmen. Two more ministers from each state are nominated as members by the Governor. The zonal councils primarily aim to resolve disputes and irritants between the Centre and the states and among the states in the zone. The councils discuss a broad range of issues which include boundary-related disputes, security, infrastructure-related matters like road, transport, industries, water, and power, matters about forests and environment, housing, education, food security, tourism, and transport. It has been reported that arrangements were made by the Union government so leaders could speak in their regional languages and their speeches were translated verbatim in English and Hindi. The Tamil Nadu minister for higher education represented the government of Tamil Nadu and “raised the issue of size and capacity of fishing boats to be used in the Indian Exclusive Economic Zone and the transfer of railway lands for Metro Rail projects.” Further, we learn that the Tamil Nadu chief minister had urged the council to “make Tamil one of the official languages of the country” and also to “declare Thirukkural as the National Book”. We do not know whether the state government tried to sort out water sharing issues with states like Kerala. The home minister’s comments about Hindi were not against the spirit of the Constitution nor against regional languages. He said, “Hindi is the friend (sakhee) of all indigenous languages (swabhasha). India’s prosperity lies in the prosperity of our Indian languages”. He also said that “we need to create an environment wherein people take pride in speaking their mother tongue”. Nothing is wrong with these statements. A few people may find fault with this due to their narrow mindset and vested interests though.   When P Chidambaram was home minister during 2008-2012, all the files in the home ministry were written in English, not in Hindi. The reason was that he was comfortable with English. However, his statement, “Today I feel very proud to say that not even a single file is written in English in the Union Home Ministry. We have completely adopted the official language (Hindi)”, become a media sensation and controversial in Tamil media for no valid reason. Those who argue that the above statement is against regional languages tend to forget that when P Chidambaram was home minister during 2008-2012, all the files in the

Mullaiperiyar: A playing field for vested interests in linguistic states Mullaiperiyar: A playing field for vested interests in linguistic states Chandrasekaran Balakrishnan November 17, 2021 Tamilnadu Economy Read in : தமிழ் During the freedom struggle against the British, there was a deep sense of oneness among the people. Creation of administratively autonomous states based on language after Independence has become a structural hurdle against national pride.  It has led to miscommunication among the people driven by sentiments. It has also led to a lack of pride in belonging to a diversified civilizational nation with a culture of its own and family value systems. Economic development was pursued based on imported ideas and policies at the cost of environmental, social, and cultural norms. As a result, regional disputes have become festering sores. The Mullaperiyar Dam issue is one such issue that has been persisting since the 1960s showing deeply flawed thinking in Tamil Nadu as well as Kerala.  In a different context, development economist Yamini Aiyar recently stated that “our shared histories, cultures and geographic interconnectedness are a source of great strength and power. But without careful nurturing, these very interconnections and shared histories are a tool for a deep, divisive, and violent politics that is increasingly gaining domestic legitimacy within … across the region. Such a politics will leave each individual nation more vulnerable and at far greater risk of re-living the traumatic violence of its past. A strong, peaceful, connected … is at the heart of protecting national interest within the region.” This is true of the Mullaperiyar dam issue between Kerala and Tamil Nadu as well as the Cauvery water issue between Karnataka and Tamil Nadu and the Krishna water issue between Andhra Pradesh and Tamil Nadu. In 1979, because of the controversy that had erupted, storage level was reduced from a full capacity of 152 ft to 136 ft.   However, as one report rightly stated, “the equation between the two States is far more complex than those of Tamil Nadu with Karnataka. With Kerala,Tamil Nadu has issues on several river waters, such as Parambikulam-Aliyar, Siruvani of the Bhavani sub-basin, Neyyar, and the proposal for linking the Pamba and Achankovil rivers of Kerala with Vaippar of Tamil Nadu. But, in the case of Karnataka, Cauvery is the only river to be considered.” The main dispute is the appropriateness of the dam’s water level. The safety aspects of Mullaperiyar dam trace back to the 1960s when mysterious stories erupted in a national daily after a Kerala flood raising concerns over the safety of the dam. It has been four decades now but safety concerns are yet to be proved scientifically or advanced from the basic features which were cited as main reasons initially. The main dispute is the appropriateness of the dam’s water level. Since the dam commissioning in 1895, almost everything went smoothly for nearly eight decades. In 1979, because of the controversy that had erupted, storage level was reduced from a full capacity of 152 ft to 136 ft. But this did not tamp down fears in Kerala. It is possible there are other factors at work behind the demand for the safety of the dam. Judicial intervention has provided a concrete roadmap for the states. The Supreme Court gave two separate judgments, in 2006 and 2014, and directed that water level can be raised to 152 ft. It also directed the formation of a committee for oversight. So, the system is in place as it should be in a rule-based practicing democracy. Educated, but ill-informed people in academia, a section of the media and film actors are among those who are working against giving the other state its constitutional due, Scientists and experts have gone into the intricacies of dam safety. Courts gave specific mandates for the experts and their opinion formed the basis for judicial intervention. But these have been completely ignored by some media outlets that have launched a campaign against the dam. International forces, academic and non-academic, are working against the interests of both states, thus jeopardizing national interest. Their warnings on dam safety are based on vague estimations and predictions. One such report is “Ageing water infrastructure: An emerging global risk” by United Nations University’s Canada-based Institute for Water, Environment and Health. Instead of producing country-specific working papers and making raw data available in the public domain, the report seeks to make a generic conclusion including on Mullaiperiyar issue that the media in Kerala has recently highlighted as a cause for concern. Poor communication between water management authorities of both states and mismanaging critical situations covering dam water storage, release, maintenance and so on has contributed to the problem. Part of the current controversy is due to the unusual rains and devastating floods in Kerala. Misjudging of the rains and the possibilities of flooding has contributed to the problem. The Mullaperiyar dam comes in handy to divert people’s attention. Poor communication between water management authorities of both states and mismanaging critical situations covering dam water storage, release, maintenance and so on has contributed to the problem. Rejuvenating and restoring hundreds of water bodies like streams, odai, tanks, ponds and lakes, downstream of the dam is not being given enough attention in Tamil Nadu. These measures could boost groundwater and offset the requirement on the water from the dam. But these issues are not given adequate attention. Tamil Nadu and Kerala have much in common and have a shared civilizational journey with many common cultural, family and social values. Both sides should introspect and avoid acrimony while protecting each state’s interests. Unbiased scientific data on dam safety and water use should be the basis of solutions. At present, authorized studies commissioned by governments on dam hydrology, structural stability, and the problem of seismicity are not available in the public domain. One way is for both states to abide by the rule curve set by the Supervisory Committee formed by the Supreme Court. Secondly, bigots on both sides should be quickly punished so distrust between the peoples is

Paying for TN’s welfare budget: Growth projections are a pie in the sky Paying for TN’s welfare budget: Growth projections are a pie in the sky Chandrasekaran Balakrishnan March 20, 2020 Tamilnadu Economy The state budget has targeted social welfare to create a votebank for the DMK. But achieving overall state prosperity has been ignored.  Read in : தமிழ் The state finance minister, P Thiyagarajan delivered a welfare budget on March 18. But there was little in it to support projections on economic growth and tax buoyancy that would pay for the spending while keeping deficits under control. The budget is not aimed at increasing economic growth and development by leveraging or adding further economic and institutional infrastructures facilities in the state. Several major industrial development projects have been delayed. The broad focus areas highlighted in the budget do not support economic growth. Yet, the budget has projected that the nominal Gross State Domestic Product (GSDP) growth of Tamil Nadu will be 14.0% in 2022-23 and 14.0% in 2023-24. The goal is one trillion dollar economy by 2030. The budget forecasts some 25% growth in tax revenues to pay for welfare expenses and keep deficits under control. This can come only with high economic growth. The announcement made in the budget for setting up of new industrial parks in districts like Coimbatore, Perambalur, Madurai, Vellore, and Thiruvallur is not backed up with specific sector specialisation or tie-up with major industries houses. Growth estimations in the budget are too ambitious and do not match ground realities. The environment is not conducive for rapid economic growth. Economic growth will come from manufacturing and services sectors largely. But the MSME sector has been allocated a measly Rs 911.5 crore. Tamil Nadu has about five million MSMEs which accounts for an 8% share all-India and the third-highest in the country. The sector employs 10 million people (Male-7 million and Female-3 million). According to the Union MSME ministry, as of November 26, 2021, in the Udyam registration portal, 6.23 lakhs units were registered from Tamil Nadu, During the last two years’ pandemic period, the MSMEs sector was most hit by loss of employment, wealth generation, etc. The state budget failed to take into account the severe pains and financial stresses faced by this sector. The budget provision of Rs.100 crore for the Tamil Nadu Credit Guarantee Scheme for MSMEs is just not adequate. There is no indication at all in the state budget that the state has approved the pilot phase scheme on January 4, 2022, through which Rs 100 crore will be disbursed by the end of March 31, 2022. The allocation for industries department, which generates employment directly or indirectly, of Rs.3,267.91 crore is paltry. There is talk about boosting public infrastructure facilities to promote exports from the State with a target of $100 billion by 2030. But the budget has largely ignored this. Service sector has been ignored even more. The announcement made in the budget for setting up of new industrial parks in districts like Coimbatore, Perambalur, Madurai, Vellore, and Thiruvallur is not backed up with specific sector specialisation or tie-up with major industries houses. Except Perambalur, many of these districts already have industries. No fund allocation has been made for the development of parks. In the past, many such announcements were made with or without funds allocation but nothing happened even after years of demands from industries associations and entrepreneurs in the state. The overall allocation of Rs.20,400.24 crore for the Municipal Administration and Water Supply Department which covers more than 54% of the State population is not adequate given the acute shortage of quality urban infrastructure and services. The token amount of Rs 10 crore each allocated in the budget for newly created city corporations like Tambaram, Kanchipuram, Kumbakonam, Karur, Cuddalore, and Sivakasi serves little purpose. The following announcements made in the state budget for urban areas could address long pending structural issues. They can make a difference if implemented properly. State’s share of Rs 2,169 crore allocated for municipal solid waste management to improve sanitation under Swachh Bharat Mission 2.0 scheme of Union Government Rs 2,130 crore for projects of water supply and sewage management under the AMRUT Scheme of Union Government. The Outer Ring Road from Minjur to Vandalur with a length of 62 km proposed to be developed as a Development Corridor with the establishment of large-scale residential complexes, SIPCOT industrial parks, recreational spots, warehouses, horticulture parks, organic food processing zones, and plug-and-play facilities for industrial development along this corridor. Unless the state government rationalises power subsidies through a Direct Beneficiary Scheme, losses cannot be arrested The new scheme, Kalaignar Nagarpura Membattu Thittam, and Singara Chennai 2.0 have been allocated Rs 1,000 crore and Rs 500 crore, respectively. It is not clear how this scheme will be different from the ongoing smart city projects. It could be just that the ruling party wanted to have its own scheme though the budget has allocated Rs 1,875 crore for the Smart Cities Programme. Given the crisis of the power sector in the state, the budget did not talk about promoting alternative energy sources such as solar and wind. The state finance minister did say: “Tamil Nadu Generation and Distribution Company (TANGEDCO) is a matter of grave concern as it continues to incur huge losses every year”. But the budget bore 100% of Tangedco’s losses for the current year (2021-22) and further gave Rs 9,379 crore to reimburse the tariff subsidies being provided by the Government. Unless the state government rationalises the subsidies through a Direct Beneficiary scheme the losses cannot be arrested in the state. The budget announcement of loan waivers of Rs.4,131 crore would erode institutional morality and credit availability for dutiful citizens who repay on time. Loan waivers only give wrong ideas. In sum, the state budget has targeted social welfare to create a votebank for the DMK. But achieving overall state prosperity has been ignored. 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