International brokerage CLSA likes Narendra Modi and the Gujarat economic development story.
In its recent Greed and Fear report (31 May), the brokeage notes that even as the UPA dithers on policies at the centre, Gujarat has become the poster child for economic development in India.
“It really seems to be the case that Chief Minister Narendra Modi does run the state like a chief executive officer,” the report said. “Businessmen report that investment approvals are remarkably swift while the state government is viewed as both clean and highly efficient with the word ‘pro-active’ most often applied to describe the functioning of the bureaucracy.”
The report noted that Gujarat had achieved an estimated average real GDP growth of 10 percent over the past seven years, accounted for 16 percent of India’s industrial production and 22 percent of exports, although it only contained 5 percent of the country's population. That growth has led to improved roads, a power surplus, an integrated gas grid, and development of several sectors such as textiles, pharmaceuticals, ports and more recently, automobiles.
"Looking forward, Gujarat can also hope to benefit from the proposed construction of dedicated (rail) freight corridor between Delhi and Mumbai. This is because 38 percent of the length of the 1,483 km corridor will pass through the state," it added.
While it acknowledges that several locals would like to see the 61-year-old Modi become prime minister, the report said that given his “autocratic tendencies , combined with the perceived unlikelihood that the BJP party could ever again achieve an outright majority in the national parliament , makes such a prospect unlikely if not impossible".
Still, as the report noted, there's always room for the unexpected.