Davos economic forum: States hoodwink public by signing local agreements at the summit

Kerala promoted as God’s own country that follows Leftist ideology, participated in this year’s World Economic Forum (WEF) after an 18-year gap and sent its industries minister, P Rajeeve, to present the State there as a good destination for overseas corporates and investors.

They had 60 one-on-one meetings with prospective investors and the minister is quoted saying it considered the scenic Swiss town Davos a “single point to meet various investors.”

On the other hand, Karnataka, busy with its upcoming investor meet, has said that Davos would have been “a distraction.”

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Kerala was busy trying to dispel the notion that it was not an investor-friendly state – now it even has a private university. It probably succeeded in some measure because ministers from other countries reached their pavilion to discuss prospects. Kerala too is having a summit to woo investments from overseas.

Two other states, however, played a different set of cards at the annual WEF where men in black suits network, listen to policy strategies in a changing world, and pitch from hopefuls looking for investments in their respective states. These two states are Maharashtra and Telangana. And it was a disquieting charade where most MoUs signed by Maharashtra were with Indian investors.

Telangana did relatively better with some MoUs signed with corporates that were headquartered within Telangana and some elsewhere in India. In this part of the activity that unfolded in Davos, except for the measure – in numbers of such cases and the extent of the investment – both states did the same.

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Telangana CM with Unilever officials at the WEF in Davos.

Chief Minister Devendra Fadnavis led the high-powered delegation from Maharashtra and the Telangana chief minister Revanth Reddy was the head of his team. It is quite unusual as far as my mind can hark back. One does not go to Davos, and sign MoUs, with the corporate honchos too going there to do what could have been done easily back home.

This is a significant twist, even a departure from the norm because Davos is not the platform for wooing your neighbour overseas. In all probability, these investments would have been discussed and MoUs prepared for signatures to be affixed there. These MoUs are not prepared at short notice on a whim but a lot of concrete inputs go into them.

They may or may not fructify into on-ground projects over time but the curious aspect is that whatever is publicised or shared with the media at the time of signing the MoUs is a critical set of facts: When would the funds come in and the timelines were not announced. No government wishes to commit itself.

Maharashtra has signed MoUs worth Rs 15.7 lakh crore and Telangana Rs 1.7 lakh crore. Each of these MoUs is to lead to employment opportunities for 15.95 lakh persons in Maharashtra and 49,550 in Telangana. Here is a very short list of such local as global pretense: Reliance Industries, Rs 3 lakh crore; Megha Engineering & Infrastructure, Rs 15,000 crore investment.

Interacting with likely investors, networking is indeed an important and critical component of wooing businessmen. But if investment decisions by domestic players are put on a show and dressed up as successes at Davos, it amounts to what Sharad Pawar says is a “show”. He was referring to a Jindal plan to put up a steel plant in Gadchiroli, the MoU signed in Davos.

As Supriya Sule pointed out, Sajjan Jindal stays just three minutes away from Chief Minister Devendra Fadnavis’ residence by car and seven minutes if one walks. Where was the need for them to go to Davos when they could have signed in Mumbai? The same questions and similar sniggers may have been invited by Revanth Reddy, Telangana Chief Minister Revanth Reddy.

This is a different kind of “optics”. Inform the public that a state government ventured forth to Davos and “secured” investments of lakhs of crore rupees which would generate a particular number of jobs. It is a headline-begetting announcement sans details like when the investments would be made and the project completed. Governments tend not to let us know about it.

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