Baby steps not enough, need giant strides to get biz moving

From a buoyant 18% growth from 2004-05 to 2009-10, Goa’s economy witnessed a much lower compound annual growth rate of 8.1% from 2015-16 to 2020-21, with private investment giving the state a miss. A successful rejuvenation of Goa’s economy requires higher private investment and a robust policy framework for industrial growth, says Goa Inc.
The ten years of the current BJP government, including the three with chief minister Pramod Sawant at the helm, have seen other states sprint ahead, as Goa’s investment thrust remained weak at best. The state’s emphasis on infrastructure projects by spending from the Centre’s pockets has done little to improve investor sentiment.
Industry bodies have taken the first step to revive private capital expenditure, and while Sawant and his cabinet have made the right noises, a lot more needs to be done. As a confidence-building measure, the state handed over letters of intent to 24 firms that came forward to invest in the state’s economy at the Invest Goa Summit 2022.
“It is the bounden duty of the government to ensure that all clearances, including approvals, are processed on a fast-track basis,” said the summit’s convener, Manguirish Pai Raiker. “We are monitoring the applications of the 24 companies through our facilitation desk, but until and unless the final brick is cast, we cannot relax.”
After commencing the process to draft a new policy in 2018, the state notified the Goa Industrial Growth and Investment Promotion policy, 2022, which replaces the Goa Investment Promotion policy, 2014. In the earlier policy, the government had set an ambitious target of creating 50,000 jobs and bringing in Rs 25,000 crore in investment, but the new policy has toned it down to 30,000 jobs and Rs 20,000 crore investment.
Goa Inc has welcomed the new policy, but has added that an environment of trust, transparency, and predictability is key to a healthy investment cycle.
“Existing industries are made to run from pillar to post, and between different departments as well as local governance bodies, for the required permission, which leads to unnecessary delays and interferences,” said owner of Ultratech Automotive, Damodar Kochkar.
Kochkar, who is the president of Goa state industries association (GSIA), says that the Goa government needs to go back to the basics and address the challenges faced by entrepreneurs. He says that government employees and bureaucrats need to be “sensitised” to understand that the government’s role is to facilitate and not to create hurdles and queries.
“For new industries to come, the government needs to support existing entrepreneurs. You need to put in place proper SOPs. Put things in order and investors will automatically come,” said Kochkar. “The existing players have invested so they can’t go anywhere, but the new investors have options in other states.”
A clear example is the two-year delay by the state to grant approvals for the CMM Group’s logistics park at Dharbandora. The Rs 120 crore project is close to the state border, and has the potential to create 400 jobs for locals. CMM Logistics Pvt Ltd applied for investment clearances in March 2019, but the in-principle approval came in March 2021. The state has now handed over a letter of intent to the firm at the Invest Goa Summit 2022.
“What Goa lacks is a robust grievance redressal system for existing industries as well as new investors,” said the managing director of a local company. “Queries regarding the application from an investor should be addressed within 15 days and applications should be processed within a month at best.”
The Goa Investment Promotion Board appears to have learnt its lessons from the past.“The government has started processing the applications of the 24 investors and is looking into their land requirements, the permissions required, and the other aspects,” said a government official who is not authorised to speak to the press. “In the medium term, Goa-IPB is doubling down on ease of doing business reforms, so that all government services are online and seamlessly integrated across all departments. In the end, Goa IPB must become a true single-window system for investors.”
Skill development and constant training is also vital, not just for local youth but for government staff too, says the industry. “Goa needs to be ready with the skillset, trained manpower. Our youth need to come forward to work, this is crucial. We cannot later complain that outsiders are getting jobs, or that there are no jobs or that unemployment is rising,” said Raiker.
It is clear that while Goa has inherent strengths like human capital, natural resources and a strategic location, the government also needs to recognise that the opportunities will be squandered if immediate steps are not taken to address the governance and institutional gaps that stymie investment in the Goan economy.