Global Investors Meet: MOU figures impressive; what about implementation?

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GIM: MOU figures impressive; what about implementation?
The Karnataka Global Investors Meet 2012 (GIM) was overwhelming on all counts - the staggering number of MoUs signed; the turnout; the buoyant mood and the investment proposals worth Rs 7.6 lakh crores signed.

But despite all this, here's what S R Jindal, Chairman and Managing Director, Jindal Aluminum had to say in the Economic Times.

"In 2010, Rs 4 lakh crore worth of MoUs were signed, but only 4% of that has taken off so far. The government has claimed it has created a single-window clearance for these projects, but the reality is, when we peep through this window, all we can see are several doors," said S R Jindal, chairman and managing director, Jindal Aluminium.

Are all the MOUs signed for projects in GIM 2010 implemented?

The figures for the 2012 GIM look impressive indeed. But then, how may of these will finally be implemented? If a report in the Deccan Herald is to be believed then in the 2010 GIM, the government had signed 389 MoUs worth Rs 3.92 lakh crore. But only 39 of them have been implemented so far. About 237 MoUs worth about Rs 2.91 lakh crore are said to be under various stages of implementation. There's no mention of what has happened to the remaining 113 MOU's, which is almost a third of the MOUs.

The real challenges!

The proposed investment figures of Rs 7.6 lakh crores is certainly staggering and is almost double that of the 2010 GIM figure. In fact, when the 2010 MOUs were signed the economy was growing at a scorching pace. But the current mood is sombre to say the least, which is why there is a serious doubt on implementation of many of the projects signed for GIM 2012. Big corporates are cash strapped and interest rates at elevated levels. In fact, the economy has grown at its worst level in seven years.

Then there is the usual bureaucratic inertia, which invariably keeps projects stalled or on tenterhooks. However, Karnataka Chief Minister Sadananda Gowda had this to say, "I will take measures to have exclusive review of these proposals made at the GIM 2012. No investor should hesitate to call me over my mobile phone if he has any doubt about the implementation of the project or faces any problem from government departments."

His intent is certainly honest, and investors might want to call him on his mobile. The only concern being that elections are slated in Karnataka early next year. Will he be at the helm after that to pursue projects? That's something only God can answer.

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