Title - D.V. Sadananda Gowda | Political turmoil in Karnataka will not hurt investor sentiment

Bangalore: Karnataka’s political crisis took another turn last week, and the timing could not have been worse, as it preceded the 7-8 June Global Investors Meet (GIM) in the state. Chief minister D.V. Sadananda Gowda not only had to tackle belligerent former chief minister B.S. Yeddyurappa, chafing after the Supreme Court ordered an inquiry into alleged wrongdoing in iron ore mining during his regime, but also his own industries minister Murugesh Nirani was campaigning for his removal. In an interview, the chief minister said Karnataka remains a good place to invest in. Edited excerpts:

Looking at the last edition of GIM in 2010, how would you rate it, a success or failure?
In 2010 GIM, except as far as the iron ore matters are concerned, we have done extremely well. Out of 392 MoUs (memorandums of understanding) signed, nearly 78 MoUs have been completed. Of the rest, around 235 are in the execution stage. But will you invite investments in the iron ore sector?

Yes, we will. The Supreme Court and the CEC (Central Empowered Committee, set up by the court) have come up with certain guidelines. Already they have classified 45 mining areas under ‘A’ category, which can begin mining operations. Already, two have been cleared, and six will be cleared in another week or so. Before GIM, I hope that the MoUs we had signed with previous investors will be cleared.

What will the focus of GIM 2012 be?

Our focus area this time is automobiles and aerospace. Our state is one of the front-runners as far aerospace is concerned. We have come up with (an) aerospace policy. The draft is ready and before next GIM we will clear it.

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D.V. Sadananda Gowda talks about his state’s infrastructure projects and its upcoming global investor conference

Other areas we are looking at are urban and transport infrastructure, education and textiles. Agro-food processing is one of the major thrust areas this time.

Overall, we had good roadshows across the country, and even my colleagues had roadhows in Japan, Singapore, Taiwan and San Francisco. We got extremely good response from Japan, with nearly 150 industrialists participating in the roadshow. We have also had detailed discussions with a delegation from Bavaria in Germany. They’re looking in particular at automobiles and engineering.

Singapore government intends to invest in urban infrastructure and other things. For this GIM, we hope that we will reach investments of at least Rs. 5 trillion.

According to the last census, Bangalore is one of the fastest-growing cities. What are you doing on the infrastructure front?

We have taken several projects, and under PPP (public-private partnership) we are going to take a few more. We are looking at high-speed rail link between Chennai and Bangalore, and also between Bangalore and Mysore.

How are you looking to fund the high-speed rail considering the costs are estimated around Rs. 200 crore per kilometre?

We had some discussions with the railway ministry last week and they have asked us to come up with a detailed project report. The work on the Chennai-Bangalore line will be taken up by the Union government, while we will be submitting the DPR (detailed project report) on Bangalore-Mysore soon.

What has happened to the proposed 35km-long high-speed rail link to the new airport?

Six companies have submitted their expressions of interest and the proposal has gone to the government of India. We are now awaiting the approval.

What about the high-speed rail link from Kerala to Karnataka? Is the Karnataka government interested?

We are really interested. Initially, the proposal was to build a high-speed rail between Kochi and Mangalore, but we thought it should be extended up to Udupi. It will be under PPP and the Karnataka government will take the lead in implementing the project.

Has there been any impact on the recent political turmoil on investor sentiment in Karnataka?

I don’t think there will be a big impact as far as the political turmoil in Karnataka is concerned. Because my bureaucrats are ready with the policy and they will go ahead with it. It is a continuous process and there will be no impact as far as GIM is concerned. Almost in all areas we have got great policies already in force, and there will be no more turbulence.

You have one more year before the state assembly elections. What is your agenda?

One of my main objectives is to implement all the MoUs that we have signed in GIM 2010 and we will be signing now. I will clear the MoUs held up because of the Supreme Court case in iron ore mining. From the upcoming GIM, we are expecting nearly Rs. 5 trillion investment.... After the MoUs are signed, we will take up the matter seriously, and we will go ahead with it.