he/she got the chair of Maharashtra but how difficult is the path for Fadnavis? These important tasks will have to be done

R. Jagannathan: The Mahayuti government led by Devendra Fadnavis has come to power. It is hoped that the political wrangling before government formation will not distract the state from delivering the governance, economic growth, employment and better social outcomes it really needs. Maharashtra is the top state in India with 13.3% contribution to GDP. Maharashtra’s performance will decide how soon India becomes the world’s third largest economy. In such a situation, there are 5 such tasks which the new Chief Minister Devendra Fadnavis will have to do.

1. Better coordination with colleagues

First, political stability does not depend solely on legislative majority. Insecure partners and a wounded opposition will test the political courage of the government at every opportunity. Therefore, it is advisable for Fadnavis to run the state through an advisory trio. This means that both the junior partners, Eknath Shinde-led Shiv Sena and Ajit Pawar-led NCP, should be part of taking important decisions on the policy front. If this trio works mostly by consensus, it would bode well for political and policy stability.

2. Focus on fulfilling promises

Second, given the huge amount of relaxations announced and implemented even before the assembly elections, the first priority of the government should be to deliver on the promises in a targeted manner with minimal leakages, so as to stabilize the fiscal position. Mahayuti had promised to increase the payment under the Ladki Behan Scheme for eligible women from ₹1,500 to ₹2,100 per month.

This may reduce the availability of funds for infrastructure development. The state’s debt has increased to ₹7.82 lakh crore. Some experts say that without a big increase in revenue, it may be difficult to even pay salaries to employees in the coming months. As the country’s key growth engine, it would be a tragedy if Maharashtra becomes the poster boy of fiscal irresponsibility rather than prudence.

3. Focus on creating startup hub

Third, the state has two of the largest stock exchanges in the country and is also the financial capital of India. For this reason it should have been made an automatic option for start-ups. Instead, Bengaluru (despite poor infra) and Delhi (despite poor air quality) are performing better. Hyderabad and Chennai are trying hard to challenge Maharashtra’s third position from bottom.

The state should aim to become India’s No. 1 start-up state. For this, it will have to simplify the rules for small companies, which are the main engines of employment generation. It should be at the forefront of the race to make India the best place to do business.

4. To be a leader in implementing labor reforms

Fourth, if the key to prosperity is good quality jobs, then as the manufacturing and financial services capital of the country, Maharashtra must play a leading role in implementing labor reforms and encouraging labour-intensive businesses. One wonders why Apple or other electronics manufacturers find Delhi or Tamil Nadu more attractive to set up their global supply chains.

This needs to be fixed. Maharashtra’s position at the top of the GDP table will be challenged in the next decade first by Tamil Nadu, then Karnataka, Gujarat and even Uttar Pradesh.

5. Priority on urban infrastructure

Fifth, with several large metros and urban growth centres, Maharashtra should focus on urban infrastructure as a priority. For this, urban land prices and housing should be made affordable. This means that the real estate sector has to be taken out of the clutches of vested interests and land mafias. Without improvements in urban infrastructure, jobs will grow at a snail’s pace.

Fadnavis government will have to be careful about these things

1. Control over caste and religious conflicts

First, since all development depends on social stability, the Mahayuti government will have to control caste and religious conflicts. This is not a battle of secularism versus communalism, but about reducing mistrust between communities by encouraging dialogue.

The government must start with the recognition that community relations are not sufficient to ensure social peace. It should work district by district to encourage dialogue at the local level between opposing castes or religious communities. Very often the law and order mechanism is not sufficient to maintain peace. Religious communities themselves should be encouraged to make workable compromises to live in harmony.

The same logic applies to caste-based rivalries and conflicts. The government may try to create multi-caste conflict resolution panels that can serve as examples for other caste-conflict-stricken states. Law and order can work only when there is underlying trust in the community.

2. Don’t promise the moon

Second, after promising voters the moon in terms of freebies, Mahayuti should ensure that the same does not happen in the next five years. Elections can be won with freebies, but there cannot be good governance if one inherits the winner’s curse of a bankrupt state. Two years of fiscal probity can help the state invest in development for the benefit of all in the remaining tenure.

3. Urban Development Department…Illegal Earnings

Third, every Chief Minister wants to keep the Urban Development Department with himself because it holds a lot of money and illegal money is made from real estate deals. The Fadnavis government should try to make this department less attractive by delegating more powers to urban local bodies, including municipalities and metros.

4. Adequate resources for infrastructure

Maharashtra can set the pace in urban development by giving cities real freedom to manage themselves with adequate resources for infrastructure. In India, we debate the power asymmetry between the Center and the states, but not the even more important power asymmetry between the states and local bodies. States have too much power and local bodies have too little.

5. Self-reliance of urban bodies is necessary

An unintended consequence of GST is that many sources of municipal revenue have been subsumed into the state GST. In such a situation, urban bodies are dependent on transfers from state revenue. This situation needs to change and Maharashtra can play a leading role in this direction by making urban bodies more self-reliant in finance and governance. Sometime politicians should aspire to become Mayor of Mumbai, Pune or Nagpur instead of becoming CM of Maharashtra