We may rue that there is unemployment in the State and that salary structures are below those in the metros, but Goa has one of the highest per capita income figures in the country, and despite the mining ban, the Gross State Domestic Product (GSDP) grew faster than the national average.
That is the good news. But, if the ban on mining operations, that casts a long shadow on the Goan economy, is not lifted anytime soon, the Rs 3,500-4,000 crore per annum contribution to the GSDP from this sector will have to be compensated from other sectors. And, when one looks at the future, there are no sectors that can meet the economic might of mining. Goa therefore needs a roadmap for industry that will, while setting aside mining, serve the State for at least a decade, and whose key words should be land and infrastructure.
There is unanimity in the sector that Goa needs to invest a lot of effort to strengthen the economy, and the planning should start now. Immediate past president of Goa Chamber of Commerce and Industry (GCCI) and chartered accountant Sandip Bhandare believes there is a difference between incremental thinking on a year-to-year basis and for a perspective of ten years.
Raising the issue of migration, Bhandare said, “We need to see what kind of a population mix Goa is going to have in the next ten years. This includes age profile, educational qualifications, skill, inward as well as outward migration, culture. This becomes very important for any policy framing. We also have to be very careful of the impact on environment. Beaches are getting eroded due to a rise in water level. Also, we need to see where the world is moving. We have limited land available with us and the pressure on land is immense. Lastly, we have to look into the jobs, skills and training. Are we ready for jobs that may require certain skills after 10 years? Government will have to play a big role on this issue.”
Land availability is a recurring theme in all conversations. According to Goa Institute of Management director Ajit Parulekar, Goa’s big challenge in facilitating growth of industry is the low availability of land for setting up industry, as well as the relatively higher cost of land for setting up industry given the higher rate of urbanisation.
But, it is not just land for industry. Bhandare clarified that because of pressure on the land, agricultural land and water will be stressed, which earlier were the mainstay of agro economy of Goa.
However, though Goa is geographically small in size, Sanjay Shankar Bhandari, manager, Corporate Affairs of Nestle India in Goa opined that it has huge potential for attracting new investments from existing as well as new investors. The total turnaround in offerings to the investors in the form of infrastructure, air, sea port, adequate land availability and power would be the key, besides skilled workforce.
Infrastructure is the other keyword, and here industry is looking at Mopa airport contributing in a big way to growth. GCCI president Manoj Caculo believes that ten years is a long period and there will be two to three government changes during this period and policy changes will take place. “It cannot be predicted with conviction. However, my feeling is that there will be a lot of developmental work taking place in our State, which will change the entire economy. First would be the Mopa airport and once it is functional the entire industrial scenario of Goa will change as lot of activity will happen around the airport and lot of clusters for hospitality will come up. North Goa is likely to develop a lot. Even the logistics will be revamped as we are told that Mopa will also be a cargo hub which will help the importers and exporters a lot,” Caculo said.
There are echoes of this in what Goa Confederation of Indian Industry (CII) chairman Lalit Saraswat said. “We have to rapidly allow world class educational institutes to set up in Goa. The political leadership has to remove all obstacles for this on mission mode. This will allow talent to relocate to Goa. Talent also needs access to quality infrastructure including roads, 24×7 power, good reliable broadband, water, hospitals and public transport. Before attracting newer industries we have to make it easier for existing industries to work and expand.”
If land can be identified and infrastructure developed, there still remains the question of what industry Goa should look at? Saraswat feels that Goa can leverage skills-based industries. “In my opinion we should welcome pharma, Hi Tech manufacturing, defence manufacturing, arts, education, ITeS and R&D. Additionally we should invest heavily in skilling,” Saraswat said.
In other words, instead of a manufacturing heavy industry, Goa should look at technology, where pressure on land would also be small. “In my opinion technology will be the main driver of the economy in Goa. We also have to look at education right now to see that we are prepared for the upcoming situation, which will happen after ten years. No one thought about the e-commerce platform of online cooked food delivery or taxi business at our doorsteps ten years ago. They have generated good amount of employment too. All are technology-based businesses. One needs to be innovative and look for a long-term preparedness,” Bhandare said.
But, how does Goa, which has not though too far in the future, get prepared for all this? “A simple check is the ease of doing business (EODB) rankings. Industries want to focus only on innovation, sales and operations, and not waste energy fighting the system. They need quick problem resolution, which means an empowered single window system whose decisions are binding irrespective of whether governments change,’ Saraswat said.
EODB turns out to be an important factor. Stating that the ‘government needs to improve industrial climate in the State’, Goa State Industries Association (GSIA) president Damodar Kochkar listed out 13 simple points (see accompanying box) on what the State government should concentrate and improve upon for the next ten years.
However, should all this be left to the government to decide upon? Saraswat opines that as stakeholders of Goa, they should decide what sectors they want to encourage in the State, and also think from the perspective of the investors on what they need as enablers to invest in Goa.
“The sectors we want to encourage should be based on our unique strengths. Globally, industry is embracing technology like 3D printing and robotics, which will make it tougher to attract industries that need faster response to customer needs or labour arbitrage. We also do not want to attract industries that cause pollution above permissible limits that cannot be controlled. Once we decide which industries we want, we have to go all out to support it,” Saraswat said.
But when industry comes, it will need a workforce, for which Goa has to prepare by readying its youth for the jobs that will be available. “The industry readiness of youth is a must in Goa to earn jobs and for industries to flourish. The increasing commodity prices and competition is huge challenge that the industry is facing today worldwide. Technology is obviously one of the options to reduce the cost of production and stay competitive. However, it replaces jobs to quite a large extent. It is must that our youth are offered the skills through academics and on job trainings to make them employable in the world of technology. The focus also needs to be on soft skills and good communications are very critical. Government policies, tax reforms, improvements in the scale of ease of business, are very important and need of hour,” Bhandari said.
But then, this is Goa, and mining cannot be kept out of any discussion. Caculo is certain that there is something going to happen on the mining front, either ways, and that the economy will grow. “If not boom, then definitely grow and along with it the stakeholders in the mining sector are also likely to revive. This, if it happens, can have its effect across several industries and there will be liquidity as there was in 2012. Lastly, there is expectation of major growth in the field of infrastructure like roads and connectivity. I am bullish that the next decade is going to be a period of development, which is going to help the Goan economy in a big way, provided both the State as well as the Central government concentrate on developing the economy,” Caculo said.
Infrastructure is also a key sector, which is going to play a major role. Investment in this is unlikely to fail. India is spending on this sector and has picked up the pace in last couple of years but it still needs to be at its best. If infrastructure increases rapidly, it will bring in huge opportunities for development. Goa needs to keep pace with the infrastructure growth in the rest of the country.
