Ahmedabad, 21 June, 2014

Minister Shri Saurabh Patel, Minister – Finance, Energy and Petrochemicals, Industry and Mines, Govt. of Gujarat on Saturday addressed students of PGPX, the one-year MBA programme, at IIM Ahmedabad. Shri Saurabh Patel spoke about key strategic initiatives undertaken by the Govt of Gujarat over the past decade and their results.

In outlining the strategy of the government in the power sector, Shri Saurabh Patel spoke about the previous conditions in the state. In 2002, the state was losing close to INR 2300 crore per annum in the power sector. The ministry sought to address this by executing a series of reforms. The state renegotiated power purchase agreements and in the process earned the distinction of being the first state to procure power through the process of competitive bidding. Today this sector generates profits of INR 550 crore per annum for the state.

The minister underlined the importance of political will and the hard work of the state government of Gujarat for putting into effect well planned reforms in a sector that had been reluctant to change.

In the power sector, it also has 23000 MW of capacity to address a peak demand of only 13800 MW. Despite Gujarat’s excess capacity, power-deficient states are unable to benefit as much because of some states’ inability to pay and poor transmission systems across the country. Shri Saurabh Patel explained how investments in a strong transmission network within the state and a clear and strong stand to prevent electricity theft in rural areas went a long way in ensuring access to power at market prices. These government actions resulted in about 18,000 villages having access to power 24 hours a day. Access to power raised the standard of living in villages – improving education, access to water, education outcomes, and enabling several small and large-scale industries to be able to compete effectively and thereby increase profits. The minister attributed a large part of the increase in the state’s GDP to these steps. Today Gujarat holds an impressive share of close to 7% of India’s GDP.

Looking to the future, Shri Saurabh Patel emphasised the government’s political will and desire to work hard to reduce the gap between the haves and the have-nots. He explained that the government would focus on partnering with businesses, increasing the representation of women in the workforce in rural sectors, investing in education, and on promoting manufacturing units in the state in the future.

Another area that the minister pointed out as being important was land acquisition. He stated that the GIDC has implemented an excellent land acquisition programme in the state that benefited landholders and also shared profits of the resale of land with them.

Shri Saurabh Patel also answered several questions from students of the PGPX batch. IIMA’s PGPX batch comprises eighty-five highly experienced professionals from diverse sectors. The PGPX programme is currently in its 9th year. Earlier this year, several prominent leaders including the former Indian President Dr. APJ Abdul Kalam, Ms. Renuka Ramnath, Founder – Multiples Alternate Asset Management and Ms. Usha Ananthasubramanian, CMD of Bharatiya Mahila Bank interacted with the students of the PGPX programme as part of the ‘PGPX Speaker Series.