Breaking Bread with Governance Now: A chat with Ananth Kumar

Over the course of a sumptuous meal, the minister gives a crash course on the crucial role his ministry plays for three pillars of economy: industry, agriculture and health

ajay

Ajay Singh | February 12, 2015


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Union chemicals and fertilizers minister Ananth Kumar is a veteran politician. He served as a minister in the Atal Bihari Vajpayee government. In his home state Karnataka, he has always been a force to reckon with in the BJP, at times evoking extreme reactions within the Sangh Parivar. Kumar’s induction into the Narendra Modi cabinet was a logical conclusion to his long innings in politics.

Yet his assignment as the chemicals and fertilizers minister appeared to be less befitting his status. That was what I thought when I walked into his Shastri Bhavan office for a casual conversation on his work. As usual, it is difficult to find a minister’s office which is not crowded. I was taken to his anteroom where the minister retires for lunch. Perhaps, in the hectic schedule of the day, the recess for lunch is relatively a calm session.

As he walked into the room, my first question, “what exactly do you do in this ministry?”, flustered him a bit. After a pause, he replied, “Let me tell you this ministry is the backbone of the country’s economic and social life.” I was a bit amused at this self-inflated description and asked “how?” Kumar explained that his ministry caters to the building of three essential pillars of Indian economy – industry, agriculture and health. “You cannot imagine a life without chemicals in the modern world,” he said, explaining that just as chemicals are essential for industry, so are fertilizers for agriculture and pharmaceuticals for health.

This was the first time that I realised the significance of his ministry. Given the latest crisis caused by a shortage of fertilizers, I asked if there was any plan to tackle the problem. “You see, we have focussed on the issue and can assure you that shortly we would be self-reliant in fertilizers.” Referring to the fast-tracking of the fertilizer projects in Gorakhpur, Sindri, Barauni, Talcher and Ramagundam, he said the government would revive these units by modernising them and enhancing their capacity. “But the basic question remains why did they turn sick and what is the guarantee that it would not happen again,” I asked while the minister ordered for his home-cooked lunch. “Regarding your first question, you have to ask Sonia Gandhi or Manmohan Singh for the right answer. As far as I am concerned, we are guided by the prime minister to be self-reliant in fertilizers,” he said, adding that the PM had shown keen interest in a power-point presentation made before him recently. “You see, our objective is to produce enough urea for domestic consumption and curtail imports in a big way,” he added.

As the plates were laid out on the table and dishes were about to be served, I asked if he was wary of the urea crisis which has hit farmers. “Yes, we are aware of the situation and initiating measures to check it,” he said while pointing out that in some cases the crisis was man-made and blown out of proportion. Kumar had held a series of meetings with his officials to find out the genesis of the problem. “What about the growing bill of subsidy if production increases?” I asked. “We are already paying a huge subsidy for the imported fertilizer,” he responded while making it clear that the revival of units and new fertilizer plants would also create jobs within the country. “We intend to invest '40,000-50,000 crore for setting up and modernising fertilizer plants,” he said. “But from where will you get the feedstock?” I asked, knowing it well that enhancing the production of fertilizer, particularly urea, is easier said than done. “We are working on that with the petroleum ministry,” he assured, indicating that various supply lines for petroleum products would be made functional shortly.

“You see, our biggest challenge is to hold the price line for urea at the constant level,” he said, while explaining that though many reforms with far-reaching consequences are on the anvil, the biggest of them relates to efficient use of energy for fertilizer production. “We are striving to enhance urea production by effective utilisation of energy (feedstock),” he said, laying emphasis on bringing in new technology for the purpose. “But what about the proposal to give fertilizer subsidy directly to farmers instead of fertilizer companies?” I asked. “This is a very complex issue as it is difficult to distinguish between a land owner and a sharecropper,” he said, adding that unlike other subsidies where intended beneficiaries are identified, it will not be easy to apply the same model on fertilizer subsidy. “We are looking for an effective mechanism to transfer subsidies in more targeted manner but that is yet to evolve,” he said, putting to rest speculation about the possibility of transferring fertilizer subsidy directly to farmers’ accounts.

Two chapatis with stir-fried greens in south Indian style and sambar were served to us. And we started eating chapatis as the conversation drifted to the second essential pillar of the economy – public health. “What about the recent brouhaha over the US food and drug administration’s (FDA) actions on quality control of Indian drug manufacturing?” I asked in an obvious reference to the ban on imports of certain medicines manufactured by Indian firms. “We are maintaining quality in manufacturing drugs but the FDA’s objections must be seen in the international context,” he said. India is one of the largest exporters of medicines, and in Kumar’s view, much of the controversy was intended to stymie India’s export growth. Yet, he pointed out that if there is any concern about quality, it will be taken care of.

Referring to the paucity of bulk drugs known as active pharmaceutical ingredients (APIs), the government is going ahead with the setting up of bulk drug parks to enhance the production of bulk drugs which are essential for formulations. “We are in an unenviable position vis-a-vis China which is the biggest supplier of bulk drugs.” These parks along with pharmaceutical parks would make India a major exporter of bulk drugs apart from making the nation self-reliant in drugs, he said, adding that it will create a huge potential for employment. “Let me tell you about another important step: the Modi government has included 251 essential medicines under the price control regime,” he said, adding that the move was aimed at providing essential drugs for chronic and serious diseases at low cost.

We were almost in the mid-course of the meal when fragrant rice was served though I concentrated on chapatis and the delicious sambar. And we moved on to the third critical pillar of economy – industry. “You cannot imagine life without plastic today,” he said. “There is an impression that pollution would be a natural corollary to growth of the chemical industry,” I asked. “No, there is an impression that pollution is synonymous with chemicals,” he corrected me. “But the reality is that plastic is one of the products of petrochemicals which is used in many essential equipments,” he said, adding that only 3 percent of plastic produced is used for making bags.

In an obvious reference to the PM’s Make in India campaign, Kumar said that the government intends to set up many petroleum, chemicals and petrochemical investment regions (PCPIRs) on the lines of the Dahej project in Gujarat. “We  have opened the sector to foreign direct investment (FDI) for bringing in new technology and enhancing the production of different variants of petrochemicals,” he said, making it clear that the sector would see an investment of nearly '10 lakh crore to create job opportunities for 37 lakh people and give fillip to industrial growth. Regarding the menace of pollution, his prescription was that we should reduce the level of pollution by efficient use and recycling of such products. “We are planning to set up cracker complexes at downstream to maximise gains from petro-products and reduce pollution to a negligible level,” he pointed out, adding that it would take care of shortage in feedstock for fertilizer and chemical sector.

Our lunch was almost over and there was no scope of deserts as the minister had to go out for an official function in Noida. I was curious to know about the ministry’s response to the proposal to create ethanol hubs across the country. “It is a complicated issue that involves the interests of farmers and the sugar industry,” he said, adding that ever since ethanol came to be used as a bio-fuel, it has hurt alcohol manufacturers. “But for us farmers’ interest is uppermost, as the remunerative price of their produce is dependent upon the use of ethanol as a bio-fuel,” he pointed out. “I can go on for one more hour on these issues,” he said as the plates were removed. As he readied for his Noida visit, Kumar mischievously remarked, “I hope you are now convinced that my ministry is not as unimportant as you initially thought.”  I concurred.

ajay@governancenow.com

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