The Gujarat government has been making tall claims about the success of chief minister Narendra Modi's pet event, the Vibrant Gujarat Global Investor Summit (VGGIS) , but the reality seems to be totally different.
As against the touted 60-70% success rate, figures show that only 15% of the investments proposed in the first four editions of Vibrant Gujarat Summit, i.e. from 2003 to 2009, have materialised into actual investments so far. The percentage would come down to single digits if VGGIS 2011 is also taken into account.
MoUs proposing investment of a staggering Rs18.77 lakh crore were signed at the biennial event from 2003 to 2009. The first Summit in 2003 saw signing of 80 MoUs proposing investments of Rs66,068 crore. The numbers rose to 226 and Rs1.06 lakh crore in 2005, and further to 454 and Rs4.65 lakh crore in 2007. The 2009 Summit witnessed signing of 8,860 MoUs, while the investment proposed was of Rs12.39 lakh crore.
However, of the total investment proposed at the four events, investments worth only Rs2.88 lakh crore, i.e. 15.35%, have materialised so far.
The figure falls further to 8.03% if MoUs worth Rs20.83 lakh crore signed at the Vibrant Gujarat Summit of 2011 are also taken into calculation.
What is shocking is that in spite of the tall claims, the ratio of MoUs resulting into actual investment has fallen with every Vibrant Gujarat Summit. The success rate of 2003 Summit was 52.5%, which came down to 50.88% for the 2005 event. For the 2007 Summit, the actual investment was 35.24% of the investment proposed, while the figure was 15.10% for the 2009 Summit.
However, the government claims that many MoUs are still under implementation, and much higher investment would be realised.
"The successive Vibrant Gujarat Summits have been huge successes. The success ratio is more than 60-70%," industries minister, Saurabh Patel, said. Patel accepted that success ratio of 2011 MoUs was lower so far, but clarified that this was only because of long gestation periods of projects, particularly those related to power, infrastructure, ports, among others.
However, the Opposition Congress does not buy the argument.
"The Vibrant Gujarat Summit is hogwash. The chief minister uses the platform for his publicity, but there are little gains for the state," Gujarat Congress president, Arjun Modhwadia, said.
Government records show that MoUs (from the first four Summits) totalling a further Rs5.03 lakh crore are under various stages of implementation. This includes projects worth Rs2.81 lakh crore from 2009 Vibrant Gujarat Summit and Rs1.84 lakh crore from 2007. Interestingly, projects worth Rs10,710 crore from the 2003 Summit, and Rs27,932 crore worth of projects from 2005 are also still under implementation.
With regards to MoUs signed in 2011, actual investment of Rs29,815 crore has been realised so far, while projects worth Rs2.49 lakh crore are under implementation.
