A chartered accountant by profession, Suresh Prabhu is an Indian politician. He served as Union Power Minister (2000-02), Union Railways Minister (2014-17), and Union Commerce and Industry Minister (2017-19) of the Government of India. He talked to New Business Age on several issues related to Nepali economy, among others. Excerpts:
What makes you come to Nepal this time?
I came here to participate in the annual meeting of the Nepal-India Chamber of Commerce and Industries. They invited me as a guest of honour. The chief guest was Nepal’s Minister for External Affairs. I have many friends in Nepal. When they learned that I am here, they asked me to attend many other programs. I addressed the Young Professionals Association. I also spoke at an event organised by the Nepal-India Friendship Association as well as a Confederation of Nepalese Industries (CNI) event. I had a very good meeting with Nepal’s Minister for Communications and Information Technology and Minister for Agriculture and Livestock Development. I went to Pashupatinath Temple to get the divine blessings. I had a very good three-day visit. It was very hectic but very enjoyable and fruitful. And I would say, it was a very good trip.
You were in the cabinet of two Prime Ministers - Vajpayee and Modi. Did you find any difference in the working style of these two Prime Ministers?
They are two different personalities. Obviously, there'll be a difference. But there is one common thing in them - the love for the country. Both of them are extremely popular leaders. They are also very good orators. Both are very good in governance. In fact, Prime Minister Modi decided to observe Vajpayee’s birthday on 25th December as a good governance day as a testimony to the commitment to good governance. Both of them have been exemplary leaders focused on future growth as well as present-day problems. That is helping India because the focus on infrastructure will ensure that India will continue to grow for many more years to come in a very sustained manner.
You held different portfolios in the cabinet. Which one was the most challenging for you?
I would not say challenging, but interesting. Of course, every ministry has a challenge because India is a very large country. When you work at the federal level, at the centre, you will have to take care of so many complex issues. Railways was one of the very interesting portfolios. People make more than 800 crore train trips every year in India - that’s more than the world population, that is round trip. It is employing 1.4-1.5 million people and is the largest employer. So, it is all about managing passenger numbers, and ensuring that employees are also properly taken care of. It is also about meeting the aspirations of the people because every village, every city, every state wants railway connectivity. Doing that was very interesting and challenging.
I also worked as the Union Minister for Power. I would say that was also a very interesting portfolio because at that time India was in power deficit - we had an 18% peak level shortage. It was a huge power deficit. I brought a new law, the Electricity Act, which changed the entire power sector. People started to call me a pioneer of power sector reforms. So I have people call me the pioneer of policy reforms. Evidence of that is that India has today become power surplus. So, this is something which we did under Mr Vajpayee’s leadership.
So I think today, we are very fortunate that we have a completely different kind of person than we have when I was a power minister. So we are happy about it. I was also a Minister for Environment and Forest, Water Resources. Those were also interesting and challenging.
Nepal is also becoming power surplus. How do you see it?
I think Nepal will be power surplus not because of hydropower alone, but also because of solar. So, now, if you can start generating solar power in Nepal the country will not have a foreign exchange crisis. Because today, a lot of foreign currency is going to buy energy. into buying energy. So, if we generate more energy, you will become energy secured. Also they're both very clean forms of energy, so it’s good for the environment. Also, it will create a lot of jobs. When you have so much energy, more industries will come here. So this is something which can be a transformative step for Nepal.
Recently Prime Minister Modi came to Nepal to pay respect to Lord Buddha in Lumbini. Issue of air connectivity was raised during the meeting between the two Prime Ministers. Is there a possibility of allowing more entry and exit points for Nepal?
I think it’s a very urgent thing to do. Nepal is a landlocked country, its trade, tourism and all other activities can happen only through air or roads. So, therefore, it is extremely important that, particularly for the poor people, and also for promoting trade, it is important that we must provide more entry and exit points. Because there is a lot of air congestion in Nepal which causes a lot of issues. When I was a commerce minister, I'd actually started working on it. So, I think we really need to take this forward. I am happy that Prime Minister Modi is now pushing the agenda again.
India started the ‘Make in India’ campaign under Modi. How far has it gone?
Now, it has succeeded a great deal. There is a lot of new manufacturing happening. The Indian government has launched a program called production link incentives which is also helping to create more manufacturing in India. It is creating more jobs. Similarly, once you start manufacturing, it will also lead to more and more small scale industries coming up. So, I think this is a very interesting and good development. ‘Make in India’ still has a long way to go because today the share of manufacturing to GDP is only around 16%. When Prime Minister Modi launched the campaign, he set a target to make it 25%. So, there is still a lot of work to do. But we are definitely taking very important steps to realise that vision.
Did demonetisation have any effect on the Indian economy?
When you do demonetisation, obviously, it has some impacts on the economy. But it also helped to flush out black money and also helped in more informal sectors becoming a part of the formal economy. More importantly, it has helped in digitisation of the Indian financial system in a big way. Today, a large number of transactions by common people take place in digital form. This is an amazing change that has happened in such a short period of time. So I think the digitisation of the Indian economy, particularly the financial services sector, is the single largest success in the developing country. So I think it's a very good development.
Nepal opened its economy a little bit earlier than India, But India has left Nepal behind in terms of opening the economy. What do you think Nepal should do?
Nepal must have its own model. I would say Nepal shouldn’t copy anybody else’s model. In my opinion, people-centric development should be Nepal’s priority. You have so many natural resources, and you have a very rich past. Nepal was one of the most prosperous countries in the world. If people were not that rich, you wouldn't have built such wonderful palaces and temples.
So you had a very prosperous past. Looking at present times, Nepalis are successful people in whatever they do. They are very competent people. Nepal’s development model should be based on its people. Entrepreneurship in Nepal should be allowed to prosper. Any impediment in entrepreneurship should be removed. We should think about how you allow the Nepali entrepreneurship, the Nepali people's ability to come to its full notion, that is what should be the idea of opening up.
India had decided to include Nepali in the list of destinations for Leave Travel Concessions (LTC). But it is not being implemented. What are your suggestions to implement it?
There are many possibilities of promoting tourism between Nepal and India. Indians are more outbound, than inbound. That means they travel a lot all over the world. So when they are travelling all over, they should come to Nepal because Nepal is so beautiful. You don't have to go to Switzerland to enjoy the scenic beauty and what mountains offer. Nepal has immense tourism possibilities, Nepal has adventure tourism, Nepal has possibilities of scenic tourism. Nepal has everything that one can think about when it comes to tourism. And it is so close by. We have to take promotional measures to ensure that Nepal and India will benefit from each other's closeness and sharing of border. Also, I will say Nepal and India can do a joint tourism promotion. When tourists come to Nepal, they also visit India and vice versa. This will benefit both the countries because there is so much of different possibilities. Nepal doesn't have beach tourism, India has. Also, India also shares the same mountain range that Nepal has. So I think we can really work very closely and work on promoting tourism on either side.