Uttar Pradesh govt's $1 trillion target gets economic advisory support

In the 2023 Assembly elections in Telangana, residents of Patancheru woke up one morning to the sound of hundreds of bulldozers trundling along on the roads. Leading them was Nandeeshwar Goud, Bharatiya Janata Party (BJP) candidate from the constituency, as he prepared to file his nomination. Nandeeshwar said: “The bulldozer rally symbolises the BJP’s promise to demolish illegal encroachments and return to rule of law. We wanted to show that similar to the Uttar Pradesh (UP) government under Yogi Adityanath, we too will demolish encroachments.” In the Madhya Pradesh and Chhattisgarh polls too, the bulldozer was deployed as a political message.

 

 

But now UP Chief Minister Adityanath is looking beyond demolition and bulldozers. After months of discussion, UP has become a rare state in India to have a Chief Minister’s Economic Advisory Group (EAG), similar to the Prime Minister’s Economic Advisory Council. Sixteen leaders in different sectors have been named members. They include Mohandas Pai, former Infosys chief financial officer and leader of private equity fund Aarin Capital; Aavishkaar group founder Vineet Rai; Manish Sabharwal, vice-chairman of TeamLease Services; and Amit Kalyani, managing director of Bharat Forge. The Minda group and Larsen and Toubro too were represented. The coordinator of the group is Nachiket Tiwari, professor at the Indian Institute of Technology, Kanpur. The EAG has a two-year term, which makes it virtually coterminous with the term of the government. Its first meeting was held on July 12.  The image makeover is brisk and businesslike.

 

“The politics of it is very clear. UP goes to the polls in March 2027. The biggest challenge before the state is lack of suitable employment. While UP is identified with good work on law and order, on the economic front it is still a work in progress,” Anil Bharadwaj, general secretary, Federation of Indian Micro and Small & Medium enterprises (FISME), a member of the EAG, told Business Standard. 

 

K V Raju, the chief minister’s chief economic advisor, said: “We are working towards making UP a $1 trillion economy by 2027. Anything that takes us closer to that is welcome. The EAG is a move in 

that direction”.

 

“In 2020-21, UP’s gross state domestic product (GSDP) amounted to ₹16.4 trillion. In 2023-24 it was ₹25.63 trillion and in 2024-25 ₹29.57 trillion. So, the growth rate is about 15.9 per cent at current prices while India’s growth rate is 13.6 per cent. For March 2026, we are looking at ₹41 trillion. How did we manage this? The devil is in the detail. We did minute and meticulous analysis and collated GDP estimates at district level. This is the first time a state has done this in the country. So today, every member of the Legislative Assembly and every minister are keen to know how her or his district is faring. How can it grow further? What should he do?” Raju said, adding the EAG would be able to  provide ideas and interface them with the reality, informed by the data the state government has been collecting.

 

At the first meeting, Mohandas Pai set the ball rolling with a factoid. There were 28 flights every day between Lucknow and Bengaluru. This was because children from UP were studying or working in Bengaluru and their parents were travelling  to visit them. What if UP’s services sector developed to the point that the professionals concerned got jobs in UP?

 

The chief minister seems enthused by the idea and Pai will likely arrange meetings for Adityanath with top IT (information technology) honchos in Bengaluru in the next 10 days, those present at the meeting said.

Sabharwal said until the state government grit its teeth and rolled out deep and wide structural reform, its target would remain elusive. He spoke about labour reform and said it was essential that labour law violation be decriminalised.

 

Bharadwaj said: “In UP today, there are jail terms if you don’t whitewash your factory and if you don’t provide spittoons. There is a serious problem with ease of doing business. It was heartening to hear people speak their mind.”

 

“Interestingly, in this group there is no one from the BJP’s own front organisations — which suggests the government wants advice that is independent,” he added. “There is no suggestion that the EAG is going to be an echo chamber. Initiatives are being solicited that are short- and medium-term — 100 or 200 days and 18 months at the most.”

 

Vineet Rai backs agro-tech startups and will be advising the government on the way ahead, especially agri export, which has great potential. The Utkarsh Bank, one of Aavishkaar’s group  companies, is active in financially assisting many entrepreneurs in UP. He said the chief minister was “receptive and did not flinch”, responding only after he had heard everyone out. He was also “completely on top of the numbers, even correcting some  of them”. 

 

Rai said the policy structure had been created by the bureaucracy and the data collected by the state system would be invaluable tools. “There was no pushback to ideas if they were thought to contribute to the $1 trillion economy target,” he said.

 

A member recalled that till a few years ago, Yogi Adityanath would baulk at meetings with investment bankers or the private sector. But that appears to be changing, spurred by UP’s target of becoming a $1 trillion economy.

 

Shortly after assuming office in 2021, Tamil Nadu Chief Minister M K Stalin had constituted an Economic Advisory Council to the Chief Minister. The council comprised Nobel laureate Esther Duflo, former Reserve Bank of India Governor Raghuram Rajan, former Chief Economic Adviser to the Government of India Arvind Subramanian, development economist Jean Drèze, and former Union finance secretary S Narayan.