Column: Indicting India Inc

Apr 02 2014, 03:06 IST
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SummaryReduce the powers government has—to give licences, grant tax breaks, etc—and you fix cronyism

Attacking rivals, distasteful as it may seem, appears to be part of the cut and the thrust of politics. So, you have Narendra Modi’s constant jibes at ‘shahzada’, and now some reports suggest, even ‘matashree’. In turn, finance minister P Chidambaram talks of Modi’s ‘deep character flaws’ and how sections of Indian business are in favour of Modi as his brand of capitalism is crony capitalism. Given the support the BJP’s prime ministerial candidate apparently enjoys across industry—not just from a section of businessmen—it would appear the finance minister has painted large swathes of India Inc with the same brush.

Given the plethora of scams unearthed during the UPA government, of course, that’s a bit rich. While the CBI seems to be undecided as to whether money changed hands, and if so how much, in the case of Coalgate, there is very little doubt in the case of the 2G scam that saw A Raja and his telecom secretary in jail for several months. It is of little help that, in many of the cases talked about, the prime minister was opposed to the way the licences were given out and wanted a more transparent system.

The larger issue, however, is that the way the levers of power are structured—whether at the Centre or at the level of states—it is next to impossible for companies to do business without getting numerous clearances from the government. In such a situation, whether it is a Modi or a Jayalalithaa, any chief minister in a state where industry is doing well, will be accused of being a crony capitalist—was declaring the auto industry to be a ‘public utility’ in Tamil Nadu a sensible act or was it an act of crony capitalism, designed to help a few auto firms? And why just the chief ministers, the Central government is being accused of favouring Reliance Industries—ironically, by several BJP leaders—when all it is doing is to allow free market pricing of gas, something that is not only desirable from the point of view of attracting investments, it is something promised in the contracts the government signed with these firms.

Were Modi to become the prime minister, it is this that he needs to work on. If he doesn’t, the tag of being a crony capitalist is likely to stick to him. Every time there’s a hike in prices of gas, or a reduction in diesel subsidies—the latter

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