The recent brouhaha in Parliament over the recorded?telephone conversations between a lobbyist of the Tata Group and?influential?members of UPA?s alliance partner, DMK, has kicked up a debate over the role of lobbying as an organised activity in this country. Lobbying has become more intense over the past decade, coinciding with India?s rise as an economic power. The global heads of the leading Fortune 500 companies now visit India every year as opposed to once in five years in the 1990s.
The Tatas recently admitted they lobbied actively to get a level-playing field. Even MNC heads claim they visit India every year to lobby for greater transparency in government policies. MNCs, in particular, feel at a disadvantage as their home country laws and regulations do not allow lobbying methods that are used freely by domestic companies to influence the government and legislators.
For instance, US companies cannot fund political parties in India the way domestic companies do. Partly because there is lack of transparency in the way businesses fund political parties in India. What is paid by cheque is a minuscule portion of what is paid in cash. In some ways, this is at the root of the unholy nexus between politics and business in India.
The only way to address this problem is to make election funding more open and transparent, and create a strong regulatory framework for lobbyists in India.
In a?candid interaction?with the Express Group, finance minister Pranab Mukherjee agreed that lobbying firms must register themselves and operate transparently. The most intense lobbying happens?while handing out defence contracts worth billions of dollars every year. In fact, India?s defence procurement is plagued by the games lobbyists play in scuttling their competitors from time to time. Sections of bureaucracy invariably get mixed up in this internecine war among the lobbyists?representing global arms manufacturers.
Mukherjee said as defence minister he had indeed invited all the lobby firms to register with the government. But they would not do so ostensibly because of all the paperwork involved in the registration process.
The latest episode relating to corporate lobbying for 2G spectrum?whether by the Tatas or earlier by the Anil Ambani group?has once again brought to the fore the need to regulate the lobbying industry closely.
There must be some urgency to this exercise because in the absence of transparency and disclosures, unregulated lobbying?could compromise?important arms?of the state apparatus, including the bureaucracy and legislature. This is already happening in the form of MPs allegedly receiving cash to ask questions in Parliament.
India just needs to study the history of the lobbying industry in the US to avoid the pitfalls.?If we draw the right lessons from the American experience, there will be no need to reinvent the wheel.
A guide to the evolution of lobbying in America says, ?The objects and tactics of lobbying have shifted sharply in American history. In the nineteenth and early twentieth centuries, the typical lobbyist focused on the legislative arena and used high-pressure methods, including bribery, to influence legislators. The most notorious examples of illicit lobbying in the nineteenth century involved railroad lobbyists, who brazenly handed out cheques to legislators on the floor of the House and Senate. By the 1950s, many lobbyists had enlarged their focus to include the executive branch and shifted to soft-sell tactics. This shift in technique was a response to exposure of lobbying scandals at both state and national levels. Congress began investigating lobbies in 1913 with a study of the National Association of Manufacturers (NAM). Since that time there has been at least one major investigation in every decade. The investigations were followed first by piecemeal legislation and then, in Title III of the Legislative Reorganisation Act of 1946, by general legislation to regulate lobbies. These acts and subsequent legislation aim at control, primarily through publicity, but many loopholes remain that permit lobbies such as the NAM and Washington, DC, law firms to avoid registration and others to avoid full disclosure of their activities. While not eliminating lobbies, the investigations and legislation have encouraged lobbies to seek a lower profile by moving away from high-pressure methods.?
The evolution of lobbying in America, as stated above, suggests that our own government and legislators must initiate similar legislative and executive processes to bring the lobbying industry above board. True, this will not happen overnight, but a start can be made by industry associations such as CII and Ficci along the lines of American industry associations in the first half of the twentieth century.
Dirty lobbying that has the potential to corrupt the political process itself was also an important subject of debate at the recently concluded British Parliamentary polls. The Labour party had promised new laws on lobbyists after disclosures that ex-ministers sought to sell their access and inside knowledge. According to a newspaper report, Harriet Harman, Leader of the Commons, used an emergency statement to confirm that the party?s election manifesto will include plans for the statutory regulation of the lobbying industry?an idea previously rejected in favour of a voluntary code.
An investigation by The Times, London, showed at least 28 persons currently working with industry could get elected as MPs. That is the ultimate victory for lobbyists as they happily turn legislators!
Things are not so bad in India yet. But we could get there soon if corrective actions are not taken.
mk.venu@expressindia.com