India has gone through its busiest ever summer, where every industry you could name has figured in at least one substantive development. Following such a summer, we could be justified in expecting the agenda for the upcoming monsoon session of Parliament to be choke-full with assessing the impact of these developments.
The agenda is not public yet. But it is for sure that none of the following developments will figure anywhere. A major vestige of the socialist raj mindset blocks the Indian political class from conducting any dialogue with the industry at a public forum. So, even as we see the top BP officials getting it in their beak at open Congress hearings because of the US oil spill, no such accountability lessons will be on display in India. But this lack of dialogue occurs not only in cases of corporate malfeasance, but even on issues where industry or sections of it may justifiably need the support of the political establishment. This is not just tragic, but a massive oversight that needs to be fixed. Just as you can?t have a high grade football match without a good referee, strong competition among companies cannot take place without good political umpiring.
From April, Indian industry has seen enough ruckus?over the pricing of telecom spectrum, the disquiet over Chinese imports, a furious back and forth on inflation and rate rise between the finance ministry and RBI, the IPL saga and the mining war. We are not even including the renewed ruckus over the pricing of natural gas, the timing of the disinvestment deals, or the DTC and GST.
For Indian democracy to take deeper root, it is essential for the political establishment to understand the complexity of the industrial complex we have built up. This can only develop if we write in rules for public hearing and debate on major economic issues. Without this avenue, the asymmetry of information between the executive and the legislature will deepen further. This hurts both as no serious pressure mounts on the government to offer help to a sector or fix corporate responsibility, even as the corporate industrial complex has become the driving force of the economy.
Also, without such an understanding, we will witness the spectacle of sections of the government trying to push through Bills that get blocked or inordinately delayed at some stage.
The plan to reduce government ownership in public sector banks to less than 51% will be more successful if the bankers and politicians get to understand each other better. Entrenched positions on this or the pension and insurance Bills will be far less once the politicians get to hear voices from outside their community. This would be possible when public hearings are beamed across the media, as constituents will immediately have information and question their representatives more closely. Given the underlying support for key reform measures, these representatives will then become more attuned to the ground reality. Sure, political opposition will still remain, but the chances of building support across the parties will be stronger based on such awareness. It is conceivable then to come across situations where the parties will drop their whip for members to vote en masse, making the government more comfortable about bringing in major changes.
At present, the only forum where parliamentarians get up close with the industry is in a standing committee, when there is a concerned bill. Here too, it is the bureaucrats who occupy the pride of place, reducing evidence by industry to tepid responses from chambers?we hardly ever hear from industry captains in their individual capacities. One can easily check this out in the records of the standing committees of key ministries like finance, industry or petroleum and power. Moreover, the evidence is cocooned in secrecy (except snatches gleaned by reporters as exclusives), which adds nothing to the debate.
This has created a perverse system where corporate accountability is actually reduced. On malfeasance, instead of putting a company on the mat publicly, ministers end up sort of defending them on the floor of the house. How does this happen? Whenever a company creates trouble, the rumbling in Parliament closely follows media reports, but with few additional inputs from those most affected. Companies in the affected sector get no organised platform to educate the politicians, except the ministers, or those outside the government to call for evidence.
If there is a calling attention motion, it is the minister for the concerned sector who makes a reply. It is a peculiar aspect of our governance system that the reply means the minister will now take up the responsibility of bringing the company to heel or lead the charge with his respective ministry. This happened in the case of Satyam. Instead of broad-basing the subject, Parliament members have to rely only on information supplied by the ministry concerned. If there is a debate, members have to use their individual proximity to the corporate world to secure information to embarrass the government. This immediately creates opportunity for leaks and backroom deals. By contrast, public hearings would create an opportunity for all the concerned parties to participate, making the content of the debate and the resulting government action far superior. If that happens, we would probably have learnt the right lessons from the Bhopal disaster, even if 26 years later.
subhomoy.bhattacharjee@expressindia.com