In this column in The Telegraph of 15 July 2003, I summed up the performance of the BJP government - the first time the BJP lasted for five years.
VAT, CAS, MSP,
ETC
It seems ages ago, but it is only five
years since the BJP won enough seats to capture power. It did so by attracting
new voters; it won especially strong support amongst literate, middle-class,
politically conscious voters. They were tired of the cynical hypocrisy of the
Congress; they wanted to give the BJP a chance because it was untried. The vote
for the BJP was not so much a vote for communalism, the atom bomb or
Paki-bashing; it was, before all these things, a vote for change, for something
different from Nehru-Gandhi-worship.
These first-time
supporters of the BJP should not be disappointed, for the party has made many
new departures and taken initiatives. Its attempts to raise India’s profile on
the international chessboard need not detain us here; international power games
are always unpredictable and slow. But the sheer level of its activity in the
economic field is impressive. Whether it is oil, telecommunications,
disinvestment, taxation, sugar, or broadcasting, no one can accuse this
government of having slumbered.
And remarkably,
the more active it has been, the bigger the mess it seems to have got into. The
allocation of petrol pumps has long been a political sleaze game. The
allocations made under Captain Satish Sharma blew up into a scandal; although
no one was convicted, the judicial process they were subjected to brought
considerable publicity to the sordid details. Ram Naik put in place a system of
district allocation boards, manned by judges and other worthy local citizens,
to clean up the system. The supposedly sound procedures led to equally
questionable allocations; although the petroleum minister was hardly
responsible for them, the mud stuck. The Prime Minister turned on a
high-pressure jet to wash it off; he asked that all the allocations since 2000
be cancelled. But mud has a particular affinity for this government; the
Supreme Court castigated it for a mindless cancellation of all allocations
regardless of merit.
In
telecommunications, competition was introduced without any attempt to offset
newcomers’ handicap; so the new entrants spent much time whining and lobbying.
The lobbying naturally went over TRAI’s head, to its detriment, and
concentrated on the power centers in the government. In the government too, the
minister in charge favoured and disfavoured, or at any rate pleased and
displeased one lobby or the other; the disfavoured one played the Prime
Minister’s Office against him. It was clear from the beginning that in a
seamlessly interconnected network, WLL was no more local than mobile telephony
and should have been allowed to all players. But the ministry favoured a few
for WLL licences. Even such a straight and upright minister like Arun Shourie
is not prepared to let the files bearing on this act of patronage be seen by
the courts. The suspicion is difficult to avoid that they tell a damning story.
Shourie, as
minister of disinvestment, brought vigour as well as rigour to the process; he
achieved more in two years than his predecessors had in ten. But he invited the
wrath of Shiv Sena for not favouring its favourite bidder for a hotel; this
thirst for patronage within the ruling alliance finally aborted the
privatization of the airlines, and has held up the sale of the oil companies.
These high-profile reverses cost far more in public goodwill than Shourie’s
many successes.
To spruce up
fiscal policy which had been erratic under Sinha, the Prime Minister brought in
Jaswant Singh, who seemed to have brought along a new broom. He inducted Vijay
Kelkar and asked him to prepare a fiscal bullet. But when the bullet was ready,
he hesitated to fire it. The repeated postponement of the introduction of
state-level value added tax is probably a blessing, since its design is so
defective; but it illustrates the point, that this government has great ideas
but is hamhanded in their implementation.
Rationing was a
hangover from World War II. Food shortages disappeared thirty years ago, and
with it the need for rationing. But it has been kept alive because it involves
sale of food below market prices, and the margin can be captured by corrupt
politicians, their relatives, friends and clients. Narasimha Rao doubled the
release of subsidized foodgrains, and thereby politicians’ and traders’
profits. The BJP did not have the guts to tackle this mega-racket; but it did
decide to abolish sugar rationing. It brought down the government’s compulsory
purchases of sugar from 40 to 15 per cent of output. But now the horse has
reared before the last hurdle. There is such a huge sugar surplus that the
government could bring down sugar price to any level, and thus benefit the
entire population. But if it abolished the levy, it would have to abolish the
minimum support price (MSP) for cane that it calculates from the levy price and
which all sugar mills must pay cane growers. If it abolishes its own minimum
price, the states will also have to give up fixing even higher cane prices. And
if they cannot fix confiscatory cane prices, if cane prices become aligned to
the market price of sugar, if sugar mills are allowed to pay for cane what they
can afford, they may begin to pay cane farmers in time. If the incessant
disputes between cane growers and sugar mills cease, how will Mayawati collect
money from sugar mills? And she is too valuable an ally for the BJP to
displease.
In broadcasting,
the government allowed foreign companies to beam in programmes for years. Then
suddenly one day it announced that to be able to uplink from India they had to
issue 74 per cent of their equity to Indians. So Rupert Murdoch sold equity in
a shell company to a small group of Indian friends, but that company will have
to buy content from another company on which he retains full hold. Other
companies have used similar stratagems before. But no one in the BJP asks himself:
why is it laying down these silly percentages? And many outside are asking,
whom are they trying to kid?
But none of
these proceedings has brought the government as much ignominy as the
conditional access system. Here was a simple, clear, cut-and-dried idea – that
every television set must have a box to control which channels the viewer can
access. What he paid would depend on what he chose to view. It should have been
eminently implementable. But the government went in with an obsession – that
the total cost to the viewer must be less than Rs 200. Why? The answer must be,
that it would be politically popular. This mindless quest for popularity led
the BJP into a quagmire.
Soon the party
will come up with another manifesto; because of the manifesto or in spite of
it, it may win the general election. But if its record of implementation
remains so poor, at some point the people will wake up and say, the Emperor has
no clothes. Not even a saffron loincloth. It would pay the BJP to invest some
effort in understanding governance.
