Monday, July 31, 2017

Narayanan's non-partisanship was classic. So was Kalam's. Mukherjee played safe. His successor will be safer

In his farewell speech President Pranab Mukherjee highlighted India's strong points and said they had become endangered. "Multiplicity of culture, faith and language is what makes India special", he said."The soul of India is in pluralism and tolerance", he said. Then he referred to increasing violence in the country and warned: "At the heart of this violence is darkness, fear and mistrust". All true, very true. But the question arises: What did President Mukherjee do to use the constitutional and moral power of his office to protect the soul of India against the forces of darkness?

The Bengali intellectual in Pranab Mukherjee paid laudable attention to the culture associated with the Rashtrapathi Bhavan. His focus during the period of his presidency was on bolstering the grandeur of the place -- converting the old stables into a museum, restoring the building housing the President's Body Guard and so on. Reports say that the complex now looks more magnificent than before. But the pluralism, the tolerance, the darkness, the mistrust? That story got lost in translation.

Not that the President has powers comparable to the Prime Minister's. But he has powers that can be used -- powers that come from perceived impartiality, from the exercise of checks and balances. Of the 12 presidents before Mukherjee, nine chose to remain safely inconsequential. (Zail Singh and Fakhruddin Ali Ahmed went to the extent of declaring their servitude to the Prime Minister while V.V. Giri and Sanjiva Reddy sustained servitude without declaring it -- evidence of the overriding power Indira Gandhi ensured for herself).

Of the three presidents who dared to plough independent furrows, Rajendra Prasad, the first President of the Republic, was a loner. Firstly, he became President despite Prime Minister Nehru's opposition. Nehru was against him because he was Sardar Patel's choice and was religiously inclined (though not communally, in today's Hindutva sense). Secondly, he wanted powers the Constitution did not envisage. There was an exchange of letters between the President and the Prime Minister with Rajendra Prasad arguing that he must have the power, for example, to contact any government secretary directly for information and to function as a third arm of the legislature with discretion to sign bills passed by Parliament. He lost out in this argument because Nehru had the Constitution on his side.

It was K.R. Narayanan who brought out the full potential of the presidency. It was a turbulent period with Deve Gowda and Inder Gujral and A.B.Vajpayee successfully eroding Congress omnipotence. The hour found the man. Narayanan showed his individuality by becoming the first President to exercise his right to vote, and by using his Republic Day address to caution against growing discontent among the deprived sections of society.

Narayanan dissolved Lok Sabha twice. He was the first to establish that a person could be appointed prime minister only if he convinced the President, through letters of support, that he could secure the confidence of the House. Vajpayee was the beneficiary of this decision. The President underscored his non-partisan independence by declining the United Front Prime Minister's recommendation to dismiss the BJP Government of UP, and later by declining the BJP Prime Minister's recommendation to dismiss the Rabri Government of Bihar. An interesting conundrum rises. The nation's first Dalit President, an ardent Congressman, became so impartial as to help the nation's first BJP Government to power; will the nation's second Dalit President, an ardent BJP leader, become impartial enough to decline a BJP Government's recommendation? No prize for guessing the answer because there is no need to guess.

P.J.Abdul Kalam had fewer challenges compared to Narayanan, yet the "people's President" became admired for his independence. He demonstrated it when he declined to sign on the dotted line in the office-of-profit case. The Government wanted various VIPs to be exempted, but the President would not agree.

But there was a more dramatic demonstration of his independence. He was proposed for the presidency by the BJP. But within days of his assuming office, he made the BJP jittery by deciding to visit Narendra Modi's Gujarat, then reeling under the aftershocks of communal rioting. Prime Minister Vajpayee tried to dissuade him, but he said he had to go.

Pranab Mukherjee, the most political President in our history so far, steered clear of tricky situations in his own way. At least at the moment of saying goodbye, he addressed issues he could have addressed earlier. In the days ahead, even that is unlikely to happen. Where hearts unite, tongues are superfluous.

Monday, July 24, 2017

Lalu is natural target in the fight against corruption, but the problem is larger. All parties are guilty

Mention corruption, and the names of some politicians jump out like registered trademarks. Lalu Prasad Yadav is right when he says that the BJP Government is hunting him for political reasons. The Government has indeed been using the CBI to hunt its opponents on a selective basis. But it is able to play politics of revenge because facts are there to exploit. Lalu has been a synonym for corruption in unique ways -- the only leader who breaks laws with defiance and daring.

When his second daughter Rohini got married in 2002, arrangements had to be made on a grand scale which meant dozens of cars for guests, comfortable sofas and chairs for use in the pandal, dry fruits, provisions, garlands and so on. Organising them was no problem for Lalu. Musclemen walked into car showrooms in Patna and just took away all the models there. Others went to furniture storerooms, cake shops, grocery shops, fruit and dry-fruit stalls and flower shops and just took things away. What an original idea! The press published reports but didn't quote shop-owners who were so scared that they pleaded for anonymity. But Rohini got happily married. Those were also days when kidnapping for ransom flourished. Wellknown doctors were among those who lived in fear.

No Indian politician has so openly misused power. Nor has any other leader pushed the family into power with the same I-am-the-proprietor attitude. When the courts disqualified Lalu following the fodder scam (fraudulent payments for non-existent cattle feed), he unashamedly put his illiterate wife Rabri in the chief minister's chair. In the united front with Nitish Kumar, he got two of his sons into the cabinet, one as deputy chief minister. His daughter Misa, inheritor of many of her father's special talents, is in Parliament.

Left to himself, Lalu Prasad would think it perfectly natural for Rabri Devi to become President of the country, Misa to become Prime Minister, Tejaswi the Home Minister with additional charge of Industries, Finance and Information, Tej Pratap the Chief Minister of Bihar, and daughters Rohini, Ragini, Chanda, Hema, Rajalakshmi and Dhannu to be named ambassadors to the world's big powers. He would want nothing for himself except his formal portrait to hang in all government offices as the most loving husband and father in Indian history.

How nasty of CBI to get going suddenly and shatter all the dreams. It filed charges with unusual promptness, claiming that the family had acquired nearly a thousand crore rupees worth of benami properties in a decade. Contracts for the maintenance of railway hotels and licence for a liquor factory were the kind of favours given in return for prime properties. There was a "gift" of land even by Rabri Devi's cattle-shed owner. Some unkindly opponents referred to Lalu as "the Robert Vadra of Bihar".

Lalu's operations were wide and his attitude reckless. Therefore he made himself easy prey to his opponents. But deeper is the corruption that goes on at the grassroots. There has been a drop, since Narendra Modi's rise, in big-ticket scandals in Delhi like the Commonwealth Games or the Spectrum sale. But that does not lighten the burden of everyday corruption that continues as before. The last Transparency International report put the total bribe Indians paid to access routine government services at Rs 21,000 crore. (How? Go and register a trust or a will at any sub-registrar office and you will know).

All parties contribute to this shame despite the BJP's holier than thou posture.A former Gujarat chief minister's daughter faced charges of getting 422 acres of land from the state government at Rs 15 per square meter when the government's own prevailing rate was Rs 180 per square meter. The long-running Vyapam scam in Madhya Pradesh rocked Parliament again recently but is yet to be fully investigated. Lalit Modi, with friends in BJP, is not trawled the way Vijay Mallya is though both are absconders of the same kind. Most importantly, some BJP leaders in Kerala have been found to have taken money to help start new medical colleges in the state.

Prime Minister Modi made yet another call for a corruption-free India when he said, at the all-party meet on the eve of Parliament's current session, that it was the responsibility of all political parties to take action against corrupt leaders. All parties? That sounds like an instruction to the Karnataka BJP to find a clean chief minister candidate instead of one who was jailed for corruption the first time around.

Monday, July 17, 2017

Be it currency shift, Aadhaar, GST, there is a mad rush; People feel cornered, vexed. Why this mad rush?

Usually life gets simpler as nations progress. But not in India where a barrage of sudden changes, new rules and revised regulations are making life burdensome for ordinary people. First it was demonetisation. The dislocations that abrupt adventure triggered are still haunting people. As if that were not enough, a whole new mess has developed around Aadhaar. Then a bigger mess around GST. The wise men in Government tell us that it's all simple, that it's all good. What we know in everyday life is that it's all oppressive.

All tax paying in India is oppressive and vexatious. In a small outpost like Hongkong, to cite one example, there is a one-page form (that's right, one page) for the citizen to fill up and send to a named tax officer along with a cheque. If there is a doubt, the officer will phone you and settle the matter. That simple. In our country the system is designed to sustain the chartered accountants of the country. Not even an educated citizen can file his tax return on his own because of the technicalities involved. The ground rule is that the tax-paying citizen is guilty until proved innocent.

In this climate Aadhaar is turned into all kinds of things it was not meant to be. Way back in Nandan Nilekani's days, Aadhaar looked like a decent thing -- an ID card for Indians, the more sensible because it was voluntary. There was nothing intimidating about it; it merely confirmed your presence and identity in a yes-no format.

What we now have is mandatory Aadhaar. It has acquired a whole new existential importance because a citizen cannot get a passport, cannot open a bank account, cannot file tax returns, cannot buy a car, cannot even get a railway ticket unless he produces his Aadhaar. Tens of thousands of pensioners have not received their sustenance because their PF accounts are not linked to Aadhaar. Weak or infirm, they are now part of a huge rush to get the paper work done -- presenting Aadhaar card, pension passbook, bank passbook and biometric details to be qualified to get their own money.

Franz Kafka foresaw this kind of nightmarish situation where an omnipotent power floated just beyond the senses. "You go to the city to see the law. Upon arrival outside the building, there is a guard who says 'you may not pass without permission', you notice that the door is open, but it closed enough for you not to see anything (the law)".

Not just Kafka, George Orwell also saw what was coming. The expanded, post-Nilekani Aadhaar violates norms of privacy and individual freedom with joyful abandon, making surveillance of citizens as patriotic as in the days of Big Brother. Orwell was cited in the Supreme Court when a petition came up against Aadhaar. Countering it, the new Attorney General, K. K. Venugopal, argued that Aadhaar had helped more than 300 million poor. Why does Aadhaar attract such contrarian reactions, Kafkaesque, Orwellian and Venugopalish? And indeed Narendra Modi-like? One month before he became Prime Minister, Modi said that in Aadhaar, "there is no vision, only political gimmick".

Is there vision in GST? Minister Venkiah Naidu, who sees life in simple blacks and whites with no inconvenient greys in between, said last week that only those who avoid taxes would criticise GST. Is the Finance Minister of Telengana one who avoids taxes? For the state minister said that GST was "impractical" because of "irrational tax rates".

By Naidu's yardstick, textile businessmen, small traders, hotel keepers, farmers, fishermen, petrol bunk operators, chicken traders, and a whole lot of people who are on the margins are tax dodgers. For they are all at their wit's end over the GST complexities such as price variations and overcharging. Fishermen leading a harsh hand-to-mouth existence, are placed in the tax squeeze for the first time. How will they live during the off-season months when they cannot go out into the waters?

In principle, GST is a good concept. As is Aadhaar. As is demonetisation. The problem is that these are not introduced properly, gradually and after giving people time to understand and adjust to wholesale changes. The Government does not seem to have learned anything from the chaos -- and the deaths -- caused by demonetisation. It is still in a mad rush to change the country, change the way people live, change the way people think. The wise say: Make haste slowly. The otherwise show "no vision, only political gimmick".

Monday, July 10, 2017

Saudis want Qatar out; Turkey wants new dominant role; hostilities in Muslim lands pose problems for all

There is turmoil in the Islamic world. Saudi Arabia has made a hardline prince the effective ruler. Qatar, isolated by neighbouring Arab states, is defiant. Turkey has become a virtual dictatorship, changing the country's profile and claiming a larger regional role for itself. The war zone in Syria sees Russia and the US challenging each other. Jihadists lie in wait for every opportunity. These are not developments that concern only the Arabs and other Muslims. They make the world unsafe. India has reasons to worry.

The epicentre of the upheaval is Saudi Arabia, more specifically, its newly elevated crown prince, Mohammed bin Salman, son of the 81-year old King. He was the power wielder even earlier as deputy crown prince, defense minister and economic decision-maker. It was he who started the war in Yemen in early 2015. Despite US-backed air assaults and continuous ground bombardments at a cost to the Saudis of an estimated $ 200 million a day, the Saudis have failed to suppress the largely Shiah Houthis of Yemen; the war that is into its third year has only shown Saudi Arabia's military incompetence. At one point, the Saudis used their wealth to put together what was called the Islamic Military Alliance with Pakistan's former army chief, Raheel Sharif, as commander. It lead to Sunni embarrassment all over, Gen. Raheel himself quietly quitting the scene.

Undaunted, the aggressive prince launched other, bolder initiatives: Arm-twisting of Qatar, an economic overhaul to reduce Saudi's dependence on oil (taxes have been introduced in the country), and a hardening of policies against Iran. These caused concern across the world. A memo by Germany's foreign intelligence service said Saudi Arabia was destabilising the Middle East with "an impulsive policy of intervention".

The unprecedented move against an Arab alliance member was not only impulsive but also counterproductive. Qatar is the headquarters of America's military base in the Gulf -- a strategic reality that made the US, otherwise a spirited ally of Saudi Arabia, less than enthusiastic about "boycotting" Qatar. The reason for Saudi anger against Qatar is that the Qatar rulers do not consider Iran as an enemy. Qatar has tried to maintain, what is by Arab standards, a neutral position on many fronts. At one level, it runs Al Jazeera, the only Arab news service that has a degree of credibility. At another level, it keeps open its channels of communication with Iran, the Shiite power Sunni Saudis consider their rival and which, therefore, they want to destroy.

While other Sunni Arab states like UAE fell in line with Saudi Arabia, the non-Arab Muslim power, Turkey, maintained fairly close relations with Iran. It did not hesitate to help Qatar when the Saudi alliance excommunicated it. Turkey's elected dictator, Recep Tayyip Erdogan, is dismantling the secular republic created by the legendary Kemal Ataturk and building instead an Islamic State which he hopes will acquire the kind of influence the old Istanbul-based Ottoman Empire did. Turkey was waiting like a supplicant to be admitted as a member of the European Union. Not any longer. Now Erdogan has turned against Europe, especially Germany and Netherlands where Turkey's ministers were not allowed to address Turkish diaspora. Erdogan went so far as to call the Germans and the Dutch "Nazi gorillas". Turkey's foreign minister warned that Europe now faced the prospect of Holy War.

As far back as in 1996 Samuel Huntington had foreseen something like this happening. His Clash of Civilisations had said that at some point Turkey could resume its "historical role as the principal Islamic interlocutor". This would happen, he prophesied, if Turkey rejected Ataturk's legacy "more thoroughly than Russia has rejected Lenin's". That is just what is happening.

Fear of the unexpected has changed the tenor of life. Security protocols control everything. Suddenly, it's an unsafe world. For India, too. The US and Saudi Arabia turning against Iran could tempt India to join them -- which would be a costly mistake given the benefits India can reap from economic collaboration with Iran. The Bangladesh Government told Delhi a few months ago that there was a three-fold increase in the number of jihadis infiltrating into India. The IS has made its presence felt in the country. It has even attracted young people from well-to-do Muslim families to join their ranks. The insecurity violent cow vigilantes have produced among Muslims in some parts of the country may be a factor in this. Everywhere there is uncertainty in the air. The world is tense. The darkness deepens.

Monday, July 3, 2017

Business leaders, SBI turn sceptical about our economy; farmers react with suicides -- which is a bad sign

Those of us who spend the midnight hour sleeping missed the celebratory introduction of GST. After all, it was not the same as the hour "when the world sleeps, India awakes to life and freedom... when an age ends, and when the soul of a nation, long suppressed, finds utterance". Every soul, illiterate or educated, felt the thrill of that utterance 70 years ago. A big majority of those who are going to pay the "consolidated" tax called GST don't understand it at all. That's the way of the sarcar whichever party is in power. Try paying property tax in any city, try paying income tax without the help of at least one chartered accountant, and you'll know how the sarcar likes you to run in circles.

Such is the confusion that we can't even be sure if the economy is going forward or standing still. It is galloping forward if we listen to the Finance Minister and his government/party colleagues. But business leaders are giving warning signals while the Government's own State Bank of India has openly criticised demonetisation. And it is no longer secret that a cold war has developed between the Finance Ministry and the Reserve Bank.

Manmohan Singh -- now seen as a Congressman rather than an economist -- was ignored when he said that demonetisation triggered an economic slowdown. But no one can ignore A.M. Naik, executive chairman of L & T, when he says that there is hesitancy in private investment and if the Government does not spend, "there will be no growth in the economy".

What is becoming clear is that, now that people have had time to see the impact of notebandi, informed criticism of that trademark policy of the Government is turning strident. Experts grant that when the economy is operating normally and people are gradually made familiar with the concept of cashless transactions, discontinuation of high-value currency can have a favourable effect. But that was not what happened in our case. The suddenness of the drastic policy shift created chaos across the country. Cash became unavailable. Small traders stared at starvation. Agriculture mandis saw prices crumbling with disastrous consequences.

Last month the State Bank of India cautioned that demonetisation could continue to slow down the economy. It told institutional investors that the long-term impact of the note ban on India's economy and the banking sector would be "uncertain". So what was the currency coup all about? It certainly did not end black money. Within days of the new currency's entry, large sums of it went underground creating new black money. Headlines turned sensational when a BJP activist was caught recently with machinery that printed fake currency notes. SBI's words of caution strengthened the view that demonetisation was not an economic move, but a political one.

When demonetisation was announced, there were conflicting reports on whether the RBI Governor was in the loop or not. Raghuram Rajan's departure from Governorship was linked to his purported disagreement over the idea. Earlier this month present Governor Urjit Patel said that members of the Monetary Policy Committee had refused to meet finance ministry officials for a policy review meeting. Chief Economic Advisor Arvind Subramaniam presented the Government's view when he said that "the RBI's inflation forecast errors have been large and systematically one-sided".

The advantage of highfalutin cerebralism among economists is that black can be presented as white and vice versa. The World Bank's India Development Report released in May appeared under two opposing headlines in the print media. One said: "India to grow at 7.2 percent in FY 18", and "7.7 percent forecast for 2019-20 on the back of strong fundamentals". The other said: "World Bank cuts India's growth estimates". Both were correct of course. Only that the second one pointed out that the World Bank's original growth estimate was 7.6 percent, but the performance had fallen short. The first one mentioned nothing about the fall and added the rosy forecast for the next year.

Publicity tricks can go so far but no further. Farmers are in deep crisis and they are responding with suicides in the thousands and mass protests that alternate between the violent and the pathetic (near-naked protestors wearing the skulls of their departed friends). The way the farmers agitation has spread across the country points to a very serious crisis that cannot be met by financially dangerous shortcuts such as loan waiver. Arguments stop and propaganda fails when people, their livelihood lost, start killing themselves. That's how tempests gather.