Friday, Nov 28, 2014

‘Somewhere India has to draw the line on how far can it go in its relations with Pak’

Nirmala Sitharaman at the Idea Exchange. Nirmala Sitharaman at the Idea Exchange.
Posted: August 24, 2014 12:12 am | Updated: September 4, 2014 12:13 pm

In this Idea Exchange moderated by National Affairs Editor P Vaidyanathan Iyer, MoS for Commerce and Industry Nirmala Sitharaman defends India’s stand at WTO, and says that the culture that had become synonymous with the Congress government has to be changed.

P Vaidyanathan Iyer: You handle a critical economic portfolio at a time when the global economy is still emerging from the woods and countries are exploring ways to improve trade and economy. At such a time, India is being singularly blamed for holding back a crucial trade facilitation agreement in Geneva and stalling trade talks. Do you think there is still scope for forward movement at the WTO (World Trade Organization)?

I think there is a great sense of appreciation about the arguments we have placed before them. I have several times explained as to why we took this position (not giving up India’s sovereign right to reform the public distribution system or decide on food subsidies). We hope the WTO will appreciate our point of view and that they will engage with us. We definitely make every attempt to engage with them, to speak about our concerns, underline the fact that we will honour the Bali package, but with the course correction in place.

P Vaidyanathan Iyer: One counter-argument is India leverage the ‘peace clause’ — which gave it four years to continue with subsidies, during which time the government could reform the PDS or set its house in order. So why this brinkmanship?

I disagree that it was political brinkmanship. Secondly, these are comfortable arguments to make that you had till 2017 a peace clause. I don’t want to compare with the civil nuclear deal we signed. Because that is the example that keeps coming to mind repeatedly, when I have similar situations, for us to explain as to what went wrong in Bali. 2017 was the deadline, in the sense that by that time I would have a permanent solution to public stockholding. But there is no guarantee that by 2017 I will have a permanent solution. From the very next day, you might end up in arbitration or in WTO court to say why we have to exceed the 10 per cent cap on agricultural production. So there are too many uncertainties and too many issues left untied.

You mentioned how we are reforming our PDS, something we could have undertaken later. I can undertake it later or not undertake it later, it’s my sovereign business. I will do it the way I want. ‘Because I have given a commitment to the WTO, I will reform it’ — no, I’m sorry, not for a minute will I go on that road. PDS, efficient use of subsidy, or how many people are going to benefit from PDS are all issues that we in India have to decide for ourselves. That will not be driven by the WTO. But at the same time, I can’t also sit back and say that whether you do it or not, I will still wait and do it the way I want.

Coomi Kapoor: To what do you attribute your remarkable success within the space of a few years in the BJP considering you are not from the Sangh Parivar?

I have not been associated with the Mahila Morcha or any woman-related group in the party. In 2008, the BJP passed a resolution making way for 33 per cent reservation for women, and that’s how I got into the party. Post that, I was a member of the National Executive. I attended every session and made sure I spoke, I participated, even as I was living in Hyderabad with family. In 2010, when the party chose me as a national spokesperson, I thought I wouldn’t be able to do justice to the job living in Hyderabad and working only part-time. So I decided to go to Delhi and work full-time, and I’m grateful to my family for having stood by me on that. That gave me the opportunity to interact with more leaders and workers, and that probably made a big difference.

Coomi Kapoor: You had worked with Narendra Modi earlier.

Yes, I did, during the Gujarat Assembly elections in 2012. Several months before the elections, we started organising the media campaign. During the campaign, I stayed there for nearly four-five months. That was when I worked directly under him.

P Vaidyanathan Iyer: Can you share your impressions of the Prime Minister?

My first impression of the Prime Minister’s working style is that he is very methodical, systematic. Sometimes for people like me who work under him, it can be a tall order. He pursues something till the last and, therefore, you find him following (it up), after giving reasonable time and space. It’s not as if he is breathing down your neck but he follows it up. At every stage, it is like, ‘Are you okay? Do you want any more support? Is there a hurdle?’ It is as though you are in the corporate sector. I easily relate to that. I have worked in the corporate sector when I was abroad. And that kind of professionalism to get work done from the planning stage till the ground stage is something from which we as politicians benefit. That’s where he stands out.

Rakesh Sinha: Why did India choose to call off talks with Pakistan at this stage, and where do you think we are headed now?

What we have called off are secretary-level talks. The BJP, even when it was in the Opposition, raised this issue now and then. Why have we called off the talks now? The high commissioner of Pakistan meets separatist leaders, the Indian foreign secretary says clearly that ‘this is not done and we are not going to allow it’. And in spite of that, the next day also the meeting happens. These are clear signs that the the goodwill-building attempts, which were revealed by the PM when he was being sworn in, are not being sufficiently reciprocated. If we want to build goodwill in the neighbourhood, it can’t be one-sided. The PM, by inviting everybody, gave a signal that he wanted to deal afresh with them. But when Pakistan’s high commissioner meets separatist leaders, somewhere India has to draw the line on how far this can go, the freedom to talk, the freedom to get in touch with everybody, whether or not it pleases the government.

P Vaidyanathan Iyer: So do trade and commerce with Pakistan take a back seat now?

Would you next say that there is a cricket match? What about sports, what about culture, what about music? We are always happy to say that there are issues on which we do not need politics. But that liberal approach to dealing with neighbourhood relations doesn’t seem to be reciprocated. My worry is that. Because I am representing the commercial interests of India, I would want to put back a question. We had extended the Most Favoured Nation (MFN) status to Pakistan in 1999. Till today, we don’t have that reciprocated. MFN is a trade parlance used all over the world. Its Urdu translation sounds very sensitive for a Pakistani to appreciate it — this is an argument given by our Indian friends. I have no problems with it. But if I’m expected every time to be pushed to say that you should understand the sensitivity because that expression used in Urdu means something — why am I being pushed to say that? I have extended an MFN to you. Pakistan has agreed to extend that to us. We have waited. We are waiting even today. But I don’t want any more explanations. Would you like to do it? I will welcome it even if you do it tomorrow or a year later. Ideally sooner.

Raj Kamal Jha: What is the government’s view on separatists? If the PDP delegation had gone and met the Pakistani high commissioner, would you have been okay with that? What was it about separatists meeting them that is a deal breaker?

Well, the position of the External Affairs Ministry, the Home Ministry and the people who have spoken on this issue is clear. I’m not going to elaborate on whether a PDP delegation meeting would be less offensive. These are again questions like cricket. These are issues where all of us will have to understand layers and layers of work which has been done from 1947 till today. And any one question — however sensational it may be — is a question which needs delicate balancing between two neighbours. Every issue has a serious implication when you articulate it, however diplomatically.

Liz Mathew: There is a general feeling that in the absence of a major opposition in Parliament and outside, some forces in the BJP, the RSS and affiliated groups are acting as the opposition. How are you going to deal with them?

I don’t believe that there is no opposition. There are parties, including the Congress, in the Lok Sabha and the Rajya Sabha, that voice their concerns, and we are trying to answer them. About our own organisation playing the opposition’s role, every political party will have dialogues within itself continuously. Not just voters but political parties have expectations of their own because, after all, we have given a manifesto, based on which you get the votes, based on which you get elected and based on which your state-, district-level units communicate with people. So, within political parties, if there are groups that speak up and if they come out as opinions that are being voiced, it’s only healthy for a democracy.

Vandita Mishra: When Modi says ‘Congress-mukt Bharat’ or when your Speaker denies the leader of Opposition status to the Congress, isn’t there a refusal to acknowledge the institution of the Opposition?

Congress-mukt Bharat, even I would say it. It’s a culture — thanks to the Congress — where many things that happen are not ideal. The undermining of institutions, including not giving the stature of leader of Opposition to the opposition party, these are practices thanks to the Congress. Now, you will ask me, are you not repeating the practice of the Congress? But, the culture of remaining indifferent to people, not feeling responsible to answer, brazen indifference to the difficulties of the common man, absolute insensitivity towards those very own institutions which so-called Congress’s own leaders built up over the decades…We are saying that the culture which has become synonymous with governance under the Congress has to be removed.

As regards the leader of Opposition stature being given to the Congress, it’s worth remembering that they have denied every opposition party physical recognition, they have also sometimes gone to the extent of hounding leaders belonging to the opposition party. We are certainly not going to emulate that culture.

Praveen Swami: There has been a lot of concern recently over the rewriting of primary school textbooks according to your party’s ideological preferences. Some of the textbook content especially in Gujarat is of very poor quality. What is your take, as an educationist, on the rewriting of textbooks every five years ?

Textbooks in India had been politicised immediately after Independence. This question will have to be raised from the very beginning. Distortions have happened even in the wonderful socialist era of India. I have read history which I completely disagree with. I may not be an authority on history, I may not be an authority on science, but I can say there have been blatant distortions to our country’s own history, and to our socio-cultural issues. So if you really want to talk about it, it’s not distortions which happen every five years, it’s distortions that are encrypted into Indian school textbooks  — let’s question all of them.

Anil Sasi: The government has articulated its position on FDI in retail, but is there any clarity on what happens to the one proposal which is already in, the Tesco proposal, and if states are willing to let them open chains? Because the proposal came in before the NDA came in.

We are not in favour of FDI in multi-brand retail. There is no doubt about that. There are no pending proposals of FDI in multi-brand retail.

Appu Esthose Suresh: Since 2009, there has been a sudden spike in FTAs (free trade agreements). Have you had a chance to review the FTAs already in place?

All the FTAs are being reviewed. And the reviews are not being done with the intention of dumping any one. It’s not as if we are going to reject an FTA. We need to see if more help needs to be extended to manufacturers, and to look at others who would benefit from FTAs within India.

Appu Esthose Suresh:  When the UPA-II started entering into FTAs with countries from the East, it also had a diplomatic angle to it because that was the focus area.

In most of these things, the MEA does a lot of work. It’s not that the Commerce Ministry is dealing through a separate channel. It is definitely as per the Indian administrative protocol. We go through the MEA in most of these matters. The economic affairs offices posted abroad in the high commissions or embassies come largely under the MEA, and we also work with them. ‘Look East’ (policy) continues with us. In fact, after P V Narasimha Rao, it was Atal Bihari Vajpayee who gave it a push. We will certainly go on that route. The mission with which the PM is working at the moment is to use commerce as a flagship for India. His idea is to see how Indian diplomacy can benefit from trade and commerce.

Gireesh Chandra: Your government has clarified that there will be no retrospective changes to the law on taxation. But the impact of the retrospective amendments to the Income Tax Act, 2012, is still being played out and many cases are yet to come to the notice of tax officials. You have made certain commitments in the Budget speech and many MNCs are asking what would happen to their previous transactions. What is your message to them?

The Finance Minister has been explicit on the retrospective tax legislation. He has said that we will not take that route. As regards to the legislation that was brought in a couple of years ago, which became very contentious and through which a message discouraging the industry went out, we have made it clear that as regards that particular amendment or whatever evokes that amendment to (be used against) any particular company, it will be left to the judicial process, and we will not interfere.

Kaunain Sheriff M: Narendra Modi in his Independence Day speech spoke about bringing in another institution instead of the Planning Commission. In the new scheme of things, what will be the role of the National Development Council, which approves the plans of the Planning Commission?

The PM has clearly explained why there is a need to recast the Planning Commission. The functions of the Planning Commission as these were being performed till recently did not evoke confidence. And in changing India, you are looking at so many different functions of Centre-state coordination, looking at disbursement of economic priorities, although the Finance Commission is the one which is constitutionally provided for allocation of Plan expenditure. The temptation to increase non-Plan expenditure through Planning Commission, which is not a statutory body, was not helpful. You’re now coming to a stage where you want to have states as equal stakeholders in the economy, the Centre is not going to behave like a big brother. We are not sitting and disbursing revenues.

Transcribed by Suanshu Khurana & Somya Lakhani

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