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Journalism of Courage
Playing games with G.V. Ramakrishna
It must be awful to be in G.V. Ramakrishna8217;s shoes. Two days before the termof the Disinvestment Commission and its chief comes to an end, and six weeksafter its members put in their resignations to allow the new government torecast the commission, the authorities still haven8217;t decided whether or notto accept these. Now surely that sends out a very loud and negative signalabout the manner in which the government treats supposedly independentadvisory bodies.
Ramakrishna, you see, is no paper tiger, who believes his job is simply torationalise what the government wants. Naturally, he8217;s fallen foul of theauthorities time and again. In fact, this is why Prime Minister Vajpayee whohas to decide on the matter, is getting completely conflicting advice onRamakrishna. Keep him as he8217;s very competent, say one group of advisors;sack him since he obeys no one, says another.
Ramakrishna has given disinvestment recommendations that haven8217;t been quitewhat the government wanted on IPCL, for instance, the Commission said thatit should not be sold to a company read Reliance Industries that will geta monopoly as a result. This caveat was subsequently dropped by the Cabinet,when it approved the sale of IPCL to a strategic partner.
Similarly, whenever he8217;s felt the government8217;s doing something wrong, he8217;sgone ahead and aired his view, solicited or not. In October 1997, when theUnited Front was close to selling GA-IL8217;s shares, Ramakrishna pointed out inwriting that the price was too low and that it would be foolish to sell atthis price. Unsurprisingly, in January 1998, the government stripped theCommission of its powers to render advice unless specifically asked for. Infact, when the BJP came to power, the Commission made it clear that it wouldresign if it was not given more powers. At that time, Finance MinisterYashwant Sinha assured them this would be done, but nothing changedmaterially.
And when he8217;s been ignored, Ramakrishna8217;s made it very clear, and public,that he8217;s being fooled around with, and will not take it lying down. Almosteach report of his gives details of which recommendations have been acceptedby the government, and which haven8217;t.
Look at the statistics yourself, and you8217;ll appreciate how shoddily thegovernment has treated the Commission. It has given recommendations for 53public sector units, but only 21 have been accepted. It has recommended that32 units be sold to strategic partners, but decisions have been taken foronly 9 units. Similarly, the Commission had recommended that 4 units beclosed but the government has accepted only one of these.
What8217;s embarrass-ed, and angered, this government, is that Ramakrishnacontinues to function quite unfettered. When the controversy hotted up,during the BJP8217;s previous tenure, of whether or not aircraft should bebought for Air India, Ramakrishna argued it ma-de sense to abide by theCommission8217;s recommendations, select a strategic partner for the airlinefirst, and then let this strategic partner select the aircraft. Later, hewrote to the government stating that then Finance Secretary8217;s SpecialPurpose Vehicle scheme for disinvestment was full of holes. Ramakrishna wasalso very vocal in his criticism of the previous BJP government8217;s decisionto force oil sector PSUs to shell out Rs 6,500 crore to buy part of thegovernment8217;s equity in other oil PSUs, and pointed out that this was nothingbut forcing the PSUs to cover the government8217;s deficit. It didn8217;t help thatthe stock market agreed with this and knocked off Rs 24,000 crore from themarket value of these companies within a few weeks.
More recently, a couple of days ago, the Disinvestment Commission chief hasridiculed Power Minister Rangarajan Kumaramangalam8217;s statement that thepublic sector NTPC has been asked to pay Rs 4,500 crore to buy anotherpublic sector power company, NHPC he argued that this was notdisinvestment, but was designed simply to bridge the fiscal gap.
With such a track record, it8217;s not surprising that several within thegovernment are keen to see the current Commission disbanded. For it8217;s now,in the actual implementation of the recommendations, that there is scope forfavouritism. This newspaper has, for instance, pointed out on variousoccasions Nov 6, Oct 20 that the Sotheby8217;s-style open auction that somebureaucrats and ministers are in favour of, actually help the bidder ratherthan the government. Similarly, as the recent GAIL controversy shows, thecurrent system of disinvestment through the Core Group is very inefficient,and lowers the value the government gets for its shares. Obviously then, itis vital that Prime Minister Vajpayee appoints an independent DisinvestmentCommission to monitor the process, and ensures that he gives it enoughpowers to do its job 8212; even if he doesn8217;t feel it fit to extend the term ofthe current Commission. He8217;ll obviously fall foul of several of his advisorswhile doing so, but then a Prime Minister has to act tough sometimes.
