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Journalism of Courage
We have heard of the dictum 8216;Art for Art8217;s sake8217;. We have seen, and continue to see, 8216;Ministers for Ministers8217; sake take?8217;. Now we have a new principle, thanks to Disinvestment Minister Arun Shourie, and that is 8216;Reforms for Reforms8217; sake8217;.
The course of reforms has always been difficult, but never more difficult than at the very beginning. Mr Shourie was a silent spectator in 1991. His party, the BJP, was snapping at the heels of the Congress government and finding fault with every move. If the rupee was devaluated, that was wrong. If cash credit support to exporters was withdrawn, that was wrong. If the agreement on WTO was signed by India, that was wrong, and it was a sell-out to the developed countries. And so on and so forth.
The best thing that happened to the BJP was that it was voted to office in 1998 and again in 1999. Many of the criticisms that it levelled against the reforms of the previous governments simply melted away. The BJP stoutly opposed and defeated the Insurance Bill in 1998, but quietly passed the same Bill in 2000. With people like Mr Shourie and Mr Arun Jaitley joining the Cabinet, the Government acquired a pro-reform look.
But all reforms must be based on need and reason. Reforms must also have a context. Above all, reforms must have a purpose or a goal.
In the legal world, there is a principle called Heydon8217;s Rule. It is also called the 8216;mischief rule8217; and it reads thus 8216;8216;i What was the law before the making of the Act; ii What was the mischief or defect for which the law did not provide; iii What is the remedy that the Act has provided; and iv What is the reason of the remedy.8217;8217;
Suitably paraphrased, it will apply to the present situation as well.
I have often praised Mr Shourie in his new avatar as Minister. None can doubt his intelligence and capacity for hard work. But Mr Shourie8217;s worst enemy is Mr Shourie himself. He is like a horse with blinkers. Once set on a course, he cannot8212;or will not8212;see to his left or to his right. He will not admit that he is liable to be wrong. When he is vindicated he will shower praise on the Supreme Court the Balco case, but when he is stopped in his tracks he will ridicule the court and its judgement the HPCL, BPCL cases, and will go to the extent of inventing arguments that are laughable.
Mr Shourie has been wrong in the past. He was hopelessly wrong when he carried on a no-holds-barred campaign against Dhirubhai Ambani. On Ambani8217;s death anniversary, Mr Shourie confessed to doing a 180-degree turn. He was wrong on the Centaur Hotel disinvestment. Some clever people joined together and right under the nose of Mr Shourie robbed the Government of about Rs 30 crore. Mr Shourie was wrong in his handling of the telecom dispute between mobile service providers and the fixed line plus WLL service providers. He made some astonishing statements and would have continued in the same vein but for the Group of Ministers bringing some sense and order into the debate.
There are two views on the judgement of the Supreme Court in the HPCL/BPCL cases. The first view is that the judgement is confined to the cases of PSUs created by Acts of Parliament, and all that the judgement requires is that the Government should obtain the approval of Parliament for disinvesting in or privatising those PSUs. This conclusion of the Supreme Court does not have any alarming consequences. The second view is that the Supreme Court may have included within the ambit of its judgement all PSUs that have received funds from the Consolidated Fund of India. That certainly puts a spanner in the works, but the spanner could have been removed by a simple application to the court to clarify that part of the order.
Mr Shourie8217;s way of getting back at the Supreme Court is different. He has set his mind on privatising one or more oil sector PSUs and so, if he cannot do it with HPCL or BPCL, he will do it with IOC. This is madness, and there is not even a method in this madness.
The oil sector is the backbone of any developing economy. Many sins were committed in the past using the oil sector PSUs, but there is no gainsaying the fact that the oil sector PSUs are among the principal drivers of economic growth. Ranked by sales, the first five companies in India are oil companies. IOC is at the top with sales of Rs 1,23,628 crore last year. Ranked by profit, the first ten companies in India are in the oil and gas sectors. IOC takes the second place with a net profit of Rs 6,115 crore. Its marketcap is between Rs 30,000 and Rs 35,000 crore. It paid Rs 2,299 crore as corporate tax to the Government. In retailing, IOC has 8,000 petrol pumps and controls 40 per cent of all retail outlets. It has just teamed up with ONGC for exploration of oil. Its ultimate goal is to become a vertically integrated oil company with stakes in exploration, refining and marketing.
Why would Mr Shourie want to privatise the whole or a part of IOC? Who came up with the hare-brained scheme to hive off the retailing activity of IOC and privatising that part? Whether in the private sector or in the public sector, IOC has the potential to become one of India8217;s first truly global companies. ONGC is another. IOC happens to be in the public sector, so why not just leave it there? Why take it out of that sector or why break it up into parts?
Mr Shourie should realise that in touching IOC he has landed himself on an oil slick. He is seen as short-sighted, vengeful and pursing a personal agenda. For his good, I would advise him to say mea culpa and close the IOC chapter. Let IOC move on toward its ultimate goal of becoming a global major.
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