Disinvestment minister and firebrand Arun Shourie had it coming. At midnight last Tuesday, Prime Minister A.B. Vajpayee succumbed to the L.K. Advani-driven, 48-hour-long "remove Pramod Mahajan" campaign, and by next morning it was finalised that Shourie too would be shunted out of the disinvestment ministry and given the commerce portfolio. But then Shourie reacted like a wounded tiger and saved the day for himself, as he did six months ago.
He met Vajpayee on Wednesday morning at the latter's residence and made it clear he would have no option but to resign if removed. His argument was simple: he was not keen on commerce and his family commitments would not allow him to do justice to a post that requires jetsetting across the globe. Commerce, after all, primarily involves wto negotiations. The plainspeak clinched it. By afternoon, Shourie walked away with the cake while eating it too.
Game, set, match, disinvestment, telecom and IT to Mr Shourie. So, how did his survival strategy work, when Mahajan's didn't?
Initially, Mahajan was to stay. On Monday, during a marathon three-hour meeting at the PM's residence, Vajpayee, Advani and BJP party president Venkaiah Naidu toyed with the idea of a swap between telecom and IT minister Mahajan and the I&B minister Sushma Swaraj. The idea was discussed further when Advani had a second meeting with Naidu and Sudheendra Kulkarni, the former osd in the pmo who's now in-charge of the Press Information Bureau and is working closely with Sushma, at the deputy PM's Prithviraj Road residence.
But Mahajan wanted a mega portfolio that combined IT and I&B, which Advani was just not ready to accept. Later, Mahajan tried a strategy that had saved him from being removed six months ago. He pointed out that he would rather work for the party if there was no place for him in the cabinet. That proved to be a big mistake as this time around, both Vajpayee and Advani were game. Mahajan was promptly made the BJP's general secretary.
In contrast, Shourie was crisp, sharp and direct. It worked. To be honest, though, Shourie got the telecom and IT ministry by default. Till Wednesday morning, Arun Jaitley was a sure bet for the portfolio. In fact, people close to the PM's family were openly talking about it. Things changed when the deputy PM was told that Jaitley had earlier been the legal counsel for the Cellular Operators Association of India. Hence, appointing Jaitley as telecom minister could have sent wrong signals. Don't forget that in a highly polarised environment like the telecom sector, powerful lobbies are at work, one reason why Mahajan had to go.
So the story about Shourie getting telecom seems clear. But there's another one on how he withstood the pressure from cabinet colleagues, BJP leaders and the Sangh parivar, especially the Swadeshi Jagaran Manch (SJM). Early last week, senior RSS members visited Vajpayee at his residence, seeking Shourie's head. Well before that, the Mahajan camp had been vociferously asking for the same. There were also signals from within the BJP that shifting Shourie out of disinvestment would send a 'people-friendly' message to the PSU employee votebank in the run-up to the polls in nine states.
The winds were against the disinvestment minister. The first hint came during the crucial meeting of the cabinet committee on disinvestment (CCD), held on January 26. Shourie won a major victory that evening as the CCD agreed on details on how to proceed with the sale of two oil PSUs, HPCL and BPCL a move vehemently opposed by cabinet colleagues like petroleum minister Ram Naik and defence minister George Fernandes, and the BJP's ideological wings.
Apart from Naik, who opposed Shourie at the CCD, there was little reaction from other critics.Mum was the word, with BJP sources saying there was some sort of implicit deal that Shourie was going anyway. Thus, there was no point reacting to decisions taken by the CCD. A sign of a deal comes from the manner in which everyone supported Shourie at the CCD meet. It began predictably. Naik raised issues like the current volatility in global oil prices over Iraq, and raised the spectre of another scam as he feared the new owners of HPCL would close down the Mumbai refinery and sell the prime real estate.
Shourie tried to intervene, but was snubbed by the PM. Let others speak first, Vajpayee told him. Subsequently, all the speakers—including external affairs minister Yashwant Sinha, Planning Commission deputy chairman K.C. Pant and then law minister Jana Krishnamurthy—rebuffed each of Naik's fears and expressed full faith in the disinvestment process in varying degrees. Even Advani rallied around the reformists, although he expressed concerns about issues of realpolitik like safeguarding labour interests.
Such outright support came as a surprise. More so when it came from an RSS veteran like Krishnamurthy. "Sinha batted like Sachin," says someone present at the meeting. He, along with Pant, opposed Naik's argument to allow PSUs like ONGC to bid for HPCL. Sinha also added that it was time the government reasserted itself and not be seen as a victim of blackmail by those opposing the sale. And the moment Advani suggested a higher quantum of shares for the employees as a safeguard against labour unrest, Vajpayee seized the opportunity and agreed in toto. That was the PM's masterstroke and it was finalised that a 5 per cent stake, instead of the earlier 2 per cent, would be kept aside for employees of both PSUs.
The isolation was becoming total. There was no possibility of a scam, assured Shourie and Krishnamurthy, since the shareholders' agreement for HPCL's sale would include water-tight guarantees. For one, it would clearly bar the strategic investor from a free run through specific clauses even if the government stake fell below 12 per cent post-sale. The Competition Act and the proposed Petroleum Regulatory Bill would allow Naik to keep a check on any foul play.
Finally came the decision about not allowing other PSUs (especially ONGC) to bid for HPCL since it would make a mockery of the entire disinvestment process. Vajpayee concluded by saying, "Achcha, theek hain. Toh is baar ONGC ko chhor hi dete hain (Let's drop ONGC out of it this time)."
The sequence of events was a clear indicator to most of Shourie's critics that he had total support only because people knew his time was running out. Things moved forward the next day, when new arguments were devised to sideline him. It was pointed out that no other country has disinvestment as an independent ministry, being always an integral part of finance ministry. By that logic, the global trend should be followed and the two merged.
Finance minister Jaswant Singh was not opposed to such a move. His logic was that holding the disinvestment portfolio would help him in his work. Since a main task was to control the looming fiscal deficit, he needed to have a better idea of inflows into the government coffers. And that included a clear fix on how much money could be realistically raised through PSU sell-offs.
There was another rationale for the move. The man behind Indian privatisation, Vijay Kelkar, Jaswant's key advisor, would be an ideal person to carry on Shourie's work. For the uninitiated, Kelkar has, in the past, suggested various models to speeden the disinvestment process. Always bullish about scrapping the disinvestment ministry, he had also came out with a "compromise formula" when BJP leaders were unable to decide on how to go about the oil PSUs' sale.
Now back to the days before the reshuffle. The tussle over Shourie spilled over into two days of intense debate. On Tuesday, while the PM was away from the capital, Advani met with Naidu, Jaitley and Ananth Kumar, the urban development minister. Later S. Gurumurthy of the SJM too was in town to hold meetings with the deputy PM. The RSS patriarchs were putting pressure on Vajpayee, while Naidu raised the issue of the party's political (read electoral) compulsions for removing Shourie. The disinvestment minister too got into the act, with a few corporates that are on his side lobbying on his behalf.
Left to themselves, the PM and his deputy were not to keen to remove Shourie. Vajpayee, in fact, was worried it would send negative signals to foreign investors, domestic industry and the urban votebank, who are keen on reforms. What turned the tables in Shourie's favour was a theory floated a few hours before the swearing-in ceremony on Wednesday evening. Senior BJP leaders were told there was a chance that the disinvestment process may lead to controversies, especially when large oil PSUs are put on the block.
In such a scenario, it was better that Shourie, who has faced such pressures in the past, handle the situation now too. But to ensure that he didn't get overexcited about selling off other PSUs, he was told earlier by both the PM and Advani that while the process should continue, the final decisions should be postponed until November, by which time most of the assembly elections for this year would be over. Even so, as a senior RSS leader told Outlook, "January 26 is an auspicious day for the nation. And a decision to sell oil PSUs on that day will be fought tooth and nail." That battle was lost, but rest assured the political war against Shourie is far from over.