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Ruling Class

The lobbyists army is now choc-a-bloc with ex-babus

Ruling Class
Ruling Class

Ashok Jha, Ex-finance secy Now senior principal, Dua Consulting    C.M. Vasudev, Ex- economic affairs secretary, Now director, Noesis Strategic Consulting   C.P. Jain, Ex-CMD, NTPC, Now director, Reliance Capital 

R.V. Shahi, Ex-power secy, Now chairman, Energo Group


S.K. Narula, Ex-AAI chairman, Now director, Noesis Strategic

Cabinet secretary K.M. Chandrasekhar sent a telling missive recently to the secretaries of the ministries and central departments. “Of late, there’s been disturbing incidents which call for serious introspection by civil servants. It is important that we ponder over the manner in which we discharge our duties...and what we need to do to refurbish our image,” it said, adding that “the issue of corruption needs to be addressed fairly and squarely.”

This reminder of the core values of civil service is an index of how corruption has seeped into government. Worse, as corporate lobbyists—actually, an army of retired officials—foray into government departments, many serving bureaucrats are used to settle scores with individual industries. “I actually prefer the old-style corruption to the present lobbying,” says Sunita Narain of the Centre for Science and Environment.

The numbers are revealing: the annual report of the Central Vigilance Commission for 2008 listed as many as 1,091 valid cases of corruption against officers of various government organisations, including PSUs. Of these, the highest related to banks, insurance and coal. Overall, 138 cases of prosecution (across all categories of employees) were ordered out of 14,322 cases of corruption disposed of during the year.

The recent corruption case involving a senior IAS officer in the home ministry is but one example of how the system works. Much as the political heavyweights perform as the primary actors in swinging deals through accommodative policy changes, the bureaucrats and policy-framers manning various ministries/departments are no less powerful. The booming economy, with rise in incomes and expectations, seems to have raised the bar on corruption in the bureaucracy, many allege.

With the lobbying space becoming more and more crowded, bureaucrats are fighting shy of meeting too many brokers...fearing the “partial” charge.

The argument that clearer systems in place in ministries like petroleum and power curtail lobbying is disingenuous. The reality is a bit different, as many companies seeking 2G or more recently 3G spectrum allocation, airport modernisation projects, highway projects, mega power projects and other high investment infrastructure projects will readily point out. Why, even health, education and environment programmes are riddled with corruption, thanks to powerful lobbying. In this kind of scenario, bureaucratic interventions count and lobbying helps swing decisions. The rewards for “obliging” the corporates come not necessarily in cash, but often after retirement, as seen in the case of one state power major’s CMD who joined the private sector right after retirement.

That is not to say that the plum posts offered after retirement to PSU chiefs are just a favour being returned by the corporates. In many cases, their domain knowledge is a prize catch. “The bureaucrats understand the system a lot more.... Also they know the people (in the corridors of power) so they become the preferred lot to hire,” says Samir Kale of CMCG India, a communications firm that doubles as lobbyists.

In a system that is mutually rewarding, the task of the corporate lobbying firms and even think-tanks becomes easier once they have former bureaucrats on board. Approached for his views on the issue, Pradip Baijal, former TRAI chairman and currently a director in Niira Radia’s Noesis Strategic Consulting Services, declined to talk to Outlook saying that “the position the media has taken is very perverse”.

Over the last couple of decades, a number of ex-PSU chiefs—from M.S. Ramachandran of Indian Oil (now chairman, Cals Refineries) to former bureaucrats like R.V. Shahi (now chairman of total power solutions firm Energo)—have turned consultants. Many, like former ntpc chief C.P. Jain, have joined rival firms. As a former bureaucrat who held key positions in many ministries but has so far resisted turning a consultant puts it, “Large infrastructure projects like telecom, highway, power, oil and gas and even in finance, personal equations and influences work. It all depends on the personal equation with the current secretary, minister or a political heavyweight.”

All this activity is certainly having a ‘perverse’ impact on decision-making by bureaucrats. With the lobbying space getting more and more crowded with ngos and civil society bodies becoming as active as industry associations and chambers, often bureaucrats at the helm of affairs fight shy of meeting too many for fear of facing charges of  being “partial”.

Commerce secretary Rahul Khullar pragmatically states that one cannot be inured to the existence of lobbyists. “There is no harm whatsoever in hearing out anybody with a problem in the industry, be it on a matter of policy or anything else. But what you need to safeguard is the integrity of the decision-making process,” he says. Ironically, bureaucrats admit that it is often the well-presented PowerPoint case study by industry groups that sway policy decisions.

Taking serious note of the complaints against PSU executives, the government has decided to set up a committee under the cabinet secretariat. Meanwhile, it’s apparent that only clear rules that govern lobbying will stop bureaucratic power-play. Or, like now, it will be the opportunists who hold sway.

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