End this witch-hunt

By announcing an inquiry into the disinvestment of Mumbai’s Centaur hotels, the government has made short shrift of due process. The fi...

By announcing an inquiry into the disinvestment of Mumbai’s Centaur hotels, the government has made short shrift of due process. The finance minister said in Parliament on Friday that the decision to order the probe is based on an examination of the Comptroller and Auditor General’s report. This is startling. The established procedure is for the CAG report to be first scrutinised by the Public Accounts Committee. After examining what it perceives to be “the most important paragraphs from the Audit Reports”, the PAC submits its findings to Parliament. The government is then required to act upon these recommendations and give an account of follow-up action. It isn’t just this bypassing of parliamentary procedure that makes the proposed inquiry seem like a witch-hunt.

The implications of this circumvention could go far beyond mere specifics of the sale of hotels. Every government reads the people’s mandate in its own unique circumstance, and prepares a roadmap for governance accordingly. A government is entirely free to disagree with its predecessor. But when a government uses shortcuts and witch-hunts to overturn decisions of previous governments, it imperils the very viability of a democratic system in which elections give alternative regimes the confidence that they can use office to reflect the mandate in lasting achievements. The Congress-led UPA government must know this. Among its most well-spoken ministers are veterans of earlier Congress governments. A year ago they were returned to power after a long hiatus, but during that period many of the policies they shaped and implemented continued — among them the process under so much contention today, disinvestment. Modern Foods was privatised by a previous Congress regime; today the success of the operation is evident. It has been joined with other remarkable turnarounds: IPCL, BALCO, VSNL, etc. Even as a UPA constituent that same Congress party has not sworn off disinvestment. Its CMP gives proof of its adherence coyly but surely: “Generally profit-making companies will not be privatised.”

There lies the rub. When loss-making concerns are offloaded, the seller cannot be king. The seller has to settle for the best deal possible. The CAG’s insistence on an inflexible bidding schedule therefore could be an impediment to substantive reform and the UPA’s CMP objective of using privatisation to “increase competition”. In exploiting vague objections in the CAG report to harass a political opponent of impeccable personal integrity, the government may find its own agenda of governance shrinking into a vicious cycle of vendetta.