The issue is raw power

It is an important characteristic of the core language of Indian politics that the most naked of power struggles driven by the basest of intentions come masked in this country in remarkably genteel terms, sometimes even in the high-sounding vocabulary of serious policy 'debates.' On the face of it, there is nothing wrong with this. Each country and political system has its own grammar and code of public discourse. But what introduces hypocrisy into India's political discourse is its generally high moral and sanctimonious tone -- something it shares with the United States despite vast differences between the two. Thus, slogans about abolishing poverty can be used to win elections -- to perpetuate viciously elitist anti-poor policies. And constant harping on security can be made to generate new insecurities.

The latest example of this is the BJP/NDA 'debate' on 'divestment.' In reality, this is a dispute over the pace of privatisation of public sector units. This is itself a surrogate debate. The real fight within the NDA is over political power, and within the BJP over succession to Mr Atal Bihari Vajpayee. The contestation was sparked off on September 1 when Mr George Fernandes opposed the sale of the highly profitable oil sector companies, Hindustan Petroleum and Bharat Petroleum, and demanded a 'mid-term review' and 'course correction' of the divestment programme. He was vehemently contradicted by the two Aruns, Shourie and Jaitley. But in less than a week, the Cabinet Committee on Divestment put oil-sector privatisation on hold till December -- for political reasons.

The issue was prematurely revived in early October partly because the pro-privatisation lobby used Standard & Poor's downgrading of Indian bonds to 'junk' status to hit out at the government for losing 'the will for economic reform;' and partly because RSS sarasanghchalak K S Sudarshan unleashed a massive attack upon videshi policies and demanded that those promoting them must be weeded out. In fact, S&P's downgrading had nothing to do with PSU privatisation. What triggered it was India's bad economic indicators, including a 10 percent-plus fiscal deficit and high government debt (48 percent of GDP).

The day Mr Sudarshan went ballistic, Mr Fernandes, HRD minister Murli Manohar Joshi and Petroleum Minister Ram Naik too jointly raised questions about divestment "modalities". This prompted Mr Vajpayee's outburst staunchly defending divestment as 'our chosen path.' This new mantra is now being recited as some kind of self-fulfilling magical incantation. Even practically, it makes no sense to sell off PSUs when the world and domestic markets have fallen by 25 to 40 percent over a year and countless industries are in the doldrums, including metals, engineering, telecom, IT, even hotels. This only shows that the sell-off push comes from shady sources.

Mr Joshi has inserted himself into the present debate in an attempt to open up the Vajpayee succession issue which seemed to have been sealed by Mr Advani's elevation as deputy prime minister. Mr Joshi enjoys the RSS' confidence for pushing the Hindutva agenda more vigorously than any other minister. He also resents the prominence gained by Mr Advani through his new attempt to befriend Ms Jayalalithaa and his participation in Ms Mayawati's dhikkar rally in Lucknow. (It was Mr Joshi who originally clinched the BJP-BSP alliance as Ms Mayawati's rakhi-bhai.) Resentment apart, Mr Joshi is trying to capitalise on the widely prevalent mass suspicion -- in contrast to elite support -- of privatisation, which seems calculated to favour certain Mumbai-based 'large business houses' and multinationals like Shell, which were nationalised to create BPCL and HPCL in the first place.

Now a 'compromise' formula is doing the rounds -- to let the public sector ONGC and Gas Authority become 'junior partners' of major foreign or Indian private bidders for HPCL and BPCL. Another proposal is the non-'strategic' sale of HPCL, and later, total divestment of BPCL. These are not 'compromises.' The government is simply selling the family silver to pay the butler. Cash-rich ONGC and GAIL don't need foreign principals. As this column argued four weeks ago, there is no case for selling off core-sector PSUs.

Telecom Minister Pramod Mahajan has also joined the fray by arguing against giving the Tatas total control of VSNL and raising a dispute on revenue-sharing between VSNL and the all-public Bharat Sanchar Nigam. Mr Mahajan's case -- that the Tatas bought VSNL for (an undervalued) Rs 1,439 crores and immediately siphoned Rs 1,200 crores out of it -- not only sounds plausible; it has rattled the BJP, which now admits this was a 'mistake.' Mr Mahajan too is trying to cut his rivals to size.

Such 'policy disputes' are unlikely to end soon, for three reasons. For one, Mr Vajpayee no longer commands the kind of authority in government or party that is needed to stamp finality upon any policy decision. He has recently conceded a lot of powers to Mr Advani who now controls the party apparatus. Mr Vajpayee's attention-span and energy levels don't permit him a more active role.

For another, the stakes involved in privatisation are far too high: a bonanza of thousands of crores for Big Business. For the RSS, it means swallowing the bitter videshi pill and losing a loyal constituency. The RSS and other kindred groups to the BJP's Right are totally disappointed with the NDA's scandalous performance. They want to create an independent political option in case the NDA comes a cropper in the next election. That's why they floated the Jammu State Morcha during the Jammu and Kashmir election -- at the BJP's expense.

For a third, few combatants in the privatisation debate speak out of a sense of conviction based on any knowledge of economics. They are taking rival positions out of self-interest and someone else's goading. They agree neither on a broad economic framework in which to place the question of disinvestment, nor on a set of criteria which can resolve the many tricky micro issues it throws up. Take the evaluation of a PSU's worth. After the disastrous post-Enron crisis of global capitalism, it is no longer credible or wise to leave this to the tender mercies of 'global advisers' -- i e, discredited accountancy/consultancy firms. The Comptroller and Auditor-General's preliminary estimate is that Balco was undervalued by Rs 262 to 302 crores by global adviser Jardine Fleming.

When you lack conviction, you are swayed not by the content of policy arguments, however cogent, but by external lobbies and extra-economic considerations, including the fashionable view that neo-liberal privatisation is the way to modernisation--largely out of ignorance of what is happening in the world, including the anti-privatisation backlash in the developed countries. That's why the current Indian debate won't end soon. The NDA is likely to hurtle in the direction of policy incoherence, contradictions and anomalies.

The BJP-NDA's preoccupation with privatisation contrasts with its shocking indifference to burning economic and social problems -- the existence of 65 million tonnes of food in state granaries, and $65 billion in foreign exchange reserves, while there are starvation deaths and spreading hunger, as well as a generalised slowdown in investment and production. Unprecedented joblessness and growing hardship for the millions now stand further aggravated by a severe drought.

This is the ideal moment for the Opposition to strike and expose the NDA's incoherence, ineptitude and elitism. Regrettably, India's biggest Opposition party finds itself unable to convincingly criticise the NDA's policies and attack its weakest link. The Congress is internally divided -- with pro-globalisation neoliberals like Mr Jairam Ramesh pushing hard for privatisation (which, he says, is the NDA's greatest 'achievement'), and the party's Left wing opposing it. Ms Sonia Gandhi has not resolved the tension, although the recent Pachmarhi and Bangalore resolutions categorically reject wholesale PSU sell-offs. The result is policy paralysis. The Congress will pay a heavy price for this as the people get restive amidst the recession.

However, the biggest loser will be the incumbent government. It has nothing to show for itself in any department. Its biggest asset, from the credibility viewpoint, stands devalued: Mr Vajpayee's declining moral-political authority is revealed even on the Cauvery waters dispute. He is probably India's only prime minister to have failed to bring together two chief ministers fighting over water-sharing. He doesn't even insist they obey the Supreme Court's orders on this. Karnataka refuses to release water to Tamil Nadu despite such orders. And Tamil politicians are 'retaliating' through bandhs and by suspending Kannada cable television transmissions and cutting off power supply from Neyveli Lignite.

Mr Vajpayee is not seen by the wider public as someone independent, leave alone critical, of Hindutva. Going by the latest Outlook-Saptahik survey, 28 percent of those polled say Mr Vajpayee is the 'true representative'" of Hindutva, as compared to 15 percent for Mr Advani and 10 percent Mr Sudarshan. This represents the worst of both worlds for Mr Vajpayee. The Hindutva gang despises him for his pro-Western views. The liberals detest him for being pro-Hindutva. Mr Vajpayee may be heard with more respect than other BJP leaders. But he only speaks on an issue when he is sure he enjoys Mr Advani's consent and support. Real leadership cannot come from vagueness, insecurity or timidity.

Praful Bidwai