)n The spot
Tavleen Singh
Some days ago I met a man considered to be one of the crooks of the ‘scam’ that came to be known as Coalgate. For reasons that should be obvious he cannot be identified but he said a few things that I would like to draw your attention to. They are important for those who want to understand what went wrong with the approach that the former CAG (Comptroller & Auditor General) took when he gave us those sensational reports on the selling of coal blocks and 2G Spectrum to private companies. The alleged coal scam was said to have lost the people of India Rs 186,000 crores and since the man I went to see was one of the alleged thieves let me tell you what he had to say.
He began by asking if I remembered where this figure came from. I told him that I remembered it as having come from the CAG report. To this he said, ‘It came from the media. The CAG report did not say that this was what was lost when the coal blocks were auctioned. It said that this figure related to the estimated profits that private companies could have made over a period of thirty years and that some of this money – some of it – would have gone to the Government. It was you people in the media who twisted things around to say something else altogether.’
When I asked why there had been no attempt by people like him to set the record straight he said bitterly, ‘You think we didn’t try? But, who was prepared to listen? Certainly not you people in the media.’ He then proceeded to tell me a story that the Finance Minister confirmed last week when he said, ‘I think the former CAG did grave damage to the system. He exceeded his jurisdiction and exceeded his mandate. We are importing 160 million tonnes of coal when we should be exporting coal. We have coal reserves for over 200 years.’
Coal reserves that have been so inefficiently exploited since coal mining was nationalized by Indira Gandhi that millions of tonnes of the best coal in the world burn underground simply because Coal India does not have the technology to put the fires out. Had the former CAG, Vinod Rai, concentrated on auditing the losses in the coal sector done because of Coal India’s monopoly he would have given us figures for ‘notional’ losses of mind-boggling proportions. He chose instead to concentrate his calculations on private companies and then used his imagination to come up with ‘notional’ losses over a period of thirty years without taking account of the changes in demand and supply that could occur in that very long period.
In the words of the man I met last week, ‘These are not things that can be easily calculated. But, nobody has checked the ground realities. In our case we do not have control of a large portion of the allotted coal block because of Naxalite activity in the area. And, the portion that we did want to mine requires environmental clearances that have still not come. And, we are being charged with fraud…what can I say?’
In fairness to the CAG what he was probably trying to reveal were the bribes that those who were given coal blocks paid to politicians and officials and this would without question have happened. As someone who is familiar with the workings of the Government of India let me tell you that in recent years it has become virtually impossible to do business in our fair and wondrous land without paying hefty bribes. In some contracts there are layers of bribes that need to be paid. So if you get a contract to do something in Mumbai and have paid a few crore rupees to the Shiv Sena and the local Congress party you would still not be able to go ahead without sending some money upwards to those mysterious collectors in Delhi whose appetites are beyond belief.
It has perhaps always been this way but the price that ministers and officials now demand for using their discretionary powers has gone up hugely in recent years because the process of reforming the economy has not extended to administrative reform. So private investors have been allowed to invest in areas that were once monopolized by the public sector but the shrouds of red tape and the ministerial discretionary powers from socialist times continue to be in place. This makes transparency impossible and it is because of this that ministers and officials have become greedier and more crooked than they used to be in socialist times. It is the fault of the media that when the former CAG started his activism none of us pointed this out and chose instead to sensationalize every report that he came up with. This reached such absurd proportions that when his report on 2G Spectrum was released it was done on live television with supposedly ‘nameless’ officials reading from it for nearly four hours.
The most tragic consequence of the blind acceptance by the media of everything that Shri Vinod Rai did is that we have helped drive away private investment. Without private investment from India and abroad there is no possibility that India will be able to build the power stations, roads, ports and airports needed to make us halfway competitive in the 21st century. As someone who travels in foreign lands I can report with certainty that India’s infrastructure is today among the most primitive on the planet. This absence of modern infrastructure drives foreign investors away faster than almost anything else. Yet, when was it that you last read some good investigative journalism on this subject or saw good television programmes on it? All we have done since the former CAG started producing his sensationalist reports of losses, mostly based on imaginary projections, was to become his most enthusiastic cheerleaders so we helped kill the India story as much as he did. Can it be revived today?
The short answer I got from Arvind Panagariya when I met him last week was: no. He said that he saw no hope at all till after the general election and by then there is every likelihood that the Indian economy will go back to the dire straits it was in 1991 when the man who is now our prime minister was forced to bring drastic reforms. We in the media have served mostly to perpetuate a cheerless story of needless activism and irreparable damage.
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