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RAJAs TATAs and what about all the local scams

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Economy

what if any is the link with the growing corporate style industrialisation and the increasing corruption in the state

how many clearances are now required by the SEZ ( Centre) and Industrial townships and Industrial corridor policies. Sezs were first brought in as a GO in 2000 by NDA govt, 5 yrs later the UPA passed the law. in 2009 the SEZ policy was issued by the state

Earlier it was KIADB and Industrial estates etc and we see the result but what about the BIG lands e.g 125 kms on both sides will be an iinvestment zone in the Delhi Mumbai Industrial corridor.  Karnataka has definitely reached the pinnacle as the most corrupt in the country. in Congress chief ministers time it was the same and no less than World Bank wanted to name the state as the Ist. the reasons maybe many but they have continued and now is the state for sale?

Because the next plans by the Japanese investors is Chennai- Bangalore- Mumbai Industrial corridor!!

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vlnarayan's picture

Minister asked for Rs 15 crores to let Tata airlines fly

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Tata Group Chairman Ratan Tata on Monday said he did not enter the airline business as he was not comfortable with the idea of bribing Rs 15 crore to a minister, as had been suggested by an industrialist.

The corruption is hitting right from the common man to big business house. It is good that Ratan Tata is coming out openly & revealing the details, he should reveal the name of the minister too. Few other airline companies would have probably paid the bribe.

 

silkboard's picture

shameful, that Rs 15 cr comment

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That Rs 15 cr comment from Tata is shameful, might I say for both the private sector as well as the government.

Why it is shameful for the govt is obvious, anyone who is "into" these things knows how and who you have to "feed" to "move on" with things.

It is shamefule for private sector because even the likes of Mr Tata have to be silent about such things (revealing after 20 years, and that too only one such thing, god knows how many more he would have come across), probably because "it will hurt" their operations, and perhaps because they want to be "practical" and move on.

Industry bodies like CII have to do more than just ignore or comply with such "requests" from neta/babus. May be they need a whistelblower act for themselves, or may be they need to champion a change within their community where small or large businesses are encouraged to report such instances.

Instead, most industry captains prefer taking the highgrounds and criticize corruption and governments on various platforms, while living with the bribe-culture for "practical" reasons. Mind you, eventually,  you and me, the consumers, pay for all those bribes they give around to get projects or whatever.

Solutions? Start with Transparent FIFOs in all citizen/business facing processes in the government, simple, quickstart and practical way to get started against corruption, givers, as well as takers.

murali772's picture

liberalisation at the root of it all

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'Public Agenda' has indeed hit the nail on the head - it's 'liberalisation' that's at the root of all the problems. How come everybody else is so blind to it?

If not for liberalisation, telecom would have remained at-most a Rs 1,000 cr sector, and consequently the loots would have been limited to well within that figure, and all for the taking of 'namma BSNL/ DoT' lot, and not for the Ambani's and multi-nationals to build their 'Antilla's' and what not.

Only, instead of blogging about it all, the Public Agenda's and Muralidhar Rao's of this world would have still been writing 'letters to the editor' - indeed a very romantic notion, if you ask me. Yes, let's pursue that agenda - do join me here

 

Muralidhar Rao
kbsyed61's picture

Tatas and Reliance got preferential treatment!

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Yesterday Mr. Ratan took high moral ground of not heading to Bribe's demand from a minister. Now the CAG reports accuses govt of giving "undue" benefits to Anil Ambani-led RCom and Tata tele services.

http://www.hindustantimes...

"...The CAG said the process of giving dual technology licences to leading telecom firms including Reliance Communications and Tata Teleservices "lacked transparency and fairness", and equal opportunity was denied to other similarly placed operators who could apply for use of dual technology only after formal announcement of the policy..."

Would these gentlement now take more higher moral ground by returning the spectrum they got from government?

 

kbsyed61's picture

can't stick the neck out?

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2 days have passed since that famous statement from Mr. Ratan Tata, still no clarity on his statement particularly the name of the person who demanded 15Cr.

What is interesting is now the buzz according to electronic media is that Mr. Tata has retracted a bit. Now the news is that Mr. Ratan Tata was not directly asked by any minister, but it was his fellow passenger industrialist who made that statement.

Mr. Tata, however you slice it, the fact remains is that it is all about corruption. I am sure you and all your fraternity knows that no one would ask directly and the corruption process has been institutionalized much more than the public accountability and transparency. It is the some odd govt karamchari gets caught taking 10-20 rupees. The bigger ones has their ways and means to flourish and sophisticated ways for doing it again and again.

Getting down to ourselves, the scene is no different. How many of us would like to stick our neck and say it is time to abolish BDA, the den of all corruptions in Bengaluru. Probably all land scams starts and end there.  The process has so institutionalized can be gauged from one example.

This was told by a first hand source who are directly effected by the BDA notification. The source is one of the inheritors of his fathers agriculture lands that BDA notified for acquisition citing industrial park near the airport. Now one can pay the money and get it de-notified. Otherwise all the land owners would get is pittance. This source of mine is seriously considering the option, given their earlier experience when they lost the land to the airport. In that experience some were lucky to have their land de-notified by giving money to the politician-BDA babus. The land owners only got few 3 lakhs or so for one acre. Those who paid about 50k - 1 lac as bribe, saved the land and sold the same at commercial prices of 20-30 lakhs per care.

 The one's who dare to stick their neck either get killed or silenced for ever. Therefore very few would come forward even to file a RTI asking the basic rudimentary information. This is not based on any fiction story, but from our own experience during the BIAL-RTI efforts. We were cautioned and alerted not to get involved.

vlnarayan's picture

Bribing by big businesses common, says Bajaj

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Noted industrialist Rahul Bajaj today alleged that many a top-corporate house was indulging in bribing, even as the government assured that it would take the strongest action if anything was brought to its notice. Big corporate houses would find it easier not to be corrupt than small ones, but they still give money to get their jobs done

www.deccanherald.com/content/113333/bribing-big-businesses-common-says.html

Public Agenda's picture

License permit raj 2010 vsn

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So the luxury the elite enjoy and also those who want to be the elite in the JV / PPP mold will continue to pocket the 1,40,000 crs scam money and recycle it to swiss banks

no wonder that thishuge increase of swiss bank accnts money has happened during the 21st centry and the PMO is sitting PRETTY and quite

LONG LIVE THE License permit RAJAs in the latest luxury redux model this vsn of crony capitalisms of  Mr Natwaralalas the Ambani, Bhartis and Tatas

and the majority 80 % democratically ruled people live happily in the ever after


idontspam's picture

Red Herring!

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 those who want to be the elite in the JV / PPP mold will continue to pocket the 1,40,000 crs scam money

Thats just the opportunity cost, the scam was in the non transparency and the adoption of the process itself, including the rates used for the spectrum. Nobody actually swindled & pocketed 140000 crores. So you wont find that in suitcases & bed covers on raiding Raja or his accomplices.

Public Agenda's picture

Loss to exchequer and in private pockets

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The money will be in private pockets ( by this I mean the licensees pockets and not the Minister) precisely because it was not paid to the exchequer and the the entire 'process' swindled the government of its dues.

While the CAG report will call it a notional and presumptive loss, the fact is this money if recovered and spent effectviely would help the public services like water, health and education etc without the need for privatising them, thereby pushing more funds from the public into JVs / PPPs for so called O & M contracts.

Hopefully if the same is scrapped as many are demanding now and an auction takes place, the public will be able to scrutinise this and see that more than 1,70,000 crs is not swindled for privatising the public airwaves spectrum.


murali772's picture

so, who's to blame?

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The problem plainly is that the 'license-permit raaj' has been dismantled, only in part. What Raja has been 'raaj-ing' over is another version of his own making. And, if the Prime minister can't bother to keep him in check (whatever the reason), it is inevitable that you land up with Crony Capitalism of the kind that has got displayed before us all, now.

The Ambani's and Mittal's of this world do not claim to be (and cannot be expected to be) the conscience keepers to this nation. They are businessmen first, and if they see an opportunity, they will grab it, lest the competition gains one up on them, since the opportunity is not being put on offer (by the government) on a level playing field.

When Mr Ratan Tata says that he was not prepared to pay the Rs 15 cr bribe, he was trying to project his industrial house on a higher moral plain than those of the others. There is that general perception about TATAs, and that's why, compared to Ambani's, their growth was rather tardy during the 'full-fledged license-permit' era of until about a decade ago. During those times, if you wanted to grow, there was no other route than the one adopted by the late Dhirubhai Ambani. Alternatively, you had to look for opportunities abroad, which is what the Mittals (Laxmi) did. When the raaj was dismantled, atleast to some extent, the industry houses generally began to play by the rules. But, where the earlier climate prevailed, like in the 2G allocation by Raja, Anil Ambani perhaps chose to hark back to his father's ways.

So, who is to blame for it all - Raja and the PM who have been chosen on the trust of the electorate, or the Ambani's and Mittal's who are there on the trust of just their share-holders (a large section of whom may even be their family members)?

The Ambani's and Mittal's are obviously enjoying the trust of their constituents, going by their company share valuations. Additionally, they are providing fair value to the customers of their products and services, apart from the huge revenue to the public exchequer through taxes.

It is Raja, the PM and his government that has betrayed the trust of the aam aadmi. And, if you entrust more money to the public sector set-ups under their control (as 'Public Agenda' fervently wishes), it will all keep going down the drain as we are seeing all along (barring the few exceptions), apart from the shoddy goods and services on offer, particularly to the aam aadmi.

Muralidhar Rao
idontspam's picture

The money will be in private

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The money will be in private pockets ( by this I mean the licensees pockets and not the Minister) precisely because it was not paid to the exchequer 

Money is still in the licensees pocket and that is not a crime. If you have money to buy things at higher rates but buy it at a discount you are not committing fraud.

the entire 'process' swindled the government of its dues.

No, the process of first com first serve is not faulty it is simply called a queue. Choosing a FIFO against an auction is bad decision and any manager will need to get sacked for not evaluating the opportunity cost. But, Its applicability, the fudging of start dates & cut off dates, timing of the cutoff, changing the cut off to suit some people, choosing operators who dont qualify etc etc is the subversion which needs to be probed. The only monetary value you can attach to that is what went into some pockets to get preferential treatment. 

Violation of FIFO by fudging is the bane of our society. On the roads, in the govt offices everywhere we want to be ahead of other without respecting they were there ahead of you.

silkboard's picture

Regulator and teeth

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Regarding 2G license sale process, Public Agenda, Murali and others:

  • Regulator: If you read through the news reports etc, you will realize that the whole thing was done by DoT. Role for TRAI was limited (they advised against the first come first served sale). Tells you that if you don't empower the regulator, you are still at the mercy of quality of minister you get.
  • FIFO and transparency: A First come first served (aka FIFO) was followed, but was not transparent. And now we hear that #4 in the queue got in and became #3. We also hear that a lot of applications (85) did not have merit. Would all this happen if the FIFO was transparent?
  • Givers: Most of the talk is on Raja. Givers are still not under any serious scrutiny. The ministry only is such. Naathuram Mirdha stashed away cash under his pillows and mattresses so you would remember only his name, not any of the guys who actually printed or withdrew all that cash for for him.
silkboard's picture

And dear Public Agenda sir

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Dear and respected Mr Public Agenda sir, the value that media is putting to the scam sounds like a lot (Rs 173 lakh crore and all). But the reason you hear about a lot of these scams lately is because there has been some "opening" up!

You won't even come to know if BMTC buys Buses or GPS equipment or LED displays at higher than market price. You wouldn't know a thing if BDA allots plots at lower than market prices to people who already own districts worth of land. You wouldn't know a thing if BWSSB uses twice the amount required to build drains and pipes. And you certainly wouldn't know anything if your neighborhood power transformer gets replaced twice a month instead of twice a decade !!

But you would hear about the telecom and airline scams. Pause and think, why?

I would still say that knowing the devils is better than having unknown devils around us :)

[Disclaimer: all talk of BMTC, BWSSB etc above is work of fiction, I have no such information, and from what we know, they conduct themselves in clean and transparent manner!]

Public Agenda's picture

The CAGs role

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There is a very imp institution mostly neglected by Parliament and civil soc which is CAG

They bring detailed reports, on civil commercial and accounst aspects on states, centre and now some aspects of local governments like PRIs and ULGs also.

So it is not anything due to the opening up that the CAG is doing its job, the draft report was sent to the DoT and even action taken reports are called for and included in reports and recommendations made

and btw the scams in BMTC and BWSSB are there for all to see, for e.g the Biwater PPP for 270 mld bulk water in 1997-8 in BWSSB the malaysasian co was opposed by the Congress from opposition and once they were in govt supported it

Luckily it failed due to a lot of public and staff opposition

Obviously there is nothiing like too much scrutiny and civil soc will do well to engage and see what is possible


murali772's picture

competition, and effective regulation - the answer

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@SB

If you read through the news reports etc, you will realize that the whole thing was done by DoT. Role for TRAI was limited (they advised against the first come first served sale). Tells you that if you don't empower the regulator, you are still at the mercy of quality of minister you get.

That's precisely what I meant when I said that the 'license-permit raaj' has been dismantled only in part - meaning the liberalisation process has been only quarter-baked, at best.

But you would hear about the telecom and airline scams. Pause and think, why?

Very simply because, with the opening up, even if the regulator is not fully empowered to be sufficiently effective, the competitors will open it all up. Where else do you think all this info came from? And, with monopolies, particularly government ones (even more so if you have a Raja at the top), everything gets covered up.

and from what we know, they conduct themselves in clean and transparent manners

From what little I know, I wouldn't be so charitable

And, I'll reiterate, the 'giver' can hardly termed a culprit, when, in the first place, you provide such an un-level playing field.

 

Muralidhar Rao
murali772's picture

where are BWSSB's and BMTC's services?

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But, CAG's role is mostly 'post mortem'

And, without the opening up of the respective sectors, BMTC and BWSSB are in about the same state as when telecom was the monopoly of BSNL/ MTNL, with a miniscule percentage of the demand met, and in the shoddiest manner. Yes, the scams are also limited in magnitude, though there are enough of them. And, of course, if you open them up in the same half-baked way as you did with Telecom, and seat a Raja on top in addition, scams here can also aspire to reach the 2G scam level, if not surpass it with a bit of ingenuity, which our babu/ neta combo are capable of.

Civil society will do well to demand proper opening up, with effective regulation.
 

Muralidhar Rao
kbsyed61's picture

Any difference ?

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Ay difference between the retracted statement of Mr. Tata (Minsiter did not asked directly) and this statement " ...all talk of BMTC, BWSSB etc above is work of fiction, I have no such information, and from what we know, they conduct themselves in clean and transparent manner! .."

Any standards that defines these agencies to be free from corruption?

The same logic can be extended to BDA also and say there is no corruption there as well.

silkboard's picture

The 2G Fifo

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hey hey Syed, Murali et al, what I put above is a legal discialmer, said something and retracted just like Mr. Tata did. May be the humor was lost due to missing exclamation marks :) Anyways, ask Ex-secy Mr Vivek Kulkarni, hope you read this recent shocking article in Business Line (The Hindu publicaton) which I simply loved because it had numbers - he tried to size total corruption in Karnataka!

Back to this 2G thing, CAG report makes a good reading. Do read http://www.cag.gov.in/htm... to understand how the files go back and forth with notes, how decision making and delegation works in the central govt depts.

Note this in context of transparency & FIFO:

Swan Telecom Pvt Ltd, which had submitted the application on 2 March 2007, was given the spectrum for the Delhi service area on 28 August 2008 itself while Spice Communications Ltd which had submitted their application in August 2006 has not yet been given (March 2010), spectrum for Delhi service area. Similarly, for Maharashtra service area also, Spice Communications Ltd (Date of application- 31 August 2006) got the spectrum in May 2009 while Unitech and Videocon got the spectrum much earlier in September 2008 itself though they had submitted their applications for UAS licenses more than a year later in September 2007. Idea Cellular Limited (Date of Applications- 26 June 2006) also got the spectrum in May 2009 while Unitech (date of Applications – 24 September 2007) got the spectrum in September 2008.

 

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