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Republic Day's best gift

January 29, 2003 17:07 IST

We, the People of India... do hereby adopt, enact and give to ourselves this Constitution.' That is proof supreme that the best presents are the ones we get to choose for ourselves. So, if the best gift we could have received on the first Republic Day was the Constitution coming into force, what was the best gift one could have hoped for on the 54th such occasion?

No, it was not any national award! Pleasant though it is to receive a Padma Shri, Padma Bhushan, or Padma Vibhushan, in my experience such honours invariably incite controversy as well as congratulations. So, my vote for the best gift this Republic Day would go to a vote made by the Union Cabinet on the afternoon of January 26, namely the decision to go ahead with sale of HPCL and BPCL. After a very long time -- too long if you ask me -- the privatisation initiative appears to be back on schedule.

Why, one might legitimately demand, did it ever go off the rails in the first place? Well, there are two answers for public consumption, and a third which nobody shall admit to. Let us discuss them.

The first objection was that petroleum is far too sensitive a sector to be trusted to private hands, that issues of national security are involved. Objection Number Two was that profit-making public sector undertakings should not be sold. How much sense does either make?

First, as regards national security, can you name any sector of the economy that is not necessary for a wartime economy? True, a war cannot be waged without fuel supplies, but can you do so without, say, steel, cement, rubber, or aluminium (to name but four that come to mind immediately)? The very idea is absurd, but does that mean that TISCO, ACC, MRF, and HINDALCO should be taken over forthwith by the Government of India? So, why then should petroleum alone be singled out for special treatment?

Independent India has never undergone the experience of a really long war. Had it done so, people would have understood how foolish it is to argue against privatisation in the name of national defence. The United States and Britain are capitalist societies, but in both world wars the economy was taken over by the state for the better direction of war. The Government of India could do the same if need be.

After all, what will privatised oil firms do in the event of war -- roll up the pipes and sail away with the oil?

Now, to the second argument: about keeping profit-making outfits in government hands. A sister excuse is that loss-making organisations should not be sold off either until they are nursed back to health to get a better price. So, what on earth can one privatise?

Let us now come to the true reason why so many politicians and bureaucrats oppose privatisation: loss of patronage. Keeping a stranglehold on public sector undertakings also means a lock on transfers and postings, on the use of guest-houses and transport services. If Air-India were not a government undertaking, how easy would it be to be upgraded to First Class?

Let us be honest: the government has no business getting into the hospitality industry or civil aviation, and it should leave manufacturing to those best equipped to do it efficiently. There is one final point I should like to make: if the government is getting out of some sectors, it may find there is plenty to do elsewhere.

Take a look around the average middle-class home, and you shall see what I mean.

Anyone in Delhi who can afford it keeps inverters and generators because the power supply is so unreliable. We invest in water purification systems and in pumps because the supply of water is not assured, nor is its potability. Resident welfare associations have taken on the burden of putting up gates and hiring guards to patrol the lanes because the police are understaffed and overworked. In several areas even garbage collection is managed by residents. These associations haven't yet started paving the roads, but that is only a matter of time!

The privatisation of HPCL and BPCL is a step in the right direction. Let the government get out of areas which it had no business entering in the first place. And use the time and the funds to concentrate on providing law and order and basic services -- sectors where the authorities seem almost to have abdicated!

T V R Shenoy was awarded a Padma Bhushan by the government on Republic Day this year


T V R Shenoy