Corruption in India - 1

Does anyone expect the Lokpal to make any real difference?

Suppose Civil Society gets its entire wishlist and we end up with an unaccountable supra-governmental body with wide-ranging powers to accuse, investigate, prosecute and more or less prescribe punishment for the people it decides are corrupt.

In which of the following situations (all in the headlines in the last few days) will it be able to make a dent?

1.      Widespread smuggling and sale of rice meant for distribution to the poor.

2.     “Ghost workers” receiving funds from the National Rural Employment Guarantee scheme.

3.     The hundreds of illegal mining operations under way in a number of states.

4.      The widespread illegal quarrying of rock, with some operations threatening archeological heritage sites.

5.      The widespread illlegal "sand mining"  from beaches and watercourses.

6.      Widespread use of child labour

7.      The resort to gender-related abortions by educated, middleclass people that is causing an increasing tilt in the male/female ratio of the Indian population.

8.      The private theft and public "seizure" of land belonging to the poor in all parts of the country. While private gangsters make no bones about their motive -- profit -- public officials make a grand pretence: the POSCO steel mill on tribal land in Orissa, the nuclear power station on tribal land in Maharashtra, and the Delhi-Agra highway in UP, are all for that distant god, "Development." .

9.      The bribery of voters by political parties. According to the Chief Election Commissioner all political parties tried to corrupt voters during the recent state elections, using  clandestine contributions from corporations.

10.  The thievery of public goods by the wealthy curled darlings of the nation. The government's auditor, the Comptroller and Accountant General (CAG), has just reported that when Murli Deora was Minister for Petroleum, he did all kinds of favours for Mukesh Ambani's Reliance Industries Ltd (RIL), causing massive but unquantifiable losses to the public exchequer. (Younger brother Anil Ambani, is already neck-deep in the 2G auction scam and has two of his senior aides cooling their heels in Tihar Jail.) The CAG noted that the Ministry had allowed Reliance (and Cairn India, the subsidiary of a well connected British firm extracting oil in Rajasthan), to hold onto areas they should have forfeited because of failure to drill. That prevented the government from re-auctioning the areas, depriving it of potentially massive revenues.

11. The $7.2 billion deal Reliance Industries made in February to sell a 30 percent stake in its offshore gas fields (acquired under the abovementioned questionable contract) to BP, the British oil giant. In June, the Home Ministry issued a terse one-page security clearance  necessary for BP to proceed with the purchase. The Ministry noted that BP was already in the Indian market, selling lubricants. Selling grease is significantly different from owning a sizeable chunk of the country's strategically important energy sector, but that didn't seem to count with the biggies at Home. Nor did it seem to matter that BP has the worst safety and environmental records of any of the oil majors. Or even that it has a long history as an imperial arm of the British government, and had a notorious role in destroying Iran's homegrown democracy and manipulating it into its current miseries. (Would the Lokpal be able to take cognizance of the fact that the current Home Minister, P. Chidambaram, was in charge of the Finance Ministry when it cleared the contracts the CAG has faulted? Or that he is a former corporate lawyer who represented Enron in India and sat on the board of Vedanta, the company owned by the predatory Anil Agarwal, a Mumbai scrap metals trader who morphed into a British billionaire with a stinking human rights record?)

12.  The reported oversize loans the State Bank of India made in contravention of ReserveBank rules to Reliance Industries, Indian Oil Company and BHEL.

13.  The reported provision of an entire telephone exchange of unlisted high-speed lines by BSNL Chennai ,to benefit the television station run by the brother of Dayanidhi Maran, who held the Telecommunications portfolio in the central cabinet before A. Raja, who emceed the 2G spectrum auction.

14.  The reported routine use of torture by Police all over the country to extract information from suspects.

15. The brazen daylight murder of a prominent investigative journalist in Mumbai, and the revelation of connections among foreign-controlled gangsters, high level Police officers and Mumbai businessmen.

16.  The rotting of hundreds of thousands of tons of food grains lying exposed to monsoon rains in states across India because storage facilities were inadequate for a bumper crop.

17.  The involvement of some top Army officers in the illegal construction of a multistory residential building on property owned by the Defence Department in Mumbai.

18.  The flow of foreign institutional investment into Indian stock markets primarily from “tax havens” where “shell companies” hide the identity of the real owners of the money. Over 40 per cent of the flow comes from a single source, Mauritius, with which India has a three-decade old treaty preventing double-taxation. Negotiated to encourage bilateral economic ties before Mauritius became a tax haven, the treaty now serves as a cover for “black money” to enter the Indian economy.

19.  The tax avoidance of Vodafone, the British telecommunications giant, which moved funds from a Caribbean tax haven in 2007 to buy the Indian interests of Hong Kong-based Hutchinson Whampoa (then in partnership with the Essar Group in India). Vodafone is contesting the Indian government’s demand for over $2.5 billion in taxes on that deal, arguing that it was between two off shore entities (itself and Hutchinson Whampoa) and thus outside Indian jurisdiction!

20.  The gullibility of millions of people from whom the late lamented “Sathya” Sai Baba extracted the treasure trove he left behind in his private room and in his fabulously wealthy "Trust."  

That list does not include India’s enormous burden of preventable infant and maternal deaths that results from grossly disordered political priorities and multi-layered negligence. It omits the massive toll of misery exacted by discrimination and violence from poor women, the cases of child marriage, payment of dowry, and of blatant and even murderous caste prejudice that are all deep-rooted social corruptions not even acknowledged in the current debate. Even with those exclusions, the list makes clear that “corruption” in India is not a simple phenomenon centred on the culpability of bureaucrats and politicians. It has strong social, economic and political components, and we must understand them in order to take effective action. Without a strategic sense of the nature and origin of corruption in Indian society (to be taken up in the next posting), it is futile to think a watchdog body will make the slightest bit of difference.

(By the way, shouldn't it be Logpal? Lokpal makes it sound as if the institution is out to save the world.)

BP Gets Hooks into India

Just watched a stomach-turning bit of coverage on CNBC-18 of the RIL-BP $7.2 billion deal announced in London this morning. Bob Dudley CEO of BP and Mukesh Ambani of Reliance were video-conferencing with selected reporters to explain the deal they signed at 10 Downing Street in the presence of the British Prime Minister.

It was stomach turning because the Indian CNBC-18 anchors did not ask a single pertinent question about the deal, which should sound loud alarm bells about the future of democracy in India.

BP is one of the most thuggish companies in corporate history.

It used to be the Anglo-Iranian Oil Company back in the post-1909 days after oil was discovered in the "Neutral Zone" in Iran (then called Persia). The country had two other "Zones," one controlled by Britain, the other by Russia. After BP took control of the Neutral Zone, Britain had unquestioned control  of the country.

The Neutral Zone was policed by the Cossack Brigade, and BP chose one of its enterprising soldiers, Reza Khan, to become king. When he showed too much independence during World War II, the British (the government and BP have always been indistinguishable), wheeled him out. He was replaced by his son, Mohammed Reza.

In the aftermath of the war, the Majlis established by the deposed Reza Khan came alive and elected nationalist Mohammed Mossadegh as Prime Minister.Mossadegh tried to renegotiate the sweetheart deal BP had got for itself from Reza Khan: at the time, Tehran was getting less money for its oil from BP than the amount the company was paying the British government in taxes on the same oil. He got nowhere, and resorted to nationalizing the company,which by then had become British Petroleum.

The British, with the CIA in tow, then conducted a coup and Mossadegh spent the rest of his life under house arrest. Iranian democracy was destroyed, and the Shah set about running the country with the help of his brutal secret police, SAVAK. When the Shah got too cosy with OPEC in the 1970s he was turfed out too, and the Ayatollah wheeled in. To control the Ayatollah, Saddam Hussein in neighbouring Iraq, a CIA agent from way back, started a war with Iran. We can expect the same kind of treatment once BP has its hooks into India.

The company has the worst environmental and safety records in the industry. Its most recent achievement, the blow-out of the rig in the Gulf of Mexico that became America's worst oil spill ever, has confirmed that place in the record books.

None of this was even hinted at in the CNBC exchanges. Instead, there was talk of RIL "benefiting" from BP offshore "expertise."        

The real danger to India, however, is not environmental. BP will be a manipulative presence in New Delhi. Reliance is already a big manipulater, and the deal gives BP (British government) access to all its kept politicians and journalists.

Perhaps in the CNBC interview we had a glimpse of things to come.

Smiling widely,one of the CNBC ladies wanted to know if BP's investment indicated "faith" in India! Dudley admitted that it did. God help us all.