Murky land deals in Haryana

Its partly amusing when public perception (not necessarily knowledge) is proven right. This article in The Hindu today investigates the murky land deals in Haryana, particularly in and around Gurgaon, where my office is one of the many located in shiny glass buildings

Last week, Business Standard reported that the 3.53-acre plot of land in Manesar whose purchase in January 2008 marked the entry of Mr. Vadra into the real estate business belonged to a company whose owner, Satyanand Yajee, is a long-standing associate of Mr. Hooda. If the regulatory filings made by Mr. Vadra’s company, Skylight Hospitality, are correct, Mr. Yajee was a benevolent seller. He did not cash the cheque he received from Mr. Vadra until after the latter obtained a licence changing the plot’s land use to commercial and sold it to DLF for a hefty profit — something no property dealer would normally do.
Congress spokespersons were at pains to deny favouritism by the State government in the speedy grant of the Manesar licence to Mr. Vadra and they are correct. Skylight is not the only beneficiary of official help: It turns out that Mr. Hooda, who took office in March 2005, has allocated licences to over 350 real estate firms of all sizes, most of which were unknown or had no experience whatsoever in property development.
Of the total 20,549.63 acres that were licensed, 7,733.68 acres were in Gurgaon, 2,266.91 acres in Faridabad and 10,569.37 acres in the rest of Haryana. Commercial land use accounted for 984.83 acres, group housing 5,867.99 acres, and plots 13,303.51 acres. Surprisingly, Information Technology projects accounted for a mere 409.21 acres.

Loving the new investigative The Hindu, by the way!


Inaction as corruption

The Hindu reports that former Cabinet Secretary Chandrashekhar deposed to JPC investigation that he had submitted a note to the PM recommending an entry fee of Rs. 36,000 crore (as opposed to the then set price of Rs. 1650 crore)  

According to Mr. Chandrashekhar, the note was submitted on December 4, 2007. More importantly, it was not written suo motu, but submitted in response to a specific enquiry made by the Prime Minister regarding the financial implications of the allocation of scarce 2G spectrum at the 2001 price. Mr. Chandrashekhar explained that his recommendation for a staggering increase in spectrum price was based among other things, on the size of the market, the improvement in teledensity and the fact that demand had exceeded supply which was reflected through a long queue of 575 applicants for the licence. However, Dr. Singh never responded to his note.

At some point, we really don’t really care if the PM was himself corrupt – this kind of inaction shows precisely how badly a mute leader can hurt; and inaction has to count as corruption. On one hand Congress’ allies accuse them of being arrogant and not taking their views on crucial economic issues; on the other hand, ally after ally seem to have benefited from the Congress’ remarkable ability to tolerate corruption in every major sector possible – telecom, land, realty, health, mining…

At some level, this is really unfortunate. A few years back, the PM was seen as setting a great example for others of an erudite honest individual holding the highest office in a chaotic democracy like ours – and held out a hope that is now long lost…

Mobilising voters with information

Over the last two years, a series of scams and a hyper-active Comptroller and Auditor General of India have roused the slumbering middle classes, if only to a state of frenzy on online platforms. Depressingly though, it seems as if in spite of our collective outrage against corruption, we now take a certain level of malfeasance in public life for granted. While we might argue that we need systemic change through Parliament and the courts, is it realistic to hope that tainted politicians would all get the boot in the next election? This cannot happen unless we can nudge voters towards being more discerning in their voting choices

More here, from my latest livemint piece, on the use of legislator report cards to inform and mobilise voters

Coal-lateral damage

In an earlier post, I wrote

Mr. S. Jagatahrakshan, the current Minister of State in the Ministry of Information and Broadcasting, has disclosed that his son and daughter own shares worth over INR 3.2 crore in Pranav Communications Pvt Ltd., a media company with interests in licences from the Ministry of Information and Broadcasting! Possibly an unfair insinuation – but this minister’s assets grew by 1092% from INR 6 crore in 2009 to INR 70 crore as per the latest disclosure.

 Frequent flier Jagatharakshan is back in the news –

Minister of State for Information and Broadcasting S Jagathrakshakan, who is facing heat for alleged involvement in a company allotted a coal block, has one distinction among Union ministers. Since he took oath, the DMK leader has made 24 personal foreign trips and spent 253 days abroad — the highest among the 49 Union ministers to have made personal trips.

Is anyone surprised? Of course he had to be a jet-setter to grow by a cool 1000%.

Huge profits have been booked through the murky coal allocations. No matter whether wrong-doing is proven or intent attributed, the PMO should be ashamed of this terrible mess under its watch. 

Mrs. Rajaratnam strikes

Asha P. Rajaratnam
03:38 (19 hours ago)

to undisclosed recipients

Why is this message in Spam? It’s similar to messages that have been detected by our spam filters.  Learn more

My name is Asha Rajaratnam,I am the wife of Raj Rajaratnam founder of  the Galleon Group ,New York.

I do have a proposal for you,which would be of financial benefits to you and myself.

My husband has been jailed in the U.S for 11 years,I need your assistance to help me move some funds from Holland to India  or anywhere where it would at least be of some help to our family.

I would give you more details of this proposal if you show yourself willing to take on it,I assure you that you would most certainly be compensated but please I would kindly request you to keep this matter confidential.

I am currently here in the UK where it is a bit safe for me and my kids.

You can reach me on my personal email id which is

Sincere regards,

Asha  Rajaratnam

Waiting to hear from Mrs. Gupta next…

On ‘conflict of interest’ among India’s cabinet ministers

In this piece for livemint, Doug and I make reference to the need to take ‘conflict of interest’ of politicians and policymakers seriously. So while there are rules that restrict legislators from holding ‘offices of profit’ under the state and central government, there is no rule that restricts them from having direct financial stakes in companies. A couple of examples to illustrate – and since I draw only from the recent public disclosure by cabinet ministers, this is surely just a snapshot.

Take everyone’s favourite target (entirely justifiably so, of course) Sharad Pawar’s voluntary disclosure, for instance which shows Pawar’s stakes in over twenty different companies – including ones involved in mining and agro-industries, including some owned by his family – that may have a bearing on his role as Minister for Agriculture in the Union Cabinet. His involvement with Indian Premier League as BCCI honcho and stakes in the Pune and Bangalore teams is already well known – and his recent interventions to object to proposals bringing BCCI under RTI were stridently vocal and successful.

Another example – Mr. S. Jagatahrakshan, the current Minister of State in the Ministry of Information and Broadcasting, has disclosed that his son and daughter own shares worth over INR 3.2 crore in Pranav Communications Pvt Ltd., a media company with interests in licences from the Ministry of Information and Broadcasting! Possibly an unfair insinuation – but this minister’s assets grew by 1092% from INR 6 crore in 2009 to INR 70 crore as per the latest disclosure.

Clearly, politicians have a right to secure their livelihood and insisting that neither they nor their families have profitable investments is probably not fair. But how can we ensure that such cabinet ministers carry out their ministerial functions impartially and in the best intrests of the country?

Restraining corruption without restraining democracy

We, and many others, breathed a collective sigh of relief when, two weeks ago, Indian politicians resolved the Anna crisis by doing what politicians do best: placating an angry public through high minded rhetoric and vague commitments. No doubt they will find a way out of fulfilling these already weak commitments. Or, at least, we hope they will. As horrible an affliction as corruption is, it is no excuse for violating the constitution and the democratic ideals of the country. Nor, for that matter, is it grounds for doing away with private enterprise as some have suggested. (For all the money lost in the 2G scam would anyone seriously prefer that we go back to the old days in which a single state-run company controls all telephone services?)
Fortunately, there are remedies for the sickness of corruption that don’t involve killing off the patient. Recent debate over corruption has focused largely on what form the new anti-corruption body – Lokpal – should take in order to punish the corrupt and to act as a credible deterrent. The activism surrounding the Jan Lokpal bill has mostly resorted to high decibel rhetoric, such as calls to gherao politicians’ residences, demands to hold a referendum etc – which we feel sets a dangerous precedent for constitutional democracy in our country. While punishing the corrupt is certainly an important component of controlling corruption, it is only part of the solution. If we are to have a real impact on corruption we must not only punish offenders but also reduce the incentive for people to engage in corruption in the first place and make it easier for the media, courts, and even ordinary citizens to spot and call attention to instances of corruption. In the high pitched battle over the Lokpal, there are a few basics that the public debate seems to be missing at the moment.
In this piece, we mention a few ways we can restrain corruption without restraining democracy:
1. Reduce red tape: Not all government regulation is pointless “red tape.” But a lot of it is – and a lot of these rules are responsible for corruption at the very grassroots, often by the very ‘middle class’ or ‘common man’ that is now fighting for the Jan Lokpal. There is of course a real need to regulate and monitor things like the emissions of pollutants, but mandating a maximum floor space index of 1.33 in one of the most crowded cities in the world, as Mumbai’s government does? Seriously? How about cumbersome procedures in applying for ration cards or cooking gas connections in most states? Regulation like this only serves the interest of the bureaucrats who “enforce” the rule.
2. Draft clear and coherent laws: Malfeasance in the sale of radio spectrum and the construction of sports facilities may be making headlines now, but, over India’s history, one sector has engendered more allegations of corruption than any other: mining. This is no coincidence – there is little or no agreement on compensation rates for land and resettlement policies for affected populations. In recent years, real estate and Special Economic Zones have joined mining as some of the most contentious issues on which the different sections of society clash with each other. What this calls for, more than anything else, are clear laws. A coherent pricing guideline, clarity on sharing revenues and profits (between the centre, states and local communities), a just rehabilitation policy etc are steps that will help reduce opportunities for corruption.
3. Make it mandatory for CAG reports to be taken up by a JPC: The Comptroller and Auditor General (CAG) is the government’s auditor, which in recent months has played an critical role in unearthing financial irregularities – 2G, CWG, KG basin, Air India aircraft acquisition etc – and have been vehemently challenged by political parties. As a constitutional body, its credibility is impeccable. However, at the moment, there is no law that makes it obligatory for the government to act on a CAG report, even if it finds gross irregularities. Of course, pressure from the media and the opposition can force the government’s hand, but why not make it mandatory for the Parliament to constitute a Joint Parliamentary Committee to take up findings of CAG reports that point to corrupt practices?
4. Take ‘conflict of interest’ seriously: It’s no surprise that judges and politicians (or their immediate families) tend to act in their own interests. “Conflict of interest” laws may help ensure that their interests are also those of the public’s. Unfortunately, while India has several laws governing conflict of interest they are vague and inconsistently applied. While the ‘Office of Profit’ clauses preclude elected legislators from holding other paid positions in state or central governments, no such law applies on holding positions of profit in the private sector or non-governmental sector. How can we have cabinet ministers deliberating on policies that affect sectors where they have direct interests and financial stakes?
5. Increase availability of data: The opacity of much of the data produced by the centre and state governments is truly staggering. Researchers and journalists shouldn’t have to submit RTI applications to obtain basic data on spending or participation in public programs. Making such data available to the public in an easily accessible format would make identifying and exposing instances of corruption much easier.
This list is by no means exhaustive and readers may disagree with some (or all) of these measures. Our point is simply that there are options for dealing with the scourge of corruption other than throwing up one’s hands in despair or adopting draconian laws that trample on the constitution. Corruption is a complex, multi-faceted problem. It’s time we started coming up with serious, multi-faceted solutions.