June 27, 2006

Sunil Jain: Right to information

Now that Prime Minister Manmohan Singh has got a committee to investigate the charges against AIIMS Director P Venugopal and whether he has run down the country’s premier hospital/medical college, one hopes its findings will be made public and, equally important, Health Minister A Ramadoss will not be allowed to get rid of Venugopal even before he has a chance to respond to the committee’s report (assuming it is a negative one). This is not an empty fear as something similar happened just last month, when ONGC chief Subir Raha was unceremoniously shown the door. While the committee was set up after Venugopal went public with his spat with Ramadoss (which, in turn, followed Ramadoss appointing persons to various posts in AIIMS after removing Venugopal’s nominees), the health ministry has already asked Venugopal to explain why he went public on the issue!
The ministry of petroleum and natural gas had been having a running battle with the then ONGC chief Subir Raha for over a year (much like the one Ramadoss has been having with Venugopal, primarily over the latter’s support to the striking anti-Mandal doctors). So when a committee appointed by it (TNR Rao committee) severely indicted Raha for the Bombay High fire, the ministry simply got rid of Raha without getting his side of the story, or getting a neutral party to judge the case (the law requires the Public Enterprise Selection Board be this agency). Indeed, based on the Rao report, Petroleum Minister Murli Deora even said privately that ONGC had submitted fake documents to show its rigs/platforms in Mumbai High were safe—the Rao report had suggested a probe by agencies like the CBI to rule out collusion between ONGC and the agency that certified the platform as meeting the OHSAS 18001 safety certification. Yet Raha was asked to go without getting his side of the story (see “Raha’s fire refuses to die down,” Business Standard, June 5).
This is the ultimate irony: this is a government that was brave enough to come up with a Right to Information Act, and yet it remains extremely frugal when it comes to critical information. Deora’s insinuations about Raha, for instance, affect not just Raha, but lakhs of investors in the company, and given ONGC’s size, are a serious reflection on the manner in which the country’s companies are run. Yet, there is no official reaction to the report. So, neither the country’s investors, nor the insurance companies who have billions of dollars riding on ONGC have any clue as to whether the charges are worth the paper they’ve been made upon.
Nor is this the only instance of frugality with information. The Haryana State Industrial Development Corporation (HSIDC) inked an MoU with Reliance Industries to set up an SEZ in the state, and provided the company with 1,500 acres of land at Garhi Harsaru in Gurgaon district. While the land was originally acquired by HSIDC for its own SEZ, when the discussions with Reliance began, the proposed SEZ was merged with the Reliance one. A Congress MP, Kuldeep Singh Bishnoi, opposed the project saying that the land itself was worth at least Rs 3,500 crore and that the Haryana government had got very little for its contribution. The state was paid Rs 360 crore to compensate it for the cost of acquiring the land as well as equity in the project—if the Reliance SEZ was up to 10,000 hectares, the government’s equity share is to be 7.5 per cent, and if it was larger, this would go down to 5 per cent. Based on the proposed Rs 40,000 crore investment in the SEZ, the market value of the land should theoretically have entitled the government to a share of between 25 and 35 per cent, depending on whether a debt equity ratio of 2:1 or 3:1 is taken.
Once Bishnoi made the charges, you’d expect some sort of explanation for how the deal was structured, for whether or not the Haryana government and the state would benefit from the deal, apart from the usual spiel about the number of jobs the SEZ would create—after all, if the SEZ didn’t create the number of jobs promised, would the government be contractually bound to take back the land? And given the fact that up to 75 per cent of the land in the SEZ can be used to create housing, shopping malls and other such facilities for non-SEZ individuals, how would this give a fillip to the state’s industrialisation?
Now it is always possible the government and its investment bankers have done all the calculations and the deal is indeed a win-win one for everyone, but none of this has been made public. After all, if a state is investing over Rs 3,500 crore in a private sector venture, you’d expect a lot of information to be put out for discussion. Not only does this not happen, Bishnoi gets a show cause notice from the Congress party for daring to take the matter public! After Bishnoi went public with his opposition, the state has, however, increased its stake in the SEZ from 7.5 per cent to 10 per cent, something that is an indicator of the fat in the system. Bishnoi certainly hasn’t been thanked for this but, more important, no one really knows how this additional figure was arrived at.
Another politician who opposed a similar project in Punjab was made to keep quiet in much the same way. If Dr Singh’s government is as committed to transparency as it claims you’d expect it to laud such whistleblowers instead of pulling the plug on them.

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