A Tale of Two FMs!

In the last week, two Ex-Finance Ministers of India, pushed Kashmir out of the headlines and debates, though for reasons completely different. Palaniappan Chidambaram (PC), an Ex-Finance Minister in the UPA ministry hogged the headlines for being a political heavy weight who finally got close to the long arm of the law. Arun Jaitley (AJ), the other Ex-Finance Minister but of the Modi 1.0 cabinet, dominated news since yesterday when he passed away after prolonged ill health. The lives of these two successful personalities have many common strands but, what is striking is the way it is finally diverging and in this lie key lessons for aspiring politicians.

The similarities first. Both PC and AJ came from privileged backgrounds and were never the “rags to riches” type leaders. They were lawyers by profession and extremely successful at that.  If they weren’t full time politicians, they would have been among the top 10 highly paid lawyers in the country for sure. Both were extremely articulate.  Both made their first impressions through their communication skills within their parties.  And that also turned out to be the lasting impression. In the last few years, the most interesting debates in the parliament were, when PC and AJ were pitted against each other – whether it was the GST or the Aadhaar debates. Both were tailor made for TV interviews and discussions. Both came extremely prepared for interviews and were at their combative best in putting across their views. More often than not, one tended to change opinions after listening to their points of view on a subject.  PC through his weekly columns and AJ through his blogs have also been using the written medium to get across their views effectively.

Both PC and AJ with their legal backgrounds, would give key inputs in drafting of bills to their respective parties. Their opinions were always sought in all issues related to passing laws in the parliament. In spite of not having a background on economics, both got the opportunity to be Finance Ministers. Both showed alacrity in dealing with numbers.  And when the situation demanded, they were the chosen ones to step in, as In-charge for other ministries. In the wake of the 26/11 terrorist attacks in Mumbai during Manmohan Singh’s regime, it was PC who was asked to take over the reins of the Home Ministry from Shivraj Patil who was found wanting in terms of responding to the situation. In AJ’s case he was asked to handle Defence Ministry as well, till Narendra Modi could convince Manohar Parrikar to take up the job.  One point of time he was handling three key portfolios concurrently.

In spite of these strengths, both PC and AJ were never mass leaders. PC did win elections from Tamil Nadu but that didn’t make him a mass leader. AJ could not manage to win the election even amidst the “Modi wave” in 2014 when he contested from Amritsar! And I also reckon that their elitist background, their success in their profession and thereby their high net worth made them easy targets for “not fit for public life” barbs.

Now, coming to the divergence in their personalities. AJ has been more loyal to his ideological moorings. Having started as part of the ABVP, he stuck to the Sangh parivaar during his entire life. PC, though known as a Congress man, left the party in between to be part of Tamil Maanila Congress. He was rewarded with the important Finance Ministry by both Deve Gowda and I.K. Gujral.

While AJ is known to be congenial with his staff and peers, PC always came across as arrogant and rude. He was known to be firm in his views and not one to suffer mediocrity. This projected him as an aloof politician who won more enemies than friends. On the other hand, as can be seen from the obituaries since AJ’s death yesterday, his friend circle cut across professions and political parties. And this turned out to be going against AJ most of the time.  Among the hard core BJP followers or Bhakts, AJ was viewed with suspicion of protecting his friends from other parties and corporates in corruption and other charges.

The same goes with relations with media.  AJ had many among the media who are now calling him as “My friend Arun” in their obit pieces. I suspect PC has few friends in the media!

PC while in Government had many run-ins with his ministerial colleagues. His spats with Pranab Mukherjee and Jairam Ramesh are in public domain. Who will forget that “patching up” Press conference he did along with Mukherjee? With AJ, we have not heard of any spats he had with his peers.

PC was seen more of a self-centred person even within his party and there was always a question mark over his commitment and loyalty to the party and the leadership.  But here, AJ was always seen as a party man. When not in power and not a minister, AJ was handling the poll strategy and electioneering. Before the Amit Shah era, AJ was the master strategist in putting together the poll campaigns for BJP in states including Gujarat when Narendra Modi was fighting the elections. PC apart from being a member of the manifesto drafting committee he was not known to be a poll strategist or an organisational man.

It is to AJ’s credit that many of today’s senior ministers in the Modi cabinet were all at some time mentored by him. Whether it is Piyush Goyal or Nirmala Sitharaman or Dharmendra Pradhan, they have all been coached and guided by AJ in the past. Similarly most of today’s BJP spokespersons have been mentored by AJ. PC has no such reputation.

In terms of handling the Finance Ministry, I always thought that PC did a better job. He took over as FM in 2012 from Pranab Mukherjee during UPA-II, when the economy was at its lowest ebb. He quickly put in measures in place to arrest the Rupee slide and restore investor confidence by drawing a clear red line on fiscal deficit. That the mood of the country had already set in for a change that time is another matter.  But, it always seemed like he was a right person in the wrong party under a wrong leader. I personally felt that under a stronger government and a more decisive PM, PC would have relished his job better and would have made a bigger impact in governance.  AJ, though armed with the luxury of heading the Finance ministry of a majority government, showed very little appetite for getting into a “Mission mode” on the economy front.

The introduction of the landmark tax reform – GST shows who is a consensus man. The work on GST which started during the UPA era couldn’t see the light of the day during UPA. The then Finance Minister PC was not accommodative on many of the requests from the states like revenue compensation… However, during Modi 1.0, AJ could build a clean consensus and despite stiff opposition from Congress (in particular PC) on certain clauses could get GST off the ground in 2017.

Amidst all this, if there is a big divergence between PC and AJ, it is how they managed their families, which has now become PC’s Achilles heel.  The legal troubles PC is facing today all claw back to the conduct and involvement of his son Karthi Chidambaram. We wouldn’t know if PC was a wilful partner in all his son’s business misadventures.  However, the fact that he didn’t and he couldn’t reign his son from misusing the office of the Finance minister, makes PC a partner in crime. And today he is paying for the same.  On the other hand, AJ had a spotless track record. Except for pointing fingers at him for developing friendships across the board and being a gossipmonger, there is no charge of misconduct or misappropriation against AJ or his family. He had kept his family away from his political and public office.

In public domain, Chidambaram is seen most of the times in spotless white shirt and dhoti. However, his public life has not been spotless. On the other hand, Jaitley while being in a similar political boat, lived his life without a blemish. And kept his family away from tapping his political influence.

In analysing the lives and career of these two fascinating politicians, there lies a key lesson for many a politician – Control thy Son(s)!

The Making of Modi 2.0!

As the results of the much anticipated Lok Sabha elections in India unfold themselves this day, it is clear that Narendra Damodardas Modi is all set to occupy the Prime Minister’s chair of India once again. In this avatar of Modi 2.0, BJP is looking set to get a majority on its own and NDA as a pre poll alliance is expected to beat its 2014 tally! First things first. This is a remarkable feat for an incumbent to not just return but return with a better performance than the 1st term and so kudos are in order!

As much as the return of Modi as the prime minister was expected to a large extent, the scale and the ease of this victory was not expected till some of the exit polls predicted so. What were we told all this while? “Demonetisation hurt jobs and the poor. GST is still hurting traders. There is agrarian crisis all over. Job creation has hit a historic low. Minority are living under increasing fear. Economy is not growing enough. And since 2014, the Idea of India has been threatened”. And much more. So, in spite of the fact this this government did perform in areas of infrastructure like roads, highways, railways…, asset building in rural areas, reaching electricity to the hinterland,…,… we were told that these were not enough to re-elect Modi again that too with a clear majority.

That being the case, what explains this massive victory? What is behind the making of Modi 2.0? I call it the story of “M”s!

M for Modi: – Let there be no doubt in anyone’s mind people on this. People have not voted for BJP or the NDA. They have unequivocally voted for Narendra Modi! States like Madhya Pradesh, Rajasthan which were lost by BJP are now being swept by them!  Modi has been seen as being earnest in his endeavour to fulfil promises he made. So, even if ALL the promises were not kept fully, people are being kind enough to give another chance. Programmes like Swachh Bharat Abhiyan, Demonetisation, Toilet construction, rural electrification and Ujwala Yojana… are being seen as sincere attempts in improving living conditions in India. Though some of the programmes like Demonetisation faltered, people were willing to forgive and forget!

M for Muscular leadership: I will have to narrate an anecdote here to elaborate this point. A day before polling in Mumbai, my 11 year old daughter’s friend asked my wife as to whom she would vote.  My wife asked why she wanted to know that. And her response left me stunned. “Aunty, I hope you will vote for Modi. Because only he can give a fitting response to Pakistan. India in the past never entered Pakistan and hit them. But under Modiji, humne ghuske maara”!  This was the impact a strong leader leaves in the minds of the young.  Critics may call it mindless belligerence when Modi decided to do a surgical strike and follow it up with an air strike. But people want their leaders to show spine in matters of their country’s defence.

M for Mission mode: This is the difference between Vajpayee/Advani era BJP and Modi/Shah BJP. During NDA-1, after forming the government and running a reasonably good one at that for 6 years, BJP did not do anything to widen their base. But the BJP under Modi/Shah is a different kettle of fish. After having won a decisive mandate in 2014, did they keep quiet? They got into “Mission mode” in North East and then later Bengal and the results are there to see. For BJP, if 2014 was UP story, 2019 is Bengal+UP story! In 2019, when it was facing the spectre of the SP-BSP-RJD gathbandan, BJP activated its “Mission mode” to target 300 on its own! This by targeting areas like Orissa, Bengal and North East.

M for Machinery: This is linked to the above. That is of having a plan and executing the plan through an effective machinery. The party machinery under the leadership of Amit Shah works relentlessly in expanding their base within India. Not just during election time. This also means that BJP will now target states like Telangana, Kerala and Tamil Nadu next probably for 2024!

M for last Mile Delivery: It is one thing to announce programs. It is one thing to have a strategy in the board room. It is another thing to ensure last Mile delivery. Whether it is Jan Dhan Yojana or Ujwala Yojana or other Yojanas, Modi Government’s track record on last mile delivery has certainly made a difference to people. This is what has made BJP and Modi to hold on to their leads even in the face of a combined opposition in states like UP.

M for Marketing: The word “Marketing” is often derided upon as if it is a bad word! As a marketing professional myself, I have resented it often. And I have said that Marketing is not a bad thing at all and is a critical element in a product’s success or failure. In political arena, for a leader or for a party, it is not just enough to perform. But it is important to be “seen as performing”! In that sense, BJP as a party and Modi as a leader are miles ahead in terms of marketing themselves.  Some would say that Modi’s success is all about just marketing! I tend to disagree. One should not forget the fundamental mantra that even great marketing cannot save a bad product!  One can write a separate blog on BJP’s marketing but turning the Chowkidar Chor hai slogan of Congress on its head as Main bhi Chowkidar campaign in its favour is one example of some great marketing by BJP!

M for Models: One reason for Modi in the 1st place to earn credibility in 2014 was his famed “Gujarat model”. This credibility is important for people to take your promises seriously. And this is the problem with the opposition today. The main opposition party doesn’t have any credible model to point the people to! If today, the Congress promises “Nyay”, people are reluctant to take it seriously. Because, even in states which are ruled by Congress, they find it difficult to hold on. If Congress has to be taken seriously in future, they need to develop their own “models” which they can positively refer to.

I hear some of you saying that it is all just one “M” which is Modi! No victory is accomplished with one factor. It is usually a combination of factors. I believe that in the making of Modi 2.0, the mantras were the above so many “M”s! Now that Modi 2.0 has been accomplished, it is time to look ahead and focus on the agenda for Modi 2.0.  What should that be? Please look for my next post! For now, M for Mangal!

Pic Courtesy: Rediff

Mahagad(bad)bandhan!

WhatsApp with all its inherent strengths and weaknesses can be a good source of humour. In particular, in the election season, meme factories are running at full capacity churning out humorous content day in and day out. Among this was a clip – a gem of a creative idea that was going viral on social media few days back. Unlike the usual edited video clips, this was an animation of a WhatsApp group conversation. And here’s the best part. The group was titled “Mahagathbandhan” and showed an imaginary chat among its members who were supposed to be part of the Mahagathbandhan! As this clip was trending on social media and doing the rounds on various WhatsApp groups, I am sure you would have seen it. If not, do check out the clip here!

The humour and sarcasm in this clip notwithstanding, it exposes the fallacies of the Mahagathbandhan being propped up in just 2.5 mins! The idea for this Mahagathbandhan, which is a spectacle for few and spectre for others, I guess, germinated in May last year after the Karnataka polls. After losing the majority, Congress in a very alert move, decided to support Janata Dal (S) though they fought against each other in the elections. This move deprived BJP of forming the government in Karnataka even though, they were the single largest party with just few seats short of majority.

In Indian politics, if you ask me of one sight which is downright repulsive, it is of leaders of political parties of all hue showing up on stage clutching their hands and raising them as a symbol of being together. No other visual can be as dubious as this. The swearing-in ceremony of H.Kumaraswamy Gowda provided the schadenfreude moment for all those parties opposed to the rise of BJP in the country. So, we saw leaders as diverse as Kejriwal to Stalin to Mamata to Chandrababu to Rahul Gandhi to Mayawati to Pinnarayi Vijayan to Akhilesh coming in person to grace the occasion. That stage with the majestic Vidhan Soudha as the back drop on the 23rd May last year, would have given seed to the idea of the Mahagathbandhan to all parties who wanted to stop Narendra Modi on his tracks!

As it is usually the case, showing off a possibility is easy and making it possible is the onerous task! Unlike in the past, where parties come together in a pre-poll alliance or at times cobble up a post poll set up, the Mahagathbandhan is an epitome of conflict of interests among its constituents. Held together by one single-minded purpose of keeping BJP or rather Narendra Modi away from another term, there are conflicts galore!

By definition, the proposed Mahagathbandhan is supposed to be a rainbow coalition of all parties outside of the NDA who have one common enemy. A rainbow with all its different colours presents a pleasing sight! But a rainbow coalition doesn’t! It is obvious on paper that if they all come together and fight the BJP/NDA, thanks to the arithmetic of vote shares and the possibility of transfer of votes, the Mahagathbandhan will pose a very stiff challenge to the BJP in seats where they got the benefit of a split opposition in 2014. And thereby, this is a sure shot and obvious formula/strategy to stop Modi from getting a 2nd term.  While it may seem simplistic, in reality nothing can be more complex than the coming together of the Mahagathbandhan! And here’s why!

Let us for the moment keep aside the historical tussles and conflicts the parties in the Mahagathbandhan, had among each other and just focus on the issues of today.

Starting from the capital, BJP took all the seats in Delhi in 2014. But in the assembly polls that followed, AAP’s broom literally swept Delhi dislodging Congress after a 15 year stint! Sections of the Delhi Congress are still not able to come to terms with the scenario of fighting with a party which was instrumental in not just defeating them in Delhi but also creating that “Anti-Corruption” atmosphere in the entire country in the run up to the 2014 polls. Kejriwal went to the extent of saying that AAP will take all the seats in Delhi without Congress’ help but they needed the Congress in Haryana!

In Kolkatta, where TMC is ruling supreme and BJP is emerging as a strong challenger, a tie up of TMC, the Left and the Congress may dent BJP’s hopes of winning 7-8 seats in WB this time.  But then, the Left cannot stand the TMC and it is unimaginable for the workers to come together and work for a common cause.  So when the Left and the Congress are in an alliance, it remains to be seen if this will affect the TMC or the BJP more!

While in Bengal, the Congress and the Left are in it together, in Kerala though, the numero uno enemy for the Left is the Congress led UDF! In fact, this fault line got exposed after Congress announced that Rahul Gandhi would contest from Wayanad in Kerala in addition to Amethi! CPI(M)’s Prakash Karat was among the 1st to criticise this decision! He went on to say that the Left will work to defeat Rahul Gandhi in Wayanad!

There are such inconsistencies all over. In Maharashtra, the Congress and NCP are together for a long time, but in Gujarat, they are not. In the recent assembly polls in Telangana, TDP and the Congress fought together in an alliance but that couldn’t prevent the TRS winning the state by a landslide! After that spectacular defeat, TDP is silent about its tie up with the Congress for the Lok Sabha polls and the Assembly polls in AP!

None of these confusions are more pronounced than in UP.  If BJP needs to be defeated in 2019, it should be defeated convincingly in UP. But even this overarching objective couldn’t stop BSP and SP from ditching the Congress for the Lok Sabha polls. So, finally that famous picture of Sonia Gandhi hugging Mayawati in glee during the swearing-in function of Kumaraswamy remained just a photo-op!

And one common theme which comes up as a predicament for all regional parties to be part of the Mahagathbandhan is their perception of Congress as a liability rather than an asset in the coalition! So, in all states where the regional parties are stronger than the Congress, they don’t want to have any truck with the Congress!

Now, I am sure that all these parties which are taking a stand based in their self-interests today, will have no hesitation in coming together and form a post poll Mahagathbandhan if they get an opportunity to take a shot at power! And one can imagine, with all the inherent conflicts and fault lines among themselves, the alliance can only run with confusion writ all over! As each and every coalition partner start pulling the cart based on their self-interests and not necessarily Nation’s interest, it is not difficult to visualise what will happen to governance!  What will start as a Mahagathbandhan will soon become a Mahagad(bad)bandhan! Don’t believe?  Check out what happened to governance between 1977 and 1980, when we had the 1st Mahagadbadbandhan of sorts!

Postscript: Title courtesy my friend and an avid political watcher, Mukund Sampath who called Mahagathbandhan as a possible Mahagad(bad)bandhan in one of our chatsand that prompted this post!

Toon courtesy: Satish Acharya

From Quota politics to a “Quota for politics”!

In India, they say the wheels of the Government usually move very slowly. Not always. When there is a political will, the same wheels can attain humongous velocity just like how it happened few weeks ago. The Cabinet approved a proposal for introducing a 10% quota for economically weaker section of the society on the 7th Jan. And by 9th Jan, the bill to amend the constitution for the same was passed by both the houses of the parliament! The quota bill was done and dusted in flat 3 days!

During the debate over the quota bill, almost all parties mouthed the usual platitudes – not on the proposal per se but on the timing. The coming together of the ruling and opposition for this cause demonstrated another aspect of “Unity in Diversity” in India. That is, on the issue of reservations which has high impact on electoral fortunes, almost all parties think alike. Herein lies the irony.

 “A quota for the economically deprived sections of the society” sounds logical and seems a significant forward step in our country which for a long time has been having quotas based on caste. As a step which doesn’t differentiate based on religion… it is high on optics.  But then, as they say the deadly devil lies in the details. This 10% is over and above the existing 50% as mandated by the Supreme Court for caste based reservations (with the exception of Tamil Nadu which has 69% reservations).

Before venturing into another quota based on economic class, I think that there was a need for an assessment of how the caste based reservations have performed in India in the so many decades since they were introduced, against the desired objectives. Based on what I have seen in Tamil Nadu in very close quarters, I have no doubt in my mind that the caste based reservations have helped in emancipation of a generation of people. Thanks to the quotas, many of the deprived sections could get access to decent higher education and then jobs. Which in turn have helped a generation of families to be part of mainstream India. This could not have been possible by another poverty alleviation programme, I believe. Having said that, the important issue to define now is how we will close the tap on this affirmative action.

We all understand that the originally envisaged time frame of 10 years for caste based reservations in India is impractical. Now that we crossed 68 years with reservations which typically means it has benefited two generations, where are we in terms of social equality and equity? Do we know? Do we measure? Who will bell the cat in terms of suggesting the sunset clause?  Do the offspring of those first two generations of people who could get access to higher education and government jobs need the same level of quotas as their parents and grandparents? In addition to quotas, what else is required for bringing down the class divide which still exist in the society? These are few important questions which arise.

The second issue is, the definition of the economically weak for the purpose of this bill. The provisions like a household income of under Rs. 8 lacs or owning less than 5 hectares of land seems to be extremely liberal when you look at all angles possible and government’s own definitions in other contexts.  In one stroke, above 95% of the populace has been covered under this ambit!  So, I join the naysayers who question the effectiveness of such a quota. From the total population, if you remove those who are already beneficiaries under the earlier quota regime (roughly 70% of the population), this new 10% quota is applicable for the economically needy among the balance 30% population.

The third issue is, there are different points of view if this will finally stand judicial scrutiny. As per the Government, the 50% cap was only meant for “Caste based reservation quota” while there are others who say that the cap applies to all reservations!

Finally, Affirmative action by definition means policy intervention for favouring individuals who are known to have been discriminated for various reasons in the past. Will economically deprived but not marginalised by caste, come under the category of those who were discriminated in the past? While the concept of helping those economically deprived is indeed noble, why not provide scholarships for higher education and assistance for business ventures instead of quotas?

You can question our netas on their intellect but we cannot under-estimate their political instincts at all. Not surprising that almost all the parties voted for this quota bill in both the houses of the parliament.

In the upcoming election season, the ruling NDA will certainly go to town for ushering this new direction on quota politics in India. However, even in the Hindi belt, I feel it will have minimum resonance. The opposition by playing ball on this, has in a sense blunted the political rewards what the BJP/NDA can reap. Imagine the situation had the Congress/UPA and others had opposed this move. So, all have played their moves smartly.

The bottom line is, a quota for economically deprived is as I said, provides for excellent optics and is sound politics. I do feel, like how the Supreme Court has put a cap on the quotas on reservation, we should have a cap on the quota for playing politics for every political party when in power. We cannot expect them to stop playing politics completely but, what about a Quota for politics?

Cartoon courtesy; Times Of India

In #2019, no TINA but be wary of TAIL!

As 2018 winds down and we step in to 2019, for India, it is just not another new year. Mid of 2019 is when we will have the Lok Sabha polls that will determine if Narendra Modi will get another shot at being the Prime Minister. In my memory, I cannot recall of any individual who has come for so much scrutiny as an elected representative. And whose re-election is being discussed and debated so intensely in the country. First up, blame it all on the social media and its growing tentacles!

The fact that a government’s performance is coming up for such a rigorous appraisal itself, augurs well for our country. It should be like that. I only hope that this appraisal business isn’t selective and not just reserved for Modi Sarkar! If I think as to why this government has come under such a close assessment, I realise that it should blame itself for the same.

Did we have any other government in the past that

Set targets for itself on many fronts?

Which announced the targets and put them out in public domain?

Which tracked the actual delivery against the targets and presented them for everyone to see and comprehend easily that too mostly on real-time basis?

Today we know, not just what this government’s targets are for rural electrification, construction of highways, building targets, opening of bank accounts so on and so forth but also where it stands in terms of achievement. One look at the https://transformingindia.mygov.in/performance-dashboard/ site gives us an update on a real-time basis. It is not that governments in the past did not set targets for themselves. But all these targets were usually in terms of outlays announced in the Annual Budget speeches and seldom one would know what the final outcomes were. Between the outlays and outcomes, the India story remained in tatters. I guess not any more.  So, if people keep remembering the promises made and get disappointed if some of the promises have not been met fully or adequately, blame it on the Government’s efforts of putting out data in the open which makes it possible to compare achievements Vs goals easily.

In comparison to the upbeat mood in 2014 and 2015, today the mood in the country is more sombre. Even the most loyal fans of Modi have realised that probably he chewed more than what he could swallow. Five years are just not enough to turn around and solve all the ills of the country. That too when the global economy is facing one headwind after another! But then, as a country we had our own share of misses. Right when the economy was getting back on track in 2015/16 from the throes of policy paralysis and negative vibes and was poised for a leap, this government let loose the Demonetisation devil on the economy.  This set the economy back by 2 years to get back on track. That we didn’t fully collapse and managed to grow the economy at a slower pace nevertheless, would be a miracle, academicians would pore over in the years to come!

Before the effects of Demonetisation could subside, this government went ahead with the introduction of GST which according me is the biggest Tax reform in Independent India. Irrespective of the critics who take on this government on the “not so perfect” GST, I maintain that it was extremely creditable on the part of Modi Sarkar to launch the GST without further delaying, on the 1st of July 2017. In India, in aspects of meeting deadlines, we Indians follow religiously and rigorously the Theory of Elasticity which says solid materials deform under the application of external force and regain their original shape when the force is removed. So, in the quest of a perfect, ideal GST, if this government had deferred the launch, who knows, perhaps we will still be talking of “introducing the GST” in the upcoming budget!  Against that, today we already have a thriving GST which is now going to complete 2 years! The introduction of GST will remain this government’s biggest achievement when its history is written.

The short term pains inflicted by these 2 moves (Demonetisation and GST) to the small and medium businesses combined with the government’s failure to address the Banking crisis at the beginning of its term have led the BJP to the situation where it is today.  In its strong hold states like Gujarat, Madhya Pradesh, Chhattisgarh and Rajasthan, the party’s support base has been dwindling. On the contrary, the Congress which seemingly had no hope of a revival till mid-2017, has smelt blood and is hoping to deprive Modi of a second term and a shot at history.

In India today, in the main stream media and also probably social media, the obituary of Modi Sarkar is being written on a daily basis. As per me, it is too early to write off Narendra Modi in the context of 2019. In spite of his government’s misses in terms of promises and more importantly the delivery of Achhe Din, his personal credibility as a leader who is keen to deliver, is intact. I do believe that there are those who are disappointed with him. But they are still not disgusted with him. Yet.  My personal feeling is that they would like to give him another chance.  The same states which voted out the BJP recently could very well see voting for Modi in the Lok Sabha polls!

Apart from this factor of Modi’s personal charisma, there is another important factor at play. People like to call it the TINA (There Is No Alternative) factor. I don’t believe that there are no alternatives to Modi. In fact, we have many. We have the spectre of a Rahul Gandhi becoming the Prime Minister, if a Congress led UPA front emerges as the biggest. Or else it could be toss between a Mamata Banerjee or a Mayawati or a Chandrasekhar Rao or any other leader depending upon how many seats they win, as part of a coalition which will be cobbled together post the elections. In all these cases, a leader of the party with 30-40 MPs would head the coalition of 10-15 parties with each party playing the “I am indispensable” card!

This Mahagathbandan where, parties will oppose each other in one state but will come together in another state is only a Maha”cut”bandhan who want their share of power and the perks that come with it. I believe that people are smart enough to understand and realise that Modi Sarkar might have disappointed but will still probably vote for him not because of TINA but being weary of TAIL – The Alternative Is Lousy!

In the past, we saw many Accidental Prime Ministers as we didn’t sight TAIL properly! Hope 2019 is different. On that hopeful note, wishing India a momentous 2019!

Cartoon courtesy: Satish Acharya

Our Tryst with GST* – * Conditions apply!!!

GST – The Good and Simple Tax, as our acronym lover PM touted during the launch on 30th June is finally a reality after almost 11 years of intense labour. This along with FDI in retail must count among the most awaited reforms in India by India observers.

So, the advent of a single tax which subsumes, at last count, some 17 different taxes and myriad cesses certainly must count as the single largest Tax reform undertaken in India. Not to forget the application of tax only on value added in the chain. Along with this simplification, the fact that goods from one state can pass thro different states without wait, harassment and accompanying corruption portend a new beginning for trade in our country. In the pre-GST era, logistics and warehousing strategy of companies have been dictated by tax compliance rather than supply chain considerations. In the sense, the number of warehouses and their size would be driven by billing point concerns rather than geographical spread of demand. In the GST era, warehousing will depend on supply and demand equations and not taxation points. And hence like in most developed countries, companies will get to run larger, integrated and fewer of warehouses. Development of more efficient logistics hubs, warehouse consolidation and ensuing FDI will become a reality soon. This is a new dawn for retail, supply chain and logistics industry.

So with all the seemingly obvious benefits of the GST regime, why is it that there is still some cynicism and negativity from different quarters about the move? Why is P. Chidambaram once the prime mover of GST when UPA was in power, cautioning all of us to “Get Set for Turbulence”? The GST in the current form is nowhere close to the one which was originally conceived. Rolling stones probably gather no moss. But a rolling GST gathered whole lot of moss on its way from the wisdom of empowered committees to standing committees to GST council. The current version of GST is a product of what I call “co-operative federal bullying”. The result is instead of the One Nation, One Market, One Tax premise, what we have is One Nation, One Market, One Tax name, 3 Sub Tax names, Multiple Rates, Few Exceptions, Some flexibilities and with an *. * – Conditions apply.

Being part of the GST council, the states in their own wisdom, ensured that we as a country don’t get away with a simplistic tax which may throw many Chartered Accountants out of jobs. However, I understand that without having a set of different GST rates (in some cases different rates for the same category as per user segments) or without excluding items like Petrol, Alcohol, Real estate,.. consensus could never have been built in getting GST off the ground. UPA’s failure to make GST a reality during their regime stems from this. So the choice before the centre was to accept what the states demand and bring about a not so ideal GST or wait endlessly for a few more years may be decades before some major economic crisis forces all concerned to come to an agreement on the ideal GST. From that point of view I agree with the stand taken by the Govt. to bring in GST in its present form with its shortcomings, with a hope of ringing in the changes in the coming years. Kudos are in order hence.

The Congress party which at every opportunity reminded us that the seeds for GST in India were sown by the UPA, however, chose to be petulance personified and boycotted the GST launch. While rubbishing the GST in its present form its main “anGST” against GST was that it is being rushed thro and should be delayed by 3 months till September. We all in India know that in our country whatever may be the preparatory time available, things get accomplished at the last minute. If we get more time, we stretch our deadlines accordingly. That if we have more time, we will be more prepared and can do trial runs before actual roll out,.. exists only in theory. Don’t we see in our Indian weddings, folks tying up some loose ends literally till the baraat arrives and continue to do so as the wedding is in progress?  Finally when the wedding gets over, its smiles all over.  So even after the GST roll out, there will be glitches, teething problems and surprises which I am sure we will find ways and means of getting over. Pushing back by another 3 months is not going to make things any different.

It must be commended that this Govt. stuck to the date of July 1. It would have been very easy for the PM and the Govt. to throw in the towel and put off the launch by a few months. But then, there are other implications. Come Oct. it is the peak festival and hence business season in India. Does It help if the roll out happens when India is in the midst of its biggest Annual economic cycle? Will it help if GST is launched in Jan. in the final quarter of the fiscal year???

The ruling party, the BJP counts traders as its important traditional support base for the party. That the party still decided to go ahead with the tax reform which professes maximum disruptions for this group is a significantly courageous move.  In India economic reforms have always been carried out under duress; when push comes to shove. The heralding of GST must be the 1st major economic reform brought in when not under any kind of stress but just to ease up things for the future. This certainly conjures up the arrival of Acche Din for our country.

Still our penchant for complicating things comes to the fore here as well.  Though the GST collections have to be shared between the state and the centre, could it not have been done at the back using technology rather than coming up with 3 variants like SGST, CGST and IGST??? Does the Anti-profiteering clause make sense? Will not competitive economics eventually drive pricing??

GST is indeed a Good and Simple Tax. So there is nothing like a good or better time to introduce the same. But, we should not forget that this is India and we are Indians. So, conditions apply.

Bahubali, Kattappa and some political lessons!!!

With over an estimated 30 mill. people having reportedly watched the film Bahubali 2: The Conclusion, I can safely conclude that most of those who are reading this blog by now would have! This post is not a review of the film or about how the film has broken all collection records in the country either. But about a character called Kattappa and the political lessons it holds for the principal opposition party in India namely the Congress. In the film, apart from the lead characters, Kattappa is the one who evokes much recall and sympathy – a situation very similar to what Congress (which has its own few Kattappas) finds itself today in India.  Kattappa in Bahubali and Kattappas in Congress??? Let me attempt to join the dots.

In the Bahubali series, Kattappa is an able warrior and sort of a leader of the forces of the Kingdom of Mahishmati. In terms of characterisation, Kattappa is shown as an extremely loyal, most faithful and a trustworthy soul who will do anything to protect his master – the ruler of Mahishmati in this case. He doesn’t mind others alluding him to a dog scornfully – a creature known for being utmost loyal to its master among all pets. At the same time, repeatedly he is depicted to be a prisoner of his own choice he has made in terms of being loyal at any cost. In the film there are 2 crucial mistakes he commits as a result of putting his loyalty ahead of being truthful. First, he lets the Queen announce Bhallaladeva as the King setting aside the earlier announcement of Amarendra Bahubali without making any attempt to clear the air in the Queen’s mind about the right and good intentions of Amarendra in wanting to marry Devasena. He makes no attempt to let the Queen know that Devasena likes and prefers only Amarendra to be her life partner. Second, he carries out the order of the Queen to kill Amarendra though he knew very well of the conspiracy of the Bhallaladeva camp to create misunderstanding and confusion in the Queen’s mind. These crucial mistakes deprived the people of Mahishmati the governance of a benevolent leader like Amarendra and instead were at the mercy of an unkind and autocratic ruler like Bhallaladeva.

Well, that’s what happened in the 2 part film that helped the Director weave an interesting story of palace intrigues in a huge canvas unseen so far in Indian films and create history!  But what has Congress to do with this?

Today in India, the Congress party is in crossroads and may be at its lowest ebb. The climb has been downhill since 2014 when it was reduced to an all-time low in the Lok Sabha. The string of defeats in most of the state elections since then have been catastrophic. The principal ruling party in India namely the BJP is systematically moving forward on its slogan of making Bharat – Congress Mukt. Apart from Congress there is no other party which can be called truly a Pan Indian political outfit. Under these circumstances for a democracy to be one, a truly credible opposition party with an alternate narrative is a must. Any ruling party must have at least one if not few other parties breathing down its neck any point in time for its own checks and balances. Not to mention of the country’s. And that’s why a revival of the Congress party from where it is today is a must.

Congress led UPA had their chances in changing and developing India for 10 years since 2004. I am for the moment ignoring the 50 years they had, prior to 1998.  Congress had and in fact has quite a few Kattappas in their ranks. Experienced, Able politicians and administrators who I believe had answers and solutions to the many ills the country faced when they came back to power rather providentially in 2004. However all of them ended up being true Kattappas who only put loyalty to the rulers (Gandhi family in this case) as their priority and did what served the family well rather than the country more often than not. The result – in spite of the benefit of global tailwinds helping the economy till 2010, UPA couldn’t change things much on the ground in their 2nd term and lost the elections to BJP in 2014.  The many new ideas their leaders had, got intertwined in turf battles between ministries and never were implemented with rigour. Coming back to the present, the Kattappas of the Congress continue their old ways the string of bad news at the hustings for the Congress notwithstanding. The able leaders still remain so loyal to the Gandhi family that even today they are reluctant to come out with their honest prescriptions to revive the Congress. They all make the “right” noises in public but being “right” is seldom being “honest”! The Congress today suffers from a uninspirational leadership in the Gandhi family. However the very able and even intelligent Kattappas of the Congress party continue to labour paeans on the Sonia-Rahul leadership without ever being critical of some of their moves since 2014.

My view is that unless the Congress party’s leaders come out of their loyalty web and challenge the strategy and some of the decisions of the party’s leadership thereby leading to some churn in the thinking of the party, the drive may continue to remain downhill for some time.

Coming to think of it, it took us 2 full years since Bahubali 1: The Beginning for us to comprehend the ill effect of Kattappa’s mindless loyalty to the rulers. It’s already 3 years now for the leaders of Congress to realise the ills of theirs. And if they are among the 30 million to have watched the film, it may be good to take some political lessons from the on screen Kattappa!!!

P.S: In the above piece, one can “find” Congress and “replace” with AAP and I guess most of it will hold good as well!!!