Editorial 1 / Man of power
Editorial 2 / History lesson
Governance by committees
Fifth Column / Balance for the right exchange
Mandal served with a pinch of saffron
Letters to the editor

Lord Mountbatten had advised India�s first prime minister, Jawaharlal Nehru, that he should routinely shuffle around his ministerial colleagues. The cabinet reshuffle carried out on Saturday by Mr Atal Bihari Vajpayee cannot be described as such a routine and cosmetic exercise. The changes made by the prime minister are significant not because they affect a large number of people but because they are also indicative of the unchallenged power that he enjoys within the National Democratic Alliance. If ministerial berths are seen as a part of a rewards and punishment system, then it is clear from the reshuffle that Mr Vajpayee privileges loyalty over all other virtues. The exit of Mr Ram Vilas Paswan and of Mr Sharad Yadav is a clear message to allies that they cannot afford to take the prime minister, his wishes and his policies for granted. That loyalty is even more valuable than achievement to Mr Vajpayee is evident from the elevation of Mr Arun Shourie to cabinet rank. Mr Shourie�s record on disinvestment is not exactly glorious but he has never, in speech or in deed, deviated from the policy priorities laid down by Mr Vajpayee. The prime minister is thus moving towards having his own cabinet. Ministers, if they want to remain in office, will have to show allegiance to Mr Vajpayee before they worship at any other altar. The imprint of power is there for all to see.

Perhaps because the reshuffle was driven by power and the need to establish loyalty, it was not as far-reaching an exercise as it could have been. The obvious candidate for removal was the finance minister, Mr Yashwant Sinha, who retains his portfolio. The decision not to move him perhaps confirms the earlier point that loyalty has been given more importance than achievement. The reshuffle should thus be seen not in terms of what it does for the political and economic life of the country but for what it does for Mr Vajpayee. It reinforces his hand and confirms his power. Nobody who has been observing Mr Vajpayee and his mode of operation will be surprised at the extent of his power. From a tentative beginning, he has established his position by eliminating or silencing his critics within and without the government. A natural corollary to this sure but gradual ascent to absolute power has been the premium he has put on personal loyalty. A prime minister, according to the gospel formulated in Westminster, is primus inter pares in the cabinet. In Mr Vajpayee�s case, the emphasis is most definitely on the first of the three words. Ministers can be Mr Vajpayee�s equal provided they are loyal first. This is precarious ground but from Mr Vajpayee�s point of view, it is a precondition for giving shape to his vision of India. To implement his vision, a prime minister, by definition, needs his men.


This is by no means a �historic meeting�. Ms Sheila Dixit�s sense of the importance of the meeting organized by Mr Buddhadeb Bhattacharjee to take a stand against the National Democratic Alliance�s policies on education would certainly seem rather exaggerated. This was the West Bengal chief minister�s first attempt to bring together as many of the non-Bharatiya Janata Party chief ministers as possible to protest against the saffronization of education imposed on the states by the ministry of human resources development. Thirteen states were represented, a few by their chief ministers and most of them by their ministers of education. There are a couple of features of this meeting somewhat worthy of mention. First, ministers from two NDA allies joined in. Second, a number of Congress-ruled states have joined in this protest. Mr Bhattacharjee is feeling purposeful and almost triumphant.

But these are all petty achievements of oppositional politics, ultimately partisan in nature. However highminded and principled the rhetoric of this meeting regarding the constitutional ideals of education, what it has achieved, paradoxically, is the further politicization of education. A number of very specific points of contention has been agreed on. These touch on the Centre�s unconstitutional manner of imposing, without consulting the states, its new curriculum framework through the national council of educational research and training. More important, they reject the perceived ideological bias of this curriculum. Fair enough, although the critique of saffronization has become somewhat frayed at the edges simply through mechanical reiteration. Yet, the fundamental point that seems to have occurred to none at the meeting is whether partisan politics of any hue should at all be intervening in the formation of a national curriculum. In this, the left parties, particularly in West Bengal (Kerala was absent at this meeting), seem to be quite conveniently eliding their own continual � and historic � interventions in the contents, processes and institutions of education in the state. This has resulted in the most unfortunate � and perhaps irreparable � compromises in matters of academic excellence in the state. Moreover, it would arouse nothing but the most serious apprehensions to realize that crucial decisions on education in Bihar are going to be made by Ms Rabri Devi. Similarly, Tripura and Meghalaya ought to have much more fundamental problems to tackle regarding the basic infrastructure of education before being able to afford time to spend on ideology. In all this, what is at stake is the essence of education itself, the centrality of excellence which should be beyond any form of political dogma, saffron or red. Mr Bhattacharjee would be organizing a truly historic meeting if his government, party and the other opposition parties agree to keep out of the business of education altogether.


Many seasoned civil servants, wise in the ways of men and political leaders, often tell each other, half in jest, �When in doubt, form a committee�. Only half in jest; often it is meant seriously enough, and with good reason. Difficult issues, issues which were sensitive, and needed careful thought and consideration, are frequently placed before committees specially formed to consider them. The committees examine the issues in detail and give their reasoned recommendations to the ministry concerned.

This method of working has several advantages, in theory. It means that the issue is examined meticulously, in all its aspects, its consequences sought to be worked out logically, different courses of action arising from it are assessed for their advantages and disadvantages, all of which harried officers in the ministry would hardly have the time or energy to do. It means that the issue is studied without the haste that could lead to a crucial aspect being overlooked, and, above all, it means that this scrutiny is done by a group of people known for their sagacity, experience and knowledge of the issue, whatever it is � it is not the scrutiny of one such person but that of a group of them, which can only be of much greater value.

The recommendations by such committees are consequently wise, practical and well thought out, as a rule, and would be of great help to the ministry concerned, not only for the intrinsic value of the recommendations, but because they come from a group of distinguished people who would be respected by the public at large.

These are the advantages, as one said, in theory. There are some committees which manage to spend a good deal of time and money doing very little except accumulate quantities of paper and then, when pressed, they carelessly put together some recommendations and send a perfunctory report to the ministry which formed them. But these are exceptions; one cannot think of more than perhaps one or two such, among the many many committees one has seen set up, or which one has had a very active role in setting up.

You would think, then, that a report from a hard-working committee consisting of persons who command respect for their knowledge, sagacity and integrity, would be accepted by the ministry and acted on without loss of time. You would be wrong. The reports and recommendations of such a committee are not accepted with the alacrity that they deserve; they are �examined� in the ministry, from the section officer up to the joint secretary with different degrees of application, and a decision is then taken to accept or reject these recommendations, one by one. Sometimes the entire report is rejected; most often, however, the reports just get put away in some musty cupboard and are lost in the tonnes of paper and files that the ministry churns out every year.

Recently, one learned of a particularly scandalous instance of this sort of behaviour by a government. This concerns the committee set up by the Maharashtra government to examine the Enron tangle, headed by Madhav Godbole, former Union home secretary, who was earlier secretary to the Maharashtra government in the departments of power and finance.

This committee had two former government officials, Godbole and one other, and three other experts in the field of power and of company finance. After several meetings this committee could not come to an agreement on the recommendations; the three members who were not from the government made one set of recommendations, and the two former government officials another. The state government, which had set up the committee, promptly accepted the minority recommendations and rejected the majority view, without so much as a discussion with the people concerned.

That has been � and, sadly, will continue to be � the fate of recommendations made by committees of knowledgeable people formed by ministries, or departments in state governments. The merit of a recommendation is equated with its acceptability to the government. This makes nonsense of the work of such committees, and reduces the credibility of the government to even lower levels than usual.

What happened to the committee on the Enron affair is not different from what has happened to several others both in the Centre and in the states. Not that many years ago, one was instrumental in the formation of two committees by the ministry of information and broadcasting. One was to examine how best the marketing of airtime on Doordarshan and AIR could be done, headed by Shunu Sen, acknowledged all over the country as one of the outstanding marketing specialists, who, as head of marketing in Hindustan Lever, pioneered the marketing of time on television in India; the other members were Gerson da Cunha, former head of Lintas, and Ameen Sayani who is a universally respected pioneer in the field of radio broadcasting.

The other was to examine alternative structures and suggest what would be the best structure for Prasar Bharati. This was headed by Nitish Sengupta, who had been secretary (banking) in the government of India, and member-secretary of the planning commission. It too had some distinguished members, former CEOs of public sector undertakings.

Both committees gave in their reports, with reasoned practical suggestions. The ministry of information and broadcasting lost no time in either rejecting the counsel of these experienced people or just letting them gather dust in files. Having left the government by then there was nothing one could do except mourn the time and effort these persons had given of their own, to examine issues that they felt concerned about and about which they knew far more than anybody in the ministry. Time and effort wasted, as if we have access to so much expertise in this country as to be able to do so with such impunity.

If we really want to gain from such expertise as we have, and not waste it in such a callous fashion � and one is sure there are hard-working, dedicated civil servants who want to � it must be made a non-negotiable condition to the establishment of such expert committees that their recommendations shall be accepted without question. If this condition is not acceptable, the committee must not be appointed. Every secretary to the government can at least ensure that.

The ministry may disagree with some recommendations; in that case, they must go back to the committee and explain why they disagree. If the committee, after hearing them, does not change the recommendations, for reasons which they will no doubt furnish, these must then be acted on without question. And without delay; we know all about that little trick of negating a recommendation by delaying it.

This may sound a bit extreme but it is not. Committees of experts can examine issues with care, and without any partisan angle to their examination � if, of course, the right people have been chosen as members. Their work can lessen the burden on ministries and departments, and at the same time give their decisions � decisions based on the recommendations of these committees � a considerable degree of credibility. Accepting without question the work of respected experts in a particular field can only enrich and add value to the work of governments, something that is in short supply right now.

The author is former secretary, mInistry of Information and broadcasting


The importance of the regional stock exchanges has been diminishing since the formation of the national stock exchange in 1994. The need for regional trading platforms disappeared as NSE�s automated trading platform penetrated all corners of the country. The formation of the NSE was the first step towards the nationalization of the stock exchanges. The impending legislation on demutualization of stock exchanges should extend it by integrating the country�s stock exchanges, besides increasing the efficiency of their managements.

The regional bourses that survived the coming of the NSE did so by riding piggyback on badla and arbitrage businesses. But bourses depending on these operations cannot be sustained for long, as the recent scandal showed. The market scandal and the measures adopted by the securities and exchange board of India in response to it, have stamped badla and arbitrage out, and the regional bourses are faced with the threat of being completely wiped out.

The crisis stems from a fall in business and cost-income mismatch affecting both the exchanges and the brokers. Most of the smaller exchanges cannot meet their operational costs anymore, and many are seeking to merge themselves with the NSE or the Bombay stock exchange for survival. All the regional bourses have huge overheads, while their income has plummeted substantially. Broking firms too have the same problem, and pink slips are being dished out. Many have even had to close down.

Identity crisis

At a recent meeting with the market regulator, representatives of most of the regional bourses mooted the idea of merging with the NSE or BSE. Optimism among regional bourses is in short supply, and no one seriously believes that the smaller bourses will ever revive without badla and arbitrage operations being possible. The steps taken by Sebi are irreversible, and there are no hopes of rolling settlement and ban on carry-forward trading being rolled back.

In the given scenario, even if the exchanges as institutions manage to pull themselves through for some time drawing on their reserve of accumulated profits, the brokers cannot. Most brokers live on day-trading profits these days. A shallow market like the Calcutta stock exchange makes day trading difficult, if not impossible. Institutional players dominate the equities market and none of them is active on the regional exchanges. With retail investors absent, there is not enough liquidity on the regional bourses to support day-trading.

Even as most of the smaller bourses would like to merge themselves with the NSE or the BSE, some like the CSE still hope that they can recover without losing their independent identity. The following instance illustrates that such hopes are ridiculous.

New start

On August 23, the CSE clocked a turnover of Rs 10.88 crore, as the Mumbai-based bourses were closed. On an average, daily turnover of the Calcutta bourse hovers in the Rs 60-75 crore region, but since the BSE and NSE were closed on the day, the members of CSE did not have a trend to follow.

Alongside merger with one of the two Mumbai-based exchanges, what the smaller bourses should focus on is widening the range of securities that its members can trade on its platform. The bourses should introduce retail trading in debt securities.

The recent success of various debt-oriented schemes of mutual funds, including the Unit Trust of India, is an indicator that there is interest in debt securities among the investing public. A debt-trading platform will take off in no time.

There, however, appears to be greater interest among the bourses in introducing derivative products. But derivatives are highly leveraged products, and unsuitable for retail investors. Even in developed markets, retail investors and small brokers do not participate in derivatives trading.

The corporatization of the bourses should be an excellent opportunity to introduce these structural changes in the Indian stock markets. Besides separation of trading rights, ownership and management of the bourses, the government should also mandate amalgamation while passing the legislation on demutualization. It will be one move on which the regulator, government and the brokers will agree.


When the Bharatiya Janata Party swept the assembly elections in Uttar Pradesh in the summer of 1991, the former prime minister, V.P. Singh, made a prescient remark, �Kalyan bina kalyanva nahin.� Playing on the chief minister�s name, he spelt out that there could be no success even for the party of Hindutva unless it made a bow to the logic of lower caste assertion. A decade later, he stands vindicated, as the ruling coalition in Lucknow attempts a major gamble, making sweeping changes in the reservation policy in the run-up to another assembly poll.

Mandal or rather the politics of a Mandalized society is now central to the plans of the Rajnath Singh-led BJP. It may be ironical that a political movement committed to the unity of all Hindus irrespective of caste should try splintering the electorate further on caste lines. But the creation of Uttaranchal made it inevitable that in the absence of its only sub-regional bastion, the savarna Hindu dominated party would try another card.

Its own attempts to build up an other backward classes leadership ran aground by late 1999. Kalyan Singh was at odds with the older social base of the party, and virtually at war with the Atal Bihari Vajpayee regime in New Delhi. After his exit, two successive chief ministers tried to rally upper castes while limiting any damage he might have inflicted. It is the failure of such attempts that led to the new reservation initiative.

The social justice commission favours the break up of the OBCs and the scheduled castes into smaller sub-sets, the former into three and the latter into two. As a sop to the upper castes, it also suggests a five per cent quota for the poor among them. The bite, however, is in the former set of proposals.

The Mandal classes comprise just over half the electorate, but the quantum of reservation for them is to be fixed at 28 per cent. The Yadavs, who have been the most politically assertive of them, are eligible for a sub-quota of five per cent only. On the face of it, this is an innocuous measure: sub-quotas of the Mandal list exist in many states including neighbouring Bihar.

The obvious logic of this is to pit the Yadavs against the lower OBCs. The key community to which Mulayam Singh Yadav belongs would find its own interest for government jobs at odds with less well off brethren from other, less privileged Mandal castes. The lower backward class groups are highly populous and make up about 37 per cent of the total population. It is here that the BJP hopes to strike gold, rallying them around its new image as their benefactor.

The entire logic of Mandal was quite to the contrary. It sought to unify the backward classes as a whole. Interestingly, another Rajput chief minister, V.P. Singh, implemented the existing quotas for the OBCs in 1980, partly to offset the dominance of Brahmins in the government. The next major break came in 1990, when the Mulayam Singh-led Janata Dal government extended the Mandal commission recommendations to the state. The most significant outcome of these changes was to alter the line-up of leaders at the apex of the pyramid of power. From 1989 to 1999, for a whole deca de, there was no chief minister from the upper castes.

Yet, the divisions among the OBCs and the Dalits emerged as significant over time. Unlike Laloo Prasad Yadav in Bihar, Mulayam Singh had to contend with an autonomous Dalit-led party in the shape of the Bahujan Samaj Party. The latter has built a formidable network of SC communities across the state, but it mainly rests on the solid support of the Jadavs. Due to their control of the leather trade and their lead in education, social reform and political mobilization, they dominate the party.

The chief minister has taken a page from Kautilya�s book. Since he cannot defeat his adversaries, he hopes to divide their camps. Over the last decade, the Hindutva party has held central ground due to the division between the Dalits and the Mandalites. The new Rajnath Singh initiative tries to go a step further. He hopes to contain the reach and power of the most assertive of the Dalit and OBC communities.

The immediate litmus test in UP is a simple political one. But here the logic of numbers and the history of caste assertion both weigh heavily against any immediate gains. For one, the lower strata of the OBCs do not at the moment have strong or articulate leaders who can rally them together around the new plans. They are also educationally deprived to a degree that even some Dalit groups are not. By contrast, the Mandal report came just at the time when groups like the Yadavs, Lodhs and Kurmis were in a position to take advantage of it.

The gameplan for both Mayavati and Mulayam is a simple one. They are demanding a higher quantum of reservations. Having opened the Pandora�s box, it is not so easy for the BJP to clamp down on it. Both will also redouble efforts to reach out to the minorities who, with over one in six votes, will be all the more crucial. True, the new scheme provides for reservation for Muslim OBCs, but most Muslims are self-employed and the plank is unlikely to hold much appeal.

If the backward class card has its limitations, so too does the Dalit card. The break-up among the 21 per cent reserved for scheduled castes is revealing. The Jadavs and Pasis would have access to less than half these jobs. This is a more ambitious step than even the changes in the Mandal list. Not only because two key leaders, Ram Vilas Paswan and Mayavati, come from these respective communities.

No state in India has yet pushed through sub-categories among the SCs in its positive discrimination schemes. A bid to do so in Andhra Pradesh by the chief minister, N. Chandrababu Naidu, failed last year. It ran afoul of the SC/ST commission and even led to concern being voiced by the president. A division of the Dalits on caste lines looks too much of an upper caste plot to divide groups who have for centuries been crushed under the heel of the caste-based social order. What better way than to revive sub-categories and groups in some garb, was the refrain of critics.

Despite its pitfalls, Rajnath�s is a step that will have long term consequences. For the BJP, it is the most audacious bit of social engineering it has attempted in any state in the country. It is a measure of how high the stakes are that it has put Mandalite means before the symbolism of the mandir, with an unabashedly upper caste administration having to speak the language of its rivals.

�Good governance� as a slogan was fine but it is not a vote winner. The upper castes are not capable of putting the party back in office even if it mops up all their votes. The mandir card cannot be played in too brazen a manner as long as the BJP is part of a multi-hued coalition at the Centre. Much rests on the political impact of the new reservations policy in India�s most populous state. The test will be in how far it delivers the party from the downward slide it has been caught up in over the last two years. If it fails, much else will be at risk.



Too quiet a goodbye

Sir � Michael Atherton announced his retirement from first class cricket on a day that was in no way out of the ordinary for him or for any of us (�Atherton retires�, Aug 29). England had just lost another test match series against Australia and Atherton�s last test innings had been terminated by the indomitable Glenn McGrath. His announcement, similarly, held no surprises � it was brief and very matter of fact. But it was disappointing to find The Telegraph�s failure to realize the significance of the incident. With the retirement of the former England captain, an era has come to an end. His batting had much more to it than figures can ever show. He carried on the tradition of dour test match openers and excelled in the English art of hanging on in quiet desperation. Followers of the game will remember his resolute temperament even when he had his back against the wall. One would have hoped that the news of his retirement had been given more than the half a dozen lines it eventually got.

Yours faithfully,
N. Bhattacharya, via email

Safety costs

Sir � The minister for railways, Nitish Kumar, should be congratulated for taking a politically bold step by proposing to increase passenger fares across all categories. This will partially mobilize the resources for the Rs 15,000 crore rail safety fund (�Rail fare hike before Cabinet�, Aug 23). The funds will be utilized to upgrade railway tracks, bridges and signalling gear over the next six years.

But the lack of uniformity in the fare hike for all categories of passengers is most perturbing. While there has been a token increase of up to two rupees in the case of second class fares (both ordinary and mail or express), there is an increase of up to Rs 100 in the first class air-conditioned category. The rates also vary according to the distance travelled, whereby two broad slabs have been created � distance up to 500 kilometres and beyond 500 kilometres.

Over 13 million people travel daily by train. Seven million people out of this number travel on the suburban line. The majority of train passengers travel in the second class category. These passengers will pay a minimal safety tax, although the brunt of ensuring safety, whatever the cost, should be borne by all passengers. This is the first time since the 1999-2000 budget that there has been a hike in passenger fares. One still hopes that this step taken towards ensuring safe travel, in however skewed a manner, results in some improvement in the state of the railways.

Yours faithfully,
Parag Raja, Calcutta

Sir � The introduction of a safety surcharge by the Indian Railways is only going to place additional economic pressure on the people of the country. Although it is taken for granted that the railways should transport passengers and goods safely, in actuality it is a different picture. Despite a large number of accidents taking place and being reported, they are forgotten overnight. Instead of a safety surcharge being levied on passengers, the focus should be on the people operating the railways and on politicians.

The recent bridge collapse in Kerala in which hundreds died, the train disaster in West Bengal and the Brahmaputra Mail catching fire near Fatehpur are but a few accidents that have taken place this year. It would seem that these accidents occurred because of negligence on the part of railway employees. The most effective way to address this lack of safety is to focus on the employees.

Negligent workers should be severely punished. Employees should be promoted on a merit basis. As in the case of pilots and airline crew, special training and refresher courses should be arranged for them. A one-sided solution whereby the passengers are the only ones who bear the brunt of ensuring safe railway travel is completely illogical.

Yours faithfully,
B.S. Ganesh, Bangalore

Sir � The Indian Railways has finally raised the passenger fares and introduced a safety surcharge. According to the minister for railways, these steps should have been taken long back. Because of this fare hike and tax, passengers now have to fork out more money despite decreasing levels of comfort and safety. Delayed departures and arrivals, the shabby condition of passenger coaches, poor pantry service, robberies, unauthorized entry into reserved coaches are common features in most trains. As long as the railways offer good service, passenger fare hikes and safety surcharge are acceptable. But the appalling service and condition of most trains do not justify such fare hikes.

Yours faithfully,
Sanjay M. Padia, Calcutta

Up, up and away

Sir � According to the recent report, �3 times hike in MP pay and perks� (Aug 18), the Union government has decided to raise the salaries of members of parliament by three hundred per cent and provide them with additional perquisites. This will place an additional burden on the national exchequer to the tune of Rs 23 crore. Everyone knows that the majority of Lok Sabha MPs enjoy lavish lifestyles. Since they already have access to various perquisites, this pay hike is completely unnecessary.

The timing of the raise is also unfortunate. The country is currently going through an economic crisis. On the one hand, the Central government is trying to rescue the economy by pruning staff in government organizations and also by the reduction of postal and bank interest rates. On the other, it is raising the salaries and number of perquisites of MPs.

States like Orissa and Bihar are still suffering from floods and drought. Lakhs of people are homeless and in many areas of Orissa, people are dying of starvation. The government�s decision to raise MPs� salaries under these circumstances displays the callousness of both the ruling party as well as the MPs.

Yours faithfully,
Promatesh Chandra Bhattacharya,Orissa

Sir � The tax-free perquisites of MPs in 1969 used to be Rs 28,000 annually. Today it is over Rs 3 lakh. If the recent salary hike for them is to be undertaken, it should be adopted along with certain clauses. The MPs should be paid their daily allowance of Rs 500 only if they attend Parliament for the entire day, in light of the daily cost of Rs.75 lakh while the house is in session.

Further, each MP receives Rs 2 crore for the improvement of his or her constituency. Whether even half of this money is spent on the constituency is a matter of conjecture. The MPs should have to provide a detailed report on how this money has been used. If the MPs feel they deserve the salary hike they should also learn to be accountable for their actions.

Yours faithfully,
S.S. Bankeshwar, Thane

Parting shot

Sir � The report, �March debut for Santhali� (Aug 13), which stated that the Santhali language would be included in the Madhyamik syllabus is good news for the Santhali community. It is a welcome move that the Santhali student will be able to learn his mother tongue, which has been neglected for so long.

But the suggestion made by the member of the expert committee, Dhirendranath Baskey, regarding the printing of Santhali language books in the Bengali script is ludicrous. The phonetics of the Santhali language cannot be represented by Bengali letters as the former has certain peculiarities which are unique to it. I am surprised that a member of the expert committee, that too a person belonging to the Santhal community, could want to implement such a step.

Yours faithfully,
Sankar Murmu, Howrah

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