Imagine yourself in a large joint family. The family members have differences, but live together as one. The family owns a huge jewellery shop full of precious ornaments and family treasures. To run the shop, the family appoints a manager and gives him full control.
In fact, the manager doesn’t even have to sell the ornaments. He can give the diamonds and pearls away to whomsoever he wants, as long as he can show some selection criteria, designed by the manager himself. He can play favourites and reject anyone he wants.
What do you think will happen? What will this manager, or in fact any manager, do?
He will clearly call his friends and family first and ensure they get enough precious gems. He will also bestow jewels to those who can return favours, cash or other gifts. Soon, the shop will be robbed blind and the family will suffer a huge loss.
Next, imagine the upset family fires the first manager and appoints another one. The rules are kept the same – to give the jewellery away for free at the manager’s discretion. Of course, over time, the other manager too fills the coffers of his friends and family.
One day the family learns from its auditor that it has lost a massive fortune. When the family members confront the current manager, he says the previous manager started it. The first manager blames the second for being greedier. The confused family listens to the tennis match-style debate as blame is passed from one manager to the other. Soon, the family members begin to take sides and bicker with each other. The managers continue to loot.
Sounds like a ridiculous story? Well, it is. But it’s also exactly what is happening in the coal scam. The large, divided-but-still-one family is we Indians. The jewellery shop is our vast reserves of coal. The managers are the BJP and the Congress, in no particular order.
The Comptroller and Auditor General only quantified the coal losses. The scam has been going on for decades. Similar scams exist with regard to other natural resources too. Given the high global commodities prices, these resources are of incredible value; they could transform the nation. The loss the nation suffers from misallocation of natural resour-ces is correspondingly huge.
The money involved is so large that it could plausibly control the politics of the country. Yet, we have allowed these resources to be distributed at the politicians’ discretion. We continue to watch their tennis-match politics. Congress or BJP, we think our favourite party can fix the problem. However, the problem is not party specific; it is with the rules of resource allocation.
Hence, one hopes the discussion on the coal scam quickly moves to the real issue – how do we ensure the nation’s natural resources, which belong to the people, are allocated in the fairest and most productive manner?
Auctions are one natural route. However, unlike spectrum, sometimes valuing a mine is not easy given the uncertainty of the reserves, end use and extraction rates. In such a case, a royalty share model may work better. Whatever it is, the best practices of the world must be followed. Commodity-rich democracies such as Australia have figured out how to develop the mining sector while not compromising on public interest. Surely we can do the same.
The political parties are managers of the nation’s assets, not owners. We, the citizens and the media, have to stop focussing on the ‘he did it, not me’ drama of the two political parties (both did it) and focus on the right solution for the future.
Of course, the parties have to change tactics too. Yes, politically speaking, throwing muck on the opponent makes sense. The BJP has played smart politics in the coal scam. However, it should know when to stop. The BJP too has exploited the rules.
Is the BJP willing to change itself? Is it ready to give up the major perk of being in power – the total control over valuable assets? The political opportu-nity now is no longer proving the Congress as a thief. It is to show that the BJP is willing to make a sacrifice for the sake of national interest.
The Congress also can take steps to rehabilitate itself a little. Firstly, recent coal allocations may need to be cancelled, or at least revalued. Yes, it is unfair to the many private players and investors who may have funded projects based on coal allocations. But if the Congress wants to save face, it needs to take its hand out of the cookie jar, now.
Second, it needs to present a new natural resource allocation policy to ensure this never happens again. Third, a simple one, it needs to be less defensive and arrogant. Being in power and being right are two separate things, each with their own importance.
Some Congress leaders, while clearly wrong, are so high on power they come across as extremely arrogant. To be haughty after making a mistake is the bigger mistake. It irritates voters. Power doesn’t mean the Cong-ressmen are not public servants. Humility, reason and, if possible, some ethics are what need to be on display.
The coal scam is not a soap opera. Let us all cut the drama, and come up with a solution. Whoever doesn’t might be digging their own deep pit mine in 2014.