Why did the Manmohan Singh Government Allow Mallya to Swindle Public Funds?

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It is alleged by the ruling polity that the former Prime Minister Manmohan Singh in the UPA facilitated loans to Mallya after the latter allegedly wrote to Singh and former Finance Minister Chidambaram, in 2011, and 2013, for the defunct Kingfisher Airlines. The loan was facilitated from a consortium of banks. The banks do not have money lend from its own pockets – it is the liability that has to be repaid on demand by the income – the poor depositors. In spite of outstanding loans, Mallya was granted loans, again and again, as alleged. Mallya moved to Britain, in March 2016, by the time the group of banks initiated steps to recover nearly Rs. 9,000 crores on unpaid loans to the Kingfisher Airlines. Dr. Bhaskar points out that a well-dressed thief can get away swindling huge sums of public funds. In another instance, two autonomous bodies, Election (EC) and RBI have locked horns. All economic answers are political questions. However, now it seems that economics wins for the RBI it is alleged has rejected so far the request of the EC to enhance the withdrawal limit per week for the candidates. This columnist wonders if a level-playing field is possible in an unequal world, in the weekly column, exclusively for Different Truths.

It does not make much sense, who facilitated the liquor baron, Vijay Mallya? It makes sense if the allegation is levelled that he stole people’s money. Then the question comes to trial, proof, arrest, and all those. Imagine the fate of a petty thief – in the case of a pickpocket, in Calcutta, long back, the pickpocket would have been half-dead, in an uncivil manner, at the hands of people, on the roadside. The case of well-dressed thieves is, of course, different. It is alleged by the ruling polity that the former Prime Minister Manmohan Singh in the UPA government facilitated loans to Mallya after the latter allegedly wrote to Singh and former Finance Minister Chidambaram, in 2011, and 2013, for the defunct Kingfisher Airlines. The loan was facilitated from a consortium of banks. The banks do not have money lend from its own pockets – it is the liability that has to be repaid on demand by the income – the poor depositors. In spite of astronomical outstanding loans, Mallya was granted loans, again and again, as alleged.

Mallya moved to Britain, in March 2016, by the time the group of banks initiated steps to recover nearly Rs. 9,000 crores on unpaid loans to the Kingfisher Airlines. In the electronic media, Mallya is being shown with dirty naked lower part of his body. I have no interest in his body parts – what I am interested in is to bring back the money and spend it on poor people, who he dispossessed, allegedly supported by the peoples’ representatives. I am also not sure if the present government can set an example to stop other such alleged crooks and cronies from dispossessing the wealth of the nation. Also, I look forward to seeing that such persons do not represent us by being the members of prestigious bodies, like the Rajya Sabha, and then go into exile to live a second round life of affluence, in Britain.

Indian agencies have made several attempts to bring back the gentleman, who faces warrants in courts. He pleaded his innocence, reportedly asked for help, and instead got the loan repayable. Mallya thought to get aid interest-free. Now, he opines he is living in ‘forced exile’.

Who determines whom? Is it the self-claimed corporate leaders or is it the political power in collusion with these cronies? None of these will answer, for the answer lies with the people. Temporarily, the people are sleeping.

Contesting Autonomy: RBI vs. EC

As acknowledged both the Monetary Authority (RBI) and Election Conducting Authority (Election Commission) are autonomous with meaning best understood by the institutions as provided in the Constitution of India. In their respective domains, they play well or are expected to play well. But when it comes to intersecting domain with common space it becomes difficult to determine who plays better. One is money-related that is needed to conduct elections and the other is political processes itself. So again it is a political question that involves both economics and politics.

All economic answers are political questions. However, now it seems that economics wins for the RBI it is alleged has rejected so far the request of the EC to enhance the withdrawal limit per week. Or it may be the camouflaged power – real power lies elsewhere. The gossip in circulation is that the EC has asked the RBI to reconsider its decision to reject a request to increase the weekly cash withdrawal limit of candidates contesting the upcoming assembly polls. The EC asked the RBI on January 24 to raise the withdrawal limit of candidates to Rs 2 lakh from Rs. 24,000 a week imposed post-demonetisation to allow candidates to spend on their campaigns. It also asked if the facility could be extended till counting on March 11.

 

The EC has expressed serious concerns about the manner in which the withdrawal issue has been dealt with so far. It is the constitutional mandate of the EC to conduct free and fair elections and to provide a level-playing field to all candidates. It is reported that the RBI rejected the EC request.

The level-playing field is another serious issue – but it is beyond the section away from power to guarantee it. Power is gripped by those who hold the flag – nationally and internationally. So first prove it and then talk about level-playing… But when you are in power holding the special flag why should you go for level-playing.

So it is now the EC that has to decide the extent to which it can exercise its autonomy and ensure pledged level-playing field.

Is Level-playing Field Possible?

The term level-playing field is mostly used by those who are one step ahead in the Darwinian race. I have never heard anybody from the bottom half of India’s population pyramid, asking to ensure a level-playing field for reasons not very opaque. The institutional question, of course, is different. The institutions in India, as may be elsewhere, are for formulation and execution of laws that are supposed to be individual-neutral by birth.

My problem is, given the unequal power structure at the level of intra-nation and inter-nation, how can the level-playing field be ensured? Even with all the wings sharing power that is often non-comparable, the equality of power in execution is not possible. Who derives ultimate benefit in this game is not readily clear. And what is ultimate, is also not clear, for history does not start, as one wishes, at a particular point in time. It does not come to an end, as one wishes either.

The reason why I beat around the bush rather than going into the core of it is I do not know the core. I know ‘the bush’ – the recent one being the expression of the apparently autonomous Election Commission of India (EC) that wrote to the current Cabinet Secretary Sinha, as alleged, reminding him that steps taken during the election season can only be announced after consulting the poll watchdog (read EC). The EC referred to the elections in the five poll-bound states in India, namely, Punjab, Uttar Pradesh, Uttarakhand, Goa and Manipur. Earlier, the Apex Court declined to stay the presentation of the Budget for the argument that elections come and go throughout the year but Budget comes only once a year.

The EC, however, is in a mood to exercise its autonomy stating that in certain cases, the ministries/departments took decisions having an impact on the level playing field of poll-bound states. The EC is alleged to have stated that it was not consulted by the government on the presentation of the Union Budget. The matter was brought to the EC’s notice by the opposition parties, which urged the Commission to prevent the government from presenting it on February 1, just three days before the first phase of the elections, arguing that the government may announce populist measures to gain an unfair . The EC later cleared the Budget presentation on the condition that the government will not make any announcements specific to the poll-bound states. The Model Code of Conduct expects the party in power to not use its position to further its chances in elections. Hence, the government has to refer all decisions to the EC before implementing or announcing them during the election season.

Even if it is accepted for the sake of theoretical (academic) argument that the ruling authority says it follows the Model Code of Conduct or that it follows the recent dictum of the EC, who is there to arrest the government in case of any violation? Power reinforces power. The ruling authority may only play the game in a way different from what the EC has critiqued. In unequal power structure, there cannot exist any level-playing field. The EC knows it well.

©Dr. Bhaskar Majumder

Photos from the internet.

#RandomJotting #ElectionCommission #VijayMallya #ManmohanSingh #Economics #ReserveBankOfIndia #LevelPlayer #Bank #DifferentTruths

Prof. Bhaskar Majumder

Prof. Bhaskar Majumder

Prof. Bhaskar Majumder, an eminent economist, is the Professor of Economics at GB Pant Social Institute, . He was the Professor and Head of the Centre for Studies, Central University of Bihar, Patna. He has published nine books, 69 research papers, 32 chapters,15 review articles and was invited to lectures at premier institutes and universities over 50 times. He has 85 papers published in various seminars and conferences.
He also worked in research projects for Planning Commission (India), World Bank, ICSSR (GoI), NTPC, etc. A meritorious student, Bhaskar was the Visiting Scholar in MSH, Paris under Indo-French Cultural Exchange . He loves speed, football and radical ideology.
Prof. Bhaskar Majumder
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