ET Awards Agenda for Renewal: CEOs question Jairam, Sibal, Khurshid, ministers ask India Inc to look inward

After being at the receiving end of withering criticism and solicitous advice from Corporate India about how to run the country, the United Progressive Alliance government counter-attacked, accusing India Inc of championing its narrow self-interest. An influential troika of Cabinet ministers told business leaders at The Economic Times Awards for Corporate Excellence that the private sector is putting expediency first and has to introspect about its role.

The aggressive pushback on Saturday by Jairam Ramesh, Salman Khurshid and Kapil Sibal against corporate critiques of the government’s shortcomings included chastisement of industry for avoiding taking inconvenient positions on many important public issues.

“What I found very interesting about the Agenda for Renewal is the responsibility for renewal is external,” rural development minister Ramesh said, referring to an initiative by some of India’s top business executives to suggest specific steps that the government should take to revive business confidence and economic growth. The agenda was prepared under the auspices of The Economic Times and formed the theme of a discussion between the ministers and corporate leaders.

The awards ceremony was held in Mumbai, with finance minister Pranab Mukherjee as the chief guest. Some 350 chief executives from India’s most prominent business houses were present, among them Mukesh Ambani of Reliance Industries, Kumar Mangalam Birla of the Aditya Birla group, Sunil Mittal of Bharti and the Bajaj group’s Rahul Bajaj.

In his keynote address, Mukherjee said self-flagellation will serve no purpose and gave a call for united endeavour to solve the major problems facing the country. In that spirit, he urged opposition parties to put aside differences with the government and let Parliament function smoothly.

“If we go on expressing our sense of frustration, our sense of helplessness, no one will help us. We have to solve our problems,” he said.

Ramesh, on the other hand, was more blunt. He was particularly severe on corporates, saying there was nothing in the Agenda for Renewal about issues related to corporate governance or compliance with environmental laws and regulations.

“It does not talk about the responsibility of business to follow the rules of the game,” Ramesh said in reply to a question by ICICI Bank’s KV Kamath about the hurdles facing land acquisition and environmental clearances. “I would have expected a more balanced Agenda for Renewal to also look inward.”

Courts are Squeezing the Telecom Sector: Sibal

The track record of the private sector and government on land acquisition and rehabilitation has been “pretty pathetic”, he said, adding the proposed law will not please everybody.

“I am being attacked by The Economic Times for bringing forward a draft bill which (it says) is going to choke industry and urbanisation. I am being attacked by the progressives for opening the doors for industrialisation and urbanisation. So, obviously, something is right with the draft bill as both industry and the NGOs are totally unhappy.”

The UPA government, now in its eighth year of ruling India, has been roiled in recent months by a series of corruption scandals. While economic growth is slowing and the rate of inflation remains stubbornly high, the government has been accused of lacking the nerve to implement policies that will revive strong growth. But Sibal, the minister for communications and human resources development, rejected any notion of policy paralysis.

But he acknowledged that bureaucrats are sticking a little too fastidiously to the rule book for fear of inviting prosecution. Even so, decision-making in government, he said, is not as simple as it is in the corporate sector. “We are not the CEOs of this country. We are ordinary public servants who ultimately have to look at the multifarious aspirations of the people.”

Ramesh, too, was vehement that decisions are being taken, but the problem is, they were drowned out by noise. “Bad news is driving out the good news,” he said. Eschewing their normal politeness and tact, many corporate chieftains have been forthright in bringing up the subject of dysfunction in government.

The reluctance to openly criticise the government was overcome this year when a group of 14 eminent citizens, among them Wipro’s Azim Premji and Deepak Parekh of HDFC, wrote open letters to India’s leaders pointing out flaws in governance and urging immediate remedial steps. Premji again brought up the subject of lethargic decision-making last month and Mukesh Ambani said a few days ago in ET that the government must hasten reforms. The shedding of reserve was on full display on Saturday too. When telecom magnate Sunil Mittal asked the ministers if civil servants will be backed by politicians for the decisions they make, former environment minister Ramesh said politicians are being damned if they do and damned if they don’t.

When Mittal said he is concerned that growth is being sacrificed at the altar of revenue maximisation for the government, Sibal put the blame on the judiciary. “We do not want to squeeze the telecom sector. It is the courts which are squeezing the telecom sector.” But Sibal said writing letters to him or the prime minister is not good enough. “Private sector certainly writes letters to me and the prime minister but they do not stand up and say this is what the position should be.”

Khurshid, the law minister, chided industry for not being proactive enough to help decision-making by the government in an atmosphere where honest mistakes are a luxury. Ramesh, the man at the vanguard of the government’s counterattack, agreed with Adi Godrej’s suggestion that a list of all the State’s assets and liabilities must be published periodically.

However, he suggested that Indian industry has double standards when it comes to privatisation: wanting the government to sell shares in public sector firms while at the same time not wanting public sector financial entities such as LIC to sell shares in private companies. “There has been understandable reluctance on the part of Corporate India to take the privatisation of the private sector a little too far because they saw in the public sector financial institutions a bulwark against hostile takeovers.”