People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 51

December 19, 2010

The Spectrum of Big Business and Politics


Prakash Karat


THE winter session of parliament concluded without any business being conducted. The reason for this is the obstinate refusal of the UPA government to constitute a joint parliamentary committee (JPC) to enquire into the 2G Spectrum affair with all its ramifications.


The Comptroller and Auditor General’s (CAG’s) report has estimated a loss of Rs 1.76 lakh crore to the exchequer due to the way licences and spectrums were allotted by the telecom ministry under A Raja. This makes it the biggest corruption scandal involving the government since independence. Yet, the Congress leadership and the UPA government are not prepared to let parliament constitute a special enquiry committee into the matter.




The Congress led government has been struck by a series of corruption scandals in the past few months. The corruption associated with the Commonwealth Games (CWG) is equally startling. Yet the government seeks to minimise it by only focussing on the malpractices concerning the Organising Committee, which is only a small part of the misappropriation of public funds. The Adarsh housing scandal in Mumbai and the corruption associated with the export of rice to certain African countries during the first term of the UPA government are only some of the other examples of high level corruption.


It will be mistaken to view this spate of corruption as just a manifestation of the venality of certain politicians, or of some corporate or the other. The rot goes much deeper and it is systemic. Such corruption in high places is not a new phenomenon. It has been growing exponentially since the 1990s when liberalisation took off. Commenting on the nature of corruption in the era of liberalisation, I had written the following in People’s Democracy in March 2001:


“What is the difference between the nature of corruption before and after liberalisation? In the pre-liberalisation era, particularly till the mid-80s, the source of corruption at high levels stemmed from big business bribing to seek favours either for licences or for bypassing certain regulations. Such instances of corruption involved a particular big business house and the minister or officials concerned with a specific project or regulation. Now with liberalisation and deregulation, the entire policy itself is put up for sale. Both foreign and Indian big business houses are free to make the highest bid for policies for an entire industry. Such policies can be changed overnight, if the price is right. This has happened most blatantly in the case of the telecom sector and is continuing with the liberalised policies in the power, oil and other major sectors. In fact, every policy decision, or change in policy, in most of these sectors are being made based on the money which is handed out by the consortium of Indian big business and MNCs. Whole institutions and state agencies are suborned by big capital. India is fast reaching the level of Thailand, Philippines and Indonesia --- all countries which see the free play of MNCs and crony capitalism.”


The nexus of big business-politicians-bureaucrats emerged as a by-product of the neo-liberal regime. The first wave of corruption scandals came during the period of the Narasimha Rao government. The hawala scandal which involved top politicians of the bourgeois parties, the bank securities scam, the PSU disinvestment swindle, the petrol pump scam and others followed one after the other.


The telecom, mining and oil exploration policies were designed to benefit certain big business houses and select corporates. State policy has brazenly become an instrument in the process of accumulation of capital.




The Congress party is steeped in this corrupt nexus with big business. Nobody remembers that the chargesheet filed by the CBI in the JMM bribery case during the no-confidence motion moved in the Lok Sabha in August 1993 had listed the bribes handed over to the minister for petroleum, Satish Sharma, by the big business houses like the Ambanis, Essar, Videocon and others. Of course, all the accused were acquitted in the case eventually.


The BJP did not have much of a different record when it was in power. The favouritism to big business companies shown in the disinvestment policies of public sector companies, the telecom sector, the sale of petrol pumps and gas agencies and the corruption associated with defence deals were of the same pattern.  The BJP, more recently, set a new record by inducting the Bellary mining mafia into the government in Karnataka. The Yeduyarrappa government has become a byword for the land grab by the family members and relatives of the chief minister and other ministers.


For the bourgeoisie, it is convenient for corruption to be portrayed as a breach of ethical values and to treat it as a moral question. It is detached from its systemic roots. This is to camouflage the fact that crony capitalism and corruption are the twin hand maidens of the neo-liberal order.


The Radia tapes have graphically brought out the symbiotic relations between big business and the government. The cosy relationship between some editors and journalists and the agents of big business may have come as a shock to the middle classes, but it has come as no surprise for the Left which is systematically vilified by the corporate media. The bulk of the media, which is itself part of the corporate structure, is wilfully ignoring the fact how governments committed to the neo-liberal order function. Whether Dayanidhi Maran or A Raja should become the minister for telecom becomes an issue for rival corporates to intervene and influence. Even if no choice is made on this basis, the performance of the minister will be judged by how amenable he is to the interests of big business. One has only to recall how Manishankar Aiyer was replaced as the minister for petroleum & natural gas by Murli Deora in the first term of the UPA government.




The recent revelations have confirmed the hard truth. The prime minister presides over a cabinet in which some are advocates of certain business interests and some are businessmen themselves. A few are lawyers who have represented the very corporates with whom they have to deal with in the portfolios they look after. It is illegal money generated by the corrupt big business-politician-bureaucrat nexus that is flowing into the political system and perverting politics and democracy. There is a direct link between this corruption and the illegal money which is being used on a large scale in elections.


Fighting corruption, therefore, requires attacking the root of this evil which is the corrupt nexus. In the case of the 2G spectrum affair, not only the minister and the guilty officials but the corporates who suborned and bribed them should be brought to book and punished. The manner in which Kapil Sibal, who has taken charge of the telecom portfolio, is going about the matter raises suspicions that only some token actions would be taken. What is the need for an internal enquiry committee when already notice has been issued to 85 companies asking why their licences should not be cancelled? Why is the minister not categorical about declaring that licences will be cancelled of all those companies that have adopted illegal means? Why is the minister stating that auction of the spectrum may not be the best way forward?


In all this we are seeing the now familiar pattern --- a smokescreen to see that the main culprits, i.e. corporates, are let off the hook. The real reason why the government does not want a joint parliamentary committee is because such an enquiry will show how the entire system has been manipulated by the nexus which gets policies formulated and implemented for their benefit. The Political Resolution adopted by the Extended Meeting of the Central Committee had taken serious note of the dangerous phenomenon of the nexus between big business and politics. The Political Resolution said that “The party has to conduct a broad-based campaign against the influx of money power in politics and in elections, the growing subversion of public policy making by big business money power and expose those bourgeois parties which are utilising such methods.”


The fight against corruption and the neo-liberal policies that spawns them in a big way are interlinked. This has to be taken up in right earnest by all the Left and democratic forces.