Since 2G and coalgate reports of CAG, a lot of media reports, allegations, counter-allegations have flooded Indian media.

Indian media have traditionally acted as a spokesperson for others, without validating the truth of allegations, baseless or credible; or the defenses provided against those allegations – baseless or fundamentally solid.

Indian media thereby further adds-up with the multiplier-effect to the existing noisy-Indian democracy, making it noisier.

Howard Zinn, while examining one of the rarest failures of the US media on Iraq war, pointed out categorically and clearly the responsibility of the press, in informing the society ‘accurately’, by analyzing and exposing governments actions. He noted:

‘What about the press? What about the media? Isn’t it the job of the press, isn’t it the job of the media, isn’t it the job of journalism to expose what governments do? …Don’t journalists learn from I.F. Stone, who said, “Just remember two words,” he said to young people who were studying journalism, he said, “Just remember two words: governments lie”?’

A particular emphasis needs to be made on the last two words, which Indian press is yet to pick up.

However, Indian media has not cared to learn from it, barring a few, like, possibly The Hindu. So, when detractors shout at corruption or mismanagement of natural resources, they report it. When Government comes up with defenses like revenue maximization was not its objective (but what has been the objective then?), it again reports that.

In the meantime by reporting both verbatim, what Indian media forgets to ask both, is the fundamental point to any journalist, again noted by Prof. Zinn in same lecture: Isn’t this what you learn as a freshman in college? Hey, what are your sources? Where are your footnotes?’

They never ask the sources, the footnotes to both the parties. They never ask CAG why CAG feels that auction is the best way to manage natural resources, or the reverse of it for allotment on 1st-come-1st-basis to the Government. They never examine neutrally what  the priorities of the nation has been when the decision has been taken, and how could have the priorities suffered, had the auction route was taken up, as apparently, it is win-win-win for government, nation and also for the private enterprise having an interest in the natural resource. They never educate us how the natural resources are extracted in other nations – be in the US or in China? Do these nations allot natural resources based on 1st-come-1st-serve, or do they take the opportunity of revenue maximization, at the same time, managing the projects better by having higher and faster production/utilization from those natural resources?

They never tell us the best practices of managing natural resources.

The twelve precepts of natural resource management recommends:

  • ‘Successful natural resource management requires government accountability to an informed public’ (point 2, as it promotes transparency)
  • ‘Competition in the award of contracts and development rights can be an effective mechanism to secure value and integrity’ (point 4).

The recommendations of the Extractive Industries Transparency Initiative (EITI) echo similar voices. A couple of these points again deserves a mention:

  •    ‘We recognise that achievement of greater transparency must be set in the context of respect for contracts and laws.
  • We believe in the principle and practice of accountability by government to all citizens for the stewardship of revenue streams and public expenditure.’

And on implementation road-map, the first recommendation of The EITI is:

 ‘Regular publication of all material oil, gas and mining payments by companies to governments (“payments”) and all material revenues received by governments from oil, gas and mining companies (“revenues”) to a wide audience in a publicly accessible, comprehensive and comprehensible manner.’

Such an ‘all’ encompassing  payments to revenue receipt report for Government of India, from oil, gas and mining sectors, may exist in India; however, I have never seen a mention of that in any Indian media, or Government report. The emphasis is on the word ‘all’, and not selectively a few, without any systematic approach.

How should an average Indian interpret these allegations and their denials? Where are the opinions or analysis, with ample clarity and accuracy, with the footnotes, stating who is speaking the truth – and who probably is obfuscating the issue. Point to be remembered here is literacy level in India is not high, nor is education level of average Indians. In such a society, facing severe challenges from several quarters, press does not make it any easier for the common man in understanding the truth, or better to say, the more probable truth.

CAG or PMO – both are credible and constitutional offices. That does not mean whatever they say or do deserves to be treated to be accurate. As a citizen, I fail to comprehend fundamentally the PMO justification of coalgate that revenue maximization was not its goal. It simply does not make an iota of sense. Is there an inherent conflict of revenue/payment against faster production/utilization of that natural resource, if the country needed the 2nd more? Contrarily, when a private promoter pays for the asset at market rates, there is an urge to develop/exploit the asset (barring rare cases where asset valuation was so high that it made the industry itself sick), to get a return from that investment. What examples from which nations/sectors are Government of India citing while stating that revenue/payment from natural resources are against quicker production objectives?

It even is more sustainable, as owners would exploit it sensibly, protecting environment, and for the longer term exploit-ability of the asset. Even in cases where companies, under ‘irrational exuberance’ pay more for an asset, it eventually gets adjusted with price volatility of the market. And it always is a fundamental issue  in any business – as business risk.

A golden rule of subsidy is never to subsidize input costs. Today, government of India subsidizes fertilizer which is an input to food grains, consumed more by middle-class/rich (per-capita basis) than the poor. Government subsidizes diesel as an input cost of transportation where  per-capita consumption of this ‘transportation basket’ (or ‘diesel basket’) is more for economically well-off section than the underprivileged. Government subsidize coal for cheaper power when per-capita consumption of power for rich is much more than the poor (and what about industrial consumption?).

Government effectively subsidizes the section of well-off citizens, that should subsidize the poor, more than Government subsidizes the poor itself, at whose name all these subsidies run, on a per-capita basis.

After 64th year of independence, the country has been continuously engaged in gross mismanagement of natural resources, all with the objective to protect the poor, but fundamentally subsidizing well-off section more, on a per-capita basis.

It is time we get some clarity from Indian press, Government, policy-makers, Judiciary and constitutional bodies like CAG – both on management of natural resources and on subsidy. If Government is to be believed, each and all of their actions are meant to help the poor; but if the numbers on poverty in India is to be believed, the poor seldom get any of the whopping money spent on subsidies.

Facts are sacrosanct, opinions are free. The poverty figure in India speaks for itself.

Time to end this endless debate with clarity and accuracy, with some best practices as Standard Operating Practices, that the nation can follow for next few years until next best practices emerge. Taking umbrage under policy-making as the prerogative of government again proves futile as any government anywhere is accountable for its policies to its people all the time, and not only during the election time.

Prof. Ranjit Goswami works as the Director of School of Management of RK University. Opinion expressed in this article is personal. He invites you to visit his blog, Wondering Man (or take a look at his book, Wondering Man, Money & Go(l)d). You are also invited to join him on Twitter.

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