Narendra Modi and his fellow leaders of the Bharatiya Janata Party believe they are on a ten-year mission to turn India into a successful world power with a strong nationalist base. Today (Oct 19) they have put two more building blocks in place with state assembly election victories in Maharashtra and Haryana, where they have ousted Congress Party governments and reduced that party to a humiliating also-ran role.

They have not however done as well as they had hoped because they have not won overall control in Maharashtra. Nevertheless Modi, who was the BJP’s star campaigner in both states, has broadened his and the BJP’s base in the country, and will now be able to implement his message and new policies more easily in the two states. The results also potentially improve the BJP’s minority position in the indirectly elected Rajya Sabha (upper house of parliament), where the Congress Party and other opposition parties can currently block the government’s legislation.

In Haryana, adjacent to Delhi, the BJP has won outright control with 47 seats in the 90-seat assembly, compared with just four in the last election. It has ousted a Congress government that has been in power for ten years and was widely perceived to have facilitated corrupt land deals involving, among others, Robert Vadra, Sonia Gandhi’s businessman son-in-law. Congress won just 15 seats, down from 40.

photo 3-4In Maharashtra, the BJP (celebrating, left) has won 123 seats and is by far the biggest party, but needs support to establish a majority in the 288-seat assembly. Maharashtra has been run by Congress-led governments for 15 years, and the outgoing coalition with the Nationalist Congress Party (NCP) was riven with corrupt land and infrastructure deals that Prithviraj Chavan, who was shipped in as chief minister by Sonia Gandhi four years ago to clean up the government, has admitted he was unable to stop.

In an attempt to remain politically relevant (and maybe seek protection from corruption inquiries), the NCP has offered the BJP the support of its 41 assembly members. The Shiv Sena, a state-based chauvinist and often violent party which has 63 seats and has been a BJP ally for 25 years, is however a more natural supporter despite sharp clashes during the election campaign.

There will be some debate about whether the BJP’s failure to win outright in Maharashtra marks a gradual dwindling of the popular wave that swept Modi to power nationally in May, though the BJP line is that the wave has become “a tsunami”. He campaigned extensively in the state, but could not sufficiently reduce the grip of the Shiv Sena, which is renowned for its street-level gangs and clout, nor of the moneyed NCP, whose leaders include Sharad Pawar, a veteran national and regional politician, his nephew who faces corruption investigations, and Praful Patel, a rich businessman who was a controversial aviation minister in the last Congress government.

The main loser is the image and clout of the Congress Party, led by Sonia and Rahul Gandhi. They made tactical mistakes in both states and must have expected defeat because they made fewer than 20 appearances during the campaigns. That compares with a total of over 70 meetings addressed by Modi and Amit Shah, the powerful BJP president. Congress came third in Maharashtra after the BJP and Shiv Sena and with almost the same number of seats as the NCP. In Haryana, it came third behind not just the BJP but also the local-based Indian National Lok Dal, whose former leader and chief minister, Om Prakash Chautala, is in jail for corruption.

This indicates a devastatingly declining role around the country, which there is no sign of Congress leaders doing much to reverse in the short term, despite criticism and dissension in many states and disagreements between Rahul’s 30-40-something generation and  older politicians about the way forward. Rahul is making occasional forays to individual states to rebuild the party with democratically elected local young officials – he was in Punjab last week. This is a very long-term task and seems, on present reckoning. to be unlikely to interrupt Modi’s 10-year prime ministerial dream and expanding role in state elections.

243955-prakash-javadekar-03Modi’s brand of personal showmanship and nationalism is currently winning, coupled with skilful election campaign management, but he now has to meet people’s aspirations with economic success and improved government administration and performance by public officials.

Yesterday the government introduced significant long-delayed economic reforms when it de-controlled diesel prices, ending subsidies, and raised natural gas prices.

Prakash Javadekar, (left)  minister for information and the environment, says that it is not just the much-discussed new middle class that is aspirational, but also the poor. “They don’t want to remain poor but to succeed through hard work and dignity,” said Javadekar on a visit to the Foreign Correspondents’ Club in Delhi two days ago. Modi, he said, reflected those aspirations as a prime minister who could deliver, was honest, kept promises and provided good governance. “This is the new reality of India”, he added.

The messages of hard work and dignity rhyme with the broader nationalism preached by the BJP and by the RSS, its arch Hindu-nationalist mother organisation, whose activists have a simple view of a strong India that is respected worldwide as a modern version of an ancient Hindu civilisation. It is this vision that drives Modi and his ministers, raising the question of how much they will disturb India’s broad-based traditions that have been built up since independence by Congress governments to embrace Muslims and other minorities.

For now, such issues do not worry most voters who are more concerned with the price of food, the availability of jobs, and the overall well-being of their families. The Gandhis and their Congress Party failed to satisfy these ambitions, so Modi has a chance to show he can do better.

Tyeb BluePainting Sotheby's London Oct '14Two trends emerged from Sotheby’s auction of contemporary and modern India art in London on October 7, which achieved sales totalling £4.7m ($7.6m, Rs46.3 crore).

The top lot was Tyeb Mehta’s notable Blue Painting (left) with a bid of £930,000 (£1.12m, $1.8m including buyers’ premium), which was 50% above the lowest estimate.

The first trend is that, in the current highly selective and uncertain market, freshness plus provenance produce good auction prices for India’s established modern masters and earlier works that have not been trailing round the auction circuit and that have the cachet of being part of recognised collections.

These criteria produced astonishing prices for Kalighat paintings and also for other works including the Tyeb Mehta, though 24 of the 99 lots failed to reach their minimum sale price.

Subodh Gupta trolleyThe second trend is that the slump in prices for contemporary works that were fashionable a few years ago is worsening.

An oil on canvas painting of an airport luggage trolley (left) by Delhi-based Subodh Gupta went for just £116,500 ($187,000) including buyers’ premium. That was just above the top estimate but, allowing for inflation, it was far less than 10% of a record $1.2m achieved for a similar work in the heady days of 2008. It was also far less than a $250,000 sale in 2010 immediately after the initial crash. Gupta is more famous for his installations of shiny pots and pans. Two paintings by his wife, Bharti Kher, failed to find buyers this week.

Set of four KalighatsThe most remarkable prices came for four sets of Kalighat watercolours (right) on paper that originated with Bengal village painters who sat in the 1800s outside a Kali temple in Calcutta producing works for pilgrims. These works were collected by famous art historians and writers, William and Mildred Archer.

William Archer was head of the Indian department at the V&A museum in London 60 years ago, and the works (mostly around 17in x 10in) were found and brought to Sotheby’s by his son. Estimated at around £1,000-£1,500 a painting they were all bought by the same bidder for hammer prices of £6,000 to £8,000 each (plus 25% buyers’ premium).

There were good examples in this auction of works by members of the Bombay Progressives Group of the artists from the 1940s and 1950s, including F.N.Souza, M.H.Husain, S.H.Raza, Ram Kumar and Tyeb Mehta, though some works by all of them apart from Mehta did not sell, mainly because they did not pass the freshness test.

The star success after the Blue Painting was Akbar Padamsee’s oil on board, Prophet I, (below) which fetched a hammer price nearly three-times the low estimate at £440,000 (£530,500 including buyers’ premium). Painted in 1952 when Padamsee was establishing himself in Paris along with Souza and Husain, this work was the first of his famous Prophet series. The work was sold in 1968 by its first owner to a collector in Brazil, so it has been out of circulation over 45 years and was one of several works in the auction from the same collector.

The 45in x 35in Tyeb Mehta Blue Painting was acquired in 1992-93 by Masanori Fukuoka, a Japanese dealer and collector of Indian works that are kept in his Glenbarra museum in Japan.

Padamsee Prophet 1The auction was one of three this week staged in London for the first time by Sotheby’s as an Indian and Islamic Week, which together netted £13m. This breaks the pattern of past years, when Sotheby’s has held its annual London auction in June at the same time as Christie’s, it’s main rival and the leader in the market.

An Art of Imperial India auction netted £1.78m and included an impressive collection of 31 albums of over 2,000 mid-late 1800s photographs from the collection of Sven Gahlin, an Indian art historian. Apart from eight individual photographs exhibited in London in 1983, none of the albums had been seen in public for over 40 years. There was also a collection of Indian miniatures from the Duke of Northumberland’s collection. An Arts of the Islamic World auction netted £6.59m.

The modern art auction was in line, among others, with two successes. One staged by Saffronart Art in Delhi last month which netted $6.38m (Rs38.27 crore) and one by Christies in Mumbai last December – its first in India – which produced an astonishing $15.45m (Rs96.5 crore). The next one to watch will be Christie’s return to Mumbai this December.

Posted by: John Elliott | October 3, 2014

Modi wows the US and sweeps the streets – now for the hard part

Just back from a tumultuous five-day visit to the US, Narendra Modi yesterday launched his Swacch Bharat Abhiyan (Clean India Movement) by sweeping up rubbish in Valmiki Basti, a Delhi neighbourhood where Mahatma Gandhi, once stayed. It was the father of the nation’s birth anniversary, and a public holiday at the beginning of the long festival weekend of Dussehra that celebrates the triumph of good over evil.

INDIA-POLITICS-SANITATION-ENVIRONMENT-HEALTHIn his first radio broadcast to the nation this morning, marking Dussehra, Modi asked people to “pledge to remove dirt from our lives”. He ordered thousands of bureaucrats to go to work and clean their offices in a drive that started a week ago, and the Delhi symbolic street sweeping was repeated in other state capitals where the Bharatiya Janata Party is in power.

After four months as prime minister, Modi is emerging as a motivated hands-on politician, who leads by example and expects others to do the same. He is beginning to strike chords with the mass of Indians who respect his and the BJP’s nationalism, which was echoed this morning in a annual Dussehra speech (controversially shown live on state television and some other channels for the first time) by Mohan Bhagwat, leader of the RSS, the BJP’s arch Hindu fundamentalist parent organisation. Modi and Bhagwat called on people to follow the simple life style of Mahatma Gandhi, and Bhagwat even asked them to boycott goods from China, apparently because of the two countries’ border confrontations.

Modi also sticks to his beliefs, refusing food at banquets during his successful US visit because he always fasts for nine days of the Navratri festival running up to Dussehra.

India is becoming accustomed to his symbolic gestures that began with South Asian leaders being invited to his swearing in, and continued with him playing drums when he was in Japan, taking China’s president Xi Jinping to his home state of Gujarat for a festive evening, and last weekend addressing huge crowds in New York’s Central Park and (photo below) in Madison Square Gardens.

He has established himself as a tough politician who expects ministers and bureaucrats to turn up for work on time, actually take decisions, and keep files moving, so that policies are turned into action. He has shown the world he can be a friendly politician as well as a capable orator. Clearly a man on a mission to make India work, he also wants to make the world realise it is happening – something he seems to have achieved with President Obama earlier this week in Washington.

Now he needs to spend time in his grand Prime Minister’s Office in Delhi and turn all the symbolism and gestures into action.

But he won’t be doing that yet because tomorrow he is off to Haryana and Maharashtra to campaign for the BJP in state assembly elections due on October 15. The party needs to win those states from the Congress Party, partly to strengthen Modi’s ability to implement policies at state level, and partly because the BJP needs to build up its minority position in the Rajya Sabha, which is elected through state-level electoral colleges. Modi also needs to ensure that the BJP’s embarrassing defeats last month in various state assembly by-elections do not turn into a trend – and he wants to prove that he is still the party’s primary vote winner.

Modi Madison SqWhen he is back in Delhi after the political campaigning, Modi faces mounting problems. The most serious is that too many top ministers are in charge of several ministries, especially Arun Jaitley, the finance, defence, and company affairs minister, who is a diabetic and is in hospital with a chest infection after a stomach operation. Jaitley is the most important, and also the most experienced and probably the most capable, minister in the government. Doctors have said he might be home this weekend, but his load needs to be lightened.

Some commentators have been calling for Modi to introduce economic reforms that would catch headlines, but India does not need reforms so much as implementation of existing policies.

The clean India campaign, which expands on work done by the last Congress-led government, needs to be driven beyond yesterday’s symbolism. The task is huge in a nation that dumps rubbish in the streets, where a third of garbage is never collected, and 70% of rural homes have no access to toilets. Traditionally, cleaning is regarded as something best left to the lowest castes.

A new Make in India manufacturing policy needs political and bureaucratic leadership to reduce blockages that impede investment at all levels. Among many other examples, the highway building programme needs to be actively revived, the railway system needs to be modernised, and care needs to be taken in revising environmental laws and regulations so that infrastructure projects are speeded up without seriously harming India’s natural heritage. Dreadful educational and health facilities also need to be improved in hundreds of thousands of villages and urban areas.

Governments everywhere love to go for high profile and fine sounding projects such as industrial corridors, special economic zones, smart cities, and bullet trains. Such long-term vision is of course necessary, but none of these projects, which Modi has been promoting, will help him to fulfil, by the time of the next general election, his pledges in this year’s election campaign to get India moving again. To do that, he and his ministers and top bureaucrats have to focus on the hard slog of unblocking bureaucratic lethargy and corruption, simplifying laws, and speeding up implementation.

Not a ‘pain in the ass’

Modi attracts a lot of brickbats from observers who find it hard to come to terms with his rise and international success. Pankaj Mishra, an Indian writer who has a following for views aired from his vantage point in the UK, scathingly wrote after Modi’s flamboyant success in the US that “India desperately needs a vision other than that of the vain small man trying to impress the big men with his self-improvised rules of the game”.

The former Mumbai correspondent of The Economist, who is now posted in New York, managed to work “pain in the ass” into his blog report on Modi at Madison Square Garden, which mocked the Indian-origin audience saying the people were “willing themselves into the kind of obedient hysteria they were meant to have left behind generations ago in the badlands of Asia, along with hunger and snakes”.

The magazine responded to complaints by issuing a statement saying: “The Economist does not consider Mr Modi to be a ‘pain in the ass’ ”. The epithet had merely been “how we imagined an uninformed New Yorker might feel about someone who causes a traffic jam” – which Modi had done as the 18,000-strong audience flocked to see him. That was especially embarrassing for the magazine because it had amazingly backed Rahul Gandhi to become prime minister in the general election since it could not bring itself to be identified with Modi.

There are many people waiting for Modi to fail to deliver on the dreams and visions of a successful India that he spun during his presidential-style general election campaign. Obama belted out “Yes we can” from his election platforms and, many would say, failed to deliver. Modi added, “Yes we will do” – now he needs to turn the oratory into practice.

India yesterday became the first country in the world successfully to complete a space mission to Mars on the first attempt, beating China, which does not yet have a craft in orbit around the planet. It also beat Russia and the US which did not succeed first time, and its cost was only Rs450 crore spent over three years ($74m) compared with the US spending $679m over six years.

photo 1-2Today Narendra Modi, the prime minister launched his “Make in India” campaign at a televised jamboree in Delhi. This is aimed at persuading both foreign and Indian companies to invest in India and thus boost both its unsuccessful manufacturing industry and its exports. Twenty-five sectors have been identified  for social focus.

Abandoning the usual comparison between India as a lumbering elephant and China as a prowling tiger, Modi has chosen a lion (made of engineering cogs) as the logo of the campaign, presumably because his home state of Gujarat is home to India’s only lions.

With these two events, one might think that all is beginning to come right for a country that has lost its way economically in recent years. The timing is good. Modi is about to leave for what promises to be a spectacular five-day visit to the US where he will try to persuade investors and politicians – and world leaders at the United Nations – that India is bring back on track

Sadly it is not so. Just as Mangalyaan, (Mars-craft in Hindi) was entering the Mars orbit, three judges in India’s supreme court cancelled, with effect from March next year, 214 of the 218 coal mining licences that have been issued without open tendering between 1993 and 2011. This endangers India’s power generation industry, its steelworks and other industries, as well as adding to foreign investors serious worries about the risks and uncertainty of doing business here.

All these events link up to illustrate why India’s fudge and fix-it approach policy making and governance, known as jugaad, coupled with a belief that everything will work out ok (chalta hai) have whittled away at the country’s institutions and economic performance to such an extent that Modi won a landslide general election victory four months ago because voters believed he could restore India to its rightful place in the world.

Even though it fails in many industrial areas, India is a world leader in space and rocket technology, manufacturing, and delivery, mainly because the US and other countries stopped it being able to import high technology after its nuclear weapon tests in 1974 and 1998.

This meant that India was on its own so, capitalising on work initiated shortly after independence in 1947 by prime minister Jawaharlal Nehru, scientists and private sector companies produced a series of successes that culminated in yesterday’s Mars achievement. Two companies that have done pioneering work for decades, the Godrej group and Larsen & Toubro, contributed to the Mars mission, as did many smaller companies that have innovated and developed high technology over the years.

photo 5-1The development speed and the  low cost of the Mars probe illustrates how Indian industry is capable of developing the negative skills of jugaad into frugal engineering where the best is made of limited resources at minimal cost.

Contrast that with India’s defence industry, where there has been no ban on imports and where US and other foreign companies have connived with the defence establishment to such an extent that as much as 70% of India’s defence orders have to be bought from abroad – even night vision goggles, radars and guns as well as helicopters, other aircraft, ships and missiles have not generally been manufactured in India to satisfactory standards.

This bureaucratic throttlehold on the growth of manufacturing industry stretches far beyond the defence industries, and Modi’s hopes of reviving the industry will not succeed unless he stops bureaucrats working with foreign suppliers to boost imports at the cost of local companies.

Judicial activism

Governments till now have failed to tackle these and many other failing in the way India works, which has led to an escalation of “judicial activism” that began over 30 years ago, where courts take it on themselves to order governments and other authorities what to do. Initiatives have ranged from protecting bonded labour and enforcing environmental regulations, to ordering Delhi’s buses to be powered by compressed natural gas, and even recently challenging the government’s tardiness in appointing an official leader of the opposition in parliament

This has progressively upset the balance between the executive and the judiciary as the machinery of government has begun to implode, but yesterday’s mining judgment is probably the most damaging and irrational of edicts. It follows a similar but less economically damaging ruling two years ago that cancelled mostly corrupt telecommunications licenses. It stems from a coal scandal during the time of the last government when coal licenses were handed out without proper controls to a wide range of companies in order to speed up coal-fired power generation. But many companies simply sat on the assets and did not start mining, which led to the Supreme Court action.

It would have been understandable if the judges had cancelled licenses where coal mining had not been started, but it has acted retrospectively on 21 years of licenses and is also fining companies Rs 295 per tonne of coal mined. That money will go to the government which now has six months to reorganize the industry and the inefficient Coal India to try to fill the gaps.

The judges no doubt felt they were doing their legal duty, and it is of course the failings of successive governments that have led the supreme court to intervene to such a degree. And it will no doubt continue to do so until the government gets a grip on affairs that it should be running.

Posted by: John Elliott | September 18, 2014

India and China agree deals despite border face-off

modi-xi-swing1 - IndianExpressIndia and China’s leaders have today successfully agreed in Delhi on plans for economic and other co-operation despite over 1,000 troops from each side facing off against each other in Ladakh on the two countries’ disputed border, known as the Line of Actual Control (LAC), 15,000ft up in the Himalayan mountains,

China is to invest $20bn in Indian infrastructure projects over five years, and eight agreements and memorandums of understanding were signed on subjects ranging from China modernising Indian railways and building industrial parks to twinning the commercial capitals of Mumbai and Shanghai and Ahmedabad in Gujarat with Guangzhou in the Chinese province of Guangdong. A five-year economic and trade development plan was also agreed.

The visit was supposed to have been full of friendliness and co-operation. The day that China’s president Xi Jinping arrived was prime minister Narendra Modi’s 64th birthday, and Modi celebrated it by proudly hosting Xi to a carefully choreographed afternoon and evening of serenading and dining (with 150 vegetarian dishes) on the waterfront of the Sabarmati River in Ahmedabad, the biggest city in Gujarat where he was chief minister.

The chemistry between the two leaders, who had previously bonded at a BRICS summit July, was good and Modi’s eyes twinkled when he spoke to Peng Liyuan, Xi’s wife, who is a famous folk singer and former soldier. Later in the visit, Peng got widespread media coverage for relaxed informal meetings with school children

Modi-Xi2 -Peng - PTI - Indian Express

But Modi’s birthday was spoiled not only by Chinese troops massing on the border, which threatened to upset the mood, but also by bad by-election results announced the day before when the Bharatiya Janata Party lost significant regional assembly seats.

Confrontations happen frequently on the LAC, mainly stemming from the fact that the line of the current border is not demarcated. A similar confrontation built up just before China’s prime minister visited India last year, but that was solved before he arrived. This time, there have been at least two confrontations and they increased even after Xi had arrived, without Chinese troops withdrawing. While it seems unlikely that Xi personally ordered the Chinese troops to cross what India regards as the border, there is speculation that the People’s Liberation Army decided to flex its muscles and test India’s reaction – and Xi may not have been in a position to stop it. If that is correct, it underlines the PLA’s growing independence.

modi-xi umbrella - Indian ExpressModi had promised before he became prime minister to take a tougher line over border incidents with China and Pakistan, and it seems that India has reacted more aggressively than it has done in the past by moving troops rapidly to the LAC to match and even exceed the number of Chinese troops. He also, inevitably, complained about the Chinese troop activity during talks with Xi both in Ahmedabad and Delhi.

In a prepared media statement after the talks, Modi voiced India’s “serious concern over repeated incidents along the border”, and said peace on the border was essential for “mutual trust and confidence and for realizing the full potential” of the relationship.

“This is an important understanding, which should be strictly observed,” said Modi, using tougher language than is usual. He also suggested reducing the risk of confrontations by demarcating where the existing border runs, while leaving (though Modi did not spell this out) the dispute over a permanent settlement till later.

Xi was the first Chinese president to visit India since 2006 and he sounded constructive in his remarks, though he used the words always deployed by China that the border dispute is something “left over by history”.

Modi saw Xi’s visit as an opportunity to attract China’s capital and technology to help modernise India’s infrastructure and industry. It follows a similar exercise when he visited Japan three weeks ago and obtained investment pledges, and then met the Australian prime minister in Delhi. This is in line with Modi’s pro-active approach to diplomacy, which he will continue in the US at the end of this month. He wants to develop foreign policy far more pro-actively than has done in the past in order to harness other countries’ help in accelerating India’s under-performing economy and industry.

The $20bn figure is much lower than rumours of an unrealistically high figure of $100bn, but it is a massive increase on the $400m that China has invested in the past ten years. The figure offered by Japan was $35bn and the challenge for Modi now is to speed up India’s slow-moving bureaucracy and project approval system to absorb such big investments. There is also serious concern in India about the poor quality of some Chinese power project equipment which, it appears, was not mentioned in the talks.

umb--621x414 - Mint

Xi arrived in India from Sri Lanka and the Maldives where he had been increasing China’s involvement in what used to be seen as a region of India-influence. He unveiled new infrastructure projects in both countries, and talked about them having a role in reviving an “ancient maritime silk road” of trading posts that led to China. In Sri Lanka he inaugurated a China-funded $1.5bn port development in the capital, Colombo, which is billed as the island’s biggest ever foreign investment project. Xi was also to have gone to Pakistan, a long-term China ally, but cancelled to visit because of he political unrest in the capital, Islamabad.

The BJP losses came in by-elections for state assemblies in eight states and followed other less significant defeats in recent weeks. This week’s results were significant because they involved the key northern state of Uttar Pradesh, where the BJP did spectacularly well in the general election but lost eight out of 11 seats to the regional Samajwadi Party. In Modi’s home state of Gujarat, it was defeated by the Congress Party in three out of nine seats.

These results may show some disenchantment with Modi’s national government for not tackling basic problems such as prices. But more importantly they seem to show voters in UP turning against divisive Hindu nationalist anti-Muslim rhetoric orchestrated by Amit Shah, a Modi confidante who has been controversially installed as the party’s national president. It is also significant that Modi was not personally active in the by-election campaigns, which underlines the point that the general election result was more a vote for him personally than for the BJP.

It hasn’t taken much to lift the gloom of Delhi’s elite. Three good months of economic growth plus a booming stock market were capped last night when India’s modern art market came alive with sales totalling Rs38.27 crore ($6.38m) at an auction mounted by Saffronart of Mumbai. Only four of ninety works on offer had to be withdrawn after failing to meet their reserve prices, which is far less than usual in Indian art auctions.

SHRaza SfrnArt Sept '14The Rs38.27 price was just above the total higher estimates for the works, and nearly 50% above the Rs25.74 lower estimates.

The top sale was La Terre (left), a 50in x 29in acrylic on canvas by S.H.Raza, one of India’s leading elderly masters. It sold at a hammer price that matched the top estimate of Rs7 crore hammer price – Rs8.17 crore ($1.31m) including buyer’s premium. A rather dark and gloomy oil on canvas by Jehangir Sabavala titled Flight in Egypt 1 tripled its estimates to sell (including premium) for the artist’s world record price of Rs3 crore ($500,000).

The power elite, as they are known in this city, are supposed to be in the depths of despair now that Narendra Modi has burst into Delhi as prime minister of the new Bharatiya Janata Party, shattering the self-confidence, power and patronage of political and social circles who have swirled around the Nehru-Gandhi led Congress Party for years if not decades.

Tyeb Mehta SfrnArt Sept '14

But last night, many of them were at the Saffronart evening auction in Delhi’s smart Oberoi Hotel as buyers as well as spectators. Unlike such events in the UK and US, drink and snacks were served during the sale in a large room alongside the auction ballroom, and refreshments were brought into the hall for select high-rollers.

The party mood continued after the auction, which was the most successful since Christie’s of London held its first ever auction in India last December in Mumbai with sales totalling Rs96.5 crore ($15.45m).

The next big events on the India art scene are the annual auctions in New York later this month, and then there is an India Week with three auctions being staged in London by Sotheby’s at the beginning of next month. Sotheby’s will span five centuries from Mughal miniatures and the art and rare photographs of imperial India (some lost or hidden for many years) to modern and contemporary works.

Tyeb BluePainting Sotheby's London Oct '14The ‘modern’ highlight will be Blue Painting, (left) a 45in x 35in oil on canvas painted by Tyeb Mehta in 1982, which is being sold by Masanori Fukuoka, a leading Japanese collector, and was unveiled in Delhi two days ago.

A much earlier and unusual small 13in x 7.5in Tyeb Mehta gouache on paper (above), dating from 1954, went last night for a hammer price of Rs82 lakhs, which was more than five times the estimates ($165,000 including buyers’ premium).

The event was the first live auction held in Delhi by Saffronart that has been pioneering on-line auctions for twelve years. It was also the first big auction staged in the city by professional specialists for several years. Only works by moderns such as Raza, M.F.Husain, F.N.Souza and others were included, and there were none in the contemporary category where prices remain low after a slump a few years ago.

ManjitBawa SfrnArt Sept '14All this helped to draw a far wider selection of Delhi’s collectors than many smaller auctions, most of which fail to create a buzz, and then finish with a considerable number of unsold works. Last week less than half the works on offer were sold at an auction (partly to raise funds for a charity) by the Delhi Art Gallery, which has a vast collections and is an active buyer and seller.

A measure of the buzz last night was shown when a small rather evocative 11in x 15in Manjit Bawa pencil and pastel on paper (above) fetched a hammer price of Rs25 lakhs ($41,000), triple the estimates, and also triple the price paid for a very similar work at the Delhi Art Gallery sale.

“People were excited and old collectors came out, with people wanting to feel the market and buy,” says Dinesh Vazarani, Saffronart’s co-founder, and the auctioneer. The question now is how long that will last – the auctions in New York and then at Sotheby’s in London will provide some of the answer.

Posted by: John Elliott | August 31, 2014

Narendra Modi kick starts government in his first 100 days 

Modi Japan rtr44dh7Narendra Modi’s Bharatiya Janata government is now celebrating its first 100 days in power. Modi is now in Japan on his first big international visit as the guest of prime minister Shinzo Abe, who has given him an effusively warm personal welcome reflecting their rapport (left).

Two days ago it was announced that economic growth reached 5.7% for the three months to June, the highest for two years, and a big financial inclusion scheme to open bank accounts for millions of the poor has just been launched. A raft of defence contracts and tenders have been decided, with more Indian private sector involvement than has been allowed before.

This shows that the government is now moving into an action phase, though the economic growth of course was generated before the general election.

There is widely reported gossip about rifts among BJP leaders, and there are also concerns about the BJP’s right wing and its ideological partners pushing a nationalist agenda. This has surfaced most damagingly with suggestions that all Indians are Hindus, which marginalises the identity of minorities, notably Muslims but also others including Christians. Such suggestions do not fit with Modi’s current economic-oriented agenda, though he probably has to allow the right some slack to keep them content.

photo 2-2

There will be a price to pay for the newly energised growth-oriented government that Modi is running. “Dirty growth is inevitable,” a leading Delhi columnist adamantly said to me the other day. Rules restricting coal mining in forest areas are expected to be watered down soon, along with the powers of a National Green Tribunal. The government has also avoided appointing the authorised number of independent members to the National Wildlife Board, though that is being questioned by the Supreme Court. Such developments will gradually unpick environmental protection moves started by the Congress government.

Modi‘s approach is to solve problems and implement decisions, unlike the Nehru-Gandhi dynasty’s leadership of the Congress Party that not only let growth drop by half from its peak of 9-10% in the last five years, but also failed to reduce the official poverty level below 30% in the 67 years since independence when it was mostly in power. The dynasty believed in modulating the impact of social issues rather than solving them, and Rahul Gandhi, the fading heir to the party leadership, even said to friends that, to stay in power, Congress should focus on aid schemes not economic reforms. Modi will continue with schemes, but he will also go for growth and for cleaning up the way that the government functions, including reducing corruption.

De Gaulle or Putin?

Commentators have likened him to Charles de Gaulle, Margaret Thatcher and Vladimir Putin – all autocrats who wreaked change in democracies (albeit a managed one in Russia), plus Jawaharlal Nehru who set India on its independent path in 1947. He has also been compared by one writer to Deng Xiaoping and Lee Kuan Yew, who managed development and social cohesion in China and Singapore.

Such a range of impressive comparisons illustrates the burden that Modi heaped on himself with his presidential style general election campaign, when he made himself the reason to vote BJP, not the party itself. He is an autocrat and is showing not only that he is in charge, but that his ministers and top bureaucrats – who have started working a full day from 9am till into the evening for the first time in years – are watched and monitored.

There have been often-repeated stories in the media about a minister, who was dining in a hotel with a top industrialist, receiving a phone call from Modi who showed he knew the name of the industrialist. Another minister on his way to an international airport in jeans was called and told to go home and smarten up. The names of the cities, hotel, and people change with the repeated-telling, but one story that has caused rifts is Modi allegedly cautioning the son of Rajnath Singh, the former BJP president and now home minister, for talking a bribe. I’ve also heard a story about intelligence officers manning corridors in at least one ministry, watching who visits ministers and officials.

The image of absolute authority was also shown by the way that plans for India’s and Pakistan’s foreign secretaries to meet were suddenly cancelled two weeks ago, and by the sudden cancelling of India’s pledged support (given by the last government) for a World Trade Organisation agreement on trade facilitation. In neither case did Modi seem to care who he was upsetting – including the US and other parties to the WTO agreement.

photo 5

The India-Pakistan move has potentially re-set the terms for talks between the two countries because India is saying that they are strictly bilateral matter and should exclude Kashmir-based separatist organisations that Pakistan has talked to in the past. The message here is that Modi is in favour of improving economic and other links with India’s destabilised neighbour, but not having talks that get nowhere.

Modi’s visit to Japan – which follows his earlier regional trips to Bhutan and Nepal – is focussed on establishing a new bilateral relationship that will lead to deals covering nuclear power equipment, infrastructure investment, education, modern city planning, and defence and other manufacturing. A strategic bond is also being developed to offset the regional ambitions of China. Later in September, Modi will develop his approach to foreign policy when he meets China’s president in Delhi and the Barack Obama in Washington.

It is now clear that Modi will have a significant impact on the way that the central government works, indeed he has already started doing so. His ability to introduce new legislation however is restricted because the BJP and its allies do not have a majority in the Rajya Sabha upper house of parliament. They are unlikely to do so till 2018, according to a forecast by the Washington-based Center for Strategic and International Studies. Rajya Sabha seats are indirectly elected via the states, and the BJP and it allies would have to win six state elections between now and 2018 to achieve a majority, according to the analysis

That does not however stop Modi implementing policies that the last government failed to do and taking wide-ranging initiatives ranging from boosting the manufacturing industry to building highways and establishing effective schemes for the poor like the bank accounts.

This should continue to expand the growth that began under the last government, and bring back foreign investors who, though they are piling record amounts of money into the stock market, have been reluctant to bring in direct industrial and other investments.

It’s a new style of government and Modi is on a roll, though not everyone will like it!

Narendra Modi has yet to show that his government can make a significant difference to the way that India is run and performs, but this morning he impressed critics as well as supporters with his first Independence Day speech as prime minister from the ramparts of Delhi’s majestic Red Fort.

Breaking with tradition, he ad-libbed his hour-long speech in Hindi with minimal notes, and was not protected by the bullet-proof screens that have cocooned prime ministers at this event for more than 20 years.


That left Modi free to deploy his impressive free-wheeling oratory and speak directly to the thousands of people (including school-children who he chatted to later) gathered at the Red Fort, and others watching television. This was in stark contrast to the monotonous detached delivery of most previous prime ministers, especially Manmohan Singh who made the speech ten times

Modi’s key policy announcement was the expected closure of the Planning Commission, which has become an out-dated top-down hangover from the days of India’s controlled economy. It is to be replaced by a new, less aloof, and reforms-oriented organisation that co-operates with the states.

Other initiatives included providing bank accounts and insurance for the poor, plus a campaign for cleanliness, and separate school toilets for girls within a year. People “might not appreciate my talking about dirt and toilets from the Red Fort,” said Modi, who went on to condemn the country’s widespread rapes and appeal for parents to rein in their sons.

He appealed for India’s youth to avoid the divisive and often violent effects of the caste system, and of communal and sectarian divisions, and proposed “a ten years moratorium to get a society free of all these tensions”.

He also tried to inspire moves to boost India’s slow-developing manufacturing industry and urged foreign companies to “come and Make in India”, with “Made in India becoming a synonym of excellence”. He dreamed of “ electronic digital India” uniting the country in the way that the railway system has helped to do in the past.

And he referred to changes in the government’s work culture, which he has been trying to transform. He had been “appalled by the discord and disunity among various Government departments”.

Shopping list

This was a grand shopping list and was delivered in a style that seemed more like an election campaign speech than a programme for action. It dealt with the government’s key issues of protection of women and development of the economy, but it was little different from the last Congress government’s policies and lacked details on delivery. Modi’s challenge now is to satisfy the massive hopes and expectations that he has generated with firm action.

Each one of the points he raised are central to what is wrong with the way that India functions – from the filth and dirt and lack of respect for women that repel tourists and worries investors, to the caste and communal divisions that lead to mass violence (notably in the state of Uttar Pradesh in recent weeks). Manufacturing industry lags behind foreign competitors, especially China but also other Asian economies, and government departments fail to provide effective administration.

So far, in the twelve weeks since he became prime minister, Modi has been most effective in improving the time-keeping of bureaucrats and smartening up government offices, and in setting a new approach to foreign policy. After years of working from their homes in the mornings, or just turning up to office late, ministers and bureaucrats now arrive around 9am, and there are countless stories of mazes of ancient files and office clutter being cleaned up.

In foreign policy, Modi has broken new ground by visiting the small neighbouring countries of Nepal (the first prime minister to do so for 17 years) and Bhutan, both of which are buffer states with China. All the neighbouring countries’ leaders attended his swearing in, and at the end of this month he will visit Japan that is emerging as a leading economic and diplomatic partner.

Making visits however is easy, and the government will now have to find ways to improve day-to-day relations and economic development in Nepal, and also offset Chinese influence there and in Bhutan. Elsewhere among the neighbours, there is little sign yet of improved relations, and on the broader foreign front India has upset the US and other countries by blocking an international trade treaty at the World Trade Organisation.

Environmental worries

At home, Modi has begun moves to raise the limits for much needed foreign investment in defence manufacturing and insurance, and has begun to change out-dated labour laws. He has also cleared some blockages for construction of infrastructure and other projects, though this has led to risky and controversial jettisoning of environmental protection arrangements. Environmental clearances have been rushed through, and a key environmental advisory body, the National Board for Wildlife, has been revamped with members more committed to development than environmental protection.

Modi won his landslide general election victory however because people expected more dramatic and fundamental improvements in the way the country is run, with government departments becoming more efficient, police becoming less indifferent and brutal, and the railways and other services becoming more effective and responsive to people’s needs.

That is an impossible task for one man so, to deliver what is expected, Modi needs to motivate those around him. He said at the Red Fort that he was speaking “not as Pradhan Mantri but as Pradhan Sewak” – as the first servant, not the prime minister. That was a part of the populist appeal that he likes to portray along with a powerful image. His challenge is to use both to deliver.


Posted by: John Elliott | July 20, 2014

Modi and Jaitley have yet to make their mark

The current disillusionment with India’s new government is not surprising given the images built up in the past by prime minister Narendra Modi and finance minister Arun Jaitley. Modi, a powerful regional politician, blasted his way to power in a presidential style campaign with the theme that he alone could save India from its declining economic record and international image. Jaitley, a highly rated lawyer, spent years getting increasingly angry on television programmes and elsewhere as he barked and bit his way into the Congress-led coalition’s failings as if he knew what ought to have been done.



Inevitably, neither man (pictured left) has lived up to the implicit promises of their self-confident performances before and during the general election campaign.

Jaitley produced a drab Budget speech on July 10 that one leading commentator, Swaminathan Aiyar, dubbed (referring to the last finance minister) a “Chidambaram budget with saffron lipstick”. I thought that a bit unfair on Paliannapen Chidambaram, who did manage to put some vision and inspiration into his speeches, even if he wasn’t able to deliver the visions afterwards.

Despite taking a firm line on government administration issues where he is trying to introduce efficiency, Modi has yet to display the sure touch on policy that his reputation indicated. Indeed, it looks as if he had underestimated the difficult if not impossible task of transferring his Gujarat chief minister style to the far more complex national and international arena of New Delhi. It is of course far too early to make sweeping judgements, but so far he has failed to deliver on his Obama-style “Yes we can” message, to which he added “Yes we will do” last August.

I’ve been out of India since just before Budget Day and these views are culled from people I have met and talked to in Washington DC as the budget was being delivered, and in the UK, as well as reading the India news and comment. In the policy think tanks around Washington’s Dupont Circle, analysts thought the Budget good in parts, but were understandably disappointed that Jaitley did not take a clear stand on subsidies and against a damaging policy of retrospective corporate taxation pursued by the last government (initially over a Vodafone take-over deal and then affecting other companies).

In the UK, there is uncertainty about how new the Modi approach will turn out, while prime minister David Cameron is busy fawning on the leadership of both China and India. To placate Beijing, he is failing to honour pledges he has given in the past to defend democratic development in Hong Kong, which is now under attack from Beijing, and he has this past week gained publicity by promoting an Indian-origin declared right-wing Modi supporter as a Treasury minister.

I’ve been asked more about the treatment of women, rape and the caste system than I have about economic performance. “Can Mr Modi change that?” people want to know, referring to the non-economic subjects – including the use of child and slave labour in brickfields that BBC correspondent Humphrey Hawksley has been publicising on television.

Of course Modi can’t change everything, though the ten-year time frame that he has said he needs as prime minister should lead to a revamping of India’s police forces and legal system, plus education, so that police and judges do their jobs on time and education weans people away from the worst excesses of the caste system and persecution of the poor.

‘A lot of red ink’

To return to the budget, Chaitanya Kalbag, a former senior Reuters editor, neatly summarised the lack of new thinking when he wrote a few days ago: “So far, Modi and Jaitley have meekly accepted a string of programmes and targets set by the [previous Congress-led] United Progressive Alliance government.  If India was a failing corporation, the new CEO and CFO seem to be content to inherit a balance sheet smudged by a lot of red ink.  We hoped for big-bang reforms.  Instead, subsidies continue apace.  The National Rural Employment Guarantee Scheme sails on, leaks and all.  The new government says it is committed to food security – there is no attempt to trim the swingeing UPA pledge to give two-thirds of our population cheap rice and wheat. Jaitley has ‘accepted’ the challenge set by his predecessor of an almost impossible fiscal deficit target of 4.1 per cent of GDP this year”.

Swapan Dasgupta, a self-declared staunch Modi admirer, has similarly questioned Jaitley’s decision not to ditch the last government’s over-optimistic figures on the economy, writing: “There are things that just don’t add up. Jaitley may have preserved the honour of his Finance Ministry by not rubbishing the entire past, but what sort of signal has it sent to the bureaucracy that will oversee the big changes Modi contemplates? Continuity has its pitfalls and the most obvious one is that the Modi dispensation is in serious danger of being led by the nose by a bureaucracy that is most at ease with perpetuating the status quo through control. Certainly the main body of the Budget speech conveyed the unmistakable impression of having been penned by someone who was completely impervious to its political rationale and made the seamless transition from UPA to NDA.”

Dasgupta seemed to be suggesting that Jaitley had accepted the views of his finance ministry bureaucrats’ and said that Modi’s efforts to motivate and directly drive senior bureaucrats, Gujarat-style, would not work until “babudom grasps the reality of political change”. At present, he says, “there is no indication of such a realisation”, and the Indian bureaucracy still thinks the achche din [good days] has been never-ending”.



On the positive side Jaitley did indicate a new focus on economic growth, with the prospect of urgently needed agricultural and taxation reforms.

The few details he announced included an increase in foreign direct investment limits in defence equipment manufacturing and insurance companies from 26% to 49%, and a boost for government spending on highways. He also repeated an announcement made more than once by the last government that FDI in insurance companies, which needs parliamentary approval (unlike defence and other areas), would be raised from 26% to 49%.

Analysts in Washington were disappointed that the defence figure had not been raised to 51% because that would have allowed US and other companies such as Boeing, Lockheed and Raytheon to have a majority share in India-based companies.

The 49% limit was welcomed by most Indian’s private sector defence manufacturers because they understandably want to have a chance to develop Indian capability if the defence industry is at last to be opened to private sector involvement.

Meanwhile, Modi seems to be more willing to be tougher and more abrasive on the Bharatiya Janata Party’s Hindu nationalist interests and causes than on economic policy and sorting out the way that India is run.

In Budget week, he appointed Amit Shah (above), his controversially tough and apparently ruthless political henchman as president of the BJP, despite an on-going criminal investigation into Shah’s alleged involvement in Gujarat police killings and phone tapping. Shah has been close to Modi since they were both teenagers in the Rashtriya Swayamsevak Sangh (RSS), which lays down doctrine and played a large part in the recent election campaign by providing thousands of volunteers.

There have also been moves to have a new look at India’s history and rewrite education books, as the last BJP-led government did in the early 2000s, along with other initiatives aimed at adjusting India’s approach to culture so that it fits with Hindu nationalist views.

It’s easier of course to do these things than it is to reform the way that India and its economy is run. The government however won its overwhelming general election victory because people want economic and other changes, not because they are devoted fans or followers of the BJP’s long-term nationalist ambitions.

This article on is –

In a society ridden with crony capitalism and crony politics, businessmen and politicians inevitably try to stop people writing books that reveal their goings-on. But there is a limit to how much disruption they can achieve

This has has been shown by the recent publication of three books that uncover many of the secrets of the showy but shadowy Sahara Group run by the idiosyncratic and reclusive Subrata Roy (now in jail), the intrigues, spats and influencing of Reliance companies, run by the Ambani brothers, over natural gas pricing, and the fixes and fudges of Air India, especially when Praful Patel, a suave and wealthy Maharashtra politician, was aviation minister in the last government.

Roy took legal action that delayed publication of the book, by Jaico of Mumbai, about him and his Sahara company for several months, while the Ambanis have been complaining and threatening noisily but have not yet taken firm action to have the privately-published book about them and India’s “gas wars” banned. Patel got the Air India book withdrawn by Bloomsbury India, but the author is now publishing it himself.

Such disputes are good for sales – the Sahara book has gone into a reprint after an initial run of 15,000 copies, while Gas Wars has sold 4,000 hard and paperbacks. The (semi) joke doing the rounds is that the Ambanis are trying to obliterate the book buying up all the copies, but it’s not possible to do that to e-books of which 1,000 have been sold.

Sahara’s mysteries

Subrata Roy, the founder of the secretive but publicity conscious Sahara India Parivar group took out a Rs200 crore ($32m) injunction last December that delayed publication of Sahara: The Untold Story by Tamal Bandyopadhyay, an editor of the Mint business newspaper.



Roy was jailed four months ago on an (unconnected) contempt of court case, and seems to have decided that he was fighting for his survival on too many fronts. He agreed last month that the book should be published, along with a curiously worded disclaimer, which appears on both the cover flap and the first two pages, saying that it “is based on a particular notion, wrong perceptions supported by limited and skewed information. Hence, it does not reflect the true and complete picture”.

Roy is an extraordinary character, apparently employing 600,000 agents to draw savings from millions of the poor for a myriad of financial schemes. He penalises them mercilessly when they fall short on payments and dodges regulators who try to investigate. He invests in massive real estate dreams (claiming a 36,000 acre land bank) and has created and sold a loss-making airline.

He has owned and lost a cricket team, was till recently the official sponsor of the Indian cricket team, and has a share in a Formula One racing team (he invested to help the financially ailing Vijay Mallya of Kingfisher fame).

He owns two hotels abroad, including the famous though faded Grosvenor House on London’s Park Lane, a couple of minutes walk from Mayfair’s Grosvenor Square and nearby streets favoured as fashionable addresses by India’s wealthy. He bought the hotel in 2010 for £470m mysteriously sourced funds.

Roy lives and works in a closely guarded gated compound called Sahara Shaher that contains replicas of world famous buildings and covers an incredible 270 acres in the centre of Lucknow, the capital city of Uttar Pradesh where his political power has been based. He mixes with film stars and powerful politicians of varying shades of respectability, many of whom, it is widely rumoured, invest their money anonymously in his schemes.

Yet oddly the rich and powerful, who ostentatiously partied with him for years, have not managed to rescue him from exasperated and humiliated Supreme Court judges and financial regulators who have eventually trapped him and put him in jail over an alleged Rs24,000 crore ($4bn) bond scam.

For years, regulators have been trying to tie down where his money really comes from – is he caring for the poor or cheating them, or is he mainly laundering money for the rich?

In his book, Bandyopadhyay writes: “Roy, the guardian angel of the group, whose feet are touched by everybody in the Parivar, is an entrepreneur who wants to reach out to a million lives, and who feels claustrophobic in regulations. So, the clash with the regulators is inevitable. But when one regulator slams the door, Roy opens another. This play has been on since 1978 when Sahara was set up”.

Bandyopadhyay asks whether the “poor people actually keep their money with him or are they a front for others?” At the Delhi book launch, he wondered whether “investors really do exist” since none had complained about their treatment, yet Roy had claimed he had repaid 147m investors, which if true amounted to an astonishing “one in nine of all Indians”.

The Ambanis’ Gas Wars

Gas Wars – Crony Capitalism and the Ambanis by Paranjoy Guha Thakurta (below), a prominent business and economics journalist, and two colleagues, was published privately by Thakurta in April and is now for sale on the internet as well as in bookshops. The launch event in Delhi became an occasion for wide-ranging attacks on crony capitalism.



Reliance Industries (RIL), run by Mukesh Ambani, India’s richest man knew about the book but, says Thakurta, had not tried to stop him publishing it.

However it quickly threatened to sue for Rs100cr (about $16m), serving legal notices alleging defamation on the authors, the book distributors (including Amazon and Flipkart), plus some reviewers and, according to Thakurta, even a young woman who forwarded electronic invitations for the launch event.

That may seem draconian but it is mild compared with what Reliance Industries did in 1998 under Mukesh’s father, Dhirubhai Ambani, when it forced Harper Collins India to withdraw publication of a book, called The Polyester Prince that had been separately published in Australia. The ban pushed the price of hard copies on the net up to more than ten times the original sale price (even now $200-300 and £200-300 is quoted on and sites), but it was reissued four years ago by Roli Books of Delhi, slightly amended and the family stayed silent. (read the story here).

Thakurta’s book must therefore be regarded by the Ambanis as more threatening than the reissued Prince. It explores RIL’s natural gas finds at the KG-D6 oil and gas field in India’s Krishna-Godavari Basin and a very public row over delivery prices to a power project run by Mukesh’s younger brother Anil’s separate company. It quotes how the India’s Comptroller and Auditor General (CAG) alleged the petroleum ministry “designed contracts and tailored rules” to favour RIL, which was thus able to recoup “excessive capital expenditure” and reduce payments to the government.

There are two detailed scoops in the book, which reveal details not previously published involving two of the main players. One is a long interview with Subir Raha, a former chairman of ONGC, India’s leading public sector gas exploration company, and Mani Shankar Aiyar, a Congress politician renowned for his “clean” reputation who was for a time the petroleum minister. Aiyar and another minister were removed from the petroleum ministry because, it was widely reported at the time, they had not been toeing the Reliance line. The anti-corruption Aam Aadmi Party also attacked Reliance and Ambani last year and started court cases.

Reliance of course denies all the allegations and last week launched on the internet a 56-page presentation and promotional video – a Flame of Truth eBook titled “India Has Never Been Here Before – Facts You Didn’t Know About KG-D6”.

The Ambani family has good connections in all political parties. Thakurta’s book tells the story of how it managed the environment (a neat and often used euphemism) with the Congress-led government of the last ten years. Mukesh is known to be a keen supporter of Narendra Modi, the new Bharatiya Janata Party prime minister, and they both come from Gujarat, but he must now be wondering how to manage with a prime minister who might not be as willing as Congress to appear to be favouring one company – however true or not that may have been.

The government last week adjourned for three months a decision on doubling natural gas prices that would inevitably benefit RIL. Commenting on this at a recent Mumbai Press Club meeting on the book, Aiyar wondered why Modi had kept responsibility for the petroleum ministry and therefore oil pricing, and is reported to have added: “Since we have only one company in the private sector, the ministry of oil pricing has effectively become the ‘ministry of Reliance affairs.”

Praful Patel and Air India

The Descent of Air India, by Jitender Bhargava, a former executive director and pr chief of the airline, was published last October. Patel said it contained “baseless allegations” about him and in November his lawyers brought a criminal defamation case in the Mumbai courts against Bloomsbury India and Bhargava. In January, Bloomsbury apologised, withdrew the book from sale, and agreed to destroy its remaining stocks, though Bhargava is selling ebooks on the internet and plans to publish a hard copy himself soon.



Patel, who is presumably no longer wielding so much power and patronage at the centre of politics following after the recent general election, does not seem to have tried to stop Bhargava’s sales.

Patel was aviation minister from 2004 to 2010 and then heavy industries minister. His time dealing with aviation was especially controversial because of deals for airport projects and for aircraft purchases and other happenings at Air India, the national carrier, whose finances and viability were declining while well-connected private sector airlines (and airports) bloomed. I once described him on my blog as the “Government’s top Teflon Man”.

Bhargava writes about what he describes euphemistically as Patel’s political interference “on acquisition or leasing of aircraft, purchase of merchandise, appointments, giving out free air tickets and upgrades, and on promotions, transfers, and postings of employees”. These decisions were taken, he says, “without any thought for the airline’s future”. For whatever reason, foreign airlines were given far greater access to India’s airports than was justified by customer demand, which damaged Air India’s ability to generate revenues.

The story isn’t over yet. There has been a case in Canadian courts alleging bribes were paid to Indian officials on a biometric identification system. Bhargava’s book gives details, adding Patel’s denials, but the courts, which were impressed by evidence of money trails, have now convicted a Canadian company official for paying bribes. That has led to calls in India for fresh official investigations into the Biometrics case and other allegations in Bhargava’s book. The Supreme Court is expected to rule on that later this month, unless the CBI files an FIR (first investigation report) against Patel first.

All the people in these stories are accustomed to wielding power and patronage at the centre of government. But a new era has begun and none of them can be sure how things will develop with a prime minister whose general election mandate included cleaning up corruption.

Older Posts »



Get every new post delivered to your Inbox.

Join 2,233 other followers

%d bloggers like this: