Why Narendra Modi supporting an Ambani and Adani is more myth than fact

As defence minister Manohar Parrikar was deliberating with his officials on Thursday over the weapons platforms and systems that the country needed to acquire, the defence circles in Delhi and abroad were agog with speculations that “in today’s meeting, the Modi government will clear the ways for the Ambanis and Adani to capture the Indian defence industry by making their groups strategic partners”. But nothing of the sort happened. As of today, it is only the Tatas, Mahindras and L&T in the Indian private sector that have some meaningful role in the Indian defence industry; the Ambanis (both the brothers) and Adani are behind in the race, despite the widely-held perceptions that under the Narendra Modi government, they are ruling the roost.

Perceptions are quite distinct from facts. But then perceptions matter more in politics than facts. And that is why if you listen to our opposition leaders in general and Congress vice president Rahul Gandhi in particular, one gets an impression that ever since Modi assumed office, everything in the country has been done to promote the interests of a select group of industrialists (particularly the Ambanis and Adani) at the cost of the country’s poor. If Gandhi is to be believed, the entire demonetisation scheme of the Modi government is only for the benefit of the big businessmen in the country. In almost every public rally that he addresses, he makes it a point to emphasise how Modi’s is 'suit-boot ki sarkar' (a government that caters to capitalists).

 Why Narendra Modi supporting an Ambani and Adani is more myth than fact

File image of Narendra Modi. PTI

On his part, Modi too does not spare a single public platform in the country to show his concerns for the poor. Relentlessly he points out his various pro-poor schemes like opening the Jandhan accounts, Swachh Bharat, Make in India and Clean-Ganga projects. That these are really ambitious schemes and as columnist social scientist Pratap Bhanu Mehta has pointed out in The Indian Express are badly implemented and that most of these are projects whose results will come later, not sooner, are different matters altogether. But the point is that the Modi government is not a pro-rich government that the likes of Rahul Gandhi and Arvind Kejriwal accuse it to be.

It is against this background that it is interesting to see the data compiled and brought out by the BJP, as reported in The Times of India, “to nail the claims that the NDA dispensation is 'Adani-Ambani ki Sarkar.' It is said that loans worth Rs 36.5 lakh crore, granted to various corporates between 2005 and 2013, were waived off during the two successive terms of the Congress-led UPA government under Manmohan Singh. Refuting the recent allegations of waiving "bad loans" to a few corporates, the BJP has provided data that says that ratio of "bad loans" had increased by 132 percent from 2005-06 to 2013-14. According to BJP spokesperson Shrikant Sharma, “SBI had frozen Vijay Mallya group's accounts after he failed to repay loans of over Rs 1,450 crore in 2012. However, Mallya was given loans of Rs 1,500 crore...Adani, Ambani and Mallya were not born in the past two-and-half years...these are as old as the Congress party and have been flourishing when Rahul Gandhi was not even born. Therefore Congress owes more explanations about how these groups flourished if they had a tainted background."

There are merits in the BJP-data. Take for instance the case of Reliance’s heavy and costly investments in the Krishna-Godavari basin to extract gas. Let us refresh our memory how the Manmohan Singh’s oil minister Veerapa Moily had decided to increase the gas price $8-8.4 against the then current price of $4.2 per million British thermal unit just few days before the UPA government was voted out in 2014. In contrast, the Modi government has imposed fines on the Reliance worth thousands of crores (first Rs 14000 crore and then additional Rs 2500 crore for “under-production”; and Rs 10311.76 crore for “extracting gas from state-run Oil and Natural Gas Corp. Ltd’s deep-water block in the Krishna-Godavari basin for seven years”. These penalties can be legally challenged by the company, but the point is that it is difficult to fathom how a company perceived to be so close to the Modi government is being imposed fines, one after another, by the latter? And worse, now there are reports that the India will probably cut the price of natural gas by about 18 percent from $5.05 per million British thermal units the government set when it first rolled out the formula in 2014, in what will be a huge setback for explorers like Reliance.

Talking of the Adani group, its promoter Gautam Adani has presented enough evidence in the last three years to the press saying how his infrastructure empire grew after the liberalisation of the country’s economy under the Congress government headed by Narasimha Rao in 1993. He acquired barren and non-agricultural land in Gujarat and developed ports under the Congress governments in Gujarat led by Chimanbahi Patel and Shankarsinh Vaghela. According to him, in his business, he has got cooperation from all the governments irrespective of whether they are led by the BJP or any other party. It is not true at that the State Bank of India has loaned him Rs 62000 crore loans to start his mining business in Australia (where he has now got the environmental clearance).

Incidentally, under the Modi regime, the market capitalisation of both Reliance and Adani group has been adversely affected; in fact, the Adani group has reportedly witnessed a steep fall of 51 percent of its market capitalisation after Modi became Prime Minister. But that has not made either the Reliance (led by Mukesh Ambani) or the Adani group defaulter on the interest payments against their bank loans.

What all this suggests is that the systematic way perceptions are being built about the “nefarious nexus” between the Modi government and industry is unfortunate. These perceptions are far from the truth. In the process, such perceptions do great harm to the nation’s development. Creation of wealth by the industry is not a crime; instead it is vital for the growth, jobs and help to the poor as long as it is created transparently and under the taxation regime.

But then what should we do to deal with the deliberate distortion of facts and outright lies by the politicians? There is no easy answer to this question in a competitive democracy such as ours. In my considered view, the media can make a small beginning to retrieve the situation. One is told that some European publications carry features such as “PolitiFact” or "Truth-O-Meter" that has a range from "True" through "Mostly True" to "Mostly False," "False" and finally, "Pants on Fire." The Washington Post has a regular feature called “The Fact Checker”. But then, there are criticisms, justifiable to certain extent, against these features. The argument here is that a journalist or analyst is subjective in choosing facts. For instance, one may only like to see how much truth Rahul Gandhi is saying by ignoring the similar treatment of Narendra Modi. The converse is equally true.

But then, doing something is better than doing nothing. And it is quite possible that when some subjective person separates facts from fictions by Rahul and another subjective person does the likewise with Modi, there will be some “balance” between the two sets of facts and fictions.

(Disclosure: Firstpost is part of Network18 Media & Investment Limited which is owned by Reliance Industries Limited. These are the author's personal opinions)

Updated Date: Dec 25, 2016 17:29:32 IST