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Advocacy of interest or corporate bribery?

delhi Updated: Dec 15, 2012 23:21 IST

Hindustan Times
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Paranjoy Guha Thakurta
Independent journalist and educator

The debate on whether or not lobbying should be "legalized" is a sterile discourse which comes up in India every now and then when corporate conglomerates or interest groups are accused of influencing government policies and/or decisions by legislators, bureaucrats or regulatory authorities. This issue has re-surfaced in the context of the demands for an inquiry to ascertain the recipients of funds paid by Walmart (allegedly to certain influential Indians) that have been disclosed in reports filed by the world's largest multinational corporation under the US Lobbying & Disclosure Act of 1995.

Unlike the archaic etymological definition of the word to signify influence-peddlers who throng hallways (or lobbies) of Parliament in the UK, in India, lobbying has been dignified to mean different things. Lobbyists here are better known as "image managers", "PR practitioners", "corporate affairs" executives, representatives of "advocacy groups" or even, lawyers and accountants. Such lobbying has been around for donkey's years although only a few lobbyists have gained prominence or notoriety of the kind bestowed on Niira Radia, who worked for Mukesh Ambani and Ratan Tata.

If the dark side of lobbying is when people with inordinate power and pelf successfully subvert the law by tilting it against the interests of many to favour a few and encourage corruption, the more benign aspect of lobbying is evident when a wide variety of groups - from civil society organizations, political parties, academic think-tanks, industry associations and chambers of commerce - seek to persuade others to come round to a particular view. In that sense, it can be argued that lobbying is an essential part of the working of any community, society or nation-state. However, huge problems arise when lobbying by wealthy groups is conducted in an opaque or clandestine manner. This is when the dividing line between predatory practices and struggles for justice get obliterated.

Washington DC is home to an estimated "registered" 12,000 lobbyists (although only a few are really influential) who have to adhere to an extensive set of rules. But the US law is riddled with loopholes. Not only does it exclude lobbyists whose "activities constitute less than 20% of the time engaged in (such) services" it defines various "thresholds" of expenditure that must be mandatorily recorded and disclosed. Any organization that contributes more than $10,000 towards lobbying activities must be registered but one that spends even one dollar below this limit is exempt from the provisions of the law. Even registration entails providing basic information and government offices dealing with such information are reportedly understaffed. During a Senate hearing, it was pointed out that since 2003, "the Office of Public Records has referred over 2,000 cases to the Department of Justice, and nothing's been heard from them again."

In the case of Walmart, out of 29 lobbying disclosures filed with the US Senate between 2008 and 2012, "discussions related to FDI (foreign direct investment) in India" was one among many many items listed for lobbying that included "supply chain" issues, "security" considerations, "trans-Pacific partnership negotiations", "women's economic empowerment", "conflict minerals" and so on. How much was spent by the world's biggest retail group on which issue and how much was given to whom is not required to be disclosed.

The real issue is not lobbying per se but transparency in public life.

Rajiv Desai
Chairman and CEO, Comma Consulting

Though the BJP's noisemakers may not appreciate it, through their hysterical outbursts against Wal-Mart, they may have unwittingly sponsored a major reform in pursuit of good governance. In its misbegotten campaign against the American firm, the BJP threatened to disrupt Parliament again, as it has done repeatedly for the past nine years. This prompted Parliamentary Affairs minister Kamal Nath to agree to a public inquiry into the company's lobbying activities in India. Though a spectacularly ignorant BJP spokesman suggested that the minister's assent to an inquiry proved their point, the truth is that the UPA's quick response saved the day and it appears that much overdue legislation will now be enacted.

The BJP's empty-vessel strategy to corner the government on lobbying by Walmart boomeranged in Parliament because of Mr Nath's finesse. Reports say the government will appoint a retired judge to conduct the inquiry. Most likely, the exercise will stretch out and will hold no more sensation value; the BJP will find some other dubious platform from which to rant against the UPA government. As such, the inquiry will join the long list of commissions that have provided not much more than sinecures for superannuated law officers.

On the other hand, the government could actually use the inquiry to clean up the murk that surrounds lobbying in India. To secure the public interest, it is vital that the government shine a light on power brokerages and influence peddlers in Delhi and in the various states.

A thoughtful judge at the helm of the inquiry might recommend the establishment of a Parliamentary registry that provides credentials to lobbyists, individual as well as firms. In accepting such credentials, lobbyists would be required to disclose their clients and fees received. The registry could go a step further and demand from various government ministries, departments and agencies periodic reports on any contacts they may have had with lobbyists.

Recommendations of this nature could bring much needed transparency to the conduct of public affairs; you won't have a BJP president Bangaru Laxman accepting bribes or a DMK minister A Raja playing fast and loose with the allocation of telecom spectrum. A whole horde of middlemen, the kind you see at power lunches in The Taj or cocktail parties at The Oberoi, will stand exposed. The business of lobbying could become professional and cleansed of the stain of corruption.

Lobbying is a time-honoured practice that dates at least as far back as the signing of the Magna Carta in 13th-century England, from whence sprang the right of association and the right to petition authority, the cornerstones of the lobbying profession.

Closer to home and to the age, lobbying has had many beneficial outcomes. These include campaigns for universal primary education, against sex trafficking, to lower taxes on toiletries and cosmetics, to amend laws governing the business of financial services, courier firms and cable operators, among others. They have been successful and have benefited the public interest as much as the interests of those who sponsored them.