Friday, January 8, 2010

Telangana - Behind the scenes II

Sonia Day & Chidambaram : These are the press reports and analysis of the Sonia Day and how it happened.

Dec 10, 2009, 2:53AM : Midnight Cheer in Telangana
Quote:
  • While a group of Andhra and Rayalaseema parliamentarians met Congress president Sonia Gandhi on the occasion of her birthday and urged her not to divide the state, about a dozen Telangana Congress MPs also called on her and sought a separate state at the earliest. ''We are hoping that it would be her birthday gift for the people of the region,'' said Malkajgiri MP Sarve Satyanarayana and he was proved right a few hours later.
Telangana MPs reinforce the ego of the empress. "Give us the gift on your birthday.. and your birthday will forever be enshrined in the history of Telangana". Just like we have Children's day on Nehru's birthday, there would possibly be a Telangana day and Telangana state holiday on Sonia's birthday. That is irresistible in an age where no new national holidays can be accommodated anymore.

  • The Union home ministry's advice prevailed over political counsel from the Congress's Andhra Pradesh (AP) MPs to pave the way for last week's controversial midnight announcement on statehood for Telangana.
  • The home ministry pressed the panic button based on intelligence reports warning of a possible resurgence of Maoist violence in Telangana around the sentiment for a separate state. It argued in favour of pre-empting a Maoist consolidation in the region by taking the issue off the radar with the announcement of a Telangana state.
  • With finance minister Pranab Mukherjee away in Jharkhand on that fateful Wednesday when the party's core committee met thrice before deciding to divide AP, there was no wise political voice to temper the scare scenarios presented.
  • Home minister P Chidambaram, who has been spearheading the government's anti-Maoist drive, had an open field to push his ministry's assessment. Mukherjee flew back in time for the final late-night meeting of the core committee but the mood had already swung.
  • The indications were there earlier in the day when a group of non-Telangana MPs met Sonia Gandhi's political secretary Ahmed Patel and the Congress's pointperson for AP Veerappa Moily. The MPs warned of a backlash against the creation of a Telangana state but they were told "kuchh to karna padega", disclosed a senior leader.
In all the above, Chidambaram comes as extremely active in getting the core committee to approve the "birthday gift". After days of meetings ending on the Dec 9th, it was his "internal security" argument that convinced the rest of the folks to go along. If we give Chidambaram benefit of doubt and say he genuinely thought it would help internal security, then, at best, he would be a victim of Tunnel-Vision, failing to see anything but Maoists. At worst, he could be an active instrument of Rajmata/Yuvraj in return for something else. 
Either way, when the core-committe met on Dec 9th, they had a hard deadline to get everybody in line by end of the day. Note that Pranab was conveniently away. Some relevant questions here. 
  1. In the age of video conferences and remote work, was it so difficult to get Pranab on the phone for the hectic meetings on the 9th?
  2. With his consistent appeal for caution on the Telangana issue, would he be unavailable if he knew about the deadline?
  3. What purpose does it serve to wrap up the the decision in his absence?
Dec 15, 2009 : Chidambaram feels Telangana heat
Quote:
  • Agriculture Minister Sharad Pawar was forthright in seeking clarifications from Home Minister P Chidambaram on announcing the decision of the Congress Core Committee on Telangana as the United Progressive Alliance's. The argument was picked up by Mamta Banerjee.
  • Sources said Finance Minister Pranab Mukherjee prevailed in the meeting to give priority to return of normalcy in Andhra Pradesh. He said any decision on Telangana would come only if the Andhra Pradesh Assembly unanimously adopts a resolution for creation of the separate state.
  • Pranab Mukherjee, who headed a sub-committee on Telangana during the first tenure of UPA, said that issue was too sensitive and emotional.
  • "I understood it, but when such a major issue was being announced, it was the Congress duty to have taken the NCP, TMC and DMK into confidence." By this remarks, Pranab was clearly hinting at the PMO and the home minister as well.
That was quite a display of arrogance on the part of INC, by first excluding the UPA parnters in the dicussions and secondly, announcing it as a UPA decision.

In the end, is it a cascade of "unintended consequences"? An explosive combination of all power given to Sonia, Chindambaram's loyal urge, Pranab's timely absense, High command detached from ground sentiment and the Sonia/Rahul's emperor complex. There are no clear winners yet, though there is a long list of losers, starting with Indian Economy.

Thursday, January 7, 2010

Telangana - Behind the scenes I

There is enough rhetoric on the Telangana/United Andhra movements to bury us until next elections. So, I am going to stay clear of the pro/cons of the Telangana/United Andhra movements and instead focus on the players as I see them. The goal is to provide a "view from the top". Any contributions towards expanding the perspective are most welcome.

Telangana movement has had its ups and downs since 1947. It peaked in 1969 under Indira Gandhi's tenure, and was revived in 2000 only to culminate in the crushing defeat of TRS in 2009 elections. So lets look at  what possibly led to the current events from that low in 2009 elections.

PS : Note the timestamp of reports

Nov 2nd, 2009 analysis : The three sides after YSR : Jagan-Rossiah-Sonia

Link

Quote:
  • The Congress party, especially the CM Rosaiah, has to tread a fine line between keeping Jagan in the fold by allowing some leeway in his (and his associates') business transactions, and at the same time, not allowing Jagan & friends to become financially so strong that they can hold the party to ransom. (Let us face it, all these parties, Congress, TDP, BJP etc. work only towards enriching their leaders and the associated business class). The issues surrounding the Obulapuram Mining Company (OMC) point to this balancing act. Gali Janardhan Reddy and his associates can get away with the loot of public wealth provided their political backers in AP (Jagan & associates) toe the high command line. However, now that the issues have been raised and an investigation has been ordered, any time Jagan &Co raise the banner of revolt, the files can be dusted off and CBI asked to investigate. So, there you go.
According to the rumor mill from the inner circles of Congress, Rossiah and INC high command intended to undercut Jagan via Mining scandal since his ambitious signature campaign. Jagan prods KCR and sponsors some of this street protests as a likely tactical move to counter this strategy. It was supposed to deflect public focus from OMC scandal and possibly create some problems for the Rossiah-Center combine. Apparently, it wasn't meant for a showdown. However, on first contact with reality, it took a whole different tone and KCR got his momentum. Little games have started an avalanche and winners are yet to emerge.


Nov, 2009 :  Telangana campaign intensifies

KCR wants T-land vacated (Nov 09, 2009) - Deccan Chronicle
Quote :
  • The Telangana Rashtra Samiti president, Mr K. Chandrasekhar Rao, said that the Andhra people who “grabbed” valuable land and acquired assets in Telangana should give them up voluntarily and leave the region. 
  • Speaking to reporters at Vemulawada temple after having darshan of the deity, Mr Rao said the party would chalk out a special action plan to take over the lands occupied by people from Andhra.
KCR threatens to chase away Andhrites (Nov 10, 2009) - Indian Express
Quote :
  • “This is my final step. Either you will see KCR’s funeral or his victory procession,” he said.
  • However, after asking Andhraites to stay away, which ruffled many feathers, KCR modified his statement. “Actually Andhraites settled here are facing anger of Telangana people due to a few land sharks, industrialists and businessmen, who are fleecing local people and minting money. It is because of a few people that Andhra settlers are facing the brunt of Telangana anger. I must admit that if Telangana agitators become upset and direct their anger at Andhraites I won’t be able to stop them,” KCR said. His statements initially drew the ire of other political leaders, but soon they dismissed him as a rabble rouser.
  • Having left with no political base and with only two MPs, including himself, and 10 MLAs, KCR is adopting various ways to seek attention, including making statements against Andhra ‘settlers’. Now, he has announced that he would soon start a fast unto death demanding separation of Telangana. “He has asked his aides to start preparing for the fast and they are asking if KCR wants to fast what should they be preparing for?” asked a TRS MLA.
KCR's Telangana drama shifts to Jail (Nov 30, 2009) - Times of India
Quote:
  • “I will continue my fast even if the government imprisons me,” KCR said while being shifted to the jail at Danavaigudem after he was produced before a magistrate in Khammam where medical tests were conducted. Rejecting the bail plea, special judicial second class magistrate Ch Sreerama Murthy ordered 14-day remand for KCR and nine others. 
  • Following the arrest, students and TRS workers protested at Osmania University (OU) in Hyderabad, Kakatiya University (KU) in Warangal, Telangana University (TU) in Nizamabad and pelted stones at police and RTC buses. Ten RTC buses were damaged across the state. The situation turned volatile on the OU campus when students hurled stones at the cops who resorted to lathicharge to disperse them. A student threatened to jump from hostel terrace.
In one month, KCR becomes the "Tiger of Telangana" and arouses sharp emotions from Telangana. Even at this moment, most people from Telangana remained neutral. The rest of the folks, have smugly imagined that it would be as usual.

By this time, in order to prove the loyalty as is customary, all the Congress representatives have unanimously voted to allow Sonia make the final decision. These representatives said that they will abide by whatever Sonia decides.

Sonia and Rahul's behind the scenes (Nov 29, 2009) : Madhu Yashki Goud's letter (pg1) & pg2
Quote :
  • I draw your attention to mention that I met Sri Rahulji and brought to his notice the desires and the imminent need to carve out a seperate state-Telangana. Sri Rahulji is the champion who believes in smaller states and he is for the same without any concern for the people's choice. Sri Rahulji hates the people of Andhra. He is not interested to see that the people of Andhra or for that matter the people from Rayalaseema to have their say in the matter of formation of the state of Telangana. Sri Rahulji has assured a separate state of Telangana in his discussions he had with me. He also informed me that the news of separate state of Telangana may be announced on 9th December, 2009, the birthday of Smt. Sonia Gandhi as a gift to our Telangana people. The assurance of Sri Rahulji is, therefore a happy news to all of us. It is a big morale booster to our efforts.
  • In view of the backing of Sri Rahulji we people of Telangana have planned to put Sri. K. Chandra sekhar Rao, Chief of TRS in the fore front to project the views of Telangana people. We have planned that after his calls and indefinite fasting for a separate state, the Congress Party would finally fulfill our dreams. 
If the claims were to be believed, then Sonia/Rahul, with or without the mandarins have made up their mind by the Nov 29th. All they need is for TRS to make it easy for them. The possible motivations are a whole different topic.

Dec 09, 2009 11:30PM : Center announces new state aka "Sonia Day"
Note that earlier, the MPs from all regions unanimously voted to allow the Empress to take the final decision in this regard. As predicted by Yashki 11 days ago on 29th (around the same time KCR launched the 2-phase fast), 30 mins before midnight on Sonia's birthday, Chidambaram goes to media to announce the gift.

This is reminiscent of the Raja/Maharaja/Nawab syndrome, where the rulers throws presents to the common people to commemorate their important days. No wonder they are referred to as Rajmata and Yuvraj.

More later, on the Sonia Day itself and the aftermath. 

      Tuesday, January 5, 2010

      YSR : The Good, The Bad & The Ugly


      This was put down months back at snail pace, but got overtaken by the latest events. I was half minds on whether I should post this or leave it, but sometimes, our thoughts have a new meaning when seen in retrospect. So am still putting it out there, with the caveat that it was put down sometime in Sept-Oct, 2009.

      --------------------------


      I will use a few of my personal exchanges with folks to build this post. Not surprisingly things aren’t the same on ground.

      THE GOOD :
      Pension Scheme
      The case used to be that older people were at the mercy of younger offsprings or relatives for support. Some unfortunate elders have suffered a horrible fate and turned to homelessness and charity in their last days. 

      While previous governments had some kind of assistance or other for the needy, YSR had maintained clear focus on this front. One of my granddads in the far-extended family, aged 70+, (living on his own in a remote village) used to receive regular financial support from his nephew. After YSR’s pension scheme took effect, the granddad conveyed to his nephew that YSR takes care of him and the that its ok if he can’t send the support as often. The amount of pension would seem miniscule to a lot of folks, but in the remote village, this was a good complement.

      Health Care
      In all my life in India, I have seen one ambulence respond to an emergency. Even that was too late for the sick person. 

      My home town had moved ahead since then in this regard, to a large part due to the YSR’s attention to Healthcare. Now, there are ambulences responding to “104” and “108” calls. And the last time I paid attention, I counted 3 ambulances responding to emergencies in one week. AP Government also reimburses up to 2 Lakh Rs. towards treatment of chronic illnesses in either corporate, public or private hospitals. By any measure that is a considerable improvement to a vast number of people who could not afford quality healthcare on their own, especially in a timely manner.


      Education for Low Income Group
      While the AP voters have witnessed several populist electoral policies ranging from free electricity to free TVs, this is as close as it gets to getting my approval, even if reserved. This got wide and silent appreciation from folks who qualified that would otherwise disapprove YSR’s governance. 

      While the fees in government institutions have always been subsidized, private institutions were previously required to offer half of seats for a subsidized fees leaving the rest to be offered for a premium fees. The fee scheme has since been restructured and the subsidy was taken even further now. For economically backward students, Government will reimburse the fees (whether subsidised or premuim).

      Low Income Housing
      In an effort to get rid of the slums in the cities, YSR kicked off a very ambitious project of building low-income apartments and give them away at a highly subsidized rates. This has increased the quality of life of countless poor people who were otherwise living in horrible conditions with little or no sanitation available.

      Leadership
      YSR ruled the AP Congress with an iron fist. He suppressed dissent mercilessly and navigated his way around the obstacles in a patient and assertive manner. He single-handedly gave Congress leadership its plum state of Andhra Pradesh.

      Though there is little evidence in terms of lot of successful industries, investors feel that they have YSR’s ear and have respect for the prompt approval of some projects. Note that, even the ones with direct approval of YSR have to go through the customary “hand wetting” of various layers of the beuracracy and politicians to eventually fructify.

      Telangana Embroglio
      After long laying idle, Telangana was raked up again in the past decade. In my opinion, this is a good example of the political thought “If I cannot become CM for the large state, let me liberate the part I am popular in and become CM of that state”. At some point, grievances may warrant a drastic measure, but Telangana has long been exploited for whims of few leaders. YSR played a pretty savvy game by initially supporting the TRS, but staying non-committal until he gathered steam. Once TRS outran its utility, YSR buried the TRS and in his own way helped to keep the state united. Ofcourse, due credit needs to be given to the people of Telangana, because, in the end, it was them who shut the door on TRS.

      THE BAD
      NGOs (Non Gazetted Officers) 
      Teachers and Non-Gazetted officers have received a healthy hike in salaries with an eye on the elections. Looked in isolation, it is important to keep earning parity of the employees intact. However, note that these employees form the largest human resource for Electioneering duties. If an old or illiterate voter needed help with operating the Electronic Voting Machines, guess who helps them, its the teachers and NGOs who owed YSR.

      Increasing Expenditure, Falling Income
      Imagine a case of a family of husband-wife, two kids and some grandparents. For the kids to be nurtured and older grandparents to be well taken care of, a lot depends on the earning potential of the husband/wife or both. If family earning falls below the family spending, family accumulates debt.

      Extending the above analogy to a state, the poor and economically backward needed to be taken care of. On the other had, the earning members are the big factories and businesses that generate services/commodities to create profit. While the profits provide Government with taxable income, they also create jobs directly and indirectly. This would in turn increase the number of people paying income tax to the Government. In the end, the industries/businesses and profitable farming are the sole sustainable contributors to the State’s funds. 

      However, YSR’s government has cultivated the dependants, but failed to bring in the breadearners. This would mean that all the money spent on social welfare will result in debt, and will burden the subsequent governments later, when YSR gets all the goodwill now.

      While YSR (and Congress) in general flaunts the poor and economically backward and exploits them for votebanks, very little is done to make them self-reliant and contribute towards a econimcally viable apparatus. This is the same irresponsible and descructive monetary policy that kept India in debt until the 1990’s, when PV Narasimha Rao brought on Beurocrat Manmohan Singh into politics and shielded him from the deep rooted resistance all around. Y2K and subsequent IT rush saved the nation and all the states that caught the train. The next train is “Solar and Green” technologies and current Government support for these technologies are best described as “token measures”.

      Neglect of Industrial Growth
      Compared the to the zeal with which the previous government has went after investors, the YSR government has fallen short by miles. With little worthwhile investments coming from outside, YSR  is increasingly dependent on the non-sustainable sources of income like Property registration fee and sale of Government lands.


      THE UGLY
      The Cudapah beginnings
      In a flight to Malaysia, I was sitting next to a muslim lady. She seemed sad and aloof initially, but we started chatting midway through our travel. It turns out the lady is going to her city, Bangalore, to attend to a family emergency. To my surprise, she was speaking in my native tongue, and after listening to my rant on general state of things, she opens up and starts narrating her story. They are a wealthy family from Cudappah who are now settled in Bangalore. 

      A group of local influentials (including the leader in focus) apparently had an knack for accumulating assets in the following way. They would approach somebody with a desirable property with a minuscule amount (she quoted Rs. 10,000 not sure when) and ask nicely to write the property on their name. If property owner refuses, they loose the property by force along with the paltry amount that was voluntarily offered. A lot of people simply took the offer and left to never return back! The lady belongs to one such family.

      Institutionalized and Rewarded Corruption
      In the process of arresting corruption in lower rung of the Governance, Chandrababu Naidu antagonized Government employes of all kinds including teachers. He went even further by demanding that they volunteer their weekends and other spare time for communiy activities. Even though it was for the larger good, the government employees who were long accustomed to corruption and getting paid for inefficiency, shafed under the TDP administration. Not that CBN and his associates were any clean at the high level, but the mid-level administration that deals with people on a day to day basis were kept tightly under control.

      The sea of disgruntled employees heaved a huge sign of relief when YSR took the power. YSR, as somebody aptly put it, offered a free-for-all system. He let the system slide into older ways where corruption became a way of life. Everybody takes their cut, in turn helping YSR and his associates take their lion’s share. Everybody is happy. Infact, all the social policies highlighted above have contributed in a large way towards corruption. 

      Housing : Most congress workers could get a low-income house assigned which could then be traded away. The several needy people from slums would accept the allotment, make profit by selling it away and return to the very slums that it was supposed to replace.

      Hospitals : The primary goal of Government Hosptals was to provide almost free health care to the patients. However, the corruption and sad state of affairs have left the caretaking in a mess. Instead of making the Govt. Hospitals meet their mandate, YSR provided blanket reimbursement of expenses in any hospital. Consequently, it provided unregulated corporate and private clinics with a steady stream of income for treating the needy folks.

      Private Collages
      : Government universities provide highly subsidized education for everybody through what were referred to as free-seats. Previously, a certain amount of seats in the private institutions were needed to be available as “free-seats” and the rest could be charged a far higher fee (paid-seats). Those who excelled in entrance examinations ended up grabbing the free-seats and rest had to settle for paid-seats. However, with the new policy anybody who can show low-income in paper can avail of free-seats or paid-seats at Tax-Payer’s expense. While helping the poor, it also helped any rich person who could prove low income by keeping money off the books etc. (traders, landlords etc).


      Robbing of Resources
      In the past decade, there were several proposals about an upcoming international airport in my home city. At various points, three possible locations have been rumoured to be indentified for this purpose.

      Some of my relatives owned pretty much all the very fertile lands in a small village bordering the one possible location. Their lands were forcibly taken over by the government at exorbitantly low government price on the name of a still imaginary International Airport. In the end, the existing old airport was further developed to accommodate larger flights, making a new airport unnecessary. Government then turned around and marketed the acquired fertile lands to aspiring industries at 10 or 20 times the procured price. And most of these arable lands lie barren now.

      The income thus obtained from playing a real-estate mediator has resulted in a enormous income to the government. This along with increased registration fees have to some extent financed the grand spending schemes of the government. Needless to say, such measures are one-time chances and are not sustainable. They have also resulted in severe loss of fertile lands, when our population and demand for food is only growing.

      Disproportionate Wealth and Surplus Land
      In order to prevent legacy of feudalism, where a few big-fish controlled all the lands, AP Land Reforms Act 1975 was implemented restricting the amount of land of an immediate family to anywhere between 10 to 54 acres. (link). Anything a family owns beyond that would be considered surplus land and is illegal.

      The YSR family has accumulated vast wealth to the tune of 618 acres in surplus land. He claimed to have surrendered all the land after becoming public. However, he surrendered only a 310.57 acres and not 618 acres as reported in the media. YSR later claimed it to be a slip of the tongue.

      This was not the sole prerogative of the current government. With the implementation of the Land Reforms Act, 1975, total of 7,99,663 acres were surrendered to the Govt. The distribution of this land to the landless has been a still ongoing process with little tranparency.

      Temple Neglect and Church building
      All temples in AP are controlled by the “Endowment Ministry” in the Govt. of AP. This means that any donation temple-goers make to the temple goes to the government and the government to a large extend decides how this money is spent. Since there is little transparency, it is not clear how these funds and spent, but the fact remains that the priests remain utterly underpaid and temples do not get to perform much charitible activities as they may want. So temples income goes to the government and the responsibility of their maintainence also falls on the government.

      However, no such income comes to the government from the churches and churches do not fall under the purview of AP Govt. However, YSR has approved GOs to donate money to churches. This benefited a total of 258 churches (2.63 Crores). (link)


      Real Estate bubble, or is it?
      A lot of people are surprised at how, a new crop of investors established businesses worth 1000’s of crores in paltry 5-10 years, when likes of TATA and Birla had to sweat the hard way for over a 100 years. 

      In 2004-2005, YSR’s government gaveaway contracts worth 20,000 crores ($4 Billion). This covered 18 huge irrigation projects, but were given to select 9 contractors. (link). Releasing even a fraction of that amount as advances to the contractors would create tsunami in the markets and that is exactly what happened. Anybody with that kind of windfall would reinvest while the projects progress. 

      This provided a lot of INC politicians and investors with seed capital for real-estate development when the real-estate returns were sky-rocketing at insane pace. Imagine a 10 Crore advance from the Government, that one invested in developing real-estate in 2004-2005. This helped raise incredible amount of funds for the 2009 elections and made YSR the blue-eyed boy of INC.

      Luckly for the investors, the worldwide property boom masked the contribution of these artificial funds to the Hyderabad boom. 

      This doesn't absolve TDP, as it had its own share of the pie in the 10 years of the rule.

      ---------------------------------------------------------

      YSR elicits pretty strong feelings, either of love or hate, there is little middle ground. 

      But nobody can deny that YSR was the most popular and charismatic leader with mass appeal that AP had seen since the times of NTR. He knew the pulse of the people and generated a groundswell of support from the very hardworking souls of the villages. The door to the hallways of power is in the villages and he knew that more than anybody.