DNA Edit – Aircel Maxis case: No politician can cut a deal without official help

The jury is out and it is not looking good at all. Six months after they were chargesheeted, the Centre has allowed the persecution of five bureaucrats — serving and superannuated — who have been accused of aiding and abetting former Union Finance Minister P Chidambaram in the Aircel Maxis case. The officials, who were serving in the Foreign Investment Promotion Board (FIBP), have been charged with illegally according investment clearance to Malaysian firm Maxis to acquire mobile phone operator Aircel. In 2006, Chidambaram granted FIBP clearance to Maxis for the acquisition of Aircel when only the Cabinet Committee on Economic Affairs was entitled to do. In what is being described as a clear infringement of foreign investment laws, the proposal was wrongly projected as merely involving an investment of Rs 180 crore. It was duly cleared by Chidambaram. There are lessons here that need to be learnt. No politician can do an illegal deal by any amount of subterfuge unless he has pliable bureaucrats on his side. Under the rules of business, any politician — even the Prime Minister — does not have the power to clear files, which is strictly and technically speaking, the domain of civil servants. 

That is germane to the Westminster system that India preferred to adopt in 1947. It is equally true that once an official draws the line or refuses to collaborate on a deal that is inherently flawed and against the rules, he cannot be compelled even by his boss to sign and approve a file. An upright bureaucrat will take a transfer, if it is against the rules, but will not compromise. In post-Independent India, there have been umpteen occasions when officials have refused to curry favour with ruling politicians and willingly paid the price for standing up to the boss. Sadly, India seems to be moving away from those hoary traditions. It is difficult to explain why five top-notch bureaucrats would approve an investment case when it was clearly not within their powers to do so. After all, the job of the civil servant is to render well informed advice, after a deep study of a matter. By training and education, he is expected to do so.

The only possible reason could be the misplaced notion of immunity that is fine when the deal is being clinched, but which can easily become a liability, as it has in this case. There are other long term implications as well. While this Aircel Maxis is a relatively small deal in money terms, the fact is that all business of the government - particularly those that concern financial transactions - are going to be under the scanner when a rival government comes to power. Care has to be taken to ensure that only crooked deals be exposed and probed and not every signature on every file, which will bring the process of decision making in the government to a halt. If every officer, before he signs a file, has to worry about what questions can be asked of him a decade or two down the line, then it would lead to a policy paralysis.