Welcome to the Matrix of the Indian state

The Radia tapes reveal the networks and routers, the source codes and malware that bind the corporate and political establishments in India.







29 November 2010
The Hindu

Welcome to the Matrix of the Indian state

Siddharth Varadarajan

As squeamish schoolchildren know only too well, dissection is a messy business. Some instinctively turn away, others become nauseous or scared. Not everyone can stomach first hand the inner workings of an organic system. Ten days ago, a scalpel — in the form of a set of 104 intercepted telephone conversations — cut through the tiniest cross-section of a rotting cadaver known as the Indian Establishment. What got exposed is so unpleasant that several major newspapers and television channels that normally scramble to bring “breaking” and “exclusive” stories have chosen to look the other way. Their silence, though understandable, is unfortunate. Even unforgivable.

After all, the tape recordings of Niira Radia's phone conversations have come to light against the backdrop of the recent Comptroller and Auditor General of India (CAG) report on the allocation of 2G spectrum, which demonstrated how the rules were arbitrarily bent by the then Telecom Minister, A. Raja, in order to favour a handful of private companies at government expense. Among the beneficiaries of Mr. Raja's raj were Anil Ambani. And also Ratan Tata. In one of the tapes, an unidentified interlocutor asks Ms Radia, whose clients include both Mr. Tata and Mukesh Ambani, why “you people [i.e. the Mukesh Ambani group] are supporting [Raja] like anything ... when the younger brother [Anil Ambani] is the biggest beneficiary of the so called spectrum allocation”. “Issue bahut complex hai,” Ms Radia replies. “Mere client Tatas bhi beneficiary rahein hain (my client, the Tatas, have also been a beneficiary).”

Apart from telecom, the tapes also provide valuable insight into the gas dispute between the two Ambani brothers. This was a dispute in which Mukesh Ambani made skillful use of the “gas is a national resource” argument with a pliant media even as he used his influence with individual MPs to try and orchestrate a massive tax concession for his company from the same national resource, Krishna-Godavari (KG) basin natural gas.

In an interview to NDTV and the Indian Express on Saturday — two media houses that have so far avoided covering the tapes — Ratan Tata has called the recordings a “smokescreen” designed to hide the real truth. He is wrong. Utterly wrong. No doubt we know very little about who leaked the recordings and why these were cherry-picked from a wider set of 5,000 recordings the Enforcement Directorate and Income Tax authorities made as part of their surveillance of Ms Radia. But even if the story they tell is partial and designed to expose only a fraction of the corporate lobbying which has been going on, we would be naive to ignore the contents of the tapes or be dismissive about their significance.

In the science fiction film, The Matrix, Morpheus tells Neo, “You're here because you know there's something wrong with the world.” The Matrix, he says, is the world that has been pulled over everyone's eyes to blind them from the truth that they are slaves. He offers Neo the choice of a blue or red pill. “You take the blue pill and the story ends. You wake in your bed and believe whatever you want to believe. You take the red pill ... and I show you how deep the rabbit-hole goes.”

The Niira Radia audio archive loaded on to the Internet by Open and Outlook magazines last week is the red pill of our time. It reveals the source codes, networks, routers, viruses and malware that make up the matrix of the Indian State. The transmission of information, also known as “news”, between different nodes is vital for the system to work efficiently. The news is also the medium for reconciling conflicts between different sectors of the establishment. If you hear the recordings, you begin to understand the truth about the Wonderland that is India. No wonder there are many amongst us who would rather swallow the blue pill. For once you go in, the only way out is to keep digging. And yes, the rabbit-hole runs deep.

So deep, for example, that we hear a Member of Parliament, N.K. Singh, who is meant to represent the people and the state who voted for him, brazenly batting for a single-man corporate constituency, Mukesh Ambani.

In one recording, Mr. Singh tells Ms Radia of the firefighting he is doing on behalf of Mr. Ambani to ensure a tax concession the finance minister had announced in the 2009 budget for gas production is made applicable retrospectively. Ms Radia says she has killed news stories about the Rs.81,000 crore super profit Reliance Industries Ltd. (RIL) would make were that to happen but Mr. Singh is more concerned about what happens in Parliament during the debate on the Finance Bill. His fear is that if Opposition MPs make a noise about a largesse being given to one company, the finance minister would be on the defensive and the prospect of extending the concession retrospectively would not even arise. Mr. Singh accuses BJP leader Arun Shourie of being on Anil Ambani's side and reveals how he has managed to get Mr. Shourie replaced as the BJP's lead speaker by Venkaiah Naidu. How well does Mukesh know Venkaiah, asks Mr. Singh, who is a Rajya Sabha MP from Bihar on a Janata Dal (United) – JD(U) ticket. Ms Radia replies that a senior RIL executive, P.M.S. Prasad, knows Mr. Naidu well. “Then I am going to get him flown in today to talk to Venkaiah,” Mr. Singh says, “because if he is the first speaker, and he already takes a party line, then it will be very difficult for Shourie in his second intervention, to take a different line. Then we have to orchestrate who will speak, you know, this is the immediate problem right now. Because, frankly, if this doesn't go through, this tax thing, then it's a major initiative taken that then fails to materialise.”

We don't know if Mr. Prasad flew down and met Mr. Naidu as N.K. Singh wanted him to do. But the BJP leader's speech in Parliament two days later has this telltale suggestion: “The Bay of Bengal has become the new North Sea of India. Government departments should not be seen quarrelling whether mineral oil is a natural gas or not. Whatever concessions [are] needed for infrastructure, exploration ... are connected with the energy security of the country.” This was a veiled reference to the Petroleum Ministry's letter to the Finance Ministry asking for natural gas to be given the same tax concessions available to oil retrospectively and not just from the New Exploration Licensing Round (NELP) VIII round which would exclude RIL's KG basin output. A request the revenue secretary had turned down.

In other recordings, we see journalists and editors, who are meant to report and analyse what is going on objectively, offering to become couriers and stenographers and foot soldiers in the war one set of corporate fat cats is waging against another. We also see a political fixer, Ranjan Bhattacharya, whose USP once was his familial proximity to the Bharatiya Janata Party, seamlessly open a line to the Congress and go about his business as if election results don't matter. He boasts about his proximity to Ghulam Nabi Azad and his ability to send a message to “SG, boss”, a reference to the Congress president. He then quotes Mukesh Ambani telling him the Congress party is now “apni dukan”. Mr. Bhattacharya may have been lying about his influence but then the formidable Ms Radia is anything but a dupe.

We also hear in the tapes an iconic businessman, Ratan Tata, who today makes sanctimonious statements about crony capitalism and the danger of India becoming a banana republic, lobbying through his PR agent, Ms Radia, for A. Raja to be given the Telecom portfolio.

If the allocation of spectrum by the Manmohan Singh government in 2008 and 2009 is one of the biggest scams in independent India, then the involvement of businessmen like Ratan Tata, Sunil Mittal and Mukesh Ambani in lobbying for their choice of telecom minister when the UPA government returned to power in May 2009 is surely a very important part of the back-story. But it is a story none of the journalists who liaised with Ms Radia during this time chose to report. More than the squabble within the Dravida Munnettra Kazhagam (DMK) or between the DMK and the Congress, the involvement of India's biggest companies in the process of cabinet formation was the story that should have been headlined. Ms Radia talks of Sunil Mittal and AT&T using Times Now to push out stories about Dayanidhi Maran being the frontrunner for telecom and Mr. Raja being in disfavour. Her own strategy appears to have been to use her relationship with Barkha Dutt and Shankar Aiyar to get the opposite message out onto news channels like NDTV and Headlines Today.

Instead of using Ms Radia as a “source” for covering the DMK, her role, and the role of her principal clients, in trying to push for a minister who was seen even then as tainted ought to have been exposed. But then Delhi is a hothouse of power, and proximity to power deadens one's reflexes and weakens one's nerves. What Indian journalism needs more than anything else today is distance. From both politicians and industrialists. It is never too late to swallow that red pill.