The vultures still feed

A FEAST OF VULTURES
The Hidden Business of Democracy in India
Josy Joseph
HarperCollins
229 pages; Rs 599

India supposedly liberalised its economy in 1991. In the quarter-century since, the state is supposed to have pulled back its borders, freeing up private enterprise. This is the narrative, at any rate, that we have been sold. But it is untrue in its essence. As the veteran journalist Josy Joseph argues in his new book, A Feast of Vultures: "India's socialist economy has not really been replaced by laissez-faire in these decades. The government did not really withdraw from the marketplace or regulations. If anything, it found new ways to coerce and assist a new breed of business people as the scope widened dramatically." This may not be obvious to the onlooker; but Mr Joseph goes on to argue that what we call corruption is in fact proof that the state's control is still tight: "What is constant is the grip of corrupt politician-businessmen-criminal syndicates on governance. It is even greater than anything the average observer of Indian democracy can imagine, even in these days of exposes and hidden cameras."

I may not agree with Mr Joseph on the extent of corruption, and I definitely do not agree with him on the limits to the imagination of the average observer of Indian democracy. In fact, the average observer tends to assume corruption even where there is just incompetence or laziness - or, for that matter, relatively pure motives. But Mr Joseph's larger point, about how government intervention sustains high-level corruption, is certainly proved beyond doubt in his book.

A Feast of Vultures has a scope as massive as Mr Joseph claims for corruption in India. The first part, titled "The Middlemen", discusses the many forms that "dalali" takes in India - from the petty to the great. Mr Joseph describes men as diverse as a fixer just outside Chhattisgarh's capital, and Ottavio Quattrochi, the mysterious friend of the Gandhis who was the centrepiece of the Bofors scandal. Prime ministers' personal secretaries and Congress presidents' sons-in-law all appear, with their agendas, their successes, and their failures. This section moves quickly across time and sectors - the effect is a little dizzying.

But the next section, called "The Very Private Private Sector", makes up for it. It tells the story, as Mr Joseph sees it, of the Indian aviation sector - in a way never quite told before. He mounts a credible case that the pioneers of private aviation, the Wahids of East West Airlines, were brought unfairly low by government interference and incompetence; he implies strongly that competitive skulduggery was involved. He demonstrates that there are large holes in the government's preferred narrative - that the Wahids were essentially fronts for Dawood Ibrahim, and that Thakiyuddin Wahid, the managing director of East West, was murdered by Dawood's rivals. He examines Jet's successes and the Tatas' failures, ending: "[Jet Airways promoter Naresh] Goyal's story is an instructive manual on how to succeed in modern India. But he is not the only one... In every gathering of India's powers that be, you could point to someone randomly and there would be a similar story to tell." Again, I feel that is certainly an over-statement, but there is nevertheless a grain of truth there.

The third section, titled "The Big League", is about the men right at the top of the tree - such as, for example, politician-businessmen like Vijay Mallya and Naveen Jindal. (The last chapter, unsurprisingly, is principally about Mukesh Ambani.) Again, much of Mr Joseph's narrative here is, I feel, overstated - that "the new generation of entrepreneurs... celebrated in New Delhi and New York, are the villains of India's rural heartlands", for example. Indeed, I think this is - other than the Mallya bits - the weakest part of the book. Yet, again, the basic thrust of Mr Joseph's argument - one made before him by such men as Raghuram Rajan - cannot be denied: That you can judge the freedom and quality of an economy by the way its richest men have made their fortunes. And that an economy in which fortunes are made through state forbearance and intervention is one in which democracy, too, is damaged.

But, you ask, is this not a book already outdated? Has not democracy already been renewed two years ago? Is not high-level corruption dead? We have certainly been told that often enough, by hopeful businessmen and by naïve market analysts, and by the prime minister himself. But if Mr Joseph's book accomplishes anything, it ends that argument. It effectively skewers the pernicious myth that corruption ended in May 2014. Corruption emerges from a poorly regulated, unfree economy; personalities are irrelevant. Parties still need to be funded; allies still need inducements. I will not repeat all of what he has revealed and collated about the manner in which crony capitalism continues in the Modi era; buy A Feast of Vultures and be convinced yourself. Let me just end with this quote from the book: "In India, meanwhile, nothing has changed. According to several sources in the intelligence agencies, market estimates and even formal studies, the scale of black money involved in politics has only gone up, as also the scale of corruption." Let us not over-state the problem, but let us at least stop pretending that the problem has gone away.