This episode once again highlights the need for divestment of shares held by the government. For as long as the government remains the only or the majority shareholder, the company concerned will remain accountable to Parliament. And as long as that accountability is interpreted in the way that it has been, it will be difficult for any government to hand over controls to, as one senior bureaucrat once put it, a bunch of managers. Given the history of the public sector in India and, therefore, its traditions, it is unlikely that India can evolve into a situation that resembles the one in France or Singapore or some other countries where the government is a major shareholder but nevertheless allows the public sector near-total autonomy.
Arguably, public ownership in a genuine democracy induces a degree of political calculation which is wholly absent in Singapore (but not in France). The degree of such politicisation is also important and the hard truth is that in India it is unacceptably high. That, in fact, is one reason why many well-meaning civil servants defend the governments reluctance to grant greater autonomy. It could, in the absence of prior divestment, result in the central public sector becoming like the state public sector. There, as everyone knows, minor politicians and their relatives are placed on the boards of directors as alternatives to berths in the council of ministers.
However, to look on the positive side, the Vittal Committees efforts havent been entirely wasted. The fact that as many as 696 guidelines, most of which were drawn up in at a different time to serve different objectives, have been deleted should serve as a platform from which a fresh initiative can be launched. A closer examination is bound to reveal that a further enhancement of the powers of the bunch of managers will not change the governments ability to face parliamentary scrutiny. So until genuine divestment begins, may we suggest the setting up of another committee to re-examine the remaining guidelines?