It’s showing: Narendra Modi’s IDEOLOGICAL TEETH

TT, New Delhi, Jan. 30: The Narendra Modi government's decision to take over seven tea gardens in Bengal is another scattershot indicative of a strong Left-leaning bias that has increasingly started to permeate policy-making at the Centre.

On the face of it, the government's order talks about the need to stop the managements of these gardens from acting in a manner that is "highly detrimental to the tea industry and to public interest".

"You could be killing two birds with one stone," said former Planning Commission member Abhijit Sen who believes that Left philosophy continues to dominate mindspace. "You're bailing out a sick private firm and at the same time catering to the Left thinking of the state. It would make political sense."

The order directing the Tea Board of India to take over the managements of the seven gardens is actually a tiny part of an ideological scaffold that is underpinned by the principle that the Centre needs to aggressively intervene to influence business outcomes.

Over the past year, the Modi government has started to drum up the virtues of creating large state-owned assets in a throwback to a Nehruvian era of creating state monopolies in strategic areas.

Last week, petroleum minister Dharmendra Pradhan sprang a surprise with the announcement that four state-owned oil companies would jointly establish a refinery on the west coast with a processing capacity of 60 million tonnes a year. Put that in perspective: it will be the biggest single refinery in the country. At present, there is no state-owned refinery with a capacity of more than 15 million tonnes.

But that's not all. Last year, the Modi government flirted with a proposal to establish a 3-million-tonne steel plant at Khammam in Telangana at a cost of Rs 18,000 crore.

Steel Authority of India Ltd (SAIL) was asked to form a consortium with a couple of other state-owned entities - Vizag Steel and NMDC - to set up the steel plant. A convulsion in commodity markets sent prices skidding and unleashed a tide of steel imports that effectively pushed the plan into cold storage.

The Centre has been mulling protectionist tariffs - another sign of socialistic tendencies - to protect domestic steelmakers in an effort to further its much-vaunted Make in India programme.

Not since the early eighties has any government at the Centre shown such touching faith in the public sector and the desire to propel it to the commanding heights of the economy once again. The capital expenditure by public sector units has been projected at Rs 3.17 lakh crore this year.

Some economists believe Modi's abiding faith in the public sector and state-owned assets could be rooted in his own administrative experience in Gujarat where he was chief minister for 13 years.

"Gujarat is one of the few states with many successful state government-run public sector undertakings and that would have shaped his thinking because he's seen them work," Abhijit Sen said. "He doesn't have the same anti-PSU attitude that many in the right-leaning sections of the Congress, for instance, have."

An aversion to privatisation and the creation of a larger state with greater regulatory powers are usually signs of Left-leaning thinking, and are contrary to the economic messaging that Modi came with, said economist P.K. Choubey.

"Labour laws are another example - the Modi government has hardly touched them," said Choubey, professor of economic administration at the Indian Institute of Public Administration in New Delhi. "This is also out of tune with the way welfare economies the world over are going - towards greater liberalisation."

A senior member within the Modi government said: "Look, if it's a conflict between a corporate entity and its workers, we have to be on the side of the workers. We are a political party...."

"I will go to the extent of saying that there is no case for bringing in labour reforms because I want to know the name of one company whose growth has been stalled or which has shut down because of labour issues. The reasons are of a company's own making and have nothing to do with the labourers," he added, picking an argument usually found in the Left quiver.

He did not say whether the Modi government would spring the same logic on potential investors who have been seeking labour reforms. Such investors believe that easier labour rules will facilitate the setting up of more projects and more job opportunities.

"The Modi regime wouldn't be the first government that promised economic reforms and then pandered to political pulls, which in the case of the tea gardens could be local in nature," said Ashok, an economic history professor who goes by a single name, at Jawaharlal Nehru University. "But his government is also sending conflicting signals. Finance minister Arun Jaitley only recently said the government wasn't opposed to liberalisation."

The Sangh economic ideology in which Modi was schooled in his formative years is, strictly speaking, protectionist, not pro-reform.

Virjesh Upadhayay, general secretary of the parivar trade union Bharatiya Mazdoor Sangh, said: "Prime Minister Modi has unfairly got the tag of being pro-corporate. In fact, his government has done a lot of work that is pro-poor."

Upadhayay said the BMS had drawn the Centre's attention to the plight of the tea garden labourers.

Said Piyush Goyal, minister of state with independent charge for power, coal, mines and renewable energy: "Our economic philosophy has always been consistent; it is pro-poor, it is based on (Jana Sangh ideologue) Deen Dayal Upadhayay's staunch advocacy of 'Antodaya' (serving the last person in the queue)."

The suggestion seems to be pro-reform means anti-poor - an ironic interpretation in the 25th year of the economic reforms of the 1990s, whose fruits have not been confined to the affluent alone. The refrain at an event today looking back on the summer of 1991 was real reforms require political leadership and risk-taking of the kind former Prime Minister P.V. Narasimha Rao displayed a quarter of a century ago. 

On Friday, Modi said he had no plans to wind up subsidies. Instead, he intended to rationalise and target them at deserving beneficiaries.

The Telegraph asked the Left what it thinks of "competition" from Modi.

CPM general secretary Sitaram Yechury confined himself to saying "it is the government's responsibility to save the workers" of the tea gardens.

But two other CPM leaders suggested that Modi still has some distance to cover before he can earn his Left lapels.

CPM Rajya Sabha MP Ritabrata Banerjee welcomed the government intervention in the gardens but refused to see anything Left in Modi's move: "We have to wait and watch. What happens if tomorrow they sell these tea gardens to some other private player?"

The Centre has not ruled this out, which raises the question why it had to wade into a domain that has nothing to do with governance in the first place.

CPM leader and Siliguri mayor Asok Bhattacharya has raised the bar for Modi. "This cannot be called a takeover by the government.... If you want to talk takeover, it has to be what the Centre had done vis-à-vis Sir Biren Mukherjee's IISCO in 1972," Bhattacharya said.

When Mohan Kumaramangalam, who was in the communist party before he joined the Congress, was the Union steel and mines minister, the Congress government had taken over the steel company in 1972.

Ready to match Kumaramangalam, takeover for takeover, Prime Minister?