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Lobbying is integral to policymaking

KP Sunny

Posted online: 2008-07-21 01:34:54+05:30

The cornerstone of Indian economic reforms is the gradual removal of the discretionary

powers of government through clearly laid down policies that favour none and do awaywith the need for corporates to beg for special treatment. Unfortunately, even after more

than a decade-and-a-half of reforms, the government retains substantial discretionarypowers. Discretion with respect to quick (or slow) clearance of files, speed of licence

awards, higher or lower tax imposition, smoother (or slower) loan sanction, and including

rewriting of policy for entire industries.

The Indian economy, by and large, functions around the governments discretionarypowers. Whenever government changes, the wielders of these discretionary powers also

change, making matters worse for corporate lobbyists. In most cases, businessmen hate

political instability and would prefer continuity. However, reform has the ability to

effectively dilute the discretionary powers of government through the establishment ofindependent regulators and a clear policy, as witnessed in the telecom sector.

Irrespective of the level of reform, it is an accepted fact that corporate lobbying is a

necessary evil. It remains an integral part of the policymaking process of government atall times; only its manifestations vary. In the last few days, India has witnessed a raging

debate on lobbying as it was raked up in the aftermath of a corporate feud that reached

the corridors of power at the Delhi Durbar. Lobbyists on either side have been trying hardto tilt the governments petroleum policy to their advantage.

It invited severe criticisms from the so-called anti-corporate pro-people parties,

conveniently forgetting the fact that lobbying was several times worse before Indiareformed. The Indian public now has a chance to witness how government responds tofairly open demands from lobbyists on behalf of corporates.

Lobbying goes on all the time, mainly because the state retains so much discretionary

power. But even a much-reformed state will offer scope for lobbying. Therefore, it is

pertinent to ask, Why not encourage an ethos that discourages behind-the-doorslobbying? The American experience in this regard should be an eye-opener, as lobbyists

in America are registered legal firms. Now, it is for Indian society to decide whether we

should allow covert backdoor lobbying or open transparent lobbying as practised in thedeveloped world.

Lobbying in India is at a nascent stage. Until recently, it was rated equivalent to

influencing government policy with money. With increased transparency in governance,

corporate entities realised that a more legitimate method is needed to influencepolicymakers. Certainly, religion and caste play an important role in Indian politics and

are used to influence policy as more and more politicians resort to vote-bank politics.

Being politically savvy is considered an obvious prerequisite to lobbying governmenteffectively.

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Winning a contract is one thing, but becoming a savvy local corporation in India is quite

another. A successful lobbyist needs to know how to make representations to

government, what tools and techniques can be effectively used to communicate withMPs, MLAs, ministers, etc. These are both the obvious and arcane bits of knowledge that

empower lobbyist to understand better the working of the government.

European lobbyists have been very active in India in recent times. Today, lobbying in

Europe is a highly specialised discipline, often regarded as a high-end management toolpractised by lawyers, retired diplomats and former politicians to further private and

public interests with policymakers. Even in Europe, lobbying had been perceived earlier

as something involving bribery and other criminal acts. Nowadays, lobbying has goneglobal and todays lobbyists cannot act in isolation any longer, when their clients

interests are rapidly expanding internationally.

Since the reforms cannot ensure substantial reduction in the discretionary powers of

government, it is time that Indian corporates start hiring professional lobbyists. Necessary

safeguards need to be taken to ensure that lobbyists should not double up as MPs and getfree access to ministers who formulate important policies.

Moreover, a realisation should emerge within the social and political spectrum that the

Indian democracy has reasonably matured and lobbying needs to be recognised as anintegral part of the policymaking process. It needs to be regulated and professionally

managed for the betterment of everyone.

The writer is deputy director (economic services), National Productivity Council, New

Delhi. These are his personal views

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