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Decision-making in the age of coalitions

V. Jayanth

The Prime Minister could set up a compact Group of Ministers to consult the UPA constituents before major policy initiatives.

THE WAY Prime Minister Manmohan Singh had to put on hold the Government's disinvestment plan, at least with regard to the Neyveli Lignite Corporation and the National Aluminium Company, has brought little credit to the Centre. Given that it is leading a multi-party coalition regime at the Centre, the Congress should have been more careful in pushing through such a proposal. True, the Cabinet had cleared the divestment of 10 per cent of the Government's stake in the NLC and NALCO, to begin with. But the moment thousands of NLC employees began a strike at Neyveli, led by the Dravida Munnetra Kazhagam-affiliated Labour Progressive Union, the proposal became untenable. On the one hand, how could the DMK, which is part of the Cabinet, oppose the decision and lead a strike? And, on the other hand, when it hinted at pulling out of the Cabinet (not withdrawing support to the Congress-led Government), how could the Prime Minister and his Government let it go?

These are the imponderables in a coalition regime. The Congress must realise that the coalition experiment in the country is still in its formative stage. Being dependent on a host of regional parties with their own local compulsions, it should know that it is not always possible for them to view every decision from a national perspective.

On the Sri Lankan Tamil issue, the DMK could adopt a nationalistic and cautious approach. But when it comes to the future of 19,000 employees in a profit-making public sector undertaking such as the NLC, the ground realities change significantly. Not only are the Left parties and the Central trade unions agitating over the move, the DMK-affiliated trade union is also the recognised union in the NLC. It is therefore in the vanguard of the protests. So the DMK had to gently threaten to pull out from the Manmohan Singh Government if the disinvestment move was not withdrawn.

Within hours of that thinking being conveyed to the Centre, Mr. Singh announced he was putting the proposal on hold. The strike was called off. It has brought significant relief to the DMK and its Government in Tamil Nadu, but hurt the Centre's credibility and the reforms programme. Described by trade unions as an "arbitrary, unilateral decision," it has mauled the government's reform agenda and international image — at a time when India is emerging as a favoured investment destination.

Aside from sending out a bad signal to investors and an already volatile market, this move has also given rise to mild friction in a coalition that was coming to terms with itself. The DMK has made its stand on reforms clear. Add to it the consistent and well-enunciated policy of the Left parties, and the Centre's economic framework becomes fairly clear.

Time and again, the Left parties have told the Prime Minister and the United Progressive Alliance's coordination committee that the Government should not swerve from the Common Minimum Programme, and that a continuous consultation exercise is imperative to implement policies and programmes. The Left has walked out of the coordination panel once and will not hesitate to do so again, more permanently perhaps. That being the case, it is surprising how the Centre announced this limited edition of divestment from two public sector undertakings.

If the Centre wants to raise a corpus for the National Investment Fund, it can certainly consult its allies and the Left parties to evolve a framework to do that. It should not spring a surprise. It is only July and there may be time to relaunch this exercise before it is too late for this fiscal. But the process has to be transparent and consultative. The Prime Minister can set up a compact Group of Ministers to consult the UPA constituents and then the Left so that a political consensus can first emerge.

Armed with such a backing, the Centre can then put it across to the major trade unions and seek their support and understanding. It may even be worth reaching a broad agreement with the unions on such sensitive issues. Only such an approach can succeed.

With the era of coalitions here to stay, the major constituent that leads such a government must learn the art of consensus building, first within the alliance and then in Parliament. Even if it may not be an easy task, it will get things done. Otherwise, the tag of a "rollback raj" will stick to this regime, just as some of its predecessor National Democratic Alliance government's decisions had to be rolled back for want of consensus. The economic team in the Manmohan Singh Government must see the writing on the wall and learn from its mistakes.

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