E D I T O R I A L   P A G E

IN FOCUS

Corporate marriages now made in India
Information Technology companies major gainers
by T. V. Lakshminarayan
From being dirty words till the late nineties to becoming the corporate mantra of the new century, Merger and Acquisition have indeed come a long way.

Luring foreign direct investment, the Indian way
Merger and acquisition of corporate firms in any country are inextricably linked to the investment climate, policies and procedures. Foreign Direct Investment is the most effective tool with the international players to have a direct stake in any country’s economy. From the Government’s viewpoint FDIs supplement internal resources in generating speedier economic growth.

“Quote — Unquote”

ANALYSIS

DELHI DURBAR

Corporate marriages now made in India
Information Technology companies major gainers
by T. V. Lakshminarayan

From being dirty words till the late nineties to becoming the corporate mantra of the new century, Merger and Acquisition have indeed come a long way.

It was in the early eighties that the Indian corporate world first heard of an acquisition bid. The poacher in this case was the high profile UK-based Non Resident Indian, Swaraj Paul, who through his Caparo Industries made a serious bid to take over the Faridabad-based Escorts Industries. There was a hue and cry by the shareholders and Government intervention through the Financial Institutions, which have a stake in every major company, thwarted the bid.

As the winds of liberalisation swept through, more so in the early nineties, the corporate world had its tryst with yet another take-over bid — this time by another UK-based tobacco giant BAT. BAT made a strong bid to overthrow Mr Kishan Lal Chugh, Chairman of ITC, the country’s largest cigarette manufacturer, as a precursor to its taking over the Indian company. Mr Chugh reacted promptly, cried himself hoarse over the insult to Swadeshi sentiments and had the whole country supporting him. ITC was saved even though Mr Chugh lost his job.

Then came the bid by Suzuki Motor Corporation to arm twist its equal partner in Maruti Udyog Limited, the Government of India, and have a larger say in the company’s affairs. This time it was the then Industries Minister, Mr Murasoli Maran, who cried foul over the Japanese company’s tactics. In a show of wit and resolve, Mr Maran ensured that the Japanese automobile company lost the posts of the Managing Director as well as the Chairman of the company.

As the century was coming to a close, the scene became spectacularly different. There was an unprecedented boom in global mergers and acquisitions. In 1999, alone, the worldwide value of deals exceeded 2.3 trillion dollars, or nearly 30 per cent of the European Union’s economic output for the year. And India, having been sucked into the vortex of globalisation, was not left untouched.

The protests over such take-overs had turned into a whimper in the country. One watched silently as the US-based soft drink major, Coca Cola, bought Parle’s Thums Up, Limca and Gold Spot brands. Thereafter, it was Gillette taking over Indian Shaving Products and Brooke Bond India Limited merging with Hindustan Lever. Even the BJP-led NDA Government went out of its way to make peace with Suzuki and accommodated a Chief Executive who was to the liking of the Japanese company.

Merger and acquisition is the name of the game now. Though the Government has taken several preventive measures to protect domestic companies, shareholders are backing mega mergers. The reasons for the change in attitude have been as diverse as cutting costs, expansion and growth and adding brand muscle. Shareholders too get rewarded in the process.

Indian sentiments were buoyed by what was happening the world over. Major global giants were coming together to create mammoth firms. For example American Online bought entertainment colossus Timer Warner to create the world’s largest entertainment, media and IT entity. The market value of the new firm was estimated at around 350 billion dollars.

Recently it was the British oil giant BP Amoco buying another British lubricants company Burmah Castrol Plc for three billion pounds (4.7 billion dollars) in cash. The take-over, it is estimated, would result in 1700 job cuts globally and would start enhancing profits of the merged company in 2001.

Finally, the largest merger in the history of software industry took place when two Indian-American firms entered into a 9.3 billion dollar stock-for-stock deal. Dallas-based i2 Technologies, a leading e-business solutions provider, and Aspect Development Inc, a global leader in collaborative solutions, merged to create a B2B (Business to Business) marketplace powerhouse.

Indians are quite up to the task of competing when they are forced to.

A far cry from the days when mergers and acquisitions were suspect and taunted as “sell off”, successful Indian companies have now started playing the same game.

The most successful of them has been the announcement by the Rs 873 crore Tata Tea that it is buying out the 271 million pound (Rs 1870 crore) worldwide Tetley Tea business.

A defining moment for the Indian corporate world and the Tatas personally, the acquisition of the Tetley brand was the largest deal of its kind in the country.

“I hope many other Indian companies will follow this and take India into the global arena”, is what the Chairman of Tata Tea, Mr Ratan N.Tata, had to say on the deal.

The acquisition will make the Tata Tea-Tetley Tea combine one of the largest tea producers and marketeers in the world. Tata Tea, with 74 tea gardens and a production of 62 million kg last year, is the largest integrated tea producer in the world.

Mergers have not been confined to the international arena. Recently, the Tatas and Birlas, who symbolised the whole of corporate India at one time, signed a Memorandum of Understanding to merge their cellular telephony business into a single entity with an enterprise value of about a billion dollars.

The Tata-Birla deal, is a three-way equal stakes joint venture between Tata Industries, US giant AT and T and the AV Birla Group. The merger will create a monolith with a consumer base of over 1.5 lakh spread over Andhra Pradesh, Maharashtra, Gujarat and Goa.

The bug of merger and acquisition also bit the travel industry. First it was the Swiss major, Kuoni, joining hands with SOTC, followed by Indtravels’ merger with Carlsons Wagonlit and the buy-out of Sita Travels by Kuoni.

According to industry sources, the Sita-Kuoni merger is merely one among many which are expected to follow suit. It is expected that such acquisitions and mergers would certainly go a long way in improving efficiency, profitability, enhancing competitive advantage and even adding to the brand value in the tourism sector.

Consolidation in the telecommunications arena is also expected to pick up, thanks to the New Telecom Policy 1999. The growing convergence between communications, content and computers is leading to new alliances. For instance Australian media tycoon Kerry Packer recently picked up a 10 per cent stake in Himachal Futuristic Communi-cations Limited for a whopping Rs 1039 crore and announced two joint ventures for software and internet services.

The other deals in the telecom industry included the acquisition of controlling stake in Essar’s cellular venture in Delhi by the Hong Kong-based Hutchison Whampoa. Bharti Telecom bought JT Mobile, the cellular service provider in Karnataka and Andhra Pradesh, and Skycell, the cellular service provider in Chennai.

According to industry observers, internationally, mergers between cable companies, Internet service providers and telecom companies are fast becoming the norm and such mergers will take place in India also.

Mergers and acquisitions will be outward too. For instance Infotech major HCL Infosystems has said it has shortlisted eight IT services companies in the USA and the UK for acquisition. The idea is to get a larger customer base.

The coming together of aluminium giants Hindalco and Indal also marked the coming of age of Indian companies. The buy-out of Indal by Hindalco is expected to shake the aluminium industry all over the world.

The creation of mega companies the world over, like Pfizer-Warner, Glaxo-Smith Kline and Hoechst-Rhone in the pharmaceutical sector would make it imperative for Indian companies to face the challenge of similar mergers. The creation of the three major pharmaceutical companies for instance has put pressure on Indian giants Ranbaxy and Cipla.

The emerging trend has spurred the Government to take some initiatives at its end too. The Union Budget for 2000-01 proposed a slew of measures including raising the ceiling on portfolio investment by foreign institutional investors and liberalising the norms governing acquisition of overseas companies by Indians.

To encourage Indian firms and businesses to grow into strong India-based multinationals, the Budget further liberalised the policy for acquisition of companies abroad to enable Indian corporates in the knowledge-based sector to have greater flexibility to undertake capital account transactions for acquisition of business abroad.

The ceiling under the automatic route for Indian corporates has been proposed to be increased to 50 million dollars from the existing 15 million dollars.

Under the existing policy on portfolio investment, FIIs are permitted to invest in a company up to 24 per cent of its equity, which can be increased to 30 per cent subject to approval by the board of directors and passing of a resolution at the company annual general meeting.

To give greater access to Indian companies to foreign portfolio investment, the Budget has proposed to increase this limit to 40 per cent.

The Finance Ministry has also given a blanket nod to overseas acquisition by domestic companies in specified sectors through stock swaps up to a limit of 10 times the companies’ export earnings.

The major gainers of this policy will be information technology companies such as Infosys Technologies which is set to close the year with export earnings of about Rs 800 crore. Under the new dispensation, Infosys will be eligible to fund overseas acquisitions up to Rs 8000 crore (around 1.8 billion dollars).

Global mergers are also having an impact on the Indian operations of various MNCs. The availability of shares of Indian companies abroad and the presence of cash-rich foreign institutional investors have also given a fresh thrust to the exercise.

Merger and Acquisition are no more dirty words. In fact, the Indian Government has been encouraging major companies in the country to play the same game abroad and become Indian multinationals in the process.

Luring foreign direct investment, the Indian way

Merger and acquisition of corporate firms in any country are inextricably linked to the investment climate, policies and procedures.

Foreign Direct Investment is the most effective tool with the international players to have a direct stake in any country’s economy. From the Government’s viewpoint FDIs supplement internal resources in generating speedier economic growth.

Foreign investment is not new to India. The Industrial Policy Resolution of 1948 recognised that participation of foreign funds and enterprise would help attract foreign capital in sufficient amount to supplement domestic savings for a more rapid economic development and also to secure scientific, technical and industrial skills.

In practice, the policy, over the years, was hemmed in with conditions and constraints and failed to attract any significant amount of private foreign investment as expected, in spite of all attempts by the Government. The main reason for this was the inherent contradiction in the Government’s policies and the negative character attributed to the multinational corporations (MNCs). Due to the inward-looking approach and protective walls erected around the domestic economy, Indian industry became uncompetitive, manufacturing substandard products at high cost with obsolete technologies. In addition to the lack of choice available to the domestic consumer, export competitiveness of the economy also suffered.

India did attempt some liberalisation measures in 1985, but the attempts were half-hearted. The political leadership quickly lost interest in it and liberalisation was sidelined on one plea or the other till the crisis of 1991.

It was the Industrial Policy Resolution of 1991 that, however, ushered in major policy changes to attract foreign investment. In consonance with the Industrial Policy Resolution, 1991, the Government also amended the Foreign Exchange Regulation Act (FERA) removing almost all crippling restrictions on the operation of foreign companies in India.

Following the new measures initiated in 1991, FDI inflow has gone up significantly in the post-reforms era in India due to the radical changes in policy which have increased the confidence of the investors. FDI inflow which stood at 97 million dollars in 1990-91 increased to 11,963 million dollars in 1998.

This shows that policy-wise, the attitude towards the MNCs has radically changed, but still there is an element of caution particularly with regard to their entry in many sectors and apprehensions over their growing importance in the consumer goods sector, especially consumer non-durables.

Being a signatory to the World Trade Organisation, India has been required to remove some restrictions on FDI—trade-related investment measures (TRIMS)—in the future. And, it has not failed to keep its obligations and further reforms with regard to FDI have come into force.

In early February this year, in a landmark decision aimed at giving a fillip to foreign investment, the Union Government decided to make FDI automatic in all except a few items in the negative list.

The decisions are aimed at increasing the FDI to 10 billion dollars annually. All FDI proposals through the automatic approval route are required to take clearance only from the Reserve Bank of India. FDI proposals for the manufacture of items under the negative list are, however, required to get clearance from the Foreign Investment Promotion Board.

While the Government’s free-for-all approach has been welcomed in general by the Indian industry, there have also been apprehensions from a section which feels that FDI will flow into non-strategic areas.

A section of the Indian industry has demanded that the Government should not permit the MNCs to hold more than 49 per cent equity in the consumer goods sector and these should operate in the Indian market only through a local joint venture partner.

Votaries of the open policy however, argue that in any liberalising economy, FDI, most often than not is first attracted in the domestic consumer goods sector due to its comparatively lower initial investment, shorter gestation period and anticipated faster break-even of cost. Once, some degree of confidence is gained by the foreign investors about the host economy by their experience in the consumer goods sector, investments start flowing into the core and infrastructure sectors.

Allegations have also been made that the MNCs have a sale rather than manufacturing approach. They bring in outdated technology; they leverage an Indian partner on a 50:50 basis and quickly seek majority control; and despite a joint venture with a local partner, they often set up a 100 per cent subsidiary.

According to an estimate released by the PHDCCI, there have been around 150 take-overs, including some in the pipeline, of Indian companies by foreign companies in the post-reforms era.

The Securities and Exchange Board of India has put into force a take-over code and a panel headed by Justice Bhagwati is working out the modalities of future take-overs.

The apprehensions notwith-standing, there have also been examples of MNCs which have gone in for indigenisation of plants as they view India as a firm production and export base. There are also several examples of Indian companies buying out the stake of their foreign collaborators.

The general thinking among the policy framers is that India is not in a position to isolate itself from the globally increasing integration of markets and manufacturing bases. Industries across the world are benefiting from larger inflow of technology transfer and investment and are able to upgrade production, efficiency and international competitiveness and are achieving higher exports. The entire world is in-creasingly getting integrated and India cannot afford to be left out of the globalisation process. Otherwise it will be left only with industries which have a very low value-addition potential.

April-Nov*

Source : RBI.
* Provisional.
$ Relates to acquisition of shares of Indian companies by non-residents under Section 29 of FERA.
# Represent fresh inflow/outflow of funds by FlIs.
@ Figures represent GDR amounts raised abroad by the Indian Corporates.

— T.V.L.

“Quote — Unquote”

"Delay is destroying the system. The sense of guilt decreases with delay, fear of law fades"

— P.V. Indiresan, former IIT Director.

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"Courts must hear the loud cry for justice by society in cases of heinous crime of rape on innocent helpless girls of tender age and respond by imposition of proper sentence. To show mercy in cases of such heinous crimes would be travesty of justice. And the plea for leniency is wholly misplaced."

— Suprme Court bench comprising Chief Justice A.S. Anand, Justice R.C. Lahoti and Justice S.N. Variava

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"Hindutva was fundamental, not repugnant to law and held the basic idea that ‘Ram and Rahi’ are one"

— Union Law Minister Ram Jethmalani.

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"I think America should be a force for peace and against discrimination and hatred from Kosovo and Bosnia to the Middle East and Northern Ireland to Africa, India and Pakistan"

— US President Bill Clinton.

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"The US will continue as the No. 1 power but you have China, Europe, Japan and Russia. India will have a prominent role to play. It is a power no one can ignore, least of all Turkey"

— Kamrau Inan, senior parliamentarian and head of the Turkish Parliament's Foreign Affairs Commission

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"It is the pride of our space sector (Mir). No other country in the world has this kind of station"

— Salizhan Sharipov of Mir Corp.

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"I will not allow the withdrawal of troops even if I am killed"

— Sri Lankan President, Mrs Chandrika Kumaratunga

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"We hope that the flow of FDI will increase once these zones (special economic zones) are fully operational"

— President of the Confederation of Indian Industry Rahul Bajaj

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"We do not think in terms of war, and nobody should think in those terms in this sub-continent"

— A Foreign Office spokesman

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"We see India as a very important economic player in a globalised world. There are other commonalities of interest such as the fight against terrorism"

— Huseyin Bagei, Professor of International Relations at Ankara's Middle East Technical University

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"We have no hesitation to hold that Guru Granth Sahib is a juristic person"

— A Division Bench of the Supreme Court comprising Justice M.Jagannadha Rao and Justice A.P. Misra

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"It is wrong to hang prime ministers. Nawaz may have been a bad ruler, he may have misgoverned, but you do not hang a person for that"

— Benazir Bhutto

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"The process of reforms must centre round the common man. If it fails to do so it will run into political and other kinds of opposition"

— Union Finance Minister Yashwant Sinha

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"The high-pitched propaganda against India, instances of which are rife in daily life of Pakistan, do not inspire confidence in Pakistan's interest in dialogue"

— Annual report of the External Affairs Ministry for 1999-2000.

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"Political parties which could successfully lead movements against (dictators) Ayub Khan and Zia-ul Haq can do so against Musharraf as well."

— Grand Democratic Alliance (GDA) leader and Pakistan Awami Tehrik Chairman, Dr Tahirul Qadri

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"The Islamic world has now begun to realise that in South Asia, the real problem is not Kashmir, but Pakistan"

— Dr Amitabh Mattoo of JNU

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"Ragging is a menace in educational institutions. Students have sometimes died..... We are ashamed about it and have to put an end to the practice.

— UGC Chairman Hari Gautam

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"Always keep in mind that greater the power one has, greater the self restraint required"

— National Human Rights Commission (NHRC) chairperson, Justice J.S. Verma

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"These people have put democracy to shame and are now trying to misuse the CBI for cheap political gains"

— RJD President Laloo Prasad Yadav

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"Corruption-free service should be made a fundamental right of a citizen"

— Constitution Review Commission Justice M. Venkatchaliah.

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"If you think my removal can bring peace, I will resign just now and go home. Nor will the problem be solved by the dissolution of the House"

— Chief Minister of Kashmir Farooq Abdullah

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"This year's Oscars were a propaganda window for abortion, sexual promiscuity and homosexuality"

— Mexican Catholic weekly

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“Cross-voting is a disease afflicting all parties. It is a serious matter.”

— Prime Minister Atal Behari Vajpayee

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"I want a return to civil government as soon as possible, but I don't want to bring a system that is going to do away with whatever good we have done"

— General Pervez Musharraf.

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"We do not have any territorial ambitions over Kashmir. We only support the indigenous struggle of the Kashmir people for their right to self-determination"

— Pakistan Foreign Secretary Inam-ul-Haq.

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"There are big differences (between the Republicans and Democrats), and the CTBT is the most stunning one,"

— US President Bill Clinton

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"The present regime in Afghanistan is an anachronism out of tune with the modern world"

— P.M. of Turkey Bulent Ecevit

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"Russia holds and will continue to hold talks on further cuts in strategic offensive weapons, in order to make the world safer and rid of arms stockpiles"

— Russian President Vladimir Putin

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"I will use my expertise to being about judicial reforms which ultimately will help the common man in the speedy dispensation of justice".

— Union Minister for Law Ram Jethmalani.

Euphoria over Clinton visit
By Abu Abraham

AS Gandhiji might have said, I don’t want my doors shut and my windows stuffed against the winds of globalisation, but I don’t want to be blown off my feet either. Current indications are that we are all but being blown off our feet.

Such was the euphoria over President Clinton’s visit that everyone (except those immensely dignified women of Nayala village in Rajasthan) acted as though God himself had arrived. What an undignified scramble that was in the Central Hall of Parliament to shake the hand of the President!

True, Clinton did a polished job of public relations wherever he went — he was free, frank and friendly (in a very natural and American way), and above all, he seemed to enjoy himself.

On this official visit, Clinton kept his cool. He chose his words carefully and didn’t ever get emotional. Many Indians hoped that he would get tough with Pakistan while praising India for its restraint.

The Pokhran tests were not exactly an example of ‘restraint’. On the contrary it was a wild act of jingoistic irresponsibility. And for those of us who wanted an independent foreign policy, it was playing into the hands of the United States (and other nations who believe in nuclear non-proliferation). We have now submitted ourselves to big-power bullying.

When Clinton said our region is a dangerous place to live in, he was, in my view, absolutely right, though most of us would like to believe otherwise. Is there any Indian or Pakistani, I wonder who feels more ‘secure’ after the nuclear tests than before? I think it’s a pity that the President of India has to justify the nuclear armament from time to time. But I suppose it is what is expected of him.

Mr K.R. Narayanan has been criticised in parts of the press and supposedly by the mandarins of the Foreign Ministry for the remarks he made on non-alignment. The complaint is that the President should not have raised ‘contentious’ issues. Non-alignment has always been fundamental to our foreign policy. And it should remain so. Since when has it become contentions? Indira Gandhi once described non-alignment as the “biggest peace movement in the world”.

Looking back at the history of the last half century, India can take some satisfaction from the role we played in world affairs. “This country was respected around the world and its advice sought by nations big and small, precisely because of its non-alignment, which essentially meant an independent view of the world, never agreeing to join military blocks, but always sticking to its anti-imperialistic and anti-colonialist mission. As K.R. Narayanan indicated in a talk he gave in Washington many years ago while he was Ambassador, the United States of America having been one of the first anti-colonialist countries in the world should have been a natural ally of the non-aligned nations. But World War II and the rise of Soviet Russia as a world power changed all that. Its anti-Communist crusade became hysterical and what mattered to its policy around the world was who was with the Soviet Union and who was with the “free world”. Thus it was that the free world came to include some of the most notorious dictatorships, like General Franco of Spain and Pinochet of Chile.

The USA’s attitude to China until Nixon came to terms with it, was typical of how blind anti-Communism twisted all its perceptions about the new emerging world that had liberated itself from colonisation. Thus, so long as Chiang Kai-shek was ruling China, Tibet was part of it. But when Mao Tse-Tung came to power, Tibet had to be an independent state.

The folly of the war in Vietnam was a consequence of this same mentality. Here, as in other parts of the world, if America had heeded the opinions of Nehru, Nasser or Tito, the world’s recent history would have been vastly different. Just listen to this piece of diplomatic wisdom uttered in 1954 by John Foster Dulles: ‘Under the conditions of today, the imposition on South-East Asia of the political system of Communist Russia and its Chinese Communist ally, by whatever means, must be a grave threat to the whole free community. The United States feels that that possibility should not be passively accepted but should be met by united action. This might involve serious risks. But these risks are far less than those that will face us in a few years from now if we dare not to be resolute today’.

Today, India has lost much of its old moral authority. Having become one of the poorest nations of the world, being sucked into a ruinous war of sorts on our borders, too frozen in our sterile postures, unable to negotiate realistically, we seek American help though unable to say so. We cling to our old cliches, ‘bilateral’, no signing of CTBT, and all the rest. But we seem to be drifting into a foggy land of make-believe.

When we recover from the Clinton euphoria we should take some time off to find a clear way to settle the Kashmir dispute. There seems to be a growing public realisation that making the Line of Control into the international border may be the best bet.

Delhi durbar
The Rabri Devi imbroglio

WITH the former Bihar Chief Minister, Mr Laloo Prasad Yadav, going to jail and his successor and wife, Rabri Devi, getting bail in a case of owning assets disproportionate to their income, the BJP and its allies have launched a no-holds-barred campaign for the dismissal of the Bihar Government.The Congress, caught in a catch-22 situation, has, however, decided to back the Rabri Government and has instead launched a counter campaign against the leaders of the BJP. They are demanding that the Union Home Minister, Mr L.K. Advani, who has been chargesheeted in the Babri Masjid case set an example by resigning from his post.

The BJP has retorted by claiming that there was no comparison between the two cases and it was akin to “befooling oneself”. While Mr Advani has been chargesheeted in a case of political agitation, Mrs Rabri Devi is involved in a case of moral turpitude. To further embarrass the Congress leadership, the BJP has highlighted the recommendations of the K. Santhanam Committee on corruption charges against a public servant which was accepted by the Jawaharlal Nehru Government.

The Santhanam panel had held that if aspersions were cast on a Minister’s honesty, he or she should either resign immediately or sue the party levelling charges against him or her for defamation. With Mrs Rabri doing neither of the two, an embarrassed Congress leadership is now looking for a way out.

Disgruntled MPs

The Bharatiya Janata Party’s Delhi unit is a divided house. Ever since the Prime Minister, Mr Atal Behari Vajpayee, gave a rough treatment to the BJP’s MPs regarding their accommodation in the Union Cabinet, the members have been cut up with the party. Their disgruntlement came to the fore during a recent rally organised by the Delhi unit of the BJP to commemorate the 20th anniversary of the party.

Prominent party MPs, Mr Madan Lal Khurana and Prof V.K. Malhotra, caused some embarrassment to the party leadership when they had an argument with the Delhi unit BJP chief, Mr Mange Ram Garg, over addressing the rally. The MPs contended that since the Prime Minister’s arrival at the rally was delayed the State unit should allow all the party MPs to speak and keep the audience occupied. Mr Mange Ram Garg, however, put his foot down and insisted on following the laid down schedule. Irked over his stand, the two MPs walked down from the dais even as the top leadership of the party watched the spectacle dumbfounded.

George and socialism

It is a tradition for the Defence Minister to host a dinner in honour of award winners at the time of an investiture ceremony in the capital, specially after the President has honoured the brave men of the armed forces. And, the Defence Minister, Mr George Fernandes, kept up with the tradition for the second year in running.

However, there was some difference in the Minister’s party in comparison to what was hosted by the Chief of Army Staff, Gen V.P.Malik. For one there was no band at the dinner of the General as the Army was mourning for its heroes in Kargil. The Army brass had specifically chosen to keep the band away for it wanted to respect the sentiments of the war widows.

In comparison the Minister chose to lay out a lavish dinner at his residence on the occasion. And, it came from one of the top of the line five-star hotels in the capital, apparently for a price. So much for George and Socialism.

In defence of Kargil

Noted theatrist Amir Raza Hussain’s play on Kargil has won laurels from the general public but the personnel in the services are cut up about it. The reason: They feel Kargil was too serious an affair and the play somehow trivialises the war.

Adding salt to their wounds was none other than the Defence Ministry itself when it decided to sponsor the play on an evening last week. Around 650 seats were reserved for the top brass of the services, personnel of the Ministry of Defence, the Defence Minister and other senior officials. Award winners of the services were also invited for the event. During the break, rich snacks were served and to top it all the Ministry hosted a dinner after the play for the distinguished guests. Several of them of course found the food unpalatable as they were not happy about the Ministry playing up the play.

Politics of convenience

Politics attracts strange bed partners. The recent instance of the Trinamool Congress wooing the West Bengal unit of the Congress for a grand alliance in the State to defeat the CPM-led Government is a case in point. Though a partner of the BJP in the NDA, the Congress has tried to explain its necessity by claiming that the NDA was not communal and only some elements like the BJP and the Shiv Sena were communal.

On her part, the Trinamool Congress chief, Ms Mamata Banerjee, has claimed that she was not talking to any national party and her efforts were only to woo the leadership of the parties in the State. In this context, she explains that she would not ditch the BJP.

Maneka’s woes

Social sector issues is still not serious business in the country if a press conference addressed by the Minister in charge of the concerned Ministry is any indication. Newspersons who attended the second editors’ conference on social sector issues here on Friday overlooked the mandate of the Ministry of Social Justice and Empowerment in the question round. The end result was the Minister, Ms Maneka Gandhi found herself confronted with questions not even remotely related to her area of work. While one question pertained to the measures being taken to prevent witchcraft in Orissa another related to pollution in the city. Yet another journalist wanted to know why the Minister had not taken any steps to ban “gutka”.

A visibly exasperated Maneka Gandhi replied to some but could not help remarking that journalists were perhaps not sure of her portfolio and were confusing it with that of health or environment.

Minister without house

The Minister of State for Food Processing, Mr Syed Shahnawaz Khan, may have been lucky to get a berth in the Cabinet but he is yet to find a suitable house for himself. It has been more than six months since Mr Khan became a Minister, but he continues to stay in a two-room apartment in VP House, which is just a stone’s throw from Parliament House. VP House residents have been complaining that the large number of visitors who come to meet the Minister often spill out on the adjacent lawns making it difficult for them to enjoy their evening stroll.

(Contributed by Satish Misra, T.V. Lakshminarayan, Girja Shankar Kaura, Tripti Nath and P.N. Andley)

75 years ago
April 9, 1925
Depression in the cotton industry

IT is announced that an important cotton mill in Bombay closed on the Ist instant and it is feared that several others will do so. The immediate effect of this will be that many thousands of mill labourers will be thrown out of employment.

During the discussion of the question of the abolition of the cotton excise duty in the Legislative Assembly, the representatives of the mill-owners stated that several mills would have to be closed if the Government did not give them some relief in the matter of the cotton duty.

The Government remained indifferent to their appeals. Subsequently, a deputation of mill-hands represented to the Bombay Government that they would be thrown out of employment if the mills were closed.

The local authorities did nothing more than express their verbal sympathy. The cotton industry in India is suffering from unfair competition from abroad and unfair taxation from within.

The indifference of the Government to the grievances of those engaged in the industry has culminated in the present crisis.