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With friends like these ..
01 January 1900

As if we didn't already have enough ministries governing our lives, now a new one is being formed. An information technology ministry! The IT industry has done pretty well for itself without a ministry supervising it. We have had a steel ministry for decades, and see what a mess our steel industry is in! So why do we need an IT ministry anyway?

Prime minister Atal Behari Vajpayee undoubtedly meant well when he created this new ministry. He was perhaps made to believe that the structure of the administration should reflect the convergence that has taken place in what can best be described as digital industries -- the coming together of technologies and operations in computing, telecommunications, media, and now, with e-commerce, trade too. Unfortunately, that's where the rub lies.

Wrong name?
To begin with, calling the new ministry an IT ministry was a big mistake. In India, and even abroad, information technology is too often equated with computers. Mr Vajpayee should have announced the formation of a ministry for digital industries. This is not splitting hairs. It defines the scope better than the phrase 'IT'.

He didn't, and now at least three existing ministries want the new ministry stymied rather than reduce their own powers. These are the telecommunications ministry, which would lose control of the Internet service provider business, the commerce ministry, which would have no say in e-commerce, and the information and broadcasting ministry, whose ability to influence cable networks would vanish. They don't want to let go.

And how can the prime minister persuade them to coordinate with the IT ministry? The ministers in charge of these three ministries represent three different political parties. They have made promises they want to keep according to their own separate agendas.

It's surprising we haven't heard murmurs of protests from the finance ministry. Perhaps it's finance minister Yeshwant Sinha's close relations with the prime minister, and his undoubted involvement in the decision to form an IT ministry, that prevented the finance ministry demanding a say in e-commerce (since there is a tax angle there), and in Internet banking and stock trading transactions!

In the meanwhile, it is reported, the National Informatics Centre wants to remain with the Planning Commission.

The answer
So what is the answer? The answer is not to have an IT ministry!

If Mr Vajpayee wants to give the digital industries a fillip, he should deregulate rather than regulate. As far as encouragement is concerned, the finance and law ministries can take care of the tax and legal angles. In fact, rather than bring a politician and many bureaucrats into positions of influence over the IT industry, the prime minister should push the other ministries to get out of regulating the IT- and Internet-related businesses, including cable access, e-commerce, and banking and capital market transactions over the net.

Some amount of regulation is arguably required in sectors like telecommunications, on issues like bandwidth allocation. But, considering the hash that successive governments have made of India's telecom policy since 1992, one wonders whether we might have had better telecom facilities had the government stayed completely out of this business.

Areas like telecom and the electronic media need independent regulators encouraging competition rather than politicians and bureaucrats controlling growth. And, if Internet has been a slow starter in India, it's only thanks to the government's control over the telecommunications system in the country.

Rationalise them
This principle should, actually, be applied to all other industries too. If you ask me what is the ideal number for industry-related ministries, I'd say "half". And that half a ministry should cover light and heavy engineering, petroleum, chemicals and pharmaceuticals, fertilisers, textiles, steel, aviation and aerospace, media, mining, and whatever else that resembles an industrial activity. Without that the economic reform process will not get half-way to its goals, let alone be completed.

Why half? Because the other half should be commerce. Whose task should be to ensure that competition thrives and crooks masquerading as businessmen are discouraged.

Unfortunately, despite all his good intentions, the prime minister is hamstrung by an unwieldy coalition which, if some of its members had the choice, would go for ministries for washing machines, ice creams, and sanitary napkins.

The other day, on Star News, they were talking of match-fixing and corruption in cricket. The Indian Express journalist on the panel asked one of the officials in the dock why some people hanker after positions on the cricket control board when the positions are supposed to be honorary -- are there some concealed gains they derive because of their positions of power over the game?

Perhaps NDTV should arrange a similar talk show with representatives of political parties. And ask them why, if they are not there for the money they can make on the side, and if they genuinely believe in reform, are they so keen to have so many ministers trying to control industries they do not even begin to understand.

Andhra Pradesh's Chandrababu Naidu, who, in spite of his substantial number of MPs in the Lok Sabha and his continued support to Mr Vajpayee, has turned down the offer of ministries in New Delhi, may well be the only politician to be able to give an honest answer.


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