India Today

Thunder from the East: How FDI in Retail Changed the Face of Indian Politics

On the afternoon of Tuesday, September 18, when a deceptive calm over Delhi had begun to sink into torpor, TV channels floated a story that the men in charge of the Congress machine had yet again deflated a Mamata Banerjee insurrection, this time over the diesel price hike and FDI (foreign direct investment) in retail. Politicians will plant a few weeds in the information jungle when they can; it is less understandable when media begins to fertilise weeds.

But the real problem is not a mistake, which can happen in any vocation. Our capital's elite gets it wrong because it is in the grip of those who look at Calcutta from Delhi, while real power has shifted to the grasp of those who look at Delhi from Calcutta. Pranab Mukherjee was ubiquitous to UPA because he was that rare politician who could absorb the view from both directions. In UPA 1 the Prime Minister and Mrs Sonia Gandhi outsourced political management to Mukherjee; he brought the ship of state through some historic storms because he never forgot his compass.

Neither Dr Manmohan Singh nor Mrs Gandhi seem to fully comprehend the extent to which they have alienated allies as well as potential partners. Where an ego needed some massage, it was rubbed the wrong way. Where a financial commitment could have been made with grace, it was made with a growl. It takes unique ability to manoeuvre Mamata Banerjee and Marxists into an alliance, albeit unacknowledged, against the Centre; or force Karunanidhi to join a protest against his own Government; or turn CPI(M) and BJP into partners in parliamentary inquiry committees over the 2G scam. Gurudas Dasgupta, the veteran Communist leader, actually thanked Mamata Banerjee on primetime television.

The Congress weakness is due not to the rancour of parties but the alienation of voters, fed up with unprecedented corruption and sustained inflation. Congress politics now revolves primarily around the 750-odd men and women who are Members of Parliament. Other parties are more worried about the 700 million who are voters. When Mamata Banerjee sounded out her base, she heard the overwhelming view that the price of associating with Congress now far outweighs the cost of leaving UPA.

If the Congress had been more observant, it would not have been shocked when the Bengal ultimatum was delivered through a press conference. Till then, the mood in the Prime Minister's Office was actually one of self-congratulation, with much talk of Mamata as a package of disposable bombast. The flip side of overestimating your worth is that you inevitably underestimate others. No one is a patsy. Life has changed. Congress hasn't.

At the moment of writing, Dr Singh and Mrs Gandhi have a choice: They can either save their Government with genuflection through a partial rollback, or protect the Government's credibility. This might be the ultimate Hobson's choice, since governance is a mirage without credibility. Mamata has left open a technical window through which she can return to Government, but rhetoric on the airwaves indicates that the relationship will never be fully repaired. Marriages do survive their crisis moments, but too much spouse-battering is taking place in this one.

Even if UPA manages to scramble the necessary numbers during a problem in the next session of Parliament, it will be a fluctuating advantage, purchased on daily barter. It could be a demand-a-week story. Taunts are already in the air. Bihar CM Nitish Kumar used an eloquent term, jugaad, or the ability to "manage" through suitable compensation, to describe this aspect of Congress core competence. An opposition leader can joke; it doesn't seem quite as funny when you are in office. No decision made by an uncertain government carries credibility; even a popular gesture invites the sneer that it is being done for partisan benefit.

Congress General Secretary Digvijaya Singh was frank enough to admit that the only realistic option now was a General Election. One wonders if he is also optimistic. Congress is facing not only the opposition from traditional foes but also isolation from traditional friends. Mamata Banerjee, Karunanidhi and Sharad Pawar have announced a first round of talks through their trusted nominees. You can be confident that they will not meet to discuss T20 cricket.

It is always one stone that sets off an avalanche. We do not yet know if FDI in retail will change the face of India's economy. What is certain is that it has changed the face of India's politics. My sympathies go out to the many MPs who had been promised a place in Government in the next reshuffle. It is not the errant minister who is in danger, but the Government itself. To appoint new ministers today would be an invitation to a Barmecide's feast.