Vinod Mehta RIP

Vinod Mehta with his wife Sumita

Vinod Mehta is no more. RIP Vinod, in whatever heavenly newsroom there might be up there, where I am sure you would have wound up with your irreverent pen and favourite tipple.

In 1992, I joined Vinod’s team at the 150-year-old The Pioneer newspaper then recently re-launched from Link House on Bahadur Shah Zafar Marg, New Delhi’s Fleet Street.

It was the best of times and the worst of times, to be a journalist in India. India was opening up to the world, with its own version of `Perestroika’ while combating old passions which manifested itself among others, in the demolition of the Mughal-era Babri Masjid in Ayodhya by an impassioned, partisan crowd. Preceded as these were, in Vinod’s own words “ Rajiv Gandhi’s tragic assassination, P.V.Narasimha Rao’s erratic prime-ministership (and BJP leader) L.K.Advani’s frightening rath yatra and its consequences.” 

At The Pioneer, under Vinod Mehta, we had the right to report on it all, with all its warts and quirks – without fear or favour, as long as we got our facts right and told the story well.

Vinod was arguably among the first modern newspaper editor in India who understood what made the new kind of newspapers tick. As against the old league of Editors who lived in Ivory towers, Vinod lived, breathed and dreamt of the ink that flowed from the newsroom and realised that newspapers could survive only by combining reporting with commentary and splashing news pages with feature stories and large, tell-all photographs,  pushing into the space reserved till then for magazines.

Vinod, after a stint at various jobs in the UK, had started his journalistic debut in India by editing the risqué men’s magazine Debonair, which he turned into a classy magazine with a great choice of reading and  stylishly clicked `For Men’s Eyes Only’ center-spreads.

However, Vinod’s heart lay in launching a Sunday paper on the lines of newspapers he was fond of reading during his stay at England. He got his first big break with a new launch – The Sunday Observer – which a popular publishing house came up with. After that, several Editor-ships later, he was picked up by industrialist L.M.Thapar to run the venerable `The Pioneer’, which the Thapars had bought over for a song.

He redesigned the old newspaper which at one time had Rudyard Kipling, the `Bard of the Empire’ on its staff, into arguably the best looking, modern, newspaper in the country. He brought in a fresh whiff of air into the stodgy BSZ Street which housed most of the Who’s Who of Indian newspaper industry – from Times of India to Indian Express to Patriot, with juicy, breaking news in virtually every sphere – from cabinet meetings to business boardrooms to the world of art.     

He understood the art and science of modern newspaper design, what his readers wanted to read, the value of a photograph to tell the tale, the value of giving his `boys’ and `girls’ freedom to write as they chose and the need to bond his young team together by partying with them as hard as they could stand up to !

In the words of a colleague, Madhumita Ghosh, the grand-daughter of a famous previous Editor of The Pioneer, “Vinod combined the greatest asset of an Editor. An infallible nose for news, and a management style that encouraged complete freedom with an uncanny market sense without giving in to the marketeers.”

However, many on New Delhi’s `Fleet Street’ still castigated him for being a `non-political Editor’, an euphemism for someone who does not understand Indian politics, then the life and blood of Indian journalism. Vinod broke that mis-conception when he wrote a front page news story based on a meeting with then Prime Minister Rao, asking readers to contemplate on the fate of a nation `where the prime minister’s reaction to blood curdling, nation shaking events went no further than (stating) “the soul of India is peaceful”.’

The newspaper’s owner separately confessed to Vinod that the demolition of the centuries old, ruined Masjid by religious zealots who believed it to be the site of an older temple and ostensibly Lord Rama’s mythical palace had him (Thapar) `jumping with joy’ ! However, Vinod, being Vinod merely brushed that aside and continued with the newspaper’s reports on what he considered tragic events for the nation’s secular credentials.  

However, Vinod was not a political animal. He forte lay in being a thorough newsroom man. He would hurl chaste Hindi four letter words at deskmen who could not meet the deadline to print the newspaper and call the same people up for a cup of tea and encouragement on days he felt the page was especially well designed.

He understood the import of news, like no other man I have met. One morning he rang me and my equally young colleague Jay Shankar to his `den’. We went trembling, only to be congratulated for two stories we had broken – one on an American cola giant being allowed to make a comeback in India after being thrown out of the country in misplaced socialistic zeal a decade-and-a-half back, and the other on a state run firm pioneering perfumed condoms! He told us in clear terms, `it’s all right to report on what ministers’ think is policy, or on the GDP going up or down, but what readers really want is news like this …”

Vinod was also the right kind of Editor for young reporters, who wished to follow his equally irreverent style of thumbing their nose at the high and mighty. In the early ’90s, I was assigned along with photo-journalist Arun Jetlie, who later on went on to work for the Indian Express, to cover the opening of a Global Cola giant’s first Indian factory near Agra. We shockingly found under-age child labourers in that plant. I carried out a diversion of the assembled cola officialdom and Jetlie, despite his girth, jumped across bottling lines to take pictures of the kids in question. The race back to The Pioneer to file the story was enlivened by the bus, organised by the Cola firm breaking down and their offering us free stay at a 5-star hotel in Agra.

The Pioneer team still found a way of getting the story and pictures to our newspaper to be printed the next day. I was told much later, that Vinod faced the music for that irreverent story all alone. The proprietors whose business interests seemed to have been hurt,  took him to task for our `misdemeanour’. We never got to know of the storm which brew over The Pioneer that day. All that we knew was that we soon received letters promoting us!

That was Vinod’s way.

India's Budget bets on Growth

Who will be the PM?

For a man, whom many see as Congress’s possible Prime Ministerial candidate next year, finance minister Palaniappan Chidambaram’s 8th budget was without what markets call the wow factor – nothing to perk up business, nothing much to make the middle class voters happier.

However, as in any pre-election year budgets, Chidambaram’s budget will try to spend its way out of the mess the Indian economy is in, by splurging on an all time record budget of Rs 16.65 lakh crore, a 16.5 per cent increase over the current year’s spending. In dollar terms India’s budget spend of $ 314 billion equals one and a half times’the entire economy of neighbouring Pakistan.

India is expected to grow by 5 per cent this fiscal year, far lower than the 8-9 per cent GDP growth it posted for most of the last ten years. GDP figures released today for the October-December 2012 quarter were a dismal 4.5 per cent, putting pressure on the government to opt for aq tough budget which aims to grow the economy “out of the trough”. Chidambaram in his budget speech, underlined his plan as one of “unhesitatingly embrac(ing) growth as the highest goal” to manage what he termed as “challenged” Indian economy.

India's Rich will have to pay more tax

New taxes including a `Super Rich’ surcharge on individuals earning more than Rs 1 crore ($185,000) a year and firms earning more than Rs 10 crore ($1.85 million), applied in token deference to an idea floated by Left-wing economist Joseph Stiglitz and nearer home by India’s leading philanthropist Azim Premji, and higher revenues churned out by an economy which the government hopes will grow at a faster pace of over 6 per cent are expected to fund the splurge. As also a record borrowing plan which hopes to raise Rs 5.42 lakh crore from the market.

There were however prudent cues to satisfy global credit rating agencies such as Moody’s and Standard & Poor, who had been threatening to downgrade the slowing down Indian economy beset with widening fiscal deficit, widening trade deficit and falling rupee.

India wants more butter now

Subsidies will be pared from Rs 2.31 lakh crore next year from the bloated subsidy bill of Rs 2.57 lakh crore which the government ran up this year, a compression of 10 per cent on what many see as populist spending on subsidising auto-fuels, food and fertilisers. The main axe will be felled on oil subsidies which is being reduced 26.8 per cent. Even the government’s borrowing plan has been kept `modest’ with an increase of about 4 per cent over amount borrowed this year.

Spending on non-economic activities such as defence will be kept down. For the first time in years, increase in defence spending was kept at just 5 per cent. Defence spending went up to Rs 2.03 lakh crore or $ 38 billion (for comparisons, a fifth of Pakistan's economy), from the Rs.1.93 lakh crore outlay for 2012-13.  

However, the lack of any specific spark in the budget and higher taxes on corporates and MNCs left Chidambaram's cheer-boys in India Inc, not so happy, which they made clear in interviews on television channels.  Bombay Stock market's Sensex fell 1.52 per cent or by 290 points. Markets seemed to have been spooked by the finance minister’s clarificatory amendment introduced as part of the budget, that residency would not be enough to get the benefit of double tax avoidance treaties with tax havens like Mauritius to avoid paying tax in India. Businesses and investors in India would also have to prove that beneficiaries of the investment funds were residents of the tax havens. (Something he said would be addressed the very next day, leading to a modest claw-back in the BSE )

Sensex went down after the budget

India’s leading commodity market, MCX, too reacted negatively to a 0.1 per cent Commodity Transaction Tax, re-introduced after being brought in and rolled back 4 years back, on non-farm products. The metals index went down by 0.3 per cent. Interestingly, perhaps fearing calls for a similar roll-back, the finance ministry has however not budgeted for any tax earnings from this score.

Bringing in more taxes home, is very much part of Chidambaram’s growth plan with revenues expected to grow by 19 per cent, with services tax being most buoyant, growing at 35.7 per cent, possibly on the back of a tax amnesty announced for those evading service tax. 

The government is also betting on more disinvestment earnings. Against this year’s Rs 24,000 crore expected to be realised from disinvestment, the government hopes to earn a a specific rs 55,814 crore from share sales this year, including possibly from selling the government’s rump stake in Hindustan Zinc Ltd. Similarly the government has set an ambitious target of raising Rs 40,000 crore from telecom spectrum auctions and one time spectrum fee despite spectrum auctions having been a flop this year. 

Road Eastwards

To spur investment, the Harvard educated, right-wing finance minister announced that plan spending on large public investments on highways, railways, ports, airports, power transmission lines etc., will be raised to Rs 55.5 lakh crore from Rs 42.91 lakh crore spent this year, an increase of some 29 per cent on actual spending. Firms investing more than Rs 100 crore would get 15 per cent extra tax benefits, infrastructure debt funds would be encouraged to fund ambitious long term plans and the World Bank and ADB roped in to help build an expressway linking India’s North east with Myanmar and thence on to Thailand, Malaysia and Singapore, India’s big markets in the Asean. 

Two new industrial corridors or expressways with industrial zones on either sides, one linking Bangalore with Chennai and another Bangalore with Mumbai, and new mega ports at Sagar in West Bengal and Andhra Pradesh were also among projects with which Chidambaram hopes to spur growth.

The bet will however be on growth and if that does not come about then Chidambaram’s gamble of higher revenue earnings could well fall by the way and the man who gave dream budgets to India Inc., some years back could well be the man who scripted a nightmare for the country’s economy already overburdened by high inflation, slack demand and rising debt.

Singh - Underachiever or just plain old Hamlet?

A lot of people are unhappy that Prime Minister Manmohan Singh has been described as an `Under-achiever’ by the Time magazine. Well, I think that is an understatement.

The only problem is that Time describes the hapless Prime Minister as an under-achiever because he has not done what the magazine and its backers would like him to do, such as clear  Wal-Mart’s proposal to tap into the $ 600 billion Indian retail market, give American and European banks the rights to buy up Indian banks.   

I believe the poor man is an under-achiever because he can’t make up his mind on most issues.

As long as Pranab Mukherjee was in his cabinet, he would outsource all the fire-fighting such as handling the Telengana mess* or wrestling with a global meltdown, to the older man, once his boss. While Singh took on larger, yet safer roles – talk peace with Pakistan, talk about global geo-strategy with Barack Obama.

Even there he would often backtrack after his ministers told him they could not go along with him. For instance, on Siachen*, Singh wanted a demilitarised peace park. That park went up in smoke, when his ministers and Generals warned him that Siachen was not just an Indo-Pak affair but had a China looking on. One wrong move, they warned, could see the People’s Liberation Army marching in, as the Indian Army pulled out of the strategic icy Himalayan wasteland, in his `misplaced’ enthusiasm to bring peace to the sub-continent.   

When Mukherjee, a man groomed by the Socialist era Premier Indira Gandhi moved on to try his luck as President of India, many expected Singh would come into his own. His aides suggested as much, talking about broad sweeping reforms he might bring.

Well, the problem with that has been that Singh hasn’t yet shown much stomach for hard nosed decision making.

One problem has been that “the Prime Minister and the government as a whole faces the dilemma of Caesar’s wife – everybody knows she is honest but she has to be seen as honest – that means no one wants to take tough decisions such as telecom pricing,” say top officials.

This, saw the government first appointing Agriculture Minister Sharad Pawar as head of the Empowered Group of Ministers on telecom to fix the reserve price for an auction of 2G spectrum. However, the worthy recused himself post haste from the job. Though he claimed that he was excusing himself as allegations had surfaced of his links with telecom firms and he did not wish to give detractors an opportunity to drag him into another controversy, sources said that the Maratha strongman did not fancy being a “fall guy” in the spectrum pricing controversy.

Last week, the home minister has been given the job but asked not to take a final call on spectrum pricing, which will be decided by the full cabinet !

The issue here is that a decision in favour of high reserve prices, set in competition with each other by the department of telecom and Telecom regulator, could kill the `Golden Goose’ and scare off potential foreign investors in the telecom sector, leaving the business in the hands of existing players. While a decision to lower prices is sure to arouse cries of foul from Government auditors and opposition MPs.

The other problem is that the Government wants to address too many constituencies. Just like the man in Aesop's fables, who could not make up his mind whether to let the ass carry his load and be seen as insensitive or to be sensitive and carry the load himself.

 On the Vodafone tax case, the prime minister’s office seems to be signaling that  it is against retrospective taxation. Which should please corporates who are dead against this.

(The Union Budget’s finance bill this year, had a retrospective amendment which clarifies that the Income Tax laws of 1962 meant to tax any deal where the asset underlying the sale or purchase is in India, even if the deal is struck elsewhere.

This was done after Supreme Court had ruled this January, that the Government of India had no jurisdiction to tax the share sale done by a Hong Kong registered shell firm owned by Hutchison to Vodafone conducted in the tax haven of Cayman islands. The government was asked to return  Rs 11,000 crore in presumptive taxes with 4 per cent annual interest.)

However, no formal communication has been sent to North Block to withdraw the legislation or to not serve tax notices based on it, leaving many lawmakers and taxmen, who feel they have a legitimate case in seeking taxes which they feel have been deliberately not paid by using a veil of corporate shells, confused.

The advantage of course goes to the opposition in such a situation. BJP leader and former finance minister Yashwant Sinha took the opportunity to attack the Prime Minister directly, stating Singh was an overrated economist and underrated politician.

 "Manmohan Singh has always acted as a consultant to the government, being a Prime Minister for eight years and a Finance Minister for some years. Who brought this situation? It's absolutely wrong to say it is a global mess, it's a domestic mess created by the government," Sinha said.

Luckily for the ruling Congress Party, the opposition can’t really push home its advantage. Its shop is in such a desperate mess, with bitter in-fighting and trading of charges of corruption, that even Singh playing the role of Hamlet does not kindle much favour for them among Indian voters.

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*Telangana mess - Section of people living in the backward Telegana region of the state of Andhra Pradesh have demanded a separate state carved out of Andhra, within the Union of India. A number of flip-flops on the issue of a separate state,by the ruling Congress Party , have alterternatively raised or dampened hopes for setting up of the state.

*Siachen - A glacier in Northern Kashmir, fortified by the Indian Army since the 1980s after Pakistan gave permission to several expeditions by British, Japanese and other mountaineers to  traverse the glacier in an apparent move to lay claim on the strategic Glacier. Siachen is surrounded on two sides by Pakistan-held Kashmir, Chinese-held Kashmir and on two more by India's Leh district of Jammu & Kashmir. Since 1984, when Pakistan launched its first attack on Indian posts in that icy glacier, dubbed the highest battleground in the world, the two neighbours have been at odds over the glacier and the Saltoro range of mountains, immediately to the west of the glaciers.