The time has come for the business sector and the government to reinvent their relationship

In fact, the session went off much better than in previous years. The speakers were forthright, which wouldn't have been possible if government officials were around." Thus spake Tarun Das, director general, Confederation of Indian Industries, when asked about the absence of the prime minister and the finance minister from the inaugural function of the India Summit of the World Economic Forum (WEF). Whether it was said in petulance or in candour does not matter. It reveals a lot about the relationship between business and politics in India. While a public airing of differences on policies can be healthy, leading to debate and synthesis, comments such as these show business in a poor light. Are Mr Das and others scared to speak their mind in front of government officials? Surely none of the glitterati at WEF could ever fear that they would be fired!

May be the industrialists and captains of Indian industry are scared of the government. While they lament the state of the government and its policies in private, they are the first ones to kneel before ministers and senior government officials when seeking licenses and favours. Having spent 31 years in the corporate sector, I saw it from close quarters. The same CEOs who berate the corruption and the incompetence of politicians and government departments lose no opportunity to curry favour with them.

Let's look at some facts and some history. Traditionally, government has tended to treat business like a dictatorial parent telling a child what to do, how to do it, and when to do it. Business has gotten used to acting accordingly, constantly asking for more goodies and freedom. Also, like a growing child, while business has shown signs of becoming responsible, there have been many lapses too. The result is that the relationship between the government and business still retains its parent-child tenor and hasn't evolved into an adult-adult relationship of interdependence. The government, of course, like most parents, is loath to let go.

The time has come for the business sector and the government to revitalise and reinvent their relationship. The relationship has to mature into one that is based on mutual trust, openness, understanding and internalisation of the fact that it has to be a partnership and not a win-lose game. It also cannot be based on hubris and fragile egos.

Whether by choice or on account of economic compulsion, government started loosening controls 10 years ago. While there's a long way to go before India can be called an open economy, action is required from both sides to push the relationship towards maturity. Business has to demonstrate that it can be trusted to take care of all stakeholders and not just the promoters or the shareholders. It has to show it has matured enough to act responsibly and become a part of the solution and not just a part of the problem. It has to understand that the government mindset, rooted as it is in the socialistic way of thinking, is not likely to change in a hurry. It has to prove that it can think beyond short-term profits and in terms of the country and its people.

"Mr. Prime Minister, it is time for you to be courageous, firm and decisive and take decisions as if there is no tomorrow," said Narayana Murthy at the Summit. Does one of the most visible faces in Indian industry have to say it while the PM is not present? Would he have said it if the PM was present? Are there no other opportunities where the seriousness of the suggestion can be communicated to the government without making a show like a defiant child?

But the fault is not only on one side. Unless the government starts treating business like an adult, the latter is unlikely to grow up. When Deepak Parekh criticised the government's handling of the Gujarat situation, he was allegedly summoned and told that he better watch his mouth if he wanted his insurance license! In the immediate aftermath of Rajiv Gandhi's assassination my views were quoted in a magazine. My then boss in ITC was told by a minister that he better keep his subordinates under control. I had to render an explanation to a Union minister.

While we don't need to adopt the American model, where business controls the government to the extent that it can even dictate whether to wage war with Iraq, there is no reason for business to be so scared of the government that it cannot even air its thoughts openly. We need to do a lot of growing up. The sooner the better for the country. But the most important prerequisite for the growing up process may be institutionalisation of relationships and power. In pre-modern societies like India, power is personalised. If an industrialist says something that is anti-government, that is seen as a personal affront by the person in power. When the PM or the FM don't show up at the WEF, it is perceived as a personal affront by the director general of CII.

The maturing process can only take place when there are institutions to protect people. The process cannot be independent of the society at large. And the very people who are supposed to represent the electorate are the people who destroy those institutions. But then hope springs eternal....

Nripjit Singh (Noni) Chawla

This article originally appeared in Business World - 16 December 2002