A lonely man

It’s lonely at the top. Especially when those who once lionised you turn into your bitter critics. That indeed is the unfortunate denouement that Palaniappan Chidambaram, the Harvard-educated three-time finance minister and former home minister of India, currently finds himself in.

No one ever doubted that he is not just super-smart but extremely intelligent as well. It was not very long ago that he could do nothing wrong. Today, he is being accused of being unable to do anything right as he oversees an economy in doldrums. The rupee has collapsed, growth rates are down, industrial production has declined and inflation remains stubbornly high. Mr Chidambaram is urging everybody and his brother not to become excessively despondent. But few seem to be willing to listen to him.
The job of the finance minister is hardly one that is guaranteed to win a popularity contest, even if he is paid by the ordinary taxpayer to be perpetually optimistic. But the way in which Mr Chidambaram rubbed some of his one-time confidantes the wrong way is perhaps unprecedented in contemporary Indian history. Relations between the boss of North Block and the head of the country’s Central bank and apex monetary authority have not always been smooth. But rarely have their differences of opinion been so out in the open.
Duvvuri Subbarao was literally hand-picked for the post of finance secretary by Mr Chidambaram. But the two stopped seeing eye-to-eye after the former became governor of the Reserve Bank of India. The finance minister was visibly upset over the RBI’s decision to keep the interest rates high despite his ministry putting out a fiscal consolidation roadmap. In October 2012, Mr Chidambaram publicly remarked that if the government had to meet the challenges of growth, “we will walk alone”.
Mr Subbarao waited for his last public lecture as RBI governor to hit back at his former mentor: “I do hope finance minister Chidambaram will one day say, ‘I am often frustrated by the Reserve Bank, so frustrated that I want to go for a walk, even if I have to walk alone. But thank God, the Reserve Bank exists’.”
The finance minister recently urged the people of India to stop buying gold for a year to contain the burgeoning current account deficit on the external balance of payments. Rather belatedly, he increased the customs duties on imports of the yellow metal and imposed curbs on gold purchases. It was a classic case of “too little, too late”.
Soon thereafter, the rupee crashed and the economy went into a tailspin. The same foreign investors who he had assiduously wooed left Mr Chidambaram high and dry. The same Indian capitalists who had gone overboard praising his “dream Budget” of 1997 for cutting taxes, went overseas, preferring to invest outside their country and become home-grown multinationals.
Will history judge Mr Chidambaram as one who undermined institutions in the world’s largest democracy? He is visibly unhappy that the Supreme Court’s decisions contributed to a sharp fall in exports of iron ore and that the country is currently importing a substantial proportion of its requirements of coal for power generation despite possessing large reserves of the mineral. Mr Chidambaram was also critical of the report of the Comptroller and Auditor General (CAG) of India on the 2G spectrum scam.
But a number of crucial questions remain unanswered. What did the finance minister and his colleagues do when iron ore was illegally mined and exported for years on end from Karnataka, Andhra Pradesh and Goa? Could he have intervened to ensure that the manner in which coal blocks were allotted was above board? Did he have to wait for the damning reports of the CAG to learn that telecommunications spectrum was under-priced and misallocated on a first-come-first-served basis or that coal blocks were handed out in an opaque manner to cronies of those in positions of power?
In late-August, when the Cabinet met to approve the food security law, only one minister reportedly dissented. He was Mr Chidambaram. Quoting unnamed official sources, Sanjeev Miglani of Reuters recently wrote: “...already struggling to convince doubters that he will keep the country’s hefty fiscal deficit under control, (he) made a last-minute attempt to trim the huge cost of the plan... Chidambaram’s ultimate failure to win colleagues around — despite his famed eloquence — is emblematic of the predicament he faces: he must stop investors heading for the hills as economic growth skids to its slowest pace in a decade, but he is surrounded by politicians who haven’t grasped that there is a crisis at hand and want to spend their way to the ballot box”.
The finance minister asked an interviewer recently: “When did self-confidence become a vice?” Many of his critics, including those in his own party, contend that when it comes to Mr Chidambaram, the rather thin line between self-confidence and arrogance was frequently breached.
He told the Lok Sabha: “The fact is (that) the polity of this country is divided on economic policies and that is understandable… My plea to everyone, despite our differences, is: can we agree upon some measures which have to be taken in order to lift the country’s economy from what it is today?” To many, he sounded almost helpless.
He subsequently clarified in the Rajya Sabha that he was not trying to trash his predecessor who is now the President of India. The policies and decisions made by Pranab Mukherjee as finance minister were those of the government as a whole, of which Mr Chidambaram was and remains an important part. After all, even the controversial retrospective amendment to the Income-Tax Act in the finance bill that sought to overturn the Supreme Court judgment in the case relating to Vodafone’s tax dispute with the finance ministry was passed by Parliament.
Is the MP from Tamil Nadu, who scraped through with a narrow victory margin from the Sivaganga Lok Sabha constituency in 2009, singing a different tune now that the 16th general election is looming on the horizon? Mr Chidambaram may help himself by re-reading Dale Carnegie’s famous self-help book written in 1936, How To Win Friends and Influence People.

The writer is an educator and commentator