MAIL TODAY COMMENT.

PC's role in Maxis- Aircel deal needs to be probed

IT MUST be said that with more information on the dealings of his son's former company coming out in the public domain, the case against Union Home Minister P Chidambaram with regard to the Maxis- Aircel deal of 2006 is growing stronger.

Monday saw Leader of the Opposition in the Rajya Sabha Arun Jaitley present new ' facts' to prove a link between Advantage Strategic Consulting Pvt Ltd-- which had had a direct financial dealing with Aircel-- and Ausbridge Holdings and Investment Private Limited, formerly owned by Karti Chidambaram, the home minister's son.

While Mr Chidambaram insists that there was no link between the two companies at the time the Foreign Investment Promotion Board granted clearance to the Maxis- Aircel deal, what he has to cite in defence of his case fails to inspire credibility. For, the circumstances and transactions involving the two companies suggest otherwise.

To take the most glaring ' fact' that Mr Jaitley has cited, the two companies are supposed to have had a common email ID in 2006. That Advantage Consulting made a payment of ` 26 lakh to Aircel is known, but Mr Jaitley claims that the former's balancesheet also records payments made to three companies with which Karti Chidambaram was connected.

To make things worse, news reports have highlighted Mr Chidambaram's failure to take a stand against the terms of reference ( ToRs) of the Group of Ministers being changed in 2006- 07 at then Telecom Minister Dayanidhi Maran's behest.

Significantly, Mr Chidambaram sought to include spectrum pricing within the ToRs of the GoM once the process of Aircel acquiring all- India licences was over.

Given this backdrop, Mr Chidambaram can hardly expect to be bailed out of this mess by emotional appeals of the kind he made on Monday.

What the matter needs now is a proper probe.

Govt to blame for food prices

THERE seems to be no end to India's economic woes as the spurt in inflation will make addressing the slowdown in growth even more difficult.

With the domestic inflation rate hitting 7.23 per cent in April, up from 6.89 per cent the previous month, the Reserve Bank of India has little room to boost investment by cutting interest rates.

From the perspective of the common man, the most worrying aspect is the dramatic rise in the prices of food items. While the inflation in food items as a whole was 10.48 per cent, the prices of vegetables have increased by 60.97 per cent since last year.

It is the faulty manner in which the government procures, stores and distributes foodgrain that is singularly to blame for this. While cereals end up rotting in government warehouses, there aren't adequate storage facilities and cold chains for vegetables.

This is only likely to worsen in the months to come as about 12 million tonnes of foodgrain are being procured following the bumper harvest, and the Food Corporation of India has stated that the central and state storages will be overflowing by June.

Unless the government goes in for a comprehensive overhaul of its system of food storage and distribution, food prices will continue to burn a hole in the common man's pocket.

Regressive move by TRAI 

THE Telecom Regulatory Authority of India ( TRAI) notification limiting the advertisement time on TV channels is likely to take them all into the red. This decision comes within a month of another decision, that news broadcasters pay carriage fees to cable companies carrying their channels. The two decisions together will make the TV business non- viable.

While consumers are often irritated by the frequency of advertisements that come between programmes, it is those very ads which enable the broadcaster to produce quality programmes in the first place.

The role of a regulator is to provide a level playing field in which business can flourish. But in India it would seem that the regulators are determined to choke and otherwise impair the business models of enterprises that have given this country one of the most vibrant TV industries in the world. It is not clear why the TRAI has adopted this attitude. Perhaps our regulators-- most of who are former bureaucrats-- simply lack an understanding of the way the business works.

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