Amma's Banker In Delhi

UNLIKE the other Tamilian Palaniappan Chidambaram who was greeted by the business community with jubilation after he became finance minister, the present incumbent from the southern state, R.K. Kumar, Union minister of state for finance in charge of banking, revenue and insurance, is viewed with suspicion and doubt. The suspicion stems primarily from the fact that his party AIADMK and its all-powerful leader J. Jayalalitha had demanded that the finance ministry should go to their nominee. Though she could not succeed in making her foe-turned-ally Subramanian Swamy finance minister, she did manage to wrest the powerful departments of banking and revenue within the ministry for her confidant Kumar.

In fact, so strong was Madam Jayalalitha's hold that the all-important finance ministry was, for the first time, bifurcated to give Raghavachari Krishna Kumar control of the crucial departments. A division of duties within the finance ministry was first done in 1976 when the departments of revenue and expenditure were separated. But in the past, allocation of duties has always been done by the finance minister himself. This time, strangely, the division had to be effected through a presidential order. Says an irate Dr Manmohan Singh, former finance minister: "A functional division is all right. During my tenure too, I had carried out a division of duties to give freedom of functioning to the ministers of state. But never had this kind of a thing been thrust upon us or negotiated for the sake of the survival of the government."

 There seems to be a twofold hidden agenda behind the unprecedented move. One, to protect the erstwhile first family of Tamil Nadu—Jayalalitha's close friend Sasikala Natarajan and her nephews—who are being investigated in FERA and COFEPOSA cases. These investigations are being done by various agencies that come under the department of revenue—Department of Revenue Intelligence and the Enforcement Directorate. Two, to nail the political rivals of the AIADMK: the Tamil Maanila Congress whose leaders are supposed to be involved in the multicrore Indian Bank scam, and the DMK by giving back the Tamil Nadu Mercantile Bank to the powerful Nadar community votebank .

But Kumar, the 56-year-old chartered accountant-turned-politician, strongly denies any hidden agenda. "First, we must realise that most politically sensitive cases are monitored by various courts and the ruling party has very little control over them. Second, Madam Jayalalitha will not ask for any favour from anybody. She has been a fighter all along and she will fight her cases legally. She does not need protection from any quarters," he declares. According to him, he was selected to the finance ministry because of his familiarity with the subject. "Apart from being a practising CA, I was also on the board of Canara Bank. I have functional knowledge about the world of finance and the way it works. The present controversy that I am appointed to protect A, B or C is a figment of the imagination," he protests.

Not many people are ready to buy his argument, though. Says Surjit S. Bhalla, economist and president of Oxus Research: "The budget will be indicative of the economic impact of the bifurcation. It will show us what the finance minister can do and what he can't. But it's clear that this is a political move to protect Jayala-litha." Adds Manmohan: "The move stands out and draws attention because it is not a mutual understanding. If the division has been done without consulting the finance minister and if it leads to a curtailment of his powers, then it's a matter of shame. "

Most of the AIADMK members, however, concede that Kumar is the best among the five MPs selected by Jayalalitha to be a part of Atal Behari Vajpayee's cabinet. After all, he knows his subject, and appears to have no doubts in his mind about his long-term and short-term agenda as a minister. Says he: "My first task as the minister in charge of banking is to make banks do their fundamental job: lend money. A fear psychosis has set in among the banks and they do not want to take decisions. I want to create an atmosphere where honest decisions will be encouraged and nobody will be penalised for taking initiatives." No one could disagree with that.

In fact, for a Tamil Nadu politician, Kumar is quite an unusual man. His rise itself is an indication of the changing contours of the Dravidian movement. Started as the non-Brahmin mobilisation of people against the stranglehold of the orthodoxy, the Dravidian movement did not have any Brahmin in its leadership till MGR broke away from the DMK in 1972. MGR was the first Dravidian movement leader to induct H.V. Hande, a Kannadiga Brahmin, into his cabinet. In 1982, he took in Jayalalitha, another Mysore Brahmin, and made her propaganda secretary. Since then the Brahmin stronghold in the party has increased, culminating in the current alignment with the BJP.

Kumar, who is a Brahmin, entered politics in the early '70s when MGR revolted against the DMK leadership. Kumar was enlisted to prepare a dossier on the "misdeeds" of the DMK regime. His father-in-law N.C. Srinivasan was MGR's chartered accountant. He assisted the big team headed by Mohan Kumaramangalam, CPI leader M. Kalyanasundaram, advocates Erode Kannan and Salem Kannan that produced a formal complaint against the DMK leadership. In 1972, when MGR launched the ADMK (it was rechristened AIADMK during Emergency), Kumar enrolled as a member.

WHEN a trust was formed to publish an anti-DMK eveninger, Makkal Kural, Kumar not only played a key role in establishing the paper but also started writing regular columns. But he was careful not to mix politics and his professional interest. "I did not have any accounts of any of the AIADMK leaders. My association with the party has been political and professional. I do not know from where the stories such as that I am the chartered accountant for Madam Jayalalitha emanate from," he says.

Kumar's success lies in the fact that being a rebel does not pay in the Indian political scene. He has never questioned the leadership on any issues and chose to be with the majority. The AIADMK witnessed many splits. In 1984, S.D. Somasundaram left to form his own party; in 1987, after MGR's death, the party was split into two, one headed by MGR's widow Janaki and the other by Jayalalitha; in 1990, S. Thirunavukkarasu left to float his own party and in 1995, R.M. Veerappan revolted against Jayalalitha. During all these upheavals, Kumar decided to stick by the leadership. This undying loyalty fetched him a place in the Rajya Sabha in 1996. Kumar's stars started to shine after the AIADMK defeat in 1996. He became the most media-friendly face of the party and tried to bridge the gap between the party and the leadership.

In the meantime, Kumar has already formulated some plans about what he wants to do as minister. According to him, of the 212 companies referred to the BIFR last year, at least 170 were forced on to the list just because of government policies and banking indecisiveness. "I want this tendency of attributing motives for each and every move to end so that the process of wealth creation which is very important for the economy, can go on without any artificial impediments."

With reference to revenue, he wants to create a conducive working atmosphere to ensure serious field-level implementation of various resource mobilisation moves. "I can't adopt a carrot and stick policy because I don't have any carrot to offer. Salary is determined by the pay commission. Nor can I adopt the stick because it never works in the government. So, I am planning to evolve non-monetary incentives to help the good officers and staff."

He is, however, very cautious about the insurance sector. He feels that Chidambaram's aborted attempt to get the Insurance Regulatory Authority Bill passed could have been easily avoided: there was no need for a regulatory authority when there was no private sector participation in insurance. "For any major breakthrough in the sector, we need the numbers in Parliament. First, the LIC Act has to be amended if we have to permit private sector entry. It is very complex. Unlike in banking and revenue, I don't think I would be able to do anything drastic in the insurance sector," he concedes. That's the same sort of pragmatism he has displayed throughout his political career.