If the Deora-Ambani relationship is again in the public spotlight and has become a saucy topic in nation-wide media debate, it is because the matter is a major concern of the nation since the businesses and industrial groups controlled by the two Ambani brothers touch the life of a vast section of our population.

Between the two brothers, they control about eight per cent of India's gross domestic product (GDP). Their combined annual gross revenue is close to 80 per cent of the government of India's annual tax revenue. They control public deposits in shares and mutual funds worth several lakh crores of rupees. The Ambani brothers have a considerable presence in the country's vital energy sector. Mukesh Ambani's Reliance Industries (RIL) owns India's largest petroleum refinery complex, accounting for a third of the country's petro-products market. RIL's existing refinery has an installed capacity of 33 million tonnes per annum. Its second refinery, having almost a similar capacity (capable of processing 5.80 lakh barrels of crude oil per stream day), is fast nearing completion. Lately, its exploration operation has struck huge natural gas resources in the Krishna-Godavari basin. Younger brother Anil has a big presence in power generation, distribution, telecommunication and financial services.

Energy and telecommunications are regarded as strategic sectors of industry the world over because of their security implications. In most countries, they are under the public sectors. Elsewhere, their operations are under constant public gaze. In India too, they were predominantly under the public sector until the rules were gradually changed in the 1980s and 1990s for the benefit of private operators. The biggest beneficiary of the government's policy changes are the Reliance companies, especially RIL, which acquired huge oil and gas exploration blocks from the government along the hydro-carbon-rich east and the west coasts of India. Globally, state-owned oil companies control around 88 per cent of the world oil and gas reserves. None of them is known to have any private equity participation. Even in the capitalist world, private or multinational oil companies control less than 10 per cent of oil and gas resources there. RIL's growing presence in this field in India beats even the global trend. And, few would disagree that this would not have been possible without an active support and blessings of the petroleum ministry.

In 2007-08, RIL shut down all its 1,432 domestic retail outlets and diverted over 70 per cent of the refinery production to export to make a profit windfall of nearly Rs. 19,500 crore. This would not have been possible without the silent support of the Petroleum Ministry. If other petroleum companies such as state-controlled IOC, BPCL and HPCL followed the RIL example, there would have been street riots in the country. These public sector petroleum companies suffered heavy losses on account of 'under-recovery' in sales. What did the ministry do to discipline RIL during that crucial period when crude oil crossed the $100-a-barrel mark?

A dig into the history would suggest that RIL was generally in control of the petroleum, commerce and finance ministry policies that concerned its business and competition from internal and external sources. The government, it would appear, was happy to serve this corporate organisation and bend rules whenever they stood in the way of RIL's business interest and growth. From the erstwhile controller of capital issues to the departments of commerce, petroleum, natural gas and petrochemicals, all played a pivotal role to help Reliance become the country's No. 1 petrochemical producer. The government allowed its own giant Indian Petrochemicals Corporation (IPCL) to be gobbled up by Reliance.

After petrochemicals, the Ambanis dreamt of venturing into petroleum refining. A major policy change on the part of the government at that point of time made it come true. Government policies were redesigned to fulfil the grand ambition of the Ambanis to enter into oil refining. A top Gujarat cadre IAS officer shuttled between the departments of petrochemicals and petroleum steering them as secretary during those crucial years. Dhirubhai Ambani was alive and in full control. Sons, Mukesh and Anil, played the roles of his trusted lieutenants. Both were great trouble-shooters. They still are. Also, they were great managers of external environs, including powerful politicians and bureaucrats both at the Centre and states. They mixed with uncanny ease and aplomb with top politicians, often from rival parties such as Congress, CPM, SP, BSP, RJD and BJP, to pursue their business objectives. Their external environment management team was extremely efficient in collecting commercial intelligence both from the government and the business rivals. Not long ago, the team was 'caught lifting' union cabinet discussion papers.

It is in this context, Anil Ambani's open and loud allegation against 'uncle' Deora's petroleum ministry's sudden legal intervention in support of elder brother Mukesh's contention in the Supreme Court in the KG basin gas supply agreement case can't be and shouldn't be taken lightly by the government and the opposition in the greater interest of political morality and transparency in administration. The Bombay High Court had adjudged in favour of Anil's RNRL, taking cognisance of the MoU between the companies of the two Ambani brothers about the supply of a portion of KG basin gas by RIL at an agreed price. However, the petroleum ministry's sudden rush to the apex court with a fervent appeal to get the MoU between the two Ambani brothers scuttled complicated the matter.

RIL had contested the MoU in terms of both the supply and price commitments. RIL demanded a much higher price for the supply of gas to its customers, including RNRL, than it was originally agreed upon. Ironically, the previous UPA government, in which Deora held the same portfolio, endorsed RIL's claim for a much higher price for KG basin gas. The government's position on the pricing of KG basin gas from RIL threatened to hit not only RNRL but also the country's largest thermal power generator, the state-owned National Thermal Power Corporation (NTPC), another prospective customer of the KG basin gas.

It is true that vital and scarce natural resources such as hydrocarbon can't be given to private business enterprises for profiteering and robbing the public. Left parties have demanded that the KG basin gas be distributed by the government. But, that will not serve the whole purpose. The pricing of gas is more important than its distribution. Price will make an impact on end-users, the industry and common man. Anil's outpouring against the minister and Mukesh deserves to be treated as a whistle-blower. Instead of trying to unilaterally protect one of its ministers, the government would do well to order a joint parliamentary probe into the KG-basin gas scam before supporting or rejecting the claims of the warring Ambanis and the actions of the petroleum minister and other ministers involved in the matter.

Some of the UPA ministers are openly acting as advocates of powerful business houses and are willing to sacrifice the national interest and government enterprises such as STC, NMDC, NTPC and, of course, Air India. Many senior Congress leaders in the government smelt a departmental minister's hand behind the abortive attempt of the private airline operators' cartel, led by Kingfisher and Jet, to ground their air services this month if the government did not accept their self-drawn financial rescue package worth Rs. 10,000 crore. All these indicate a growing government-business nexus and the Prime Minister's losing grip over the situation. No specific public allegation against a minister, however powerful he or she may act, should be taken lightly by any government. Such an act will only embolden the corrupt elements to pursue their evil designs at the cost of the nation. (IPA Service)