SB: What you say about regulatory role being more lucrative ( will that be detrimental to public good?) is shocking news to me as it turns upside down the notions I had till now. "...and then things should move." -- any idea how things might move and in which direction? City Zen

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Private transport is partially liberalised in KA. Although there are a lot of private buses / air service etc, we still lack a strong competitive environment. The private bus lobby was shrill in blocking the Mangalore-Bangalore train service. It was indeed a miracle that the train service was pushed through.

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Not just UP, many more states are moving in this direction. Whereas Karnataka, with all its human resource capital, should have been in the forefront of such reforms, it is now tragically seen to be falling far behind. And, the once BIMARU states are taking over.

And, Cadambi - private sector has played a role in Karnataka, particularly in South Kanara, from long. But, true liberalisation is a far way off. More on it, you may read at

http://traffic-transport-solutions.blogspot.com/

Muralidhar Rao

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A small point if I may. When government stops doing business itself, and moves back to the regulatory role, it actually makes things easy as well as lucrative for netas and babus. The corruption moves to higher levels and amounts involved become concentrated and huge. [There was an interesting editorial in biz-standard recently on the big-ticket corruption, where they tried to draw a correlation between development of states and level at which corruption plays]

When you are regulating, you are dealing with larger businesses, you get to feel more powerful (or demand more for clearances or renewals). And obviously, dealing with public complaints about poor quality becomes easier - just change or pressurize the service provider. Its really a win win for Netas and Babus on both the counts (votes and money), and one CM of a particular state in the north clearly realizes that.

Now, let me end this with some even more opinionated and loose talk. Bangalore's real estate, and Bellary's iron ore have kept the netas busy over last 8 years or so. And perhaps that is showing now. Once their "interest" spreads around and they realize the true merits of withdrawing to regulate, then things should move.

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TRAI, SEBI are two regulatory bodies in the country that I can readily think of, that have matured over the years, and are today doing a fairly decent job.

Regulatory Bodies are never constituted as government organisations. There is wide representation of all interested parties, including consumers, and the government.

In the Telecom sector, the way the call charges have been dropping, and the keen tussle between the various players over band-widths, etc are clear indications of the effective role played by TRAI. With Airtel and Vodafone pulling in one direction, and TATAs and Reliance the other, and TRAI mediating, the consumer gets to become the real king. That is what has to happen in each and every sector.

The iron ore racketeering in Karnataka is because the sector today is in the 'control' of the state ministry. Once the ministry is replaced by a properly constituted regulatory body, the scenario will change, and the state overall will benefit.

The only regulatory body in Karnataka, viz KERC, is today playing the role more of a Consumer interest group than a regulator, because the vested interests have thwarted the reforms process.

Muralidhar Rao

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Sorry, I was irresponsible with that last comment. I was speaking about government itself playing the 'regulator'. I am also unable to picture a regulatory body like TRAI for infrastructure building. In that context, I looked at the manner (speed rather) in which UP government has scoped and awarded the Ganga Expressway project in a hurry, where all of 1000+ kms of the corridor will be built by a singe business group. 

What would be the right way of "picking" representatives from all interested parties (consumers, businesses and governments)? Yet another set of elections to pick people from each interest group? Who represents consumers? Why should the government (that we elect) not be the representative for consumers?

How do you enable speedy decisions when such a regulatory body carries too many differing opinions (because of wider representation)? Notice the delay in 3 G. Notice poor service qualities amongst all wireless telecom players. Notice the delay in forcing true competetion via number portability. On the other hand, has TRAI been able to serve the consumers via VoIP? How do you see TRAI's failure in promoting internet and broadband?

The point one would get to is - structure of the regulatory body is less important than 'transparency' and 'accountability' of its operations. Government appointed folks, or industry and consumer appointed people as regulators, the risk with the "seat of authority and power" remains the same. And the way I see it, the only organization that can be made transparent and accountable in true sense is the elected government.

This would get long, neither is this Bangalore specific, so let me stop and leave it half baked here.

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See related post: UP - roads to prosperity

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