On the face of it, banking and politics have little in common. They are wide apart, one black (the bankers in their suits) and another white (the politicians in their dhotis). But the miracles of relationship banking have never failed to astound me in my long career as public sector banker.
In India, politics is a way of life for some and a means of livelihood to many. From politics springs power; money and fans and followers. Why do politicians need money, you may ask. Because some time between independence and now, times have changed.
In the early days, the sway over the masses through words was sufficient. As we began losing our innocence and incredulity, the secrets of success in pursuit of power began changing. Patriotism and policies are not enough to gain and retain power.
Thus, elections have become a costly game. You need an army of people who can set aside their personal beliefs to ally with you. For this to happen, however, you have to satisfy their other needs -- food and shelter for some, wine and women for others and for those who are beyond all this, money and promises of finding ways of making money.
That is why politicians and public sector bankers have never really been strangers to each other. Bankers, however much they may want to, find it difficult to keep politicians away. Their tryst with politicians starts quite early in their career -- from the village sarpanch during a banker's first posting as officer.
This almighty being is there to welcome you warmly. He will even invite you to his mansion. If you want to get anything done in that area, you have to pay your respects to the sarpanch. He is often friendly and will help you recover a few loans.
He is also prompt about sending a score of applications under this yojana or that because, you understand, he is so kind-hearted. But the unspoken advice is: "The applicants are our men, so take care." If you want to refuse them, go ahead, but the sarpanch knows you will eventually have to come around.
And so it goes on -- from village level to the very top, banks are a soft target for all politicians out to implement their own brand of politics. From the first posting till the last bankers are politicians' friends; the higher you go the higher the status of the friend.
There's nothing sinister about it, all the politicians want is a say in the loan disbursement process. The flip side is that they get a say in your career. This is not a game for the faint-hearted. If you don't want to play by the rules, don't worry about your personal safety.
All that can happen to you is a few transfers. A phone-call to your bosses and there you go.
Given this relationship, election-year banking is pretty special. There is so much to do for all. In this truly liberalised economy, we will have Budgets announcing new schemes covering the full spectrum of society.
No discrimination here. Starting from Rs 5,000 to a few lakhs, these "election-year specials" are announced with great fanfare.
Of course, the intent is honourable -- the uplift of the masses, encouraging the under-privileged and so on. Who can argue with these? There is competition to announce new schemes, new rules, new targets -- so many thousands of kisan cards, a million loans of over a few lakh and so on.
Remember that through all of this the end-use of funds has to be verified. Worried about staff accountability? Forget it, the politicians are here to save you.
Election-year banking can be good for some bankers too. This is a good time to get a few things done for themselves. Elections are wonderful times to acquire favours from politicians. What rules and laws can't achieve, a chit, a telephone call or even a nod works wonderfully well during election time.
The politicians are receptive and open-minded. The windows of the Mercedes are lowered, the arrogance level is lower with the sobering influence of the elections. This is as good a time as any to get admissions to good schools and colleges for our children.
Election years are particularly hard; you don't know who is coming and who is going in this election roulette so you have to please everyone. No wonder every politician behaves as if he is your master.
If I sound as though bankers are innocent victims of election-year politics, forgive me. I have heard of bankers actively courting politicians for feedback on the implementation of their schemes.
Some even have a "manifesto" of their own, setting out what they will do when they are posted as the top executive of Bank A or B.
Where does all of this end? Will election specials continue? Who knows, but changes are taking place. All we need is genuine liberalisation. That way, elections or no elections, bankers will have to decide what is right for them.
I am a great admirer of public sector banking, but only when the public sector means public, not private wealth. When politicians set targets and the Reserve Bank of India devises schemes, election-year banking is inevitable.
If bankers have to depend on politicians for appointments, can the election year effect be far behind? When bankers behave like politicians and love to bask in the glory of somebody else's money they will continue to be squeezed, elections or no elections.
I have lots of friends in politics. Over time they have realised that I am a stubborn man and will not budge despite their blandishments. From my first posting to the last, I was haunted by politicians.
Now that I have retired, the phone calls have dwindled, they have to find new friends, build new relationships.
It is an essential part of their life. Good riddance you might say, but think again, life will be so boring for bankers without elections and politicians. If some bankers don't like it, let us say, it is their loss.
The author is former chairman and managing director of Bank of India
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