Business Lobbying Free Essay Example

The topic – It is always better to have clarity on the topic as it allows a clear flow of ideas. Lobbying, in fact, are the attempts made by certain corporate groups to influence the direction of legislative policy of a country/state in such a manner so as to bring benefits to them and safeguard their interests. The objective can be achieved by influencing legislators, members of Parliament and create a lobby to bring forth and get the favourable legislations passed.

A lobbyist may be an individual or a group of individuals working for their employer or as an agent to them. Such people can be leaders of labour unions, corporate representatives, legislators, bureaucrats, and leading advocates, exercising influence in legislative circles or other private interest groups.

India does not have any clear regulation for or against lobbying, especially when it comes by the name of lobbying. But it is not legal either. Lobbying has now become a well-established service industry, although known by different names such as public relations, external affairs managers, environment management experts, etc.

Various established associations, federations, confederations of industry & commerce, etc function as lobbyists to get policies framed in favour of corporates.

Dilip Cherian, a known lobbyist and founder of Perfect Relations, states that lobbying functions as a bridge between companies and the government. He speaks in no ambiguous tone, “We help our clients understand the policy environment of the country. We help them identify key players and their positions in the policy area. The key players could be political parties, bureaucrats, the central government, panchayat, etc.

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The lobbying industry has been placing its demand for clear and transparent laws in countries like India where no clarity on the issue is available. So, it is high time that India should decide on making lobbying either legal or illegal by framing a detailed and clear policy.

When you speak in favour of the topic i.e. lobbying should be made legal in India, the key points may be:

1. Whenever there have been some big leaps in policy framing in India favouring corporates in one or the other, the issue of lobbying has always come up. Whether it was Enron – the Dabhol power project in Maharshtra, foreign investment in corporate sector, big defence purchases, infrastructure development and now foreign direct investment (FDI) in multi brand retail, all have been shadowed by the issue of lobbying. The person or the company lobbying for certain favour cannot do so till the government, legislative bodies – Parliament or state legislatures – have not considered some path to move on. Lobbying would only smoothen the process.

2. Various chambers of commerce such as FICCI and CII, National Association of Software and Services Companies, and private firms like Vaishnavi Corporate Communications owned by Niira Radia and DTA Associates managed by Deepak Talwar are among top lobby groups. These organizations, however, maintain that they are not lobby groups and work to exercise influence to engage with the government on the policy issues. When so much of lobbying is done by the registered and legal firms and companies in the guise of some or other name and it is a well known fact, making lobbying legal will add to the government’s income by levying good amount of fee and charges on the same. Where does the amount, being paid now on lobbying, go – is anybody’s guess. A transparent legislation will definitely solve this ambiguity and loss of income.

3. The US and some European countries have made lobbying legal with specific conditions like quarterly disclosures on amount spent and the manner in which the same has been spent or so. This provides vital information and transparency to lobbying practices. The furor raised in Parliament over the issue of lobbying by Walmart in the USA could come up due to its disclosures. Corporate giants such as WalMart, Pfizer, Dell, HP, Qualcomm, Alcatel-Lucent, Morgan Stanley and Prudential Financial have been eyeing the Indian market for a long time and have spent millions of dollars to have their business interest move at a faster pace in the growing Indian economy.

With the potential growth, more and more companies will engage lobbyists who can directly interact with politicians and bureaucrats and push their agenda. Lobbying, whether legal or illegal, will continue to remain integral to Indian businesses and politics. Doing away with it or making it illegal is not an option. It will be better to make business lobbying legal, of course with certain specific clauses to ensure transparency.

4. Making lobbying legal will bring forward open debates and discussions on all the forums. It will be possible to understand which option is better. Lobbyists and representatives of their companies will openly participate in such debates with the pros and cons on the performance and product.

5. At present, only the section 7 of the Prevention of Corruption Act may be invoked to call lobbying illegal. This section is not very sound. Think of the money spent on lobbying in a single year. If lobbying is made legal, at least a part of it will find its way to the government coffer. At present, it forms a part of unaccounted money going into the pockets of politicians, bureaucrats and other influential lot, the cost of which will eventually be recovered from the common people in the country.

6. Apart from saving millions of dollars, the country may see rampant corruption in the name of lobbying fading away.

7. Since India is in the process of establishing a larger institutional framework, the government needs creative inputs from various experts. As long as lobbying does not lead to ‘policy or regulatory capture’, it should be allowed.

8. The Indian government itself has a lobby firm presenting its case with American lawmakers, while a number of Indian companies and entities also indulge in lobbying activities in the US through their respective lobbyists. At various platforms like in the UN, World economic summits, in sports, in organizing Olympics, Commonwealth Games, etc, countries lobby their stake. Lobbying, in fact, brings more competitiveness and improvement in quality as things are to be explained and highlighted in comparison to any other stake holder. India would gain a lot by making lobbying legal.

When you speak against the topic, the key points may be:

1. The common man of India, who is otherwise reeling under the pressure of corruption and unemployment, will be left penniless once lobbying is made legal. All the majors will lobby for their interests in the economy, will facilitate the entry riding the common man who hardly earns his bread and butter. Those who have more power and pelf will become greater lobbyist and will ensure that their interests are not compromised.

2. National interests will be cornered as lobbyists will have one-line motto of watching their own interest and will not at all be concerned about the country’s interest as they will not be from this country.

3. Lobbyists will make corruption legal. Politicians and influential people will still garner their share from lobbyists at the cost of the nation.

4. Legislators, who are law makers, if influenced by lobbyists, may get inclined towards serving them, becoming oblivious of the national interests.

5. Lobbying in defence production and purchases might put national security at stake.

6. India is a vast country and has a lot of complexities and problems. The lobbying company has no perception of the diversity and the nature of problems. The government might simply gamble on the tactics of the lobbyist and that might become harmful in future.

7. There is no mechanism in India to bring accountability to lobbying, and publicly reveal the lobbying positions of companies and the money spent. Self-regulation in lieu of a formal legislation is often proposed by industry players. In India, nobody knows the lobbying position of companies, leave alone looking for consistencies in lobbying positions and their impact on issues on sustainable development. Making it legal will add to the woes of Indian businesses.

The efforts made so far in India-

The Planning Commission has set up an expert group to look into the processes that comprise lobbying. Arun Maira, member of Planning Commission, stated “We will be considering various interests of all the stakeholders involved. This expert group comprises industries and government secretaries. There is an on-going dialogue with the industry associations for their views. We want lobbying to be transparent and representative. We are looking at the best benchmarks for processes of lobbying in other countries. However, this is a very large issue and the final solution is far down the road.”

However, given the political exigencies of framing policies and complex nature of polity, this task will require the consummate skills of great statesmen.