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BW Businessworld

Too Early To Cheer

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The Supreme Court's concurrence with the government's view that all natural resources cannot be auctioned is being seen as a moral victory for the government. It should not be. To the extent that the government emphasised that this is a matter that should be dealt with by the executive and not the judiciary, it has triumphed. But the SC has merely agreed with the government that all natural resources cannot be auctioned. That may have been due to clever arguments by attorney general Goolam E. Vahanvati: "If fish in Kerala are auctioned, what will happen to the fishermen?"

But the SC's concurrence isn't a licence to the government to continue with its "opaque, non-competitive, inefficient, arbitrary and full of corruption" spectrum allocation policy, as the Centre for Public Interest Litigation's Prashant Bhushan put it. What's being misconstrued in this brouhaha about the SC verdict is the spirit of the SC's argument — that the arbitrariness in allocation of natural resources must stop and that there must be price discovery of all natural resources. Arguably, ‘auction' only serves the larger purpose of price discovery.

But having come this far, the Supreme  Court must, ideally, go a step further and classify natural resources into those that ‘must' be auctioned and those that ‘may' be auctioned.

Obviously, the fish argument does not apply to coal and iron ore and vice versa. There are living and non-living natural resources and there are static and flowing natural resources where guidelines can be defined tightly.

The apex court would be doing a huge disservice to public good if, having come this far, it goes no further.

(This story was published in Businessworld Issue Dated 23-07-2012)