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A review by Vivian Fernandes, Journalist and writer

A Review by Vivian Fernandes: When Narendra Modi became the chief minister of Gujarat in 2001, numerous delegations met him. Employees of Baroda’s Gujarat State Fertiliser Corporation (GSFC) was one of them. The company was making losses, the workers feared for their jobs and they beseeched Modi for the sake of their families. Modi sought some time as he was new to administrative matters. His officials said the choice was binary: loss-making state enterprises were closed down or sold off. Modi decided on a third alternative—that of reviving them.


Alexander K Luke, a bureaucrat, was the official chosen. He lived up to the trust. When he took over in May 2003, GSFC was bleeding. Losses for the previous financial year had piled up to `383 crore. The stock price in the Bombay STOCK EXCHANGE was `17. The company had sought legal protection from creditors. The Reserve Bank had agreed to its bank debt being restructured. By the time Luke quit in November 2006, GSFC’s stock price was `185. In between, it had closed at a high of `243. It had not taken any money from the government and had prematurely repaid a 10-year loan. No worker was sacked. Luke ascribes the turnaround to “ethical management” by which he means doing whatever is good for an organization, regardless of personal consequences. At GSFC, he claims, he braved the displeasure of Chief Minister Modi by not agreeing to contribute `10 crore to the Chief Minister’s Relief Fund, as it was beyond the company’s capacity (he was vetoed by the other directors). While holding additional charge of Gujarat Narmada Fertilisers, he refused to implement a government order transferring the managing director of a subsidiary because (a) transfers were his prerogative and (b) he felt the executive deserved to be rewarded, not punished. Upon assuming charge at GSFC, he renegotiated a supply contract and got a giant petrochemicals company (no prizes for guessing) to pay the market price (almost double) and also cancelled a dealership that sat in between because it was not adding value to the `50 lakh it was getting in commissions annually. Cheekily, Luke says, the dealership belonged to a person whose name was similar to that of a Gujarat minister who is related to the family that owns the petrochemicals complex! Luke has written a 1,70,000-word book on ethical management called, Passport of Gujarat: Hazardous Journey. It is a 30-year personal excursion through the innards of the government. The book published by Delhi-based Manas Publications is due for release in January. It can be more aptly titled, “Why Government Sucks”. As labour commissioner in 1990-91, Luke carried on a rigorous drive to enforce the Minimum Wages Act. This offended a well-known garment exporter with multiple factories in India and also in Sri Lanka and Egypt. For his pains, Luke was transferred to the cottage industries department, despite withering comment in the media. Harish Khare (who later became Prime Minister Manmohan Singh’s media adviser) named the industrialist in his Times of India report, says Luke. Ela Bhatt, the founderof Self-Employed Women’s Association, popularly known as SEWA, interceded on his behalf with the chief minister, to little avail. SHAMELESS EMBEZZLEMENT As cottage industries commissioner, Luke found his officers indulging in brazen embezzlement. In Saurashtra, they held a public event attended by three ministers to celebrate the installation of 1,800 handlooms in the district— the year’s target for the entire state. But an investigation revealed that all but 56 were fictitious. Of the 1,050 registered cooperative societies which got grants and subsidies, 955 were found to be non-existent. That was in 1992. When MLAs and other political heavyweights complained that the investigation went against Dalit welfare, the chief minister arranged a meeting. Luke countered the charges with facts and figures. After the meeting, the chief minister complimented Luke. A week later, he was ordered out of the department. “I was a person of average intrinsic ability,” says Luke on his website, www.ethicalmanagementluke.com. “Ethically armed, I won luminous victories.” Luke is being modest. He studied in IIT Mumbai and was awarded the distinguished alumnus award in 2001 along with Congress leader and minister, Jairam Ramesh. For Luke, ethical management is not a call to piety. He has no use for the honest leader who plays safe. “Mine was not a moral crusade but a managerial strategy,” he says about his stint in the labour department. It could not function effectively if officers were venal. After regular field visits and relentless exhortation, he saw a change of heart. The head of the officers association even confessed to him that many officers had decided to desist from corruption till he was in charge. Perhaps, Luke was being flattered. Perhaps, they had decided not to be brazen in their self-aggrandizement. An ethical manager is not a lone ranger. Luke does not suffer the delusion that he is the solution. There can be no success without everyone pitching in. He recognizes competence in others, empowers them to take decisions and assures them of his backing. There could be no dithering; every meeting had to yield a decision. At all the struggling companies he headed, emphasis was placed on sound management information. Daily production, the total cost and item-wise break-up, the sales inventory, the stock of raw material, prices, sales realization, the maintenance cost and such other details were displayed for everyone to see. Workers found this empowering. They saw a causal link between their efforts and the company’s perform- ance. Even loaders gave preference to trucks serving markets that yielded higher profits.


Empowerment does not mean being ingratiating. At the height of labour unrest at one of the plants, Luke suspended a worker for destroying the glass door of his office with a steel pipe. Indiscipline is not tolerated. But the suspension was revoked after an apology. When workers demand Diwali bonus which is beyond the company’s capacity to pay, he takes the union leader into confidence and wins him over with his transparent honesty. They settle for a much smaller amount. Luke believes that the major problems of modern society are ethical, though they may appear in other guises. Their solutions lie in ethics. India’s fiscal deficit can be plugged if money is spent on welfare as intended; if project costs are not inflated and money siphoned off; if taxes are paid honestly…. A few score “ethicals” can change India. Luke believes national resurgence is impossible without a critical mass of ethical elite being on the vanguard. These are pathfinders who are willing to fight for public interest. They will be a fraction of the power elite. A country’s greatness is determined by the numbers willing to cross over. The ethical elite must act as fifth columnists or Trojans for the sake of the many who are not as fortunate, and become traitors to their privileged class. This is not an act of heroism. It is selfishness of a noble, creative kind. Luke believes that altruism, like material possessions, satisfies a psychic need. Honest achievement raises self-worth just as worldly goods increase one’s net worth. This is not a novel idea. In his December 1922 speech to the members of Poona (as it was then called) District Law Library, BR Ambedkar mentioned “public conscience” as one of the “conditions precedent to the successful working of a democracy”. By this he meant the “conscience that becomes agitated at every wrong, no matter who is the sufferer, and it means that everybody, whether he suffers that particular wrong or not, is prepared to join in order to get him relieved”. Early in his career, Luke saw how the Mumbai plant of the Gujarat’s fisheries department was made to bleed and its 3,500 square yard plot sold in 1983 through a rigged auction for `9.5 lakh—about the same price at which it was bought two decades earlier. There are quite a few such instances. Most of Luke’s postings ended in unpleasantness for him. To not lose heart, Luke decided to work for the “mythical citizen” who does not have any vested interest and measures the success of officials by the extent to which they uphold public interest. “This was the oracle I would turn to when I sought answers. There must be an objective good. Search for it continuously and you would know what to do,” Luke tells himself.


In the end, Luke’s inability to kow-tow to the powers-that-be LEADS to his premature retirement. The denouement happens at a review meeting of the drip irrigation programme, entrusted to him by Chief Minister Narendra Modi. Luke sets up the Gujarat Green Revolution Company to persuade farmers to do drip and sprinkler irrigation through novel management practices. They pay half the amount, while the rest is paid by the government. But no cash changes hands. All payments are made electronically so there is a paper trail. Suppliers cannot scoot after selling equipment; they have to market the concept and appoint agronomists to hand-hold the farmers. A year later, Luke expects praise from Chief Minister Modi; he is criticized instead. “I told him his assessment was wrong and the scheme’s implementation was exemplary and was being welcomed in the field. My daring to do so resulted in a stunned reaction in the room after which he (Modi) remained ominously calm.” Luke asserts that the players,bankers,drip equipment suppliers and most important, farmers, were happy with it. The mention of farmers infuriates the ministers even more. “How could a civil servant, and one who was not too civil, talk about the farmers and what they felt? That only a politician could do,” said Luke. This is the nub of the problem. Luke believes that a civil servant works for the interests of the people or rather public interest, and he should directly interact with the beneficiaries during the implementation of any scheme. But politicians consider themselves to be the intermediaries. They tell the civil servant what the people want and it is the politician’s instructions that the civil servant should follow. They want the civil servant to be not a servant of the people but an instrument in the hands of the politician. “I rejected this assertion, particularly looking at the calibre of our politicians. But it is a fiction many civil servants maintain for their own convenience. This is the conflict that is now raging all over the country,” Luke says. No one takes on the chief minister and survives. Luke ascribes Modi’s spleen to the reasons mentioned at the beginning of the article. There is professional jealousy as well; the chief secretary and Luke did not get along. Luke is transferred as principal secretary, posts and telegraphs. It is a promotion but no sooner than he receives the order by fax, Luke puts in his papers. The chief minister summons him later and persuades him to withdraw his resignation. Luke insists that his transfer be rescinded. In the clash of two headstrong persons, one had to give in. Luke buys a one-way ticket to Kerala and flies out in the second week of November 2006, two years before his retirement. He now lives as a gentleman-farmer. When Luke resigned, Business Standard described him as a turnaround man. His ethical success, Luke says, is a reproach to the many professionals who have achieved it conventionally. This is a book that some of the better-known publishers should have accepted. Luke sent them the manuscript, but they sat on it or turned it down. Perhaps the title put them off. He should have disguised it as a book on wellness.