Henry Wadsworth Longfellow, the poet, once wrote “When she was good she was very very good; but when she was bad, she was horrid.” We must ask if the CAG has become a bit like that. Having produced two reports — on the 2G scam and the CWG — that measured 9 on the UPA's Richter scale, the CAG's latest offerings are of questionable quality. Both in the case of the report on Air India's acquisition of planes and in its audit/critique of the production sharing contracts for oil and gas exploration, the CAG has unwittingly given politicians an excuse to question its judgement. A simple fact has been overlooked, namely, that those were commercial decisions taken in a particular context. Sometimes these decisions turn out right, sometimes wrong. For instance, the Tata-Corus deal has turned sour on the company and one wonders what the CAG would say in hindsight had that been in its purview. These things happen and unless there are very strong reasons to suspect malfeasance which can be supported by at least some prima facie evidence — as in the 2G case — it is usually best to be economical with obiter.
In the case of Air India, the CAG has said the decision was taken far too quickly, as if 17 months is a short time — after a wait of 10 years. It says the files moved very quickly, in about a month. But the point, surely, is that the due process was followed. It has also forgotten that in the Bofors case it took a mere 12 days, from March 12 to March 24, 1986 for the purchase to be approved — after traversing the whole range of Ministries. The guns turned out to be fine later. The CAG is also critical of the Civil Aviation Ministry's traffic projections. But, then, other airlines in the world too go wrong. Even on the giving away of bilaterals, whatever may be the suspicions, the decisions can be justified on commercial considerations. Bad judgement cannot be equated with wrongdoing. Likewise, in the case of the oil and gas production sharing contracts, the CAG is lamenting the absence of a strong regulatory framework, and the inability to draw up fair contracts. But is that sort of thing within the CAGs remit? It would have done better had it asked the key question, both in regard to Air India and the PSCs: did India pay more than it need have? For example, why were the charges of gold-plating not looked into? The CAG said it doesn't know what gold-plating means! Since it did not ask, it did not get an answer; and instead has only succeeded in looking unwise.
The CAG, which has done yeoman service in the last year, has run into a peculiar problem: as an auditor it cannot critique policy; nor can it sit in judgement on commercial decisions without reference to the context. It has started a process of introspection and it should press on with it.