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Fighter of the Fourth Estate

Paran Balakrishnan and Ashok Bhattacharya

It was a straightforward investment decision by the Unit Trust of India that triggered the most extraordinary - and unintended - consequences.

Two years ago, when media stocks were the flavour of the season, an investment committee headed by former chairman P S Subrahmanyam weighed the pros and cons of investing in the Kanpur-based Jagran Group.

Subrahmanyam had already informally given the green light and indicated that the UTI was ready to pay about Rs 270 per share but the meeting did not proceed according to script.

Subrahmanyam appeared soon after the meeting and told the Jagran's owners that he could pay only Rs 170 per share and there'd be tight restrictions even on that.

For Jagran Group Chairman Narendra Mohan it was a turning point from which he never looked back. Mohan flew into a rage at the UTI's sudden volte-face. But even he could not have guessed the earthshaking consequences of that morning's decision.

Now, two years down the road, he looks back upon it almost wonderingly. Soon after his unsuccessful bid to raise funds from the UTI, Mohan embarked on a two-year crusade that altered the face of Indian journalism. Says Mohan: "That is how it started. The UTI was instrumental in bringing foreign direct investment into the print media."

This week Mohan is savouring a victory over a bevy of powerful foes. Soon after getting the thumbs down from the UTI he plunged into the fierce behind-the-scenes battle being waged by two groups of newspaper barons over whether foreigners should be allowed to invest in the Indian print media.

Though nobody realised it at the time, Mohan would prove to be the decisive force who would tilt the fight in favour of the pro-foreign investment forces. "I feel the satisfaction one gets after winning a war," he says about the battle that was finally decided earlier this week.

To the uninitiated, the intimate link between the UTI's investment decision and Mohan's entry into the battle over foreign investment in the media may not be immediately obvious.

But, it is actually quite simple: the UTI balked at investing in the Jagran Group because foreign institutional investors wouldn't have been able to invest in the newspaper group. Therefore, it couldn't offer the price that Mohan wanted for his shares.

In his Spartan MP's residence in New Delhi's Rajendra Prasad road, Mohan is almost incredulous as he looks back over the events of the last two years. Mohan is both a powerful newspaper baron (the 18 editions of the Dainik Jagran sell 1.4 million copies) and a BJP MP with connections at the party's top level.

"I don't talk to second-rung leaders," he says candidly. In the last few months, as the battle over foreign ownership reached a frenzied climax, he has spent an increasing amount of time at his New Delhi residence away from his wife and giant joint family in Kanpur.

Mohan keeps a low profile away from the public gaze. But he has tremendous influence both as a newspaper baron and at a personal level. He was drawn into politics as a BJP MP by his 'political mentor' Lal Krishna Advani.

In Mumbai, he always stops by to meet and confer with Reliance Group patriarch Dhirubhai Ambani. In fact, when the Jagran was planning an IPO Ambani's Reliance Capital had promised to buy 2 per cent of the shares.

Mohan is a far cry from being a quintessential media baron. He has come a long way from early 1940s when, as a youngster in Kanpur, he didn't have enough money to buy a bicycle and, therefore, had to rely on traditional public transport in the district - the bullock-cart.

Today, he has a white Mercedes-Benz parked in his driveway.

The group's founder was Mohan's father, Puran Chand Gupta, who never faltered in his determination to become a newspaper baron.

Jagran, started from Kanpur, was his third attempt at being a powerful news lord. But Mohan, who took over the paper while his father was still alive, almost certainly deserves the credit for turning it into the potent force that it is today.

He has made full use of the technological advances in the newspaper industry to boost the Dainik Jagran's circulation and clout. It was one of the first to switch to colour and printing satellite editions. The newspaper employs about 2,000 journalists and even introduced the concept of 'mohalla' correspondents.

During his heyday, Mohan was an extremely hands-on editor and he still writes editorials, a column and one poem each week in Dainik Jagran. He can fluently dictate an editorial over the phone without notes - never pausing for a moment.

Mohan proved to be an indomitable foe in the battle for FDI in print. At one level, he has close links with all the top politicians of the Hindi belt and held endless confabulations with top leaders from all parties.

The exact details of what took place behind closed doors aren't known but some clues are available. What is clear is that Mohan has met everyone from the prime minister downwards and has campaigned relentlessly to get his way.

He was also a voice that could not be disregarded for more reasons than one. The Dainik Jagran is one of the few newspapers that is considered friendly to the BJP.

Also, it is published in Delhi and key cow-belt states like Uttar Pradesh, Uttaranchal, Bihar, Madhya Pradesh, Punjab and Haryana. It is published from 18 centres including 11 in Uttar Pradesh. Its political clout, therefore, should not be underestimated.

Perhaps, the effects of his relentless lobbying were on show at the Cabinet meeting that finally decided to allow foreign investment.

An unusual combination joined hands to argue in favour of allowing foreign investment. One proponent was HRD Minister Murli Manohar Joshi who is considered closer to the Swadeshi lobby.

Also, strongly in favour was Railway Minister Nitish Kumar and leading lights of the BJP like Arun Shourie, Arun Jaitley and Information & Broadcasting Minister Sushma Swaraj.

Others like Ajit Singh were also on Mohan's side, though at a slightly more low-key level. The only negative vote was, apparently, Finance Minister Yashwant Sinha.

At another level, rip-roaring battles were fought in the open in the parliamentary standing committee with CPI (M) MP Somnath Chatterjee on one side and Mohan on the other.

The power struggle between the two turned into an epic battle that see-sawed over a two-year period during which both sides thought they had won the day on more than one occasion.

The standing committee's decision was crucial to the entire issue because several BJP leaders had informally told Mohan that they didn't want to kick up an unnecessary political rumpus.

Therefore, they would allow foreign investment if the right climate was created. One step in that direction was getting a favourable decision from the standing committee.

Chatterjee, the chairman of the Information & Broadcasting Standing Committee, was deeply opposed to foreign investment on ideological grounds and used every trick in the parliamentary book to put up roadblocks. On December 20, 2001, Mohan was convinced that he had put together a winning combination.

But, when the standing committee members turned up for the meeting they found the committee room locked. Chatterjee had cancelled the meeting pleading ill-health.

The term of the I&B Standing Committee ended on December 31, 2001, and soon afterwards Mohan received a rude shock. He found that he had been removed from the committee and had to use all his influence to get back on the committee in time for the next meeting on January 8.

This time, however, things went his way and a majority of the committee came out in favour of foreign investment.

"The majority view that emerged in the meeting, which was attended by 16 members, was to permit foreign direct investment in print media to the extent of 26 per cent subject to certain in-built safeguards so that the managerial control will rest in Indian hands," say the minutes of the meeting.

More drama was to follow. At the crucial meeting to clear the draft report endorsing foreign investment in the print media, Chatterjee sprang a surprise by producing two drafts - one that allowed FDI and another that rejected it. Mohan was furious and questioned the logic of the move.

Chatterjee was unruffled and wanted a discussion on both the drafts. Mohan had already discovered that the Congress had been persuaded to change its stand on FDI. The inevitable happened.

The first draft opposing entry of FDI was taken up for discussion and approved. For Mohan it was a giant setback. But that wasn't the last word in the do-or-die battle. In the next few weeks it moved to another level in the political plane.

But right from the start Mohan had already given the fight between the warring newspaper groups a new twist. His presence helped to turn it into a Bharat Vs India battle.

In favour of foreign investment were powerful regional newslords like Bahubali Shah of the publicly listed Lok Prakashan Group, which publishes Gujarat Samachar. Because it is publicly listed, Gujarat Samachar, which is the largest daily in the state, is in a position to benefit if FIIs are allowed to invest in the media.

Similarly, the Indian Express Group which publishes Loksatta, the largest Marathi daily, was in favour of FDI. From Bengal the Ananda Bazar Group was also on the side of the pro-changers.

However, it should be said that Mohan, who holds sway in north India, was a key figure in the group. The Dainik Jagran also sells 300,000 copies in Delhi and is the largest-circulated Hindi paper in the city.

But he is bitter about the price wars triggered by the Times of India - one of the fiercest opponents of foreign investment - that have forced him to cut prices of the Dainik Jagran. So, this victory is particularly sweet.

The Navabharat Times, owned by the Bennett Coleman Group (which also owns The Times of India), is one of his key rivals for Hindi readers. Says Mohan: "Their approach is very aggressive."

Which way does Mohan go from here? The fact is that he does not have any foreign partners lined up. So it isn't clear how foreign investment will help his group. But he has a slightly unworldly streak and is unworried by this fact.

Says Mohan: "I am not disgusted with the Mercedes and material life. But there is something better than all this." This week he has won a huge battle but is still searching for answers to the greater issues of life.

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