Congress vs Congress? Praveen Chakravarty slams Karnataka Govt's Rs 9.5 cr deal with BCG, apologises later

First Published Jun 21, 2024, 3:48 PM IST | Last Updated Jun 21, 2024, 3:48 PM IST

The Congress party finds itself mired in internal conflict as Praveen Chakravarty, the data analytics head of the party, publicly criticised the Karnataka government's decision to reportedly hire Boston Consulting Group (BCG) at a cost of Rs 9.5 crore for six months. The consultancy was engaged to mobilise Rs 50,000 crore-Rs 60,000 crore annually to implement five poll guarantees and fund development projects, according to a recent report in Moneycontrol.com.

As per the report, Karnataka's finance department sought expressions of interest (EoI) from consulting firms in March 2024 to enhance the state's revenue potential. The consultant's tasks reportedly include identifying initiatives to boost tax and non-tax revenues, reduce expenses, explore innovative funding sources, foster public-private partnerships (PPPs), use technologies to prevent leakages, and monetize assets. Focus will be on the irrigation, energy, public works, and rural development departments, while exploring new revenue sources in departments like mining and forests, as per the report.

Among BCG, KPMG, and E&Y, only BCG is said ot have participated in the final tender, reportedly securing a six-month contract for approximately Rs 9.5 crore. BCG is also assisting in streamlining expenditures in tenders across major departments, with some proposals expected in the next budget, as per the report.

Tagging the report, Praveen Chakravarty on Thursday took to X, formerly Twitter, to criticise and point out the irony of outsourcing both political functions during elections and core policy functions in governance to external consultants. "If one wins elections by outsourcing core political functions to external fee charging transactional consultants, then one also governs by outsourcing core policy functions to similar consultants!" he wrote, in an apparent dissatisfaction with the Karnataka government’s approach.

This public rebuke from a senior party leader, closely associated with Rahul Gandhi, sparked widespread debate over the deepening rift within the Congress. Chakravarty’s comments resonated with criticisms from opposition leaders, adding fuel to the fire.

Leader of the Opposition, R Ashoka, and BJP state president BY Vijayendra also slammed the Congress government for the BCG appointment.

“What is the need of the BCG when a self-proclaimed economist like Siddaramaiah is the CM?” Ashoka said. “Not sure whether it will boost the revenues of the state government, but it will definitely boost the revenues of private consultancy firm (sic) at the cost of Karnataka's tax payers,” said R Ashoka.

“This is akin to handing over the reins to the East India Company!” said Vijayendra. “When the state government operates under the directions of an external agency, the welfare of the people takes a backseat, and innocent citizens are the ones who suffer!”

The backlash prompted Chakravarty to issue an apology over slamming the Karnataka government's alleged deal with BCG, clarifying his intentions. "I posted my pvt opinion on the broader culture of outsourcing core political & policy functions to outside consultants with no ‘skin in the game’. It’s an issue that is debated widely in research circles & my comment was purely academic," he wrote on X.

He further expressed regret for any harm caused, saying, “In retrospect, I should have been much more sensitive about the context. It was absolutely not intended as a personal criticism of any, let alone my own party’s. I have spoken with & expressed my apologies for causing inadvertent harm to the leadership in Karnataka."

Faced with the daunting task of mobilising thousands of crore annually to fund a range of ambitious freebies, the Karnataka government has already implemented a series of tax hikes and additional levies. Despite these measures, political observers point out to the state government's inability to bridge the substantial revenue deficit, leading to annual borrowings exceeding Rs 1 lakh crore. The decision to hire Boston Consulting Group (BCG) at a significant cost of Rs 9.5 crore has further exacerbated tensions within the party. As the Congress grapples with these challenges, the broader implications for governance and party unity remain to be seen.

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