As is often recounted chapter and verse on this page, nemesis has a way of catching up with the high and mighty who after they’ve made it to the top, love to kick away the ladder behind them and forget all about lending a hand to public causes. Yet another case in point is Rajat Gupta, former managing director of the internationally renowned management consultancy firm McKinsey & Co, New York (billing rate: $1,000 per man hour plus expenses). Gupta, an alumnus of IIT-Delhi and the Harvard Business School who emigrated to the US in the 1970s after availing heavily-subsidised education in IIT-Delhi and rose to become MD of McKinsey (1994-2003) personally rendering aid and advice to notables including the likes of Bill Gates, Bill Clinton, and our own Dr. Manmohan Singh, was obliged to resign all his corporate directorships in the US (Genpact, Proctor & Gamble, Harman International, etc) on March 1.
This fall from grace was the outcome of the US Securities and Exchange Commission (SEC), having accused him of parting with privileged information to Sri Lanka-born, New York-based hedge funds billionaire Raj Rajaratnam against whom SEC has filed 14 insider trading criminal charges. According to SEC, while serving on the corporate boards of America’s top companies, Gupta was regularly passing on confidential information to Rajaratnam who used the info to make a killing of $50 million (Rs.225 crore) on the American stock exchanges.
The fact that Gupta was just another over-promoted desi who made it good in America because of the characteristic generosity and commitment to multi-racialism of his American hosts rather than intrinsic merit, struck your editor circa 2004 when this NRI icon was basking in the glory of the successful launch of Indian School of Business, Hyderabad even as this publication was experiencing a severe financial crisis. With appropriate genuflection we requested him in his capacity as a champion of education to put in a word with one or more of the great philanthropists and leaders of industry whom he advised, to modestly subscribe to EW’s capital. Despite several presentations in person and writing — and his receiving a personally addressed complimentary copy of EW for several years — he neither provided a reference, nor indeed, ever acknowledged our complimentaries. Now having touched the zenith of his glory, from that high meridian this NRI idol hastes towards his setting, with none of his Who’s Who clients willing to speak up for him.
Self-defeating value premises
It’s astonishing but true that 30 years ago until Business India and shortly thereafter Businessworld were hesitantly launched for a wary business community, business newspapers and periodicals were unknown in India. But the scenario has changed radically since then with the country flooded with publications specialising in computers, electronics, marketing, engineering, and design and lifestyle with many of them boasting foreign connections, and often equity participation from offshore media monoliths. In the business segment the pioneers Business India, Businessworld (which is all set to celebrate its 30th anniversary with a big bang this month) and Business Today now have to contend with some of the most successful global titles including Forbes, Fortune and Inc. And the pioneer business dailies Economic Times, Financial Express and Business Standard have a new and formidable competitor in Mint — a collaborative venture between the Hindustan Times and Wall Street Journal — which is now the country’s second most-read business daily (after Economic Times).
Yet while competition from foreign and adapted titles has undoubtedly raised the quality of journalism and reportage, your editor, who launched Business India and Businessworld for their prospering but insufficiently appreciative publishers, can’t help expressing disappointment with their value premises. In particular their sybaritic splashes passed of as mind-broadening leisure, lifestyle and travel information is not only distasteful, but anti-social inasmuch as it is inimical to the savings habit and puritan ethic which encourage capital formation.
Overt worship and adulation of profligacy and conspicuous consumption in developing nations is anti-capitalism and self-defeating. Gratuitous advice to editors of business publications: If you can’t cease and desist, temper and tone down.
Business as usual
One of the greatest gains of the unshackling of the Indian economy promised by liberal economists — a species which was near extinction in the heyday of India’s romance with Soviet-style central planning but has mysteriously multiplied and flourished since — was reduction of the discretionary powers and influence of politicians and bureaucrats to award licences and permits to industry and business. Yet two decades after the historic liberalisation and deregulation Union budget of 1991 presented to Parliament by then finance minister Dr. Manmohan Singh — formerly a prime architect and executive of the licence-permit-quota regime throughout the period 1960-91 but who slipped into a telephone booth for a quick change of clothes to emerge on the national stage as Superman Reformer — the powers of self-enrichment and aggrandisement of the country’s politicians don’t seem to have diminished at all. Ditto those who hitch their wagons to the rising star of politicians.
Take the case of the late A.M. Sadhick Batcha, a close associate of disgraced former Union telecom and IT minister A. Raja who following the infamy and exposure of the 2G spectrum allocation scandal is now cooling his heels in Delhi’s Tihar jail. A former itinerant vendor of women’s dress materials in rural Tamil Nadu, Batcha suddenly morphed into a real estate tycoon in the 1990s as Raja rose in Tamil Nadu politics, and hit pay-dirt when he (Raja) was appointed telecom minister. Nor is the expeditious rise of Batcha from rags to riches only for his close association with an amoral politician exceptional. Meanwhile politicians themselves aren’t doing badly either. In Tamil Nadu AIADMK president J. Jayalalithaa has declared assets valued at Rs.51 crore and her rival DMK chief M. Karunanidhi in the imminent legislative assembly polls has declared assets valued at Rs.41 crore to the election commission.
Clearly 20 years down liberalisation road, the licence-permit-quota system reported to have been dead and buried, is not only alive and well but paying huge dividends.