IT’S THE WORLD’S MOST renowned and richest university with a humungous endowment corpus of $33 billion (Rs.204,600 crore). But recently, stories have surfaced in the US media detailing how the university’s management often trades admissions of the progeny of rich and powerful elites in developing countries — especially China’s princelings (children of top communist party and government officials) — for business development opportunities.
“Of the 4,458 foreign students at Harvard this year, 722 come from China. When the once-powerful Bo Xilai was tried for corruption, his son Bo Guagua was at the Kennedy School. The daughter of Chinese leader Xi Jinping is now studying at Harvard under a pseudonym. Such party leaders as Jiang Zemin and Zhao Ziyang are said to have had relatives at Harvard, too,” writes Diane Brady, a correspondent of Bloomburg Businessweek (February 11). Unsurprisingly, Harvard University had little trouble in obtaining the required clearances to start a Harvard Center Shanghai, where it offers “pricey” business education to wealthy Chinese nationals.
Nor is this top-ranked university quiescent in India. A Harvard Business School centre which offers top dollar executive education is running smoothly across an entire floor of the 5-star Taj Lands End Hotel in Mumbai. Moreover, Indian billionaires who plead poverty when asked to fund indigenous education institutions (or advertise in EW) have been successfully wooed to fund chairs in Harvard. Among them are Anand Mahindra (Rs.6 crore), Ratan Tata (Rs.30 crore) to fund a campus building, and Narayana Murthy (Rs.3.33 crore) to establish a Murty (sic) Classical Library of India.
Harvard’s fundraising team of over a dozen, comprising hard-nosed marketing and finance professionals led by the varsity’s iron-fist-in-velvet-glove woman president Dr. Drew Faust — skilled in the art of wooing and ego massaging the rich and famous — provides an excellent example for managements of India’s perpetually funds-starved colleges and universities.
Shared values
With their talent for histrionics, proclivity for violence and intellectual infirmity, megastars of Indian cinema and sawdust caesars of Indian politics share many characteristics. One of them is amoral opportunism. A case in point is Bollywood superstar Amitabh Bachchan’s cynical betrayal of Pepsico India, reminiscent of floor crossing and turn-coatism in Indian politics.
For eight years from 2002-10 Bachchan sang praises of Pepsi, the soft drink patented by the US-based FMCG multinational PepsiCo Inc (annual revenue: $ 66.4 billion or Rs.411,613 crore) on television and print media, for which he was paid — and gleefully pocketed — a massive sum aggregating Rs.24 crore. After his contract expired last month, he trashed Pepsi, reportedly because a little girl asked him why he was endorsing ‘poison’.
One wonders why this Bollywood star — revered in some circles as an intellectual notwithstanding his ready acceptance of roles of clown, hooligan and stalker in several blockbusters — accorded such high value to the research capabilities of the little girl who posed the momentous question. Moreover, since the Rs.24 crore he accepted from PepsiCo was tainted, why hasn’t he returned it? Instead, so deep is his anguish and remorse over the issue, he refuses to answer any questions on the subject.
Another shared trait between the country’s perfidious movie stars and ruinous politicians — hypocrisy.
Private casinos
The portents are ominous. In the fiscal quarter ended December 31, the public sector State Bank of India — the country’s largest bank with 14,816 branches and 228,000 employees — reported a 34 percent decline in net profit at Rs 2,234.34 crore compared to the corresponding quarter in 2012-13. Disturbingly, the management of this banking behemoth admits this sharp fall in profitability is because of higher provisioning for NPAs or non-performing assets (aka bad debts). Provisions for NPAs rose 44 percent to Rs.2,645 crore from Rs.1,837 crore in the corresponding period of 2013.
Despite their balance sheets being duly audited and certified, anecdotal reports and personal experience suggest that the health of India’s 21 PSBs (public sector banks) is not as good as their dressed up balance sheets indicate. The main cause of this disquiet is the ineradicable feeling that PSBs are the private casinos of the country’s pathologically corrupt politicians. Citizens can’t help suspecting that the overwhelming majority of humungous NPAs of PSBs estimated at Rs.2.36 lakh crore, are on account of politically directed lending, about which there is a tacit understanding that they will be written off from time to time when banks are “recapitalized” in passim in Union budgets.
This suspicion is supported by the obstinate refusal of PSBs to disclose details of major defaulters despite bank employees and the public clamouring for them, on the plea that banker-client relationships are confidential. According to inside sources, the major defaulters are politicians, businessmen and shady characters whom no self-respecting bankers would finance.
Forty-five years ago when the country’s 28 major banks were nationalised, the promise was that credit would be easily available to SMSEs and the common man. That promise hasn’t yet been fulfilled.