The whole of the corporate and elite world is shocked by the arrest of Rajat Gupta, the high profile McKensy head and his friend Raj Rajaratnam (who is now in jail, for the next 14 years and Rajat Gupta is facing trial for his insider information charges.
The point here I want to raise and discuss is not about the fate of these cases. What lessons for India and the Indians. For our own ethical and moral values of the new and educated rising middle class professionals and others ambitious of making themselves millionaires and billionaires in the new opportunities. Right at the moment of writing I read that in India too we are seeing the rise of the CEOs, the professionals who now run the major corporations, from the Tatas to the Ambanis and the others, there are now some 1000 and odd new additions to the Rs.5 crore per year earnings of the Indian professionals!
Apart from the family owners, like the Jindals and the Sun TV network Maran, the two alone earn about Rs.60 crore plus and Rs.50 crore plus a year!
So, India is also changing and we have to see how the mix of politics and industry, in India specially, the close link between politics and business and this impacts the wider society in so many ways. Ways that are not always wholly ethical and beneficial. The number of the VIPs inside Tihar jail is also a warning as to what is likely to come in the future in the country.
See the new types of businesses that are closely mixed with politics.
In India, there are some 40 news channels that are directly controlled by politicians or political parties.
These are undesirable trends.
The politically controlled TV news channels only help to blackout the rivals’ politics, party activities.
So, we have the obvious instance of the AP’s young politician, Jagan Mohan Reddy who had challenged the Congress party and so he is hauled up by both the CBI and the ED for violations of rules as for his business and Media Empire.
So, the media, or rather the new media with new owners often use their media clout to directly manipulate the politics. See again in the TN cases of the DMK and the Sun network.
The 2G case is a fall-out of the Sun first creating problems and the rival TV was promoted by dubious financial deals and the net result is that everyone finds themselves in jail.
There are other instances in the media’s unethical behaviour.
In the paid news scandal, we see the very old, even considered venerable newspapers are involved and the result is that the report of the enquiry committee is not released, it is totally blacked out! Rather the new Press Council head, Judge Markandeya Katju is hauled up for speaking out his mind!
And even the Central government started to interfere. The Information Ministry, under Ambika Sonia, it was reported, denied ads once the Anna Hazare movement got wide media coverage.
These are all not happy times, obviously.
Now as for the Rahat Gupta and Rajaratnam messup in the insider trading speculations, it emerges that Gupta once the darling of the corporate world is now shunned by his own friends, Indians in particular and there are write-ups in the magazines on this very topic.
Those who worked with him at the Hyderabad-based Indian School of Business which Gupta helped to found in the first place and his colleagues like Premnath Raj Sinha who was the dean at ISB and others like US attorney Preet Barara, informant Roomy Khan, and friends like Rajiv Goel and Anil Kumar, Gupta’s Wharton school buddies are all aghast and speak now in different tones and voices. Over 2.8 millions live and work in the USA and they all work hard and work with honour and great integrity. Some like Preet Bharara, Rajaratnam’s nemesis, they all talk in contradictory terms, for obvious reasons. It is said that the Indians in the US earn a media household income twice the US average! Most don’t resort to cutting unethical deals.
Now with two high profile names finding themselves in such a fix what is the most agitating question today in the USA?
Are the Indians, the obvious immigrants, basically an ethically and morally guided community? Or, if not what sort of immigrants the Indian community is?
There are disturbing questions the write-ups in the Indian news magazines.
Rajaratnam was pressured to tap his colleagues conversations, says he in his Newsweek magazine interview.
Rajaratnam picked up two out of 20 Indians in the total of 600 students in Wharton.
The two were also rich, one was from McKinsey and the other was at Intel. They, it is now explained were not short on money but long on greed! Rajaratnam accuses so many racial groups for his present troubles.
So the conclusion as far as Rajat Gupta is concerned, did he act (giving insider trading tips to Rajaratnam) out of his greed?
That questions will be decided in the coming days when his trail comes up.
Now, as for the lessons for India, it is now reported that Rajaratnam besides his 14 year jail term, he will be fined a record 92 million dollar fine!
He made 70 million dollars as his illicit profits. So, the US Securities and Exchange Commission, SEC, like our SEBI will now impose these fines.
Now, the question is will the Indian SEBI would also resort to imposing fines for illegal stock trading in India.
Much more relevant is the question: will our Indian courts in the 2G scam, would impose jail terms and also fines to take back the funds that were criminally taken out of the government treasury?
Rajaratnam case flushed out a few others who are all high profile professionals in such big firms like McKinsey and also IBM, Intel and in hedge funds.
The civil fine, as the US judge said, was to deprive the illegal money maker his martial part of the fortune.
In India too we have to protect our government functioning beyond reproach, beyond such dishonourable acts of Cabinet ministers and unfortunately, in the case, we find even the other equally high profile ministers. The PM and HM names are now doing the rounds. One is really aghast at the prospects of new names tumbling out.
India is really passing through a very crisis period in its governance mechanism.
The sort of business climate, including the license raj atmosphere that gave the telecom minister a great hold on mischief making on such a large scale that had almost destablised the Indian polity.
So, we need to protect our market, free market economy is our model and as such there is a great deal of room for everybody to reflect and come out with their own prescriptions, from the parties to the other social leaders, religious heads to secular society, academia to administration to media and other institutions.
Indians must demonstrate a much more well-defined morals and ethical behaviour in our secular spheres.