Sunday, June 30, 2013

Taking citizens for granted

News International, a Pakistani daily, has editorially commented that the government has committed a fraud on its citizens by secretly writing to the Swiss authorities not to act on an earlier letter seeking details about President Zardari's accounts with Swiss banks.

There is no reason to hope that Indian government behaves differently. The government repeatedly misdirects the CBI to investigate in a way suitable to the powers that be. The government very often says they have taken up with various governments but the latter are not responding. The latest bluff was in connection with Sun TV-Maran-Maxis-Sivasankaran affair.

Saturday, June 29, 2013

State of the Nation

In current volatile environment, it does not take long for any protest in any country to escalate into a major movement and upset political calculations. Brazil, for example, is now witnessing what is called as the 'Salad Uprising'. Protests against excessive spending on soccer world cup (even in a soccer-loving nation), corruption in high places, lack of governance etc. easily coalesce into a crippling revolution-in-the-making.

How even minor events provided the inflexion-points and catapulted Tunisia and Egypt into front-page news internationally is still fresh in our memory. There are so many commonalities among Brazil, Egypt and India historically and economically that we in India should not be unprepared for Brazil and Egypt-like events in India in the near future.  Gandhian protests initiated by Anna Hazare were contained not by governmental authority but only by misdirected planning by the protesters. Otherwise, India was on the anvil for a major realignment of social forces that would have heralded welcome changes in governance.

How is India placed now? Macroeconomics is in a sorry state. Balance of Payments and Current Account Deficits are in a mess despite occasional motivational statements from the Finance Ministry. Some cosmetic changes in the recent past have no doubt encouraged the Paris-based Financial Action Task Force to say, "India has significantly stepped up its probes into suspected money laundering and terror funding cases, although a low conviction rate remains a matter of serious concern."

Strong inflow of funds under FDI has so far been one of the essential props for Indian economy. This is now becoming shaky. India has slipped from 2nd rank in 2012 to 5th rank in 2013 in 'FDI Confidence Index' prepared by A.T.Kearney. In HDI Index we rank 134 versus Brazil's 70.

In Corruption Perception Index 2012 prepared by Transparency International, a Berlin-based watchdog, India ranks 94, far below Brazil's 69. Ranking is in ascending order of corruption. This has prompted S.Giridhar of Azim Premji Foundation to conclude, "We have created a boa constrictor coil of corruption that entwines every single strand of our country's existence."

India's rulers may be forewarned that recently Brazil's courts have imprisoned close associates of former President, the charismatic Lula, who were found guilty in the "Votes for Cash Scandal". If Indian judiciary turns bold and fast, our politicians will be in deep trouble.

Monday, June 17, 2013

Ill-fated India

Manmohanji has expressed his confidence that UPA will come to power again. Recent happenings in NDA have probably bolstered his mojo.

He has also shown what is in store for the country when UPA is reelected to power. He has today made the disgruntled Mallikarjun Kharge as the minister for Railways. This position was earlier assured to him to make him reconciled to accepting another person as Karnataka's chief minister. Ministerial portfolios are allocated to buy peace from various state satraps. In this situation, what governance can we expect?

Manmohan is not what he is if he commits only one mistake at a time. He has also appointed Ola as a minister. Ola is only 86 years old! All that remains is for the able prime minister to look the other side when ministerial shenanigans are played out in full glory.

An opposition that can only talk about government's misdeeds without providing an effective alternative is a disgrace to parliamentary democracy. BJP is engaged only in its own leadership tussle and is incapable of retaining parties in NDA. A bleak future awaits India.

Saturday, June 08, 2013

Are the French ministers learning from their Indian counterparts?

It is reported that France's minister for Budget, Jerome Cahuzac has resigned since he had lied to parliament about a secret Swiss bank account. Surprisingly, the French government's enquiry with the Swiss authorities did not reveal the factual position.

Detailed investigation is now on by a parliamentary commission.

Cahuzac who is also a cosmetic surgeon resigned in March 2013 and he was sacked from the Socialist party thereafter. No country is free from corruption and black money. Countries differ only in how they deal with the menace. Some take immediate remedial action. Others indulge in dilatory tactics.

Learning from Pakistan's prime minister

Nawaz Sharif has warned that strict action will be taken against officials who issue advertisements to congratulate him on his electoral victory. He does not want "national wealth to be wasted" on such sycophantic exercises.

He has advised people to "concentrate on nation-building rather than sending congratulatory messages".

Would Indian leaders take a leaf from Nawaz Sharif?

Wednesday, June 05, 2013

Mohandas Pai's ambivalence on corporate governance

The Hindu Business Line asked Mohandas Pai, a protege of Narayana Murthy "what kind of practice it is to bring the son into the company, even if it is only as an executive assistant".

Pai's reply is disappointing to those who value corporate governance. Pai argues that you cannot stand on niceties in a desperate situation. Does it mean governance is negotiable? One expects better opinions from a person like Pai.

Pai goes on to add, "Empower him, give him whatever he wants". Infosys should not behave like a shameless political party.

Tuesday, June 04, 2013

Congress party's admission

The Central Information Commission has ruled that political parties are obligated to furnish information under the RTI Act. Salman Khurshid has at once criticised this.

What does this show? His party is not ready to be transparent because it has to hide a lot of information. This is not to say that other parties are ethical either.

Cynics (shrewd observers?) say that one major political party has offered unthinkable sums of money to leaders of another national party so that they will speak with different voices. Need one say more?

Monday, June 03, 2013

Popularity of countries

BBC does a poll survey every year to find the relative popularity of different countries. Results of the 2013 survey are given below. One disconcerting development for India is that compared to the last year, there is a 6% fall in percentage of respondents who view India positively and 8% increase in those who have a negative opinion on India.
This means that perception about India has turned negative by 14%. China is the only country which has fared worse. Its negative perception is up by 16% vs India's 14%

"Germany is the most positively viewed nation in the world in this year's annual Country Ratings Poll for the BBC World Service.

More than 26,000 people were surveyed internationally for the poll.
They were asked to rate 16 countries and the European Union on whether their influence in the world was "mainly positive" or "mainly negative".
Germany came out top, with 59% rating it positively. Iran was once again the most negatively viewed.
Global views of Europe's most populous country have improved significantly in 2013, according to the poll.
It was conducted for the BBC by GlobeScan and PIPA, who conducted face-to-face and telephone interviews with randomly selected people in 25 countries.

Of those countries, 22 have been surveyed two years in a row, so become the tracking countries on which the average ratings are based.
These averages exclude the target country's rating of itself. So for example, the opinions of Germans on Germany are excluded, meaning the country's average rating is based on 21 tracking countries.

Risers and fallers

More positively viewed than in 2012 - UK, Canada, France

More negatively viewed than in 2012 - China, USA, Russia

View of India deteriorates

A three-point increase in Germany's average rating returned it to the top of the BBC list, displacing Japan, which saw its positive ratings drop from 58% to 51%, and fell from first to fourth place overall.

The BBC's Stephen Evans in Berlin says the poll results may be a reward for diligent German diplomacy. Government ministers frequently tour countries with markets for German goods, or countries like Mongolia with raw materials for German products, he says.
There were high positive ratings for Germany in recession-hit Spain and France - though not in Greece - despite the well-publicised placards depicting Chancellor Angela Merkel as a Nazi, paraded during anti-austerity protests in Europe.
--------------------------------------------------------------------------------Who can doubt that there'll be a little more spring in the step of Chancellor Merkel because of what the poll reveals about attitudes to Germany?
After a year when she has been depicted offensively on placards in a Nazi uniform, in protests from Athens to Madrid, it turns out that many admire the country.
And in surprising places. In Spain, the recipient of a bailout with tight German strings attached, 68% said they felt Germany had "a mainly positive influence in the world".
In Britain, it was even higher at 78%. In France 81% - the poll indicates that four in every five French people look over the border with approval!
Only Greece maintains its Germanophobia, with 52% giving a negative rating.
Will the poll matter? It might well. It may confirm German ministers in their belief that tough love is true friendship.
The poll results may also be a reward for diligent diplomacy. Government ministers frequently tour countries with markets for German goods (or countries like Mongolia with raw materials for German products). Political clout isn't the driving force - it's trade.
This may be why some African countries (which have close trading ties and which exchange ministerial visits with Berlin) are approving.

Ghanaians, for example, have a very favourable attitude toward Germany, with 84% approving. Germany has a very active trade presence in Ghana.

The UK saw a bigger increase in positive ratings than any other country and climbed to third place in the table, in the wake of its hosting of the 2012 Olympics.
The poll also indicates that positive views of China and India have fallen sharply around the world over the last year. After improving for several years, views of China have sunk to their lowest level since polling began in 2005, putting it in ninth position.

India is ranked 12th, with negative views (35%) slightly outnumbering positive ones (34%) for the first time.

But Germany, whose economy has done better than almost every other in Europe in recent years, scored well across the world.

In Ghana, 84% of people polled said Germany's influence was mainly positive, while 81% in neighbouring France and 76% in Australia felt the same. But in debt-laden Greece a majority of people polled gave Germany negative ratings.

Positive views of the EU dropped to their lowest level last year but have stabilised this year, rising one point to 49% on average.
But this figure masks significant changes. There has been a sharp drop in positive ratings by Germans, down 14 points to 59%. Canadians and Americans both give significantly lower ratings to the EU. In the UK, positive views of the EU continue to fall steadily and, for the first time this year, more Britons rate it negatively (47%) than positively (42%).
Israel, North Korea, Pakistan and Iran came out worst in terms of how they are viewed globally. Only 15% of respondents said they saw Iran as having a mainly positive influence.

results of poll

Sunday, June 02, 2013

Narayana Murthy re-enters, but slips right away

It is not all that unusual for a company to requisition the services of a former CEO or Chairman. Quite a few CEOs have staged a comeback in the same position. Dell, Apple, Coca Cola and recently P & G are notable examples. However, it does not reflect well on the ability of these companies to groom leaders.

NRN's reentry as Executive Chairman of Infosys has been widely welcomed and perhaps rightly so. Yet, creation of an aura of indispensability around anyone is not desirable.

Further NRN has made a few maladroit moves. He has over-emotionalised the development which is not the hallmark of a great leader. Unable to justify his departure from his proclaimed endeavour to keep family members away from leadership roles at Infosys, he has sought to rationalise his son's entry as his Executive Assistant saying, "This was an emotional decision for him as my entire family has an enormous emotional connect with the company". Emotionalising nepotism does not make it any different. It is a pity that two great exemplars of corporate governance, NRN and Azim Premji have both thought it fit to drag their progeny into the public limited companies chaired by them. This is ofcourse not to question the credentials of their highly qualified, and perhaps unwilling, children.

K.V.Kamath will be the lead independent director. It is anomalous that a person whose leadership of the company failed to produce positive results will be vested with the responsibilty of having to 'objectively and independently' assess the company's performance. Some ironies remain widely unnoticed.