Anupam Mittal's Blog

Countdown to Copenhagen

In less than 2 weeks Copenhagen will determine the fate of the planet. It is good to see that 3 of the world's largest polluter's - USA, China and India showing signs of constructive action. Personally, I believe that India should be as seen as leader in driving the climate change agenda as opposed to somebody who needs to be put in line. Pachuary delivering the opening speech should certainly raise our profile.

And You Thought The Worst Was Over

I started the year cheering ‘may the best of our past be the worst of our future’, fully convinced that it could not get worse than 2008.  It seems that everybody I spoke to had experienced some sort of personal tragedy in 2008.  As if that were not enough, the world itself seemed to have gone through quite a tumultuous year – worst recession since the great depression, oil at unprecedented levels, a food crisis and finally the Mumbai tragedy – as if to say, this is as bad as it’s going to get.  So, with renewed vigour and hope, I looked out at the 2009 expanse from the rapidly closing 2008 window, and imagined how wonderful my life would be – The new year would bring with it new opportunities, new people, new dreams and perhaps the simple passing of time would simply erase all my troubles.  But 3 weeks into the new year and I realize that life is not that simple. New problems have come up.

 

Raju ban gaya gentleman

 Suddenly, corporate India’s biggest scamster seems to have found a conscience.  By grudgingly admitting to a multi-year multi-billion dollar fraud he seems to think that he has done the country a favor.   I personally think that he has single-handedly eroded all the business credibility that this nation had built over the last 20 years.  The only industry in India where ‘quality’ was not a concern and which, through its ripple effects, lifted the country and its people to a higher plateu, is now being looked upon suspiciously. A shame really.

 

Whose land is it anyway?

 When I used to hear the word strip (no, I didn’t take my clothes off) I used to think of  Las Vegas - the playground for adults.  These days Gaza comes to mind.  Rather unfortunate that 2009 started with renewed warfare and an end to the cease fire.  As long as I can remember, the Hamas and Israelis have been at each other’s throats.  Somewhere along the way most people, perhaps even them, have lost track of what they are fighting for.  While 2008 offered some hope, 2009 has brought an abrupt end to any resolution.

 

Oil’s not well

 Up or down, oil seems to be at the core of this world’s problems.  At $140 per barrel it was driving non-oil producing nations into bankruptcy.  At $40 per barrel, it is affecting the huge sovereign wealth funds of oil producing nations which, many expected, would finance the world out of a global recession.  In India, if oil subsidies don’t bankrupt us strikes by unions at the oil companies will.

 

Let’s see what Feb and March have in store.

The truth spelt backwards

An opinion on the Satyam fiasco -

RAM, bam, thank you ma’m, that’s the feeling I got when I read RAM Raju’s letter to his board and shareholders admitting guilt in a multi-year multi-billion dollar fraud that many people are calling the “Enron of India’.  While they will be pleased that we now go down in the history books with a corporate scandal of a magnitude that puts us at par with the USA, (we seem to be obsessed with one-upmanship with the rapidly decaying super-power of the world – what else can explain names like Bollywood, India’s 9/11, and now Enron of India) that is not the point of this commentary.  The point is that even in his letter, while Ram seemingly said sorry, it was anything but apologetic.  If anything the letter was extremely clinical.  One could even say it was arrogant – I did what I had to do, I tried my best to cover it up, the problem is that there was no way to continue hiding things, I am still not going to tell you exactly what happened, now go ahead and do what you have to – is how I read the letter.  Here is what appears to have happened –

Cooking the books

Mr. Ramalinga Raju claimed that his crime was that he cooked his company’s books to overstate the health of the company’s earnings and balance sheet as he was afraid of getting off the proverbial tiger.  This coming from a man, who only a few months back, in September 2008 on an interview on NDTV spoke at length about Satyam’s beliefs and his personal principles.  He discussed the word Satyam’s origins (his father’s name and the Sanskrit term meaning truth) and how his company and its management tried to reflect the very etymology of the word.  This was the same month that Satyam won the Golden Peacock Global Award for excellence in corporate governance – an international award conferred on companies that follow best practices as far as company administration is concerned.  Mr. Raju himself won the coveted Ernst & Young entrepreneur of the year award in 2007.  How did a company exalted for such high levels of conduct and one who’s leadership seemed to represent the highest values that mankind can strive for, go from corporate halls of fame to a shameful existence within 3 months? 

I think that the plot is a lot more sinister than Mr. Raju would have us believe.  Rather than a victim of circumstances of a dog-eat-dog world, Mr. Raju seems to epitomize what our country is quickly becoming – a culturally and morally bankrupt society.  Like many in this country Mr. Raju probably got ahead of himself at some point and started believing that reality was simply what he wanted it to be.  He figured that wrong or right was less about absolutes and more about perception.  The biggest sin was getting caught and with the kind of power he wielded – in Andhra Pradesh at least – getting caught was perhaps not probable.  However, the global economy was something beyond his control and the effects of the meltdown soon came looking for victims in india, of which Mr. Raju is the first but certainly not the last.  Essentially, Mr. Raju got caught in a vicious cycle of downward spiraling real-estate prices and a stock market that could not find the bottom.

 

Bending the truth

What we have been told so far is that Mr. Raju has not profited from this accounting scandal and all he was trying to do was to build value for shareholders of the company most of who were regular everyday people and institutions.  In fact Mr. Raju and other promoters held only 8% of the entire shareholding of the company. What incentive would he then have to engineer such a massive fraud?  There are 2 assumptions here 1) people conduct frauds only for money  2) what Mr. Raju is telling us is the truth.  Both seem faulty.  History tells us that power and competition is a much more heady cocktail than wealth can ever be and perhaps it is this very intoxication that lead Mr. Raju on the same path that many a great men have been tempted down.

Secondly, I don’t believe we are being told the truth.  In fact we may never know the entire truth.  However, for whatever it is worth, I believe that Mr. Raju siphoned off the funds to fund his real-estate ventures.  I believe that the massive land acquisitions, which put Mr. Raju and his companies, amongst some of the largest landlords in this country, were made, at least in part, from funds generated by Satyam.  Let me be clear – I have no evidence to suggest the same.  My claim is simply an opinion.  However, if one looks at Mr.Raju’s track record one finds enough evidence to suggest a man who liked living on the corporate edge.  This is not the first time that he has tried to divert Satyam’s money to other companies held by him.  In the late 1990’s there was some attempt to invest in Satyam Constructions.  In fact over the last decade Mr. Raju has flirted with several investments and companies that were actually not completely thought through, questionable or simply bad business decisions.  I believe that a deeper probe will reveal not only embezzlement of funds but also the involvement of political personalities and other corporate honchos that could raise many questions about the health of our much venerated corporate sector. 

                                                                                    

Skeletons abound

 As we learn more and more about what actually transpired at Satyam, I think we will find evidence of a crime that has long been in the making.  Further, it cannot be one person’s doing.  Crimes of this magnitude can simply not be committed by one person.  Not only are there more people within the organization that are fully in the know, there are several powerful individuals outside the company who were hand-in-glove.  As much as we like to think that the real-estate industry in this country is now professionalized and corporatized, nothing could be farther from the truth.  In reality, it is still an industry characterized by cash deals, political favors, muscle tactics, and vague legislation.  The Satyam fiasco will ideally expose some of the under-belly of this sector in our industry.

 Along with the real estate industry, hopefully this tragedy will put into question regulatory bodies such as SEBI and what their role should be, accounting companies such as Price Waterhouse and where their responsibilities lie, as well as banks and what their duties are.  How is it possible that one company over 7 years managed to release accounting statements that were fictitious, get them approved by their audit firm and get TDS certificates for interest earned on assets from their bank to validate the same?

The Satyam scandal points to a nexus of profiteers who believe that the rules don’t apply to them.  It points to bribes, illegitimate favors, coercion, forgery, theft, and perhaps many other crimes by corporate india, politicians, and the bureaucracy.  I expect that over the next few weeks many organizations in corporate india will be exposed for what they really are – a set of cooked books, ponzi schemes, and hollow transactions.  (Note - Look for at least 1 company in the broadband sector and 1 in the media sector as well as a couple more in real-estate).

 

The new husband

 Ram Mynampati is the guy now in charge.  I don’t know much about him but my only question is – why wasn’t there a criminal case filed by him and his team against Raju immediately after he took over as interim CEO?  Why did they assume what Mr. Raju was saying was the truth?  What, if in fact, Raju has siphoned off funds?  Wasn’t it his responsibility to protect the assets of the company and consequently make sure that Raju and consequently the funds don’t disappear?

 

Booking the cooks

 There is an ongoing debate on Mr. Raju’s ultimate plight.  While Mr. Harish Salve thinks – that India is god’s country and nobody goes to prison here - there are many others who believe that the law of the land will prevail and that Mr. Raju will pay a price for his crimes.  I side with the latter.  However, for different reasons –

Mr. Raju will be brought to task not because he committed a crime or got caught.  He will pay the price because he got caught at a time that citizen activism is the highest in the country.  He will serve time because he got caught just before elections – the current government cannot afford to let the opposition use this as a campaign tool.  He will face consequences as there are too many important people who could get caught in the cross-fire.  He is better ‘kept quiet’ behind bars or in other ways that we will soon discover.

If not for the above I would have agreed with Mr. Salve except with a slight modification – This is god’s country, nobody goes to prison here, they only become celebrities.

Finally, in Mr. Raju’s defense, perhaps he is not entirely to blame.  We should have seen this coming when he christened his real-estate companies  MAYTAS – the truth spelled backwards.

I have a few questions ...

Dec 13^th – Almost 3 weeks have passed since the attacks in Mumbai and I still find myself restless.  It feels as if it was yesterday and I can’t seem to shake the images off.  There are so many questions.  They just don’t stop -

 Why did the fire at Taj take so long to put out?  Why wasn’t there a sense of urgency amongst the firemen?  Why weren’t there dozens of firemen heading into the Taj as opposed to  2 standing on the ladder and helping one person out at a time?  I saw 500 firemen run into the WTC on 9/11 and as many cops within 10 minutes of the first crash – What happened to our guys?  Are we really that gutless?

 Within hours of the attacks taking place how was a civilian like me allowed to break 3 security cordons and go to the Taj and the Oberoi? Why did all the different security outfits look completely confused?  Why did they not seem to be in control?  Why did they not seem alert? Is their job to simply be present at the scene? Why wasn’t there one person coordinating the entire effort?  Why didn’t we have any information about what was going on? Why was the effort so chaotic? Why do our security heads believe that keeping us in the dark is the best way to handle such situations?  Why do they manipulate every news item that comes out?  Why are we only hearing stories about number of lives that were actually saved?  Why are we giving out 5 lacs for showing up at the target site and 10 lacs for firing a bullet at the terrorists? Why do they think we do not realize the truth?  Do they know the truth?

 Why were the 20 something reporters checking their makeup?  Why were they calling friends and asking if the sentences they were framing were grammatically correct since this was their big chance and they wanted to get it ‘absolutely right?  Why were they asking foreigners if they would come back to visit our country?  Why did they look so excited?  Why did they seem that as far as their careers were concerned this is as good as it was going to get? Why do the interviewers speak more than the people being interviewed?  Why we projecting what we want to hear as opposed to listening? Why do the anchors in the studio insist upon using the word ‘exclusive’ in every sentence?  Do we really care?  Do the media remember what their job really is?

 Why is our opposition leader referred to as prime-minister-in-waiting?  Why couldn’t he help himself from making comments such as ‘the administration has failed and will need to provide answers’?  Why did he think that it was more important to let people know his schedule and why he has decided to not visit Mumbai right away?  Why did he not provide us with leadership, facts, and assurances?  Why did he not say something that brought us together as human beings as opposed to dividing us based on political affiliations?  Is it more important for us to know how many times he has spoken to the prime minister or is it more assuring to know what the government is doing to take charge of the situation?  When did he become an expert on terrorism activities?  What right does he have to make wild claims, within hours, on which outfit was responsible for these attacks without the right data and analysis?  How can an individual who single-handedly gave terrorism a platform in this country – by destroying the Babri Masjid – be our only leadership option?  How come our streets are riddled with hoardings, posters and pictures of politicians take credit for everything from our GDP growth to the death of the terrorists?  Why do political parties have free license to disfigure our city?  Why don’t they pay, like the rest of us, if they wish to use our outdoor media? Are we ok with having our country run on personal feelings, whims and fancies? Who are these people running our country and where did they come from?

 Why is the only inspiring Indian leader not of Indian origin?  Why does our prime minister not speak with the same passion that he did when he was finance minister?  Where is the man, who through his poetic and arousing budget speeches in the parliament gave us reason to believe that change was possible?   Is he so caught up in his politics that he has forgotten his mission?  Has he lost sight of the millions of Indians who had our hopes pinned upon a new India when he came into office?  Yes, we want a prime minister who has a squeaky clean reputation; Yes, we want somebody who can take tough stands; Yes, the man should be able to propel our nation forward; But more than ever we need somebody who can move us.  Somebody who can inspire us.  Somebody who speaks to us from the heart.  Somebody we can relate to.  Somebody who can unite us.  Somebody we can have faith in.  Will the real Manmohan Singh please stand up?

Why do we make up stuff when asked questions by the media?  Why do we feel compelled to smile when a camera is in front of us even if people are dying behind us?  Why do we go about our daily lives without answers to questions that deserve answers?  Why do we have such little value for human life? Why are we so quick to take credit and so eager to blame? Why does somebody else’s success make us so miserable? Why do we try to pass off somebody else’s work as our own?  Why do we try to take ownership of things that are not ours or credit for things we did not do?  Why do we behave so sneaky?  Why are we always trying to see what we can ‘get away’ with?  When did we lose our sincerity?  Why do we always try to cut the line we are standing in?  Why are we willful to the point that we use words and sentences not for what they actually mean but for what we want them to mean?  Why do we always see things the way we want to see them as opposed to what they actually are?  Why do we lie so much?  Have we become completely spineless?

What action did our ex-Chief Minister taken in the last few years?  Has anyone ever seen a bead of worry on his forehead?  Why does he always appear like he got caught with his hand in the cookie jar?  How does he sleep at night? Why do our politicians feel that their job is to win elections and that their work ends when they get into office?  Shouldn’t their work start when they join office?  Why does it seem like being in office is the celebration for fighting the election? Why is being ‘in position’ the most important thing for us?  Isn’t being ‘in position’ the beginning and not the end?  Do you ever get the feeling that most people in this country are simply ‘getting in position’? Is there anybody left to take action?

What concrete steps have been taken since the crimes occurred?  Yes, a couple of politicians have lost their ‘positions’ but will that lead to any good or are they simply being replaced by people who had also, at some point, lost their ‘positions’.  Does it feel like we are on a merry-go-round?  Why have we still not been given one single comprehensive view on what exactly happened?  Has a complete internal security plan been presented before the people of this country? Have we been told how the victim’s families should come to terms with this?  What are we doing to make sure that people did not lose their lives in vain?  Were they just collateral damage?  Why can’t we have a cross-party task force to address all the issues completely, cohesively, and quickly.  Where is our sense of duty that will ensure that this never happens again?

I could go on and on and on because no matter how hard I try the questions just don’t stop.  In the    end, perhaps there is just one question that matters - What next?

                                                               

 

                                                                

                                                               

   

Mumbai Attacks - What each one of us can do in response

There is no question that the heinous crime in Mumbai was a cowardly act committed by ignorant human beings. My heart goes out to the people who have had to lose their loved ones in the cross fire between political factions, fundamentalist religions, and a world gone wrong. I have never been this pained about any disaster anywhere in the world. When the Pentagon blew up on 9/11, I was in my balcony in Washington DC but it did not have the kind of devastating impact I feel after Nov 26th. Perhaps it is because this is closer home. Maybe it is because I grew up in these hotels - they are a stone's throw from where I live. It could be because I heard gun fire and saw explosions for 35 hours straight. It is probably because I know many of the people who perished personally. I am not sure what the reasons are but I know that this cannot go on. I don't have the answers yet. There are a million questions but no answers. I am sure many of you feel the same. I realize that a big part of the blame lies with our government but I also think that there is a bigger question - Can we really separate ourselves from our government? Isn't a government a reflection of it's people?

No, I am not blaming you or myself for the terrible tragedy that occurred. What I am saying is that we must take some responsibility to change things. I think that the biggest difference that all of us can make is to VOTE. Our country elects it's government based on caste and community. Besides the people at the bottom of the pyramid nobody shows up at the booths. If indeed, we let only the illiterate in our country elect our government how can we expect that they will elect anybody different. A starving man has a mentality of scarcity. One cannot teach him morals and values until his hunger is first taken care of. Leaving our government to the poorest of poor in our country ensures that they elect officials as hungry as them. The only difference is that the elected official's hunger comes from greed and the fact that he knows he can get away with manipulating the proletariat. He knows he can get away with murder, rape and fraud with complete apathy.

I don't know how many of you saw the coverage of the politician who was caught in a room at the Taj. He said that while he could hear the sounds he was not concerned as he had his laptop with him and hence was able to plan his entire upcoming campaign. He said 'he was happy'. Obviously, this cannot be a very intelligent man. An intelligent person, even if he felt the way this politician described, would probably not say what he did. This man is a product of an apathetic society. He is used to getting away with inane comments such as these. He does not have the basic common sense to know the difference between right and wrong leave alone tact. How can we blame him? All we can do is to make sure he does not get elected.

I think if we want to really make a change we should all resolutely make a decision - that we will vote. No matter how painful. No matter how long it takes. No matter how far we have to travel. But vote we must. In a democracy this is not only our right but our obligation. If we don't get in the way of inept people being elected into our government we have only ourselves to blame.

P:S - Another thing we can do is to educate our circle of influence - drivers, maids, workers, etc - on what voting means. They need to understand the consequences of electing people based on caste and creed as opposed to the ability to govern and administer. When we go to the booths the only thing that should matter is the potential of the person to govern his or her constituency effectively. Nothing else.