Warning Bells are Ringing for Traditional Political Parties

ImageThe Aam Admi Party’s (AAP) earth shaking debut in Delhi compel political scientists and sociologists to redefine their understanding about Indian politics. Everyone thought that the pre-poll and exit poll surveys are exaggerations. The crowd swell for Arvind Kejriwal’s election campaigns is just public obsession with a just born political baby.  But the Delhi assembly election result had given drubbing to all the calculations. Now the new age media like Social Networking Sites will find more takers. Although every political party is present in the new media, their work is not to the level of AAP. There are more than 16 lakh followers for Arvind Kejriwal in the Facebook. The AAP band of volunteers work day and night for the rejuvenation of India. The new voters and tender youth are disgusted with the traditional political parties which deceived the nation. AAP is the alternative which they depend upon for the betterment of India.

Congress party is non performing in the SNSs too. What is the use of good work if it is not communicated to the voters? What is the point in keeping mum when the AAP was attacking it with corruption cases? Why the Congress party did not counter these allegations? AAP had a free run in charging both the Congress and BJP. On the other hand, AAP too followed the traditional method of candidate fielding with the help of caste, class and gender. Along with the social factors, AAP repeated its slogan, “Sab neta chor hai”. AAP adopted every trick in politics. But Congress and BJP underestimated its impact never withstanding the pre poll surveys which gave AAP a stunning debut.

AAP attacked both Congress and BJP. Sheila Dikshit was confident of winning for the fourth time. BJP quickly changed its candidate, Vijay Goel who was accused of massive corruption and nepotism by the AAP. Its Harsh Vardhan had taken the sheen out of AAP’s corruption campaign against BJP. Although both Congress and BJP failed to nip the AAP in the bud it was the former which was damaged totally. In the end it was dust biting defeat for many election veterans in the hands of AAP.

Sheila Dikshit, three terms Chief Minister of Delhi and a popular face of women’s political power was ejected out of the New Delhi seat. Arvind Kejriwal defeated with over 25000 votes. Ch.Prem Singh who won the elections continuously for the past 40 years had to bite the dust in Ambedkar Nagar constituency because of the negative campaign unleashed by AAP. The story is same with Rajkumar Chauhan in Mongolpuri constituency.

The main accusation put forth by AAP was that the traditional political parties are corrupt, casteists and pseudo-religious. AAP promised to be clean and secular. On the contrary the string operation carried out before the Delhi assembly election shows that the AAP candidates are faster than the traditional political parties in taking money for their personal benefits. Arvind Kejriwal’s meeting with the Muslim cleric hit the nail on AAP’s secular head. Against the rule book of the Election Commission, AAP carried out negative campaigns against the opponent candidates. Its members were caught in the string operations. The immediate reaction from AAP was “fake operation” “needs the raw footage” which other political parties used to react immediately after the exposure of string operations. What difference it makes? Another political party, another corruption, the nation moves? But this is not the way which people who voted for AAP wanted. Mostly young people who for the first time in life voted wanted a real change in India. That’s why majority of the first time voters have chosen AAP over traditional parties.

One of the most shocking news for the traditional political parties is the big impact of AAP among the Scheduled Castes. It has dented the parties like Congress and BSP which championed the SC cause and used to walk away with the chunk of SC votes. BSP which garnered 20% of votes in the reserved constituencies in 2008 has got only 5% this time. AAP has won 9 out of the 12 reserved constituencies in Delhi. It has trounced SC veterans like Chaudhary Prem Singh and Rajkumar Chauhan. AAP has also got four sikh candidates elected. In short, youth, women, SC, ST, Sikhs, upper class, middle class, lower class, every social group has voted for AAP. All the three women candidates who won in the Delhi assembly election are from AAP.

AAP has built itself as a formidable political force with its rich experience in spearheading mass movement. Campaigns headed by Arvind Kejriwal against privatization of water in Delhi, RTI act, anti-corruption movement and Jan Lokpal have laid the strong foundation for his political growth. If Delhi assembly result was negative to AAP its future might have gone nowhere. But with the flip it got in Delhi, the journey seems to be exciting, positive and potential.



Compromised Corporate Ethic

ImageCorporate ethics in India is flying in the air. Almost all corporate companies have been caught in the corruption net.  The tragedy of globalised times is that even the uncompromising corporate companies have embraced corruption. From Tatas in the 2G scam to Reliance in the KG Basin Price Rigging to Jindals in the Coalgate scam to Sahara in the investor cheating to Satyam in the book cook up case, the list is full. One of the critical reasons for the booming corporate corruption is the mushrooming of middle men and women. The brokers (dalal) have mesmerized the corporate world with their amazing bowling skills. The corporate wickets have been falling one and after the other. Unfortunately none of them are returning to the pavilion. All those who are caught in the corruption cases have been staying on the crease. The umpires have been bought and the audiences are watching helplessly. Why corporate India is becoming more and more like the destroyed IPL? How come the onus of national development in an ethical way is left unattended?

In the last fifteen years (1997-2012) more than 115 companies have been exposed for corporate fraud. Rs.43,815 crores were involved in this corporate fraud. This amount is apart from lakhs of crores involved in the mega scams involving corporate companies, bureaucrats and politicians. According to Thought Arbitrage Research Institute (TARI) the average size of corporate fraud was  Rs.282 crores till 2009. But in the last four years it has gone up to Rs.502 crores which is a whopping 80% rise in the last five years. The manufacturing tops the corporate fraud table with 35% followed by I.T with 21% and banking & financial sector with 16%. More than 115 companies which are listed in the Indian stock exchanges have involved in the corporate frauds from 2010-2012. Tinkering with procurement bills, bribing for special favours and creating fictitious accounts are considered to be the major avenues for corporate fraud.  Nearly 44% of the stock market listed companies have been caught for fraud. This is tip of the iceberg

There is no possibility of recovering corporate ethics? Despite having a Ministry of Corporate Affairs things seem to be going haywire. The Competition Commission of India is slowly started to having some impact. It has started to show its powers to the corporate companies. The regulatory bodies like Telecom Regulatory Authority of India (TRAI), Insurance Regulatory Authority of India (IRAI), Security and Exchange Board of India (SEBI) and Real Estate Regulatory Authority of India (RERAI) are great inventions to control the customer duping in India.

The corrupt corporate culture is not India specific. Even the global giants like Citibank, Enron, Xerox, WorldCom, Daewoo, have been messed up in the scandals. The bubble of mismanagement of corporate companies was blown up by the vigilant media. Even the inter-corporate rivalry exposes the scandals inside the corporate world. The fallout of corporate companies weakened the American economy which affected the world economy in general. The Chinese who are known for disciplined state control are also dancing to the global corruption tunes. From the famous Politburo member of Communist Party of China, Bo Xilai  to the bottom down there is an enlarged corruption in Communist China.  According to the KPMG Inida Fraud Survey Report, 75% of the corporate executives admit that there is fraud in their companies. They also say that there is no way to detect and punish the fraudsters. These frauds are present in different spheres of the corporate sector. The nexus between companies, bureaucrats, politicians and suppliers damage the corporate world devastatingly.

Cell phone companies are experts in duping the customers and tax authorities alike. Evading tax and service charges are common in the cellular circles. Despite heavy fining which runs into hundreds of crores, the cellular companies haven’t learnt any lesson. They continue to invent novel ways to extract money from the subscribers. Apart from cheating customers and the government, the cellular companies knowingly or unknowingly involve in collaborating with foreign companies which may endanger the national security. The 2G scam was not just financial mismanagement and scandal saga but it was also a major national security threat.  Enemies of India are engaged in a global project which promises to destroy the unity of India. The Cellular companies have become party to this project unknowingly.

Insurance sector is another trouble area where there is massive disenchantment of investors. While talking sweetly before investment, investors are made to run from pillar to post after the investment. This is sickening when the investors were put in extreme hardships while reclaiming the insurance money of their deceased family member. Even one insurance company’s advertisement pulls another company’s poor customer dissatisfaction. It portrays the irresponsible behavior of the opponent company’s staff in handling the customer query. This is common in almost all companies.

In order to deal with the pan Indian customers in a real time basis, customer care centers were opened by all corporate companies. Unfortunately these call centers have become trouble enhancement centers. Those who call up these call centers have to undergo indefinite wait to get some vague answer. The long automatic directions increase the blood pressure of the caller. Why not give the “talk to call centre representative” as the first option? Those who know the automatic number options will do it on their own. Why to increase the caller’s agony? A revolution in the customer care is needed from the Indian corporate companies. Without which they will head towards fall.

From mega corporate companies to tiny business entities ‘milk the customer’ campaign is spearheaded systematically. The hard earned money of poor people are duped through fancy advertisements and marketing. Defrauding lenders 17%, defrauding the government 13%, defrauding the investors 13%, Evading taxes 12%, others 45% account for the corporate fraud in India. KPMG report says that the corporate companies instead of taking against the perpetrators of fraud are soft towards them. Either they are removed from the company or the fraud is completely white washed. Unethical practices on the part of corporate India dents the foundation of India.

Government agencies which are supposed to watch over these fraudsters ironically collaborate with them. When it reaches unmanageable proportion, the fraudsters are arrested and released in no time. Why there is no proactive approach in saving the customers and investors? What the consumer forums are doing? Why the consumer courts are watching these public duping so helplessly? An alert watch dog is a must to contain the injustices meted out to the customers and investors. Media advertisements by the Ministry of Consumer Affairs are a step in the right direction. Its frequency must be increased. There is no point in creating employment and wealth by the government. It must also protect its hard delivered duty.


List of Recent Mega Corporate Frauds in India



Name of the company

Persons involved

Method of scam







Bhushan & 7 other companies

S .Jagathrakshakan

Ex.union minister

Subodh Kant Sahay Ex.Union Minister

Naveen Jindal M.P

Vijay Darda

Nitin Gadkari M.P (Ex.BJP President)

& other politicians, corporate honchos, bureaucrats

Undue allocation of coal blocks to private companies

Rs.185591.34 crores

Files missing

CBI dogging the case

Accused not arrested



Karnataka Wakf Board Land Scam

Officials, real estate sharks, private companies

Illegal construction of buildings &  encroachment of Wakf Board properties

Rs.20000.00 crores

No action



UP National Rural Health Mission Scam (NHRM)

Collaborative loot of Public funds by private companies and officials

Non purchase of medicines and medical equipments despite showing bills

Rs.10000.00 crores

2 Chief Medical officers, 1 deputy medical officer and a project officer found dead



Hassan Ali Khan

Hassan Ali Khan

Tax evasion

Rs.39120 crores

Arrested and let out in bail



2G Spectrum Scam

20 Telecom companies



Nira Radia, 20 telecom companies, top bureaucrats


Fictitious telecom companies


Rs.1.76 lakh crores

Arrested and let out in bail



Corporate fraud cannot be eliminated intoto. Reducing the corporate fraud from the current 75% to 15% will be a herculean task. In order to reduce the corporate fraud, the companies need to constitute internal vigilance committee with people of impeccable integrity.  This internal vigilance committee should meet regularly and discuss the ethics of the company behind the screens. Face to face meeting with the staff can motivate them to avoid frauds. A unanimous decision of the India Inc not to patronize corruption at any level can boost up the confidence level of honest staff. Vigilant public, active media and finally strong internal audits can control the corporate corruption.


Bhatia S.K (2004) – Business Ethics and Corporate Governance, Deep & Deep Publications, New Delhi

Conenen, Tracy L (2013) – Essentials of Corporate Fraud, Wiley & Sons, New Jersey.

Fernando, A.C (2009) – Business Ethics: An Indian Perspective, Pearson, New Delhi

Gupta, Ananda Das (2008) – Corporate Citizenship: Perspectives in the new century, Cambridge Scholars Publishing House, Cambridge

Wells, Joseph T  (2006) –  Corporate Fraud Handbook. Prevention and Detection, John Wiley & Sons, New Jersey

Pedneault, Stephen (2010) – Anatomy of Fraud Investigation, John Wiley & Sons, New Jersey

KPMG India Fraud Survey Report (2010) – KPMG India.

TARI Report (2013) – Understanding the demand and supply equations of corruption and fraud:  An insight into the corruption and fraud by the private sector in India. Thought Arbitage Research Institute, New Delhi.


Self-Ruining American Policies

FeaturedImageAmerica is a super power nation because of its immigrants. No doubt about the influence of immigrants in the forward move of the envious nation. Without understanding the correlation between the American growth and the involvement of immigrants, some of the members of the American ruling class are favouring elimination of the immigrants. This wrong policy not only eliminate the immigrants but also its ability to stand tall in the comity of world nations. It is time that this hard truth is realised by the concerned people in the White House.

Vivek Wadhwa writes in The Times of India on 1st December 2013

Last week, President Obama made a startling concession to the Republican Party: that he would accept a piecemeal approach to overhauling America’s immigration system. “If they want to chop that thing up into five pieces, as long as all five pieces get done, I don’t care what it looks like,” Obama said.

This is startling because, for the past few years, Democratic Party leaders have insisted on an all-or-nothing approach to immigration. They would not agree to increase the numbers of visas for skilled workers unless the Republicans agreed to legalize the more than 10 million immigrants who are in the country without documentation. The Republicans refused to provide “amnesty” to the unskilled, so the Democrats let the skilled immigrants — and US competitiveness — suffer. This is no different from the juvenile behaviour you see in the Indian Parliament.

The President realizes the political reality and is trying to get whatever he can through the system. But it is unlikely that he will have any success on immigration, because House leaders are still reeling from their loss on the fiscal shutdown and will not hand the President any kind of political victory.

This is bad for the US but is good news for India. That’s because the US has been giving India, China, and many other countries an unintended gift: highly educated and skilled workers with experience in US markets. It has been sending would-be immigrants back home; exporting its competitive edge.

Skilled immigrants made America into a technology superpower. Wave after wave came to America’s shores and brought with them their education, knowledge of global markets, and determination to achieve success. They made the natives think smarter and work harder and contributed to practically all of its technology breakthroughs.

My research team at Duke, Harvard, and UC-Berkeley documented that from 1995 to 2005, immigrants founded 52% of Silicon Valley startups, and 25% of startups nationwide. They contributed to 72% of the WIPO (World Intellectual Property Organization) patents filed by Qualcomm, 65% of those by Merck, 64% of General Electric, and 60% of Cisco Systems. Indians also co-author 13.7% of America’s global patents. Indians have founded 33.2% of Silicon Valley’s immigrant-founded startups — more than immigrants from any other ten countries combined have, including China, the UK, Canada, Germany, Israel, and Russia.

Despite this amazing contribution, the US is allowing itself to bleed competitiveness. It admits hundreds of thousands of students and workers on H1-B visas, but doesn’t provide enough permanent-resident visas to let these skilled foreigners make the US their new home. The result is that there are more than a million skilled immigrants and their families stuck in “immigration limbo”.

I explained the reverse brain drain that is in progress and the consequences of this in my book The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent. In a nutshell, because of improving opportunities in countries such India, China, and Brazil — and out of frustration with the delay in visa processing — the tide has turned. Skilled workers are returning home in record numbers. In research that my group at Stanford completed recently, we found that the proportion of companies founded in Silicon Valley from 2006 to 2012 that had been founded by immigrants had fallen to 44%. This was not because immigrants had become less entrepreneurial, but because they could not get the visas necessary for starting companies.

America’s loss has been a huge gain for other countries. If you visit any top Chinese research lab, you will find returnees from the US at their helm. The tech centres of both India and China are growing rapidly with the infusion of Silicon Valley-trained talent. These returnees are bringing America’s best practices and entrepreneurial culture back home with them.

American leaders are well aware of the damage that the brain drain is doing to US competitiveness. The President has cited my research in his speeches, and I have been asked to testify to both the House and Senate. The problem is that in addition to the issue of amnesty, there is also a xenophobic element in the US that wants to keep foreigners out. And there are technology workers prevented from getting jobs by their location, age, or skills. They are all rallying against immigrants and complicating the factional battles in Congress. This is creating the stalemate.

So India may be suffering from its own political quagmires, but it is benefiting from America’s.