Dirty little fingers

When the Satyam scandal broke, almost the first question on everyone's lips was- did B Ramalinga Raju have a political patron that helped him conceal his fraud and deception? While everyone, including the media, is still struggling to find out the exact nature of the fraud itself- did Satyam falsify its accounts, as originally claimed, or was Raju embezzling huge sums of money (both versions of the story are going the rounds, based on the premise that a 3% profit margin is absurdly low for a large Indian IT firm)- Sugata Srinivasaraju, Outlook's Bangalore correspondent, probes the available evidence to decisively link the government of Andhra Pradesh CM, the notorious YS Rajashekhara Reddy, with Raju. After the issue came out, it has come to light that YSR had authorized a 50 acre IT SEZ to be developed by Raju, evidence that makes Srinivasaraju's case far more damning.

I'd always known of YSR Reddy as a ruthless, even hooliganistic politician whose determined efforts to destroy the rival Telugu Desam Party through violence and intimidation (coupled with unfailing populism, such as free electricity for farmers) had led to the open defection of most of Chandrababu Naidu's MPs and, seemingly, the end of the TDP as a meaningful political force. Telugu film superstar Chiranjeevi attempted to fill the vacuum by launching his own political party, Praja Rajyam. Ironically, Chandrababu Naidu, whose media success owed everything to his use of the "CEO" moniker and his famed affinity for IT moguls like, ahem, Ramalinga Raju, is now trying to stage a political comeback by accusing YSR Reddy, usually considered the CM of the farmer rather than the industrialist, of having had several fingers in the dirty Satyam pie. I still believe that for Naidu to successfully return to power, he will have to join with Chiranjeevi and re-establish his lost base- in short, do the near-impossible. But in a crazy decade where a man earning 12,000 dollars a year can get a 720,000 dollar home loan, where an Arab sheikh offers to pay 250 million pounds in transfer fees and wages for a football player, where Satyam, a company that's name means "truth", can for years, even decades, maintain the most bizarre concealments- is anything impossible?

The Rajus have been arrested, contrary to my earlier prediction. More than anything else, it was the enormous attention the case received, allied with the shock effects on Dalal Street, that caused the authorities to act. The big question, though, remains unanswered: is Ramalinga Raju an isolated corporate criminal, like Robert Maxwell or Ken Lay, or part of a wider trend of lies and deceptions that are the grim underbelly to the India Shining story?

Decline and Fall

If you thought that Ramalinga Raju's bizarre attempt to use Satyam's money to rescue his sons' failing businesses made him the Indian Gerald Ratner, take a look at this.

It seems that the businessman who told me last week that corporate governance in India was even worse than in the United States was right. The difference is that in the US, people responsible for fraudulent accounting practices go to jail. Raji claims that he will "submit himself to the laws of the land", but whether the police will act remains to be seen.