Byapaar.com -The Indian Business Blog

As usual, this is one of those personal posts which I do from time to time on this blog. As there is election just round the corner, there is hyper activity in the field of politics and business has taken a back seat. The effect of politics is such in India that, even media – all types at that are focusing on it, rather than highlight the economic problems that is engulfing us slowly but surely.
I can think of only one recent business news that caught my attention and that is Forbe’s latest list of shamelessly rich people though they have not been left untouched by the global market crash. Bill Gates returns as numero uno richest persona despite loosing $18 billion during last year. His buddy Warren Buffet lost $25 billion, but it is still enough for him to occupy number two position. India’s Anil Ambani and last year’s 6th richest man lost a whopping $32 billion during last 12 months and slipped out of top 10. The saving grace for India is Laxmi Mittal at number 8 and Mukesh Ambani at number 7.
Over-all, hundreds of people lost their billionaire tag from last year’s list and only few joined the list this year which is not very surprising. Interesting Communist ruled China has over taken India as home to most numbers of billionaires in Asia.
Now lets proceed to the main story.

Visa Credit Card

Billionaires or millionaires, India is a land of great diversity – literally in everything. Even last year, there was EDC machine to process payment by credit cards in my entire state (It now has two merchant establishments accepting payment by credit cards in our state capital 185 kms away from where I live). So there were no banks or agencies that issued them. Now there is one bank Union Bank of India) which is issuing the plastic cards to clients.
Due to my involvement in the web and being a webmaster for sometime now, I have been having great difficulty in paying for my domains, hosting and other services that I need to avail regularly. So I can say easily that, the non-availability of a credit card was hampering my online business and more than anybody else in my state, I felt the absence of plastic money to great extent.
When the bank opened a branch in our big village (with more than 100,000 population), I took the first opportunity to open an account with them in the first week of December, 2008 and immediately applied for the card. One fine day at the end of January, someone called me from Mumbai to verify information and documents that I put with my application form. I was hoping to receive it by 3rd week of February. But it never came. Finally, today I received my long cherished VISA credit card. :p
After carefully checking the envelop, I discovered that the card was issued on 25th February and posted via EMS Speed Post service offered my Indian Postal Department on 28th February. Today is 13th March. So it took 13 days to reach my address from Mumbai by Speed Post! Ideally, it is supposed to take maximum of 72 hours from any place in India to any corner of the country. So much so is for the service of an important public service department of India. I am jut wondering how long would it have taken had it been posted via normal post.

This is not an isolated case if you are wondering. One of my savings policies has Read the rest of this entry »

Following post has been written by a guest blogger. So, the tone/flavor of this blog might not reflect in it. This blog also has no bindings with the guest blogger. All views expressed there is his/her own.

Raju ban gaya ….

It gives me no joy to make fun of some one facing adversity.

It is ironical indeed that the promoter of a company whose name truth has admitted of having committed massive fraud the result oriented culture has rejected the Gandhian philosophy ENDS ARE EQUALLY IMPORTANTthe attitude CHALTA HAI, any thing goes , has made people brazen once a person has committed adultery once the bohemian life style of bed hopping comes naturally what surprises is that a fraud of such magnitudes involving many persons at various levels remained hidden for so long.

Further it is also a question mark on the standards of audit! I am sure that another Arthur Anderson may happen. Having made fun of sub prime crisis India Inc has been presented with a equally audacious corporate scandal I wonder if there are skeletons in every cupboard having a mahogany exterior.

What if tomorrow Infosys or liver is accused of some thing similar ?

The need of the hour is that instead of lingering litigation of Harshad Mehta variety the scam is investigated promptly & in an objective & transparent manner the guilty (ies) not scapegoats are identified & are handed with deterrent punishment & assets are unlocked & put to productive uses.

I am sure the image of IT sector of India or India Inc per se has taken a severe beating & lots of efforts will be required to repair the gaping hole in our credibility

I wonder what happened to the quality control policy & peer review mechanism of audit profession

I am sure a case of rotation of audit firms or a system of joint auditors will to some extant work as a check

Also we need to have a real internal audit & an effective audit committee so that the criminal minds do not find it easy to have a band of followers to share the crumbs

I am sure the soul of Gandhiji will have many a sleep less nights

Hey Raam

Satyam is neither shiv nor sundar

In an unprecedented move, Mr. Ramalinga Raju, promoter and Chairman of Satyam Computer Services, the fouth largest IT company in India has announced that he has been showing false and inflated data in the company balance sheet for years. He stated that from what was a minor gap in the company book when it was a company with only handful of employees, the magnitude of the problem grew with that of size of the company that currently employs around 53,000 and has operations in 66 countries worldwide. It boast of serving one third of Fortune 500 companies and also the US government.

Satyam has been under scrutiny since World Bank banned the company in October for allegedly installing spywares in some of their computers which Satyam denies. Then, in December Satyam management faced a revolt by investors for a proposed takeover of two companies engaged in construction for approximately $1.6 billion. It has later been found that Mr Raju has big stakes in those two companies.

Since then a tussle between the board and shareholders has been going on and shareholders have been demanding resignation of the Chairman and complete overhaul of the board. In the meantime it was found that promoters were just holding meager stake in Satyam as they have pledged most of their shares with lenders against loans. All these controversies led to huge loss of Satyam’s shares at the stock market. Already speculation was doing the round that Mr. Anil ambani - the Chairman of cash rich ADAG group might step in for a friendly takeover.

The problem got so big that Mr. Raju had no alternative but to reveal all his frauds and resign because he no longer has enough stake to control the company and if others seek to take over- they will find all the wrongdoings by him once they go through Satyam’s books.

Analyst say that Mr. Raju has not only damged future of Satyam but has created a bad impression on whole IT and outsourcing industry of India. Some commentators say that foreign clients might loose confidence in Indian companies as there is a big question mark on India’s corporate governance and transparency of their operations. Otherwise how could Satyam keep on with the fraud despite being auditored by world renowned accounting firm Pricewaterhouse Coopers?

Amidst all these, top leadership at Satyam has resolved that they would carry on and make Satyam a transparent corporation. But the maimum damage has already been inflicted not only for Satyam but questions are being raised on corporate ethics of whole Indian Corp. Shame on Satyam.