‘Ghost of Sir Humphrey’ Seems to Haunt Modi
There is an almost eerie continuity in policy thinking, even a year after Narendra Modi became the prime minister on the promise of radical change. But India seeks friendship with an unrepentant Pakistan, it aims to block a sensible WTO (World Trade Organisation) deal, it still loves the public sector (no privatisation). Of course, the new government, too, is now afflicted with corruption and indecision which ultimately derailed the UPA (United Progressive Alliance). It is disappointing that the NDA (National Democratic Alliance) doesn’t break out of the policy framework of the UPA.
 
Political parties come and go from government but India’s babus retain their power and influence in the system. For now, it seems like the Modi government is being haunted by the ghost of Sir Humphrey Appleby, the (fictional) cabinet secretary of the United Kingdom who famously said, “It is my job to protect the Prime Minister from the great tide of ‘irrelevant’ information that beats against the walls of 10 Downing Street everyday.” It seems now that the wave of fresh, new ideas—there are plenty around— is being blocked from reaching 7 Race Course Road. Also Mr Modi’s silence on Sushma, Raje, et al, is baffling.
 
The babus won’t miss an opportunity to shackle the political masters. It is not possible to convert the Indian system into a US-style system. Yet, it isn’t too late. There were times in the 1970s (Indira Gandhi), 1980s and 1990s, when India’s economic policy establishment was drawn from outside. That is what enabled senior officers like Manmohan Singh, Bimal Jalan, Montek Singh Ahluwalia and several others to enter government (in its political establishment) and bring new ideas and implement decisive policy change. It is up to the prime minister and his key ministers to prevent themselves from being led up a pre-determined path.
 
Isn’t NDA-2 really UPA-3?
Subrahmanian SH, by email
 

Why was the Street Beat Section Dropped?

I am sorry to read in the 9th July issue of Moneylife that you have dropped the Street Beat section as well as the Model Portfolio section. In fact, about 50%-60% of my current portfolio (of about 25 scrips in equities) is made up of stocks recommended in these two sections of the magazine. The reasons given by the editor for dropping these sections are not convincing. He has mentioned that Moneylife is finding it difficult to find new recommendations from micro- and small-cap stocks as they have become expensive. There are more than 3,000 regularly traded scrips in the Indian market and, surely, there may be quite a few undervalued stocks among these. Moneylife’s excellent research team is ably equipped to dig into these and unearth gems like it has always done.
 
The other reason cited is overlap between Street Beat and MSSN Stockletters. As a reader of the magazine, and a recipient of Stockletters (I am an MSSN member), I have never faced any such dilemma. In fact, in the Moneylife long-term portfolio, there are about 50 stocks. Aren’t the readers spoilt for choice here itself? Moneylife is only offering them an even wider choice by recommending certain options in Stockletters and certain others in the magazine. 
 
Maybe the real reason is your anxiety to offer some sort of exclusivity for Stockletter recipients, by denying the Street Beat and Model Portfolio recommendations to Moneylife readers. If that be the case, I feel let down by Moneylife which, until now, I have held in high esteem. Principles, and not profit alone, have been Moneylife’s guiding spirit: hope you will not stray from that path.
 
Two suggestions: 
a) If the research team does not find any good stock for the Street Beat section, in that issue it can review one of the earlier recommended scrips and give its advice on whether to keep, hold, or buy more of that stock. 
b) In case the research team does not find any good scrip among the small-/micro-cap stocks, it can review a mid-/large-cap stocks in Moneylife’s unique style which is undeniably one of the best.
 
The editor has mentioned about Street Beat offering distinctive choice to the readers. Very true! The magazine’s distinctiveness derives a lot from this section. So, please continue to be different.  Do not yield to commercialism. 
 
I hope the editor will take my request seriously, and re-consider the decision to stop Street Beat and Model Portfolio sections. Do not drop the Street Beat section, at any cost.
BV Krishnan, online comment
 

Editor’s reply:

We are glad to know that you have benefited from these sections. You are unconvinced about the fact that we are not getting undervalued scrips to recommend. This is because you are not aware of the difficulty our rigorous research is facing, while identifying good-quality scrips, whose valuations are also low—even though you admit to have benefited from the rigorous research. 
 
The reason Street Beat has beaten almost all mutual funds hollow is because, over the past three years, it had the advantage of valuation, not just selection. Everybody knows which are the good-quality stocks. It is buying them when they are undervalued that makes all the difference to the outstanding results we have secured for our readers. That advantage is now gone. 
 
While there are 3,000 regularly traded scrips in the Indian stock market, why do just around 40 stocks make up 50% of the mutual fund portfolios? Because most of them are garbage. 
 
While you may be an accomplished investor, and know exactly what to do with the Street Beat stocks and Stockletters stocks, we have been unable to guide readers, who have asked us how to choose from the 26 stocks of Street Beat every year and 20-22 stocks in each of the Stockletters.  
 
What you have identified as the ‘real reason’ (yes, you are wrong)—our anxiety to offer some sort of exclusivity for Stockletter recipients—is wide off the mark and uncalled for. In effect, you are accusing us of mis-statements. It is sad that just because you are not able to buy a few extra stocks, we go down in your ‘high esteem’. Indeed, would you have 26 new stocks over the next one year from Street Beat? Buying stocks is not like buying vegetables. We don’t look for new ones daily. By the way, while we thank you for your subscription, we hardly make any profits. So much for ‘commercialism’! But then, you may not believe that either. One last point. SEBI has now come up with regulations that prohibit anybody and everybody from recommending stocks. We will fall foul of this rule, if we continue to ‘recommend’ stocks. 
 
Through your lengthy response, you seem to have ignored the most important change. Earlier, the stocks section was four pages. It was eight pages in the previous issue. We are sorry if we have disappointed you by offering more!
 

Short on Governance?

This is with regard to “Stop One-sided Contracts of E-commerce companies” by Sucheta Dalal. E-commerce has ignored consumer protection. The government has been a party to it. FDI (foreign direct investment) is permitted under some legal loopholes. Flipkart, Uber, etc, are all surviving with venture capital money and gyp the consumer with no warranties. I welcome this trade, but the consumer must have recourse. This government, unfortunately, is short on governance.
R Balakrishnan
 

Government Can Retrieve the Situation

This is with regard to “Housing for All: Slogan vs Action” by Sucheta Dalal. Even now, the government can retrieve the situation, if it is serious. The government has to acquire land, adopt high-class town planning, construct quality houses through contracts awarded by transparent bidding, ensure efficient monitoring, and sell flats at low prices. Safeguards can always be built in, to avoid unscrupulous trade. But governments always throw figures, without any feasibility studies, and corruption and lack of commitment remain the government’s hallmarks. Banks have allowed builders to borrow incessantly and have no will to discipline the errant builders.
Rajendra M Ganatra
 

A Small Healthy Step

This is with regard to “Empowerment through Feminine Hygiene” by N Madhavan. This is a potentially powerful idea for implementation, especially in India. It can be a small healthy step that can reduce medical costs substantially.
Narendra Doshi

User

Three Cheers for the Supreme Court’s Orders on IPL, Mallya and Sahara
Once again, the SC’s judicial activism shines a light on corruption, apathy and cronyism that has enveloped our executive, legislature and the media
 
Our dysfunctional democracy seems to require judicial intervention to force regulatory action, investigation and punishment by the executive. On issues as disparate as cricket, public safety, noise pollution, interlinking of rivers, or investigations into everything from coal and telecom scams to riots, only the Supreme Court (SC) is finally able to direct that the system works for us, the people.
 
There are many who complain that the judiciary cannot seem to fix corruption within its own ranks and how justice is often denied due to lengthy litigation. But, all things considered and despite its dangers, this unique activism, or what is called ‘judicial overreach’ into the domain of the executive, alone seems to uphold the faith of ordinary Indians in democracy. 
 
So it is three cheers to the judiciary for three important orders in July, which signalled that nobody, however rich or powerful, is above the law. The first cheer is for the SC-appointed Justice RM Lodha committee’s order on 14th July on the betting scandal involving the Indian Premier League (IPL). It confirmed charges and ordered stringent action against key personalities in the powerful cabal that has a vice-like grip on Indian cricket. 
 
The Lodha committee was constituted in January 2015 to decide the quantum of punishment against Gurunath Meiyappan (son-in-law of N Srinivasan, chairman of India Cements as well as the International Cricket Control Board) and Raj Kundra (more famous as husband of actress Shilpa Shetty) and the two franchisees they represent—Chennai Super Kings and Rajasthan Royals, respectively. 
 
For weeks before this order, India has been treated to a hysterical public debate over whether the Bharatiya Janata Party (BJP) leaders were shielding Lalit Modi who fled to London five years ago. He, in turn, alleges that powerful ministers in the United Progressive Alliance (UPA) government vindictively singled him out to be the fall guy for all scams related to the IPL. 
 
Lalit Modi, often described as the IPL czar, has been crowing on social media, about Justice Lodha’s order. The flamboyant Mr Modi, who has launched a unique war to ‘clean up Indian cricket’ says that Justice Lodha’s order has ‘barely scraped the surface’. And indeed, his sizzling tweets, photos and interviews, although posted from luxury hotspots of the world, do seem to suggest that the enforcement directorate (ED), which invariably does the bidding of the political masters, may have, so far, targeted only one individual while shielding the others. 
 
All those indicted by the Lodha committee have already announced plans to challenge the order. This will provide another opportunity for the judiciary to expose the powerful clique of politicians, crony capitalists and cricketers who cosy up to them.  
 
A nation, mad about cricket, is furious with the dirt spewing out from the richest cricket association, the Board for Control of Cricket in India (BCCI). Cricket-lovers are asking some simple questions that need answers. Why is it that a top position in BCCI is as coveted as the post of a Union minister? Why is it de rigueur for every powerful chief minister, finance minister and members of parliament (MPs) to be on various state and district cricket boards? What exactly are the perks and dividends connected with these posts? Surely, they are not there to serve the game or the nation. And, finally, who are the Indian beneficiaries of the massive betting ring controlled by the underworld from abroad? 
 
The second cheer is for the sharp rap delivered to liquor baron Vijay Mallya, on 13th July, for misusing the judicial process. Mr Mallya repeatedly evaded summons by the ED in the case relating to a $200,000 payment to Benetton Formula Ltd, a British company, to display the Kingfisher logo during the 1996-98 Formula 1 events. The ED claims that he did not have Reserve Bank of India’s permission to make the payment. 
 
Criminal proceedings were launched against Mr Mallya. He first approached the Delhi High Court to quash these charges and, when that plea failed, appealed to the apex court. The SC dismissed the appeal and slapped an exemplary fine of Rs10 lakh on him for ‘sheer abuse of the process of law’. The Court’s scathing observation that “(his) enormous money power makes him believe that the State should adjust its affairs to suit his commercial convenience,” could well come back to haunt him in future. 
 
Mr Mallya, the self-proclaimed king of good times, owes over Rs7,000 crore to Indian banks. He is facing investigation and action on several serious charges but has been successfully dodging action. A rap like this is bound to impair his skilful and well-oiled strategy of tying up investigation and regulatory action against him in a web of litigation in every judicial forum available to him. 
 
The third cause of cheer is, for the strange Sahara saga that has played out in the apex court for several years. Probably for the first time ever, the apex court turned into an auctioneer and doubled the value of Sahara’s 47-acre property at Gorakhpur that was up for sale. The piece of land had received a bid for Rs64 crore; the money would go towards raising funds for Subrata Roy’s bail and was, hence, before the Court. While the hearing was on, another bidder upped the stakes leading to a virtual auction, which saw the price ratchet up to Rs150 crore. The Court has now posted the matter for August, with a few conditions attached. 
 
That this could happen in the apex court ought to send a strong signal to defaulting industrialists who are known to fix the sale of properties among friends so that lenders trying to recover their dues get only a pittance. The apex court’s hard stand and its activism in the Sahara case, leading to Mr Roy’s unusual incarceration has exposed several murky details about the group and its activities. But these barely find a mention in media reports on the hearings. 
 
The irony is that Mr Roy was victim of his own arrogance. The SC, in ordering his arrest for contempt, referred to his “dilatory tactics to delay implementation of the orders of this court.” It also pointed out that his defiant attitude towards the SC, “shakes the very foundation of our judicial system and undermines the rule of law, which we are bound to honour and protect.”  
 
The key to Sahara’s strategy was its ostentatious display of wealth and power through political and social connections. However, once Mr Roy was arrested, the group, which issued advertisements boasting that it raised Rs74,000 crore, cannot seem to produce Rs10,000 crore (half in cash and the other half as bank guarantees) to bail out its chairman. Worse, the title of many of its claimed assets is dodgy and every attempt to liquidate them has turned controversial. None of this would have been exposed but for the fact that it is played out in the highest court of this country and it has only hardened the Court’s stand. There is now a second order asking the Sahara group to cough up further Rs26,000 crore in 18 months. 
 
So, while the purists may carp about judicial activism or over-reach by the courts, and while it is true that the legal system itself needs a proper clean-up, it is the Supreme Court alone that still has the ability to shine a powerful light on the thick morass of corruption, apathy and cronyism that has enveloped the three other pillars of our democracy—the executive, legislature and the media.
 

 

User

COMMENTS

Rajat Chauhan

2 years ago

Mr. Subrata Roy worked for the betterment of poor people. He’s going through a bad phase and he will surely be rewarded with good things soon.

REPLY

Nitish Yadav

In Reply to Rajat Chauhan 2 years ago

Saharasri, the man who took so many social initiatives, is now going through a very bad phase the same way every great man has gone through. The people Sahara Group has helped are with them at each and every step and Mr. Roy would come out stronger.

Rajat Chauhan

In Reply to Rajat Chauhan 2 years ago

Agreed. The success of Sahara over the past 3 decades clearly shows it is law abiding and will never indulge in any wrong things. Sahara Group has got the faith and support of the people.

Ritwik Patel

In Reply to Rajat Chauhan 2 years ago

Every great man has to go through a bad phase. This is the bad phase of Mr. Subrata Roy. I wish he soon gets out of all his troubles. My wishes are with him.

A S Bhat

2 years ago

Very Good Article. But re IPL why are there no penalties imposed on those guilty?
Why are senior cricketers like Dhoni are quiet about it?
Why can we not arrest Mallya and if he is absconding at least start confiscating and selling his properties mortgaged to Banks?

Praveen Sakhuja

2 years ago

until or unless such defaulters are protected by our politicians they can face harassment but not punishment. they will lead luxurious life even in jail so done. It requires plugging at initial stages so that public money does not bleed out from coffers to these people to lead luxurious life on public money.

REPLY

integrity

In Reply to Praveen Sakhuja 2 years ago

You are right.The way Sahara case has unfolded, the way it received minimal attention in media even as one of the judge of the earlier bench had rescued citing unprecedented pressure, it highlights a thing or two -and not only about the political scenario . Thankfully we have Money life

J Pinto

2 years ago

The few exceptions proove the rule ?

Justice delayed is justice denied when justice takes 10 to 20 years.

The budget of the judiciary needs to be increased with a caveat that each years increase will be subject to demonstrated improvement in productivity.

This area needs to be addressed even before the Land Bill.

Land bill unlikely as government fears stormy session
With little hope of getting it passed, the government is rather focusing on re-promulgating the ordinance for the fourth time
 
The monsoon session of parliament is expected to be stormy, which is why the government is likely to put off the controversial land bill this time, sources said on Sunday.
 
The joint parliamentary committee -- which was supposed to table its report on the first day of the monsoon session on Tuesday -- is set to seek an extension of two more weeks to finalise the report, the sources said.
 
"The report will not come immediately... while any final decision will depend on when the report is tabled, the bill is unlikely to be taken up in this session," a Bharatiya Janata Party leader said.
 
With the 19-day session expected to see an uproar over issues ranging from the Vyapam scam to the Lalit Modi controversy, sources said there was a feeling that the land bill will only increase troubles for the government.
 
With little hope of getting it passed, the government is rather focusing on re-promulgating the ordinance for the fourth time.
 
The opposition Congress sent out a warning on Sunday, saying the government must make "scam-accused" ministers resign if it wants to get bills passed.
 
"Hope Prime Minister (Narendra) Modi announces resignations of scam-accused ministers... Passing bills would become very easy," Leader of Opposition in the Rajya Sabha Ghulam Nabi Azad said on Sunday.
 
The list of government business, according to sources, has 35 items, including nine bills pending in the Rajya Sabha and four in the Lok Sabha.
 
Besides, 11 new bills are to be introduced, as per the government's plan.
 
Bills pending in the Lok Sabha include the land bill, the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Amendment Bill, 2014, the Delhi High Court (Amendment) Bill, 2015, and the Electricity (Amendment) Bill, 2014.
 
Crucial among the nine bills pending in the Rajya Sabha are those related to GST, the Whistle Blower Protection (Amendment) Bill, 2015, the Prevention of Corruption (Amendment) Bill, 2013, and the Juvenile Justice (Care and Protection of Children) Amendment Bill, 2015.
 
The new bills which the government plans to introduce include the Consumer Protection (Amendment) Bill, 2015, for changes in consumer protection laws; Arbitration and Conciliation (Amendment) Bill, 2015, to settle commercial disputes outside courts; the High Court and Supreme Court Judges (Salaries and Conditions of Services), which seeks to redress their long-pending demand of high court judges of one rank one pension.

User

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)