Saturday, April 23, 2011

Five executives of large companies have been remanded in custody in the 2G scam. One, Mr Sanjay Chandra is chairman of Unitech Wireless which holds 32.7% in Uninor, a telecom services provider in India. The other 67.3% is held by Telenor of Norway. In spite of his bail plea being refused by the judge Mr Chandra has not resigned his post as chairman of Unitech. Now the Norwegians have formally asked Mr Chandra to step down which he still has not done. There are two reasons for this. First, Unitech was founded by Mr Chandra's father and he has grown up knowing that this is his entitlement. Second, the concept of honor does exist in India. It is customary to continue to plead innocence in spite of cast iron proof of guilt. Contrast this with what happened to Mr Rajat Gupta who has been accused of providing insider information to Rajaratnam who ran the Galleon hedge fund in the US. Although none of the accusations have been proven Mr Gupta has resigned all his positions as he fights to clear his name. It is common knowledge that business people have to bribe criminal politicians and thieving, parasitic civil servants large sums of money to obtain licenses or large government contracts. They cut the quality of the goods and services they provide to maintain profits. In return for the money they have paid out they expect complete protection from any investigation or punishment. Politicians regularly hector business leaders to help the poor. It is not the function of business to provide social services. Instead they should concentrate on providing the best products at the cheapest prices. Sadly honor and class cannot be bought.

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