The restrictive law on cigarette shops

27 09 2017

Most of us are familiar and often use the small shops in the corner, who sell many things including cigarettes and tobacco. They usually stock items of urgent consumption and also are open long hours. They will also give you the item on credit when you do not carry a wallet on you, because he/she knows where you live.

The health ministry wants to control the sale of tobacco to children. Hence they want to restrict, the sale of other items in cigarette shops. They want to licence exclusive cigarette and tobacco shops.

I have the following issues with this proposal

– If local govt like municipalities will issue licence for these cigarette shops, this will breed corruption much like the liquor licences
– Already there is law restricting sale of cigarettes and tobacco products around 100 yards of any educational institution. If this is not being enforced properly then what makes them believe that small shops will not violate this new law too
– If ITC as a conglomerate can have a diversified portfolio including candies, biscuits along with cigarettes why restrict the small shop owner to stick to cigarettes only.


GST council is musically challenged

11 09 2017

What absurd taxation policy this GST Council has come up with ?

The Indian instruments attract No GST and the western instruments attract the highest rate of 28 %

Apparently, damru is Indian and drums are western, sitar is Indian and guitar is western, pungi is Indian and saxophone is western.Can you imagine “Pukarta chal hoon main”  without the guitar or “O Haseena zulfon wali”  without the drums. The sound of “been” in the Nagin song may be Indian, but it was created by Kalyanji on a ‘western’ instrument called clavioline. Are they not Indian music ?

The best of Hindi film music of the  ’50s and ’60s had a lot of so called ‘western’ instruments. Then why this absurd classification. There are so many musical instruments, who in the GST Council knows which is Indian and which is Western.

How far back would they go to justify an instrument as Indian. Sitar is not Indian, it came from Persia in the 18th century. Guitar came to India in the 19th century via British. Just because guitar came later, is it less Indian than sitar.

A flat low rate for all instruments can be administered better.

Is ITC justified in paying Yogi Deveshwar Rs 1 Cr per month ?

7 09 2017

ITC has filed a defamation case for Rs 1000 crore in Kolkata High court against the proxy advisory firm IIAS. IIAS had written strongly opposing the ITC board resolution of paying Rs 1 crore pm to Yogi Deveshwar.

Yogi Deveshwar ceases to be CMD since April 2017 and is designated Non-Exec Chairman. Sanjiv Puri is the CEO and MD.

Despite his Non-Exec Chairman status Yogi Deveshwar’s package is way higher than the CEO’s. CEO’s package is Rs 1.65 cr p.a plus commissions max of 300 % of salary. Say Rs 6.5 crore p.a.

Deveshwar’s package is Rs 13.5 cr p.a plus perks. So it is over double the salary of his CEO. A Non- Exec Chairman gets a salary double that of his CEO, who has the full responsibility and accountability of running a large conglomerate I.e ITC.

In Corporates, it is often said that the one who gets paid the highest, his opinion counts finally. There is even a fancy acronym for it- HiPPO. ( Highest Paid Person’s Opinion ).

Does Yogi fear that if he gets paid less than the CEO, he would not be able to assert himself as a Chairman and his opinion will no longer count ? Or it is just the board rewarding their Chairman a cosy retirement package for years of leading the company ? Or it is Yogi’s greed at work, rewarding himself a tidy amount knowing fully well there are no owners with management control in ITC and the institutional investors are passive ?

I think IIAS is perfectly justified in opposing this. Hope institutions take their advice. But who are the institutions , LIC, GIC and SUUTI i.e Govt of India owned FIs own 30 % of ITC. These institutions are either passive or wait for the call from Finance Ministry. If Deveshwar makes a call to Jaitley, problem is solved. All opposition gone.

Godmen- Who is duping whom ?

7 09 2017

Many of my friends are feeling angry at Godman Ram Rahim Singh, that he has duped poor people.

According to me, there is an unwritten contract between the 1 % ( rich & powerful) , the  Godman and the 99 % ( disenfranchised masses)..Godman plays the ‘beech ka bandar’ ( monkey in the middle ) beautifully, as long as it lasts, that is.

To the 1% ,overtly, Godman  offers peace , health and even road to God. But covertly, he offers the route to 99 % namely, markets and votes.

To the 99 %, he offers overtly identity, dignity, community and even livelihood. Covertly, the Godman is like Robinhood who steals from 1 % to feed the 99 %.

1 % is happy getting exploited economically by the Godman if the returns are good. 99 % adjusts to physical incl sexual exploitation as long as their other needs are met. Each is trying to dupe the other two.

Occasionally the equilibrium is disturbed and Godmen like Ram Rahim goes to jail.

As long as inequality exists in Indian society Godmen will exist.

Why Do NRI Professionals Find India So Difficult ?

22 11 2016

As Indian companies want to expand overseas and become globally competitive, one often cited prescription is to get the best people particularly NRI professionals to work in India.

Some NRIs are keen to return to India for various reasons, sometimes professional and sometimes personal or both. Compensation at the top is hardly a constraint these days for top professionals.

Yet, I see from several anecdotal evidences that the NRIs who choose to return to India taking plum assignments in top corporates or even government, wish to return back and many do.

Raghuram Rajan is back to teaching at Chicago. Kaushik Basu is back to US as a World Bank Economist. The recently fired Nirmalya Kumar after being in Mumbai for three and a half years is also leaving India, though he has not announced where he is heading.

I have spoken to a few friends who chose to return back after spending a few years here and this is their gripe about India and Indian organisations.

1. Professionalism in even the so-called professionally managed organisations is a 3 Micron gold plating. Beneath the coat is feudalism, bureaucracy, nepotism and a deep seated hatred for outsiders. Factions based on state, caste, village and colleges prevail. Merit is often the casualty. Mutual respect and valuing other persons time is more an exception than a rule.

2. The families find it very difficult to navigate the daily life in India. Be it the school or the traffic or getting simple things done at home. Unlimited patience and perseverance is required. Also, one can hardly trust anyone, because falsehoods and promising more and delivering less is the norm here.

3. The high pressure school environment in India with almost total focus on academics often puts off children who started studying in a western system.

4. India is no longer inexpensive. For global class goods and services, you pay dollar prices.

Urjit Patel’s Signature in Rs 2000 Note

15 11 2016

After the demonetisation was announced, the newly issued Rs 2000 has come into circulation. The Rs 2000 notes currently being issued have the newly appointed RBI Governor Urjit Patel’s signature. urjit-patel-signature

PM Modi and FM Jaitley have claimed that the preparation and printing of currency notes were being secretly done for the last six months. This would mean the Rs 2000 currency notes should have been under printing for the last six months.

But, Urjit Patel was chosen as the RBI Governor only on August 21, 2016 and he took charge from Raghuram Rajan only on September 4, 2016, just two months before the November 8th announcement.

Something is amiss. Either, the government is lying when it says it has been printing currencies to prepare for demonetisation from the last six months or they had decided  Urjit Patel as the next RBI Governor, atleast four months before the official announcement.

It can be speculated that when Raghuram Rajan made an announcement on June 18, 2016 that he would not take the second term as Governor, already Urjit Patel’s signatures as the next Governor were being taken in the new Rs 2000 note. This could have well led to Rajan’s decision to return to academia.

Nirmalya’s Jor Ka Jhatka..Dheere se

7 11 2016

Nirmalya Kumar, a former member of the Group Executive Council of Tata Sons has written a blog post, “I Just Got Fired“. You can get the link to his post here. The post has gone viral and has appeared in many publications.

At first reading, it is a personal account of a senior person’s firing by a corporate.  By using phrases like “No pity is needed” and “ I have nothing negative to say about the Tata group” he creates an impression that this post is not a way of complaining or hitting back at his former employers who fired him. By using “I realize that I am unemployed for the first time since the age of 18 and “Well, a bit lost, and ready at 8:30, instead of the usual 8:00, I head for my morning Starbucks coffee “, he tugs the heartstrings of his readers.

He mixes up the criticisms and his emotions, so cleverly, that you only realise after multiple readings that , this post is a subtle attack at some of the popular  beliefs about Tatas as an employer and as a business group.

Let me elaborate with examples :

  • “Despite the unceremonious and un-Tata like end”

This phrase clearly dispels the popular belief that Tatas do not follow a hire-and-fire policy. A popular perception among the employee community is that a  Tata job is very secure. By using “un-Tata”, he has brought out that Tatas are not what you think. Another aspect is that Tatas are not always graceful and dignified as they appear.

  • “What I found exceptional about the group was the kind of person that Tata attracts – unpretentious and dedicated. Yes, they really drink, as we would say in America, the “koolaid” of Tata. But I observed how hard they work, and how committed they are to the group and its values. “

This to my mind is the nastiest that Nirmalya gets. By praising the average Tata employee as hard working, dedicated and unpretentious, he gets them on his side and then he says “they drink the “koolaid” of Tata”.

Drinking “koolaid”  is an expression that is a reference to the 1978 event at Jonestown, Guyana, where hundreds of members of the Peoples Temple, a Californian cult, committed suicide by drinking Kool-Aid laced with cyanide.

He is clearly hinting that the gullible employees of Tatas are blindly believing the cult of Tatas without knowing the consequences of their faith, which could be disastrous.

  • They deserve a great Chairman.

He could not have got more direct than this one. He clearly feels the current one is not good enough.

  • It was not as if I was fired for non-performance (my last evaluation was excellent).

By this statement, it is apparent that Tatas do not follow any performance management system, despite their claims of professional management. They also are not fair and just with their employees, if the person belongs to a different camp.

  • When in future anyone mentions me, please don’t say anything positive. Throw me under the bus to gain credibility in the new regime. It’s my parting advice.

This parting advice is revealing of the insides of Bombay House and the Tata culture. Bad mouthing the previous bosses and blaming those who are no longer in favour and around to defend themselves, appears to be a sure ticket to succeed.

Tatas in their web-site have said the ” Dr. Nirmalya Kumar, Dr. N S Rajan and Mr. Madhu Kannan have decided to explore options outside Tata Sons and have left the services of the company.”  By writing this post and titling it as “I just got fired” he is openly saying that Tatas are lying when they say the GEC members have left on their own, when actually they have been fired.

Forget about all the exalted Tata values and ethics, one of the basic value is telling the truth and even on that count Tatas fall short.

Nirmalya Kumar through this one post has created such an adverse impact particularly among existing and potential employees of Tata group, that it will take a lot of corporate communications effort to undo the damage.

  •  Posted by G.Mohan

Nirmalya Kumar has posted a follow-up to the above post titled “Just Fired, and Moving On”. 

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