March 20, 2000

CRB going dot.com?

Last Thursday saw Pavan Nigam — whiz kid, co founder of Healtheon/WebMD and India-born billionaire — speak about his company to a hall packed with young wannabe millionaires, IT experts and dotcom entrepreneurs in Mumbai. Just before he began his speech, C R Bhansali made an unobtrusive entry, listened intently, took notes and vanished just before the proceedings ended. This is not the first time that CRB has been spotted at an IT event. In seven years, this man had built and destroyed a financial conglomerate of over Rs 1,000 crore. When he went down, he took with him the savings of thousands of investors and wiped out those foolish and greedy ones who had put all their trust in his controversial group. It should be no surprise that the dotcom mania and its crazy valuations are a phenomenally attractive to Bhansali. As Nigam said, the internet is the world’s second largest generator of wealth (the first is apparently drugs) and the largest generator of legal wealth. It is such an irony that investors have lost their money because sloppy regulators and rating agencies allowed Bhansali to send out very positive signals and dupe investors, while a ponderously slow judicial system keeps him unpunished. But the man behind all the mess is as cool as ever, attending seminars and preparing for the next big money spinning opportunity — maybe under an assumed identity?

The holy connection

The dotcom business attracts all kinds. If at one end of the spectrum you have Bhansali, at the other end is His Holiness the Shankaracharya of the Kanchi Math. TiE Mumbai President, Harish Mehta narrated how he and Kanwal Rekhi (yet another Indian success story in the US and co-founder of TiE) received a surprise invitation to meet the Shankaracharya to discuss IT. The guru believes that IT is the path to development. His mission was to set up and promote knowledge-based industry in Kanchi. The wealthy Kanchi Math is in a position to provide 250 acres of land and all the infrastructure that TiE would need to make the IT dream happen. Nobody should be surprised if the Shankaracharya, with his followers emerges as a bigger mascot for the IT industry than Chandrababu Naidu. In fact, it’d be perfectly in order, in the paradox that is India.

Power melas

Power Minister Kumaramangalam says that the cartel behind India’s Rs 20,000 crore of power thefts are gunning for him and seeking to get him out of the power ministry. Maybe so, but it is hard to believe that power thieves in different states are part of a common network and acting to a common agenda. In fact, they cannot be the only ones gunning for him. For some time now, he has been exhorting FIs to ‘‘lend boldly’’ to power projects. He even heckled them and asked why they should call themselves FIs if they are unwilling to take a few risks. Earlier loan meals used to be confined to the poor and needy, the Power Minister now wants to extend such largess to loss making power utilities too — all at the taxpayer’s expense. If the FIs had played along and accepted an unworkable escrow arrangement, then the ‘cartel’ which is gunning Kumaramangalam would presumably be allowed to continue their dacoity. A few months ago the same Ministry had another absurd proposal — that the NTPC could acquire NHPC. He wanted that they would remain independent of each other and go their own way with just a transfer of the NTPC’s huge reserves (as price of the NHPC equity) to the government. Shouldn’t the Minister realise that there are no shortcuts to power reforms?

Give us shares

The NSE has problems which are slightly different from all the 22 other bourses in the country. It is the only one which is very profitable and it has money to spare for setting up JVs for index services and IT-related services. Its members think that there is a good case for fees to be reduced, or they have another demand. It is simple, they say — either reduce our fees or give us shares in the IT company. The NSE as usual, is turning a deaf ear, but if it gives in, the NSE membership will be like winning a lottery.

 

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The author's e-mail address is: suchetadalal@yahoo.com

Other columnists:

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