Big Hang-Ups in Little India

India has producing some of the most extraordinary engineering and technology experts, literally ramming home cutting edge telecommunications research and development. And America imports those brainiacs by the planeload! Hey, you can some of the best curry in the United States in California’s Silicon Valley Indian restaurants! So if you’re gonna have a nasty political scandal in India, heavily laced with powerful business interests bribing the highest levels of the Indian government, why not stage that show in the ever-lovin’ telecommunications sector?!

Yeah, baby, and the allegations in New Delhi make Alaska Senator Ted Stevens (RIP) and his corruption convictions look like a piker. I mean, a mere $250,000 in payoffs and a lousy seven felony convictions isn’t even globally competitive! This is more like our Tea Pot Dome or Watergate scandals – BIG! We’re talkin’ at least two major cabinet appointments are likely takin’ a hike! Maybe some corporate bigwigs are gonna get free room and board, amazing in a nation where payoffs are simply a way of life.

The allegations – as I said – BIG. What’s the story here? “The issue is how a minister allied with the party sold cellphone operators the airwaves to provide their service in 2008. But the amounts involved, and subsequent revelations of how some of India’s richest men sought to exercise influence over political appointments and regulatory decisions, have surprised a nation seemingly inured to reports of corruption in politics… An independent auditor estimated that the government may have left almost $40 billion on the table by selling the rights too cheaply… The political fallout seems to grow each day. The telecom minister, Andimuthu Raja, has already resigned. On [December 1 3^th], the focus expanded to India’s minister of highways, Kamal Nath, after the retired head of India’s most powerful trade group suggested on secret tapes connected to the telecom scandal that Mr. Nath skims 15 percent from projects he oversees.” New York Times (December 13^th).

Everything in India is BIG… like 700 million cell phone subscribers (in country where it is estimated that 800 million survive on less than $2 a day), but even with those numbers, they are number two to China (with a full billion such subscribers!). Ain’t nuffin’ like a scandal to reignite the political opposition; in this case, the conservative Hindu rights party – BJP (Bharatiya Janata Party) – is on the attack, trying to nail the mega-powerful Congress Party as corrupt and doing too little too late as a result: “The scandal has energized a once-moribund opposition, led by the Bharatiya Janata Party, which has blocked normal business in Parliament. [Sound familiar?] The opposition is demanding that Prime Minister Manmohan Singh create a parliamentary commission to investigate, a step Mr. Singh has resisted, promising that the government will clean house.

“Beyond the political infighting, the scandal has broad implications for India, the world’s second-fastest-growing major economy. Growth depends increasingly on turning whole swaths of the state-directed economy over to the private sector, whose capital and expertise are critical as India embarks on plans to build roads, bridges, ports and power plants.” The Times.

Singh is worried about more dirt, and the conservative Hindu nationalists have a huge new issue for the next parliamentary elections. And if you need a new Tea Party conservative movement, where better to have it than where we get the tea in the first place?! When and where did this seed of corruption get planted? The NY Times summarizes: “The telecom industry in India was essentially born in the mud pit of corruption. Telephones were once a rarity in India — made rarer by the plodding intransigence of the government service provider, which might take one year, or three, to fulfill a customer’s order for a new line. Then in 1994, three years after India began embracing market reforms, telecom was opened to the private sector.

“The move unleashed nothing short of a revolution, eventually providing hundreds of millions with their first telephone service. But corruption also soon surfaced: in 1996, the minister overseeing the telecom field was charged with accepting bribes. Investigators searching his home discovered more than 24 million rupees, or roughly $550,000, stuffed inside trunks, pillowcases and toilet tanks.

“Nearly 15 years later, the style of corruption is far different, as is the money. This year, India’s cellphone customers are expected to pay nearly $20 billion in bills, according to the technology research company Gartner. Most of this revenue will go to a handful of big players — Reliance Communications, Airtel, Vodafone, Tata Teleservices and Idea Cellular — which together account for almost 80 percent of the market… With the exception of Vodafone, a British corporation, these giant telecom companies are all subsidiaries of India’s biggest conglomerates, headed by some of the nation’s most powerful tycoons. Their companies reach into steel, autos, natural gas, power plants, mining, construction and media. Today, India has 66 resident billionaires whose combined wealth of roughly $244 billion is equivalent to more than a fifth of the country’s $1.1 trillion gross domestic product.” Are we having fun yet? Big countries growing way too fast often take even bigger shortcuts.

I’m Peter Dekom, and this little scandal is most certainly adding a bit of insult to India.