Speaking at an international convention of the Association of National Exchanges Members of India (AMNI), he said while the Satyam scam has indeed affected the capital market, “it is a single event in the corporate market and cannot be taken as the reflection of entire Indian corporate market or Indian economy”, adding there was a need to further corporate governance.
Mukherjee said India will have to prepare for a slower growth rate for next 2-3 years owing to the economic slowdown. The former finance minister said although the Indian economy is internally driven, the impacts of slowdown are inevitable.
The Satyam fraud and the fears of global recession were the two main issues experts from the stock market discussed at the conference in the city.
Ravi Narian, the managing director of National Stock Exchange (NSE), said the global financial crisis that is hitting the markets has the potential to transform the Indian markets. “Once the dust settles, there is evidence that growth will speed up in Asia, mostly in China and India,” said Narian, adding that once the crisis is over, the size of the Indian markets and the sophistication of financial products would increase.
Narain’s views were echoed by A M Bajaj, a representative of the Union ministry of finance who was also present at the convention.
However, representatives of regulatory bodies like Securities and Exchange Board of India (SEBI) pointed out that corporate governance and ethics should not always be enforced by organisations from outside. SEBI’s executive director MS Ray added that companies should implement rules and regulations not only in letter but also in spirit.
Unfortunately Mr Mukherjee is talking through his bottom. Nobody on earth knows if and how much the Indian economy will be damaged by this scandal. We only know that Indian business absolutely MUST clean up its act re: government corruption; corporate corruption; dreadfully poor governance (Satyam was supposedly the best in India); unethical business practices and, of course, appalling and unacceptable social inequality.India, although not India alone, must hang its head in shame whilst it reforms itself.