Is an in­ves­ti­ga­tion into a mar­ket cri­sis in­volv­ing vested in­ter­ests in UPA 2, big bro­kers

The au­thor says that a coun­try needs to guard its in­sti­tu­tions and not de­stroy them if it wants to re­alise its dream of Make in India.

The Sunday Guardian - - Covert -

Se­ri­ous in­ves­tiga­tive work in print is rare these days, find­ing an en­tire book of skele­tons from the deep bor­oughs of our bu­reau­cracy and cor­po­rate cor­rup­tion in­deed rarer and chal­leng­ing. The Tar­get is in­deed a spe­cial ef­fort from sea­soned new­shound, Shan­tanu Guha Ray. It has had three edi­tions— English, Gu­jarati and Marathi—in quick suc­ces­sions, all best­sellers. It’s a tell-tale in­ves­ti­ga­tion, giv­ing doc­u­men­tary de­tails from con­fi­den­tial gov­ern­ment files, with mug shots of the pow­er­ful con­spir­a­tors of the NSEL cri­sis on the book’s jacket it­self. No won­der, the book has sold around 50,000 copies and be­come the No. 1 best­seller on Ama­zon in the Busi­ness & Econ­omy cat­e­gory within 90 days of its launch. The re­gional lan­guage ver­sions have also be­come No. 1 on Ama­zon within weeks of the launch. All the three ver­sions have also topped the best­seller charts at Cross­word, a lead­ing book- store chain.

Guha Ray picked up mul­ti­ple threads of the Rs 5,600 crore pay­ment de­fault at the Na­tional Spot Ex­change Ltd (NSEL) some years ago to re­alise that the de­fault was a craftily hatched con­spir­acy in which the then Fi­nance Min­is­ter P. Chi­dambaram, and his favourite bu­reau­crats, K. P. Kr­ish­nan, the then joint sec­re­tary (Cap­i­tal Mar­kets) in the Min­istry of Fi­nance and Ramesh Ab­hishek, the then chair­man of the For­ward Mar­kets Com­mis­sion ( FMC), the erst­while reg­u­la­tor of the com­modi­ties mar­kets, were the troika of de­struc­tion. Their mis­sion was to de­stroy tech-in­no­va­tor Jignesh Shah be­cause of his flag­ship com­pany, Fi­nan­cial Tech­nolo­gies ( India) Ltd ( FTIL). The rea­son: FTIL and its in­no­va­tions had threat­ened the vested in­ter­ests of the three in the Na­tional Stock Ex­change (NSE), now in the news for all the wrong rea­sons.

The Tar­get is a se­ri­ous in­ves­ti­ga­tion into a com­plex mar­ket cri­sis that in­volves vested in­ter­ests in the UPA2 gov­ern­ment and big bro­kers. The au­thor claims it took him close to two years to un­ravel the un­holy nexus that de­stroyed the spirit of en­trepreneur­ship and in- Shan­tanu Guha Ray Price: Rs 341 Pages: 240 no­va­tion sym­bol­ised by Jignesh Shah, who is revered as a tech-evan­ge­list in the Ex­change Em­pire he once ruled with his FTIL. Shah’s FTIL, which has been looked upon as a gen­uine Made in India story, has now been rechris­tened as 63 Moons Tech­nolo­gies Lim­ited, since it is no longer in the Ex­change space now.

It was pre­cisely for this rea­son—to oust Shah and FTIL from the Ex­change space— that his pow­er­ful ri­vals, with the help of Ab­hishek as the head of the FMC and Kr­ish­nan in the Fi­nance Min­istry, cre­ated the NSEL cri­sis and used it as a tool to tar­get and hound him de­spite the fact that not a paisa of the de­fault was found with him or his com­pa­nies. The Eco­nomic Of­fences Wing, Mum­bai, traced the en­tire money trail to the 24 de­fault­ers of the cri­sis and even the Bom­bay High Court af­firmed this, but that has not put an end to Shah’s per­se­cu­tion. It is sad, it is un­for­tu­nate. The book de­scribes how Shah pi­o­neered the cre­ation of 10 new-gen­er­a­tion reg­u­lated multi as­set (com­mod­ity, elec­tric­ity, eq­uity, cur­rency & bond) fi­nan­cial mar­kets in just 10 years across India, Sin­ga­pore, Dubai and Africa. No in­no­va­tor has been cred­ited with such ac­com­plish­ments across the world. All the mar­kets were No. 1 in India and No. 2 in the world.

Shah was ob­vi­ously rid­ing a crest from which very few could have top­pled him by way of tal­ent and per­for­mance. But he had taken on in­sti­tu­tional forces like the NSE and in­vis­i­ble forces that backed NSE, in­clud­ing its po­lit­i­cal god­fa­ther, cor­po­rates with vested in­ter­est, rich and pow­er­ful bro­kers and FII fronts — known as the famed Mal­abar Hill Club— by sheer per­for­mance to democra­tise the mar­ket pros­per­ity to the masses.

The 233-page book is a re­sult of the au­thor’s metic­u­lous re­search on how such en­trepreneur­ship and tech­nol­ogy-led in­no­va­tion—ca­pa­ble of break­ing mar­ket mo­nop­o­lies and cre­at­ing a new or­der and thou­sands of jobs—can also suf­fer at the hands of those who are ac­tu­ally re­spon­si­ble for fa­cil­i­tat­ing their growth.

The au­thor has made the book quite an in­ter­est- ing read by draw­ing ref­er­ences from Bol­ly­wood and an­cient mythol­ogy to mod­ern-day de­vel­op­ments. He has likened Shah to Ab­hi­manyu of the epic Ma­hab­harata, who was trapped in a sin­is­ter plot by the Kau­ravas and, to John Galt, the pro­tag­o­nist of Rus­si­aborn Amer­i­can au­thor, Ayn Rand’s hugely pop­u­lar book of the 1950s, At­las Shrugged.

Draw­ing par­al­lels be­tween the two, Guha says, Galt’s phi­los­o­phy of ob­jec­tivism re­sem­bles Shah’s. Both cham­pi­oned the pur­suit of ra­tio­nal self-in­ter­est that would ul­ti­mately lead to col­lec­tive glory. Like all he­roes, they have had to fight against a medi­ocre eco­nomic and so­cial struc­ture that tries to stran­gu­late in­no­va­tive in­di­vid­u­als striv­ing for ex­cel­lence. Both Shah and Galt fought

Jignesh Shah was ob­vi­ously rid­ing a crest from which very few could have top­pled him by way of tal­ent and per­for­mance. But he had taken on in­sti­tu­tional forces like the NSE and in­vis­i­ble forces that backed NSE, in­clud­ing its po­lit­i­cal god­fa­ther, cor­po­rates with vested in­ter­est, rich and pow­er­ful bro­kers and FII fronts —known as the famed Mal­abar Hill Club—by sheer per­for­mance to democra­tise the mar­ket pros­per­ity to the masses.

against the sys­tem and paid a heavy price at the hands of the high and mighty for pri­ori­tis­ing the in­ter­ests of the masses. In his case, Shah wanted to democra­tise the ben­e­fits of the stock mar­kets and take them to the low­est com­mon de­nom­i­na­tor of so­ci­ety but was stopped in his tracks.

Al­though The Tar­get re­volves around Jignesh Shah and the NSEL cri­sis, it raises some per­ti­nent ques­tions. Guha points out that the cri­sis could have been very well solved much ear­lier, but it was de­lib­er­ately kept alive with the ma­li­cious in­tent of an­ni­hi­lat­ing an in­di­vid­ual and his work of a life­time, but in the process, the coun­try ended up harm­ing its own in­ter­ests. This shows, says Guha, how we treat our en­trepreneurs and in­no­va­tors, who are the pil­lar of growth as a nation.

The au­thor says that a coun­try needs to guard its in­sti­tu­tions and not de­stroy them if it wants to re­alise its dream of Make in India. In­ci­den­tally, Shah’s was a true Made in India re­al­ity that was de­stroyed much before Make in India came into ex­is­tence. He feels the new gov­ern­ment should re­solve the NSEL cri­sis and do jus­tice to all its vic­tims by fix­ing the re­spon­si­bil­ity of each of its con­stituents in the larger in­ter­ests of the mar­kets and the nation as a whole.

Through­out the book, he strongly drives home the point that the spirit of en­trepreneur­ship and in­no­va­tion must be freed from the clutches of the en­e­mies of growth and fair com­pe­ti­tion and al­lowed to flour­ish so that India does not lose so heav­ily at the cost of greedy politi­cians and their vested in­ter­ests.

The book has a fore­word by noted so­cial com­men­ta­tor, colum­nist and au­thor Suhel Seth, who as­serts that the book is a great read not only for our bud­ding en­trepreneurs and in­no­va­tors, but for all those who want to un­der­stand what went wrong with a suc­cess story called FTIL and the im­mense value of IP-based in­sti­tu­tions of global scale and how they were crookedly de­mol­ished. Rita Joseph is a New Del­hibased jour­nal­ist who has worked for the Press Trust of India and as fea­tures ed­i­tor of The States­man, an English­language daily news­pa­per in India. She writes for me­dia out­lets in India and the United States, in­clud­ing Mat­ters India, a top news por­tal that col­lab­o­rates with GSR and fo­cuses on re­li­gious and so­cial is­sues.

The Tar­get

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