New Delhi, (NPA): After the severe drought and natural calamities such as floods and rainstorms in India, the new mantra of austerity advocated by the Prime Minister, Dr. Manmohan Singh and the UPA chairperson, Mrs. Sonia Gandhi, may not have fallen on deaf ears around the country, but has it gone down well with the rich and famous? Are they ready to give up their cakes and ale? Are they ready to change their life styles?

If millions upon millions are going without bread, could they stop feasting? Could they bother to dress down? Or has nothing much changed in a poor India or in the rich nations? The more the distress, the more crocodile tears? Is that the thumb rule of life? Have the egos been hurt, but not deflated?

The captains of industry, are they angry at suggestions by the Corporate Affairs Minister, Mr. Salman Khursheed, that they should refrain from “vulgar” or high levels of pay packets and perquisites? Audacious? Unacceptable? How could you threaten: we can hardly say we (will) shut our eyes on what salary chief executive officers are going to make? Could Parliament or its Standing Committee discuss it?

Could Companies Bill Amendment take note of it? Not authorized? Because was it not agreed several years ago that they could earn 11 per cent of a company’s profit as pay, besides commissions? Do not cricketers earn more than most chief executives? Are they not on the pay roll of a bankrupt Air India, other public and private sector outfits without having to do an ounce of work or even having to play for their teams?

Was it not agreed that foreign investment could be boosted only if India permitted the same level of remunerations as in Europe and America where it is still $100 million a year even for some company chiefs still enjoying government handouts? True, President Obama may have put a limit of half a million dollars pay for companies and banks rescued by the US Government? But other companies, no longer on government support, are they not free of such bonds?

The Group of 20 Summit at Pittsburgh last month may have gone against the market economy dictum that greed is good and ruled that bankers in member countries and international regulators will determine the level of compensation to chief executives, but will they be able to enforce it? One hundred and thirty banks, big and small, may have failed in the US in a year and one small bank or not so small may be going downhill every day around the world, but will that change the mindset of international bankers when it affects their own pockets? Forget it.


Was there not a roar of protest from Ministers to suggestions that they could travel by the best planes in the sky, but in the economy class? Cattle class? Was this the twittering reaction of a one new young horn on prompting by an admirer of sorts? Do we not live at super de luxe hotel at our own expense while our better than palatial bungalow with acres of garden gets redone for us to live and welcome visiting potentates? Yet have we not moved to humbler hostel next door or a friend’s house within 24 hours? Are we not obedient public servants and diplomatists with world-class reputations to match? Why pick on and ridicule Ministers alone in a scenario of high living for those who can afford to do so? Has Mr. Salman Khursheed not done a yeoman’s service to his fellow Ministers by hitting out at corporate greed?

Yet, the Confederation of Indian Industry has tried to set the record straight with it president, Mr. Venu Srinivasan, insisting that CII always believed that “corporates have a social responsibility and always supported self-regulation. When the Prime Minister called for self-regulation at a CII conference two years ago, we supported his call and continue to do so”.

The Indian corporate sector insists that in line with the International Monetary Fund (IMF) appeal that economic stimulus for infrastructure projects worldwide should continue to save and create jobs and build up and rescue economies from collapse. This advice is considered, especially important for a country like India, a country that has been able to partially stem the extremely harmful impact of the worldwide meltdown. But India and other governments are finding it increasing difficult to provide the funds from their treasuries for new stimulus packages in view of the high level of fiscal deficits and high level of inflation and rising prices of all goods, especially basic needs like grains and groceries.

It is in this light that the talk of austerity has risen to a new crescendo in spite of the sharp reactions to the call for tightening of belts. The balancing of budgets is easier said than done as vote banks hold the key to the survival of governments and political entities, which can ill afford to neglect the food security of the nation. Paddy sowing has been missed in 6 million hectares in India and summer crop, it is feared, will be 20 million tons less than last year even if the grain stocks are at their peak at present. There is hope and expectation that late rains and irrigation reservoirs will ensure a good wheat crop at the end of winter in a few months.

In this grim scenario, the stock markets around the world are on the upswing, a cheering thought for those with investments. In India, the Life Insurance Corporation has already invested Rs.50,000 crores in the stock market in less than six months of the current financial year against Rs.40,000 crores in the full year last year. But investors are keeping their fingers crossed whether the bulls will continue to rule for all times to come. Even as commodity prices around the world are on the bounce to the dismay of the populace, energy prices are somewhat restrained and crude oil has for some weeks hovered below or around $70 per barrel, but oil prices remain an uncertain factor for ever.

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