Handling of the Satyam Scam
The Satyam scam. How does that fit into Montek Singh Ahluwalia’s book on reforms in India, Backstage ? The reason is that, as both NASSCOM and the government of India felt: “(Satyam’s) collapse would create a great deal of disruption for clients worldwide and seriously damage India’s reputation as a reliable source of software services.” Therefore, the government decided to work with the private sector to “organize a quick takeover by a reputable new buyer, who would quickly restart the company”. But that could not be done overnight. In the meantime, the new board would have to reach out to Satyam’s clients and “reassure them that the company would survive”. For the new board to have credibility when it made that statement, it had to be staffed with people who understood the private sector, the IT sector in particular, and commanded respect and trust. Deepak Parikh from HDFC was made chairman, and other members of the board included a former NASSCOM chairman, CII...