NO REGRETS
D N Ghosh
Rupa
pages 375; price Rs 695
D N Ghosh has had a rich and varied public life. What makes it truly unusual is that most of the action began at a time when a civil servant normally gets ready to enjoy retirement. A large chunk of his civil service years were spent in the banking division (later department) of the Union finance ministry as a key official who helped draft laws that led up to bank nationalisation and thereafter to a supervisory structure for public sector banks. Significantly, the latter was designed keeping in mind what was good for the banks and avoiding bureaucratic overreach which became the reality later.
The book begins in 1969 with a dramatic call at the near midnight hour from P N Haksar, principal secretary to prime minister Indira Gandhi, to join the team tasked to draft the ordinance for bank nationalisation in 24 hours so that President V V Giri could sign it the day before demitting office and before Parliament met the day after. What comes through in this detailed inside story, told for the first time, of bank nationalisation and defending the action before the Supreme Court is the dedication and professional integrity of most of the players - civil servant, government lawyer, judge. The rot in the system came thereafter. Ghosh was transferred out of the banking department when Maruti, Sanjay Gandhi's baby, found it difficult to raise bank loans during the Emergency.
The most dramatic chapter in Ghosh's private sector years was his role as chairman of Larsen & Toubro. Dhirubhai Ambani had almost succeeded in gobbling it up, but for the way Ghosh, put there by the V P Singh government, stood his ground. A typical good student of the time who trod the beaten track by writing the civil service exams and excelling in file work, he proved a pugnacious fighter in a way that would have done any business tycoon proud. Ghosh was shifted out when the Chandra Shekhar government came to power but not before he had ensured L&T's survival an independent, professionally run firm, which remains a national leader in the engineering industry.
Ghosh did not go to the private sector straight from government but via the State Bank of India (SBI). His years as chairman mark a significant phase in its development. In quick time he got a grip of the vast organisation with its long history and set it on a different path. He had SBI internationally rated by S&P (India got rated in consequence), drove home to senior managers the need to become profit-oriented and led the bank into a historic agreement with its union to introduce computerisation. He ensured government approval by presenting the deal as a fait accompli, a bureaucratic manoeuvre that only a former bureaucrat could have devised. If SBI today lives comfortably with its huge footprint and continues to grow then it is because of the steps it took in the eighties to give itself an IT network and backbone.
In his post-civil service life Ghosh became an institution builder. While he headed SBI, the bank's merchant banking division was spun off as a successful subsidiary, SBI Capital Markets, and SBI Mutual Fund was launched. As its first chairman, he got the Indian Institute of Management, Lucknow going. Perhaps his most high-profile creation is one of the two leading Indian credit rating agencies, ICRA (ironically, now majority owned by Moody's, which had declined to rate SBI in the eighties).
Among all the institutions that bear Ghosh's imprint, Peerless is unique. Its proprietor, S K Roy, brought Ghosh in as chairman with Reserve Bank of India approval to save it from the regulatory axe by transforming it. From being primarily a deposit taker in a state notorious for collapsed deposit takers like Sanchayita and later Saradha, it became a regular non-banking finance company. In this Ghosh was helped by the formidable board he put together, consisting of people like S M Dutta, former Hindustan Lever chairman, and Dipankar Basu, former SBI chairman.
Not every institution that Ghosh founded prospered. SBI's housing subsidiary did not perform and was liquidated. He helped set up Centurion Bank and was its first chairman. It didn't quite fly and was acquired by HDFC Bank.
Memoirs are most useful for providing the story of a writer's personal journey. Ghosh made a long traverse, from being a student with strong leftist leanings (he was mesmerised when he read the Communist Manifesto) to an adept player in the business world. His basic sympathies were with the working class, and a key skill was the ability to restructure enterprises. The two came together during his stint as Adviser, Institutional Finance to the first Left Front government of West Bengal.
The two worlds of the left and the free markets again came together when he became managing trustee of the Sameeksha Trust which publishes Economic and Political Weekly , the leading academic and polemical journal which wears its leftism on it sleeve. When Ghosh took over the trust was in dire financial straits. So he went around soliciting support from enlightened businessmen so that the trust and the journal could be put on a firm financial footing. Strangely, the story of EPW, which validates the core of his being - a non-doctrinaire leftist - is missing from the memoirs.
Ghosh is very candid in describing the evolution of his being - his struggle to discover himself and which way he was destined, critically helped by a letter from a wise relative. Eventually a pattern emerged. Every time he found himself in a new situation he would use his intellect to go into enormous detail and quickly grasp the essence. Thence would emerge a vision which would outlive his tenure.
One of the subsidiaries of Peerless that it did not divest under Ghosh is Peerless Hospital of which he remains chairman. Now well into his eighties and a cancer survivor (that is another story), I hope he will have enough active intellectual years left to help shape a viable business model for private healthcare which is not predicated on maximising patient expenditure.
There is one grouse with this otherwise inspiring story. Ghosh, who was from the Indian Audit & Accounts Service, does go on a bit about his frustration and bitterness at being denied promotions and positions as a result of the Indian Administration Service helping frame rules so that members of non-IAS services were always a step behind their IAS counterparts despite being equal in very other respect. But what else do you expect from the IAS? It is quintessentially Brahminical, living by its wits and getting self-serving rules framed to protect its space.
