📰 Heading towards strategic instability
India must be alert as there is a possibility of emerging disruptive technologies prompting inadvertent conflict
•In late 2018, the government decided to set up three new agencies — the Defence Cyber Agency, the Defence Space Agency and the Special Operations Division — in order to address the new age challenges to national security. While this is indeed a useful step in the right direction, it is also important to note that the constitution of these agencies is a far cry from the crucial recommendations given by the Naresh Chandra Task Force and the Chiefs of Staff Committee, both of which had suggested the formation of three separate joint commands to deal with new challenges to India’s national security in the cyber, space and special operations domains.
•This rather lacklustre response to major ‘futuristic’ challenges to our national security raises a larger question: is India adequately prepared for the new age wars in general or is it still preparing for the last war it fought, and won?
High-tech innovations
•There is a revolution in military affairs that seems to have attracted the attention of strategic analysts and policy planners across the world. The current focus in military thinking across the world is increasingly moving away from traditional heavy-duty military hardware to high-tech innovations such as artificial intelligence (AI), big data analytics, satellite jammers, hypersonic strike technology, advanced cyber capabilities and spectrum denial and high-energy lasers. In the light of the unprecedented capabilities that these systems offer, there is also an increased focus on developing suitable command and control as well as doctrinal concepts to accommodate and calibrate them.
•The arrival of these technologies might deeply frustrate strategic stability as we know it given their disruptive nature. Strategic stability in the contemporary international system, especially among the nuclear weapon states, depends on several age-old certainties, the most important being the issue of survivability of a state’s nuclear arsenal and its ability to carry out a second strike after a first attack. Once accuracies get better, hypersonic glide vehicles replace conventional delivery systems, real time tracking and surveillance make major strides, and AI-enabled systems take over, survivability of nuclear arsenal, which lies at the heart of great power stability, could take a severe beating. There was, for instance, an assumption that the naval leg of a nuclear triad is the most survivable part since it is hidden away in the depths of the ocean away from the adversary’s gaze. However, the potential ability of deep-sea drones to detect ballistic-missile armed nuclear submarines or SSBNs may make this assurance a thing of the past thereby frustrating traditional calculations.
•Now add the arrival of these new technologies to the emerging strategic competition among great powers. The U.S.’s withdrawal from the Intermediate-Range Nuclear Forces treaty is perhaps an indication of a potential arms race in the offing. In a January 2018 article, the Economist put it succinctly: “Disruptive new technologies, worsening relations between Russia and America and a less cautious Russian leadership than in the cold war have raised fears that a new era of strategic instability may be approaching.”
Fears of conflict
•There is an inherent paradox vis-à-vis high technology-enabled military systems. While on the one hand, it is imperative for states to redesign their systems in the light of these new technologies, especially the digital and cyber components, this also makes the cyber- and digital-enabled systems vulnerable to covert cyberattacks. More so, given that such surreptitious attacks might take place in the early stages of a conflict, ensuing confusion and scare might lead to uncontrolled escalation with little time for assessment and judgement.
•The biggest fear about these technologies, the implications of which we don’t fully understand yet, is their potential to increase the risks of intentional and inadvertent nuclear use. Such scenarios may be unlikely but not improbable. Here’s what the Economist had to say on precisely such a scenario: “Both China and Russia fear that new American long-range non-nuclear strike capabilities could be used to deliver a disarming attack on a substantial part of their strategic forces or decapitate their nuclear command and control. Although they would still launch their surviving nuclear missiles, improved missile-defence systems of the U.S. would mop up most of the remainder before their warheads could do any damage.”
•The fear of a bolt-from-the-blue attack against one’s command and control systems or a disabling strike against strategic arsenal using new technological solutions is likely to dominate the strategic mindspace of great powers in the days ahead, thereby further deepening mistrust and creating instability. Therefore, the possibility of emerging military technologies prompting inadvertent escalation and conflict cannot and should not be ruled out.
Chinese capabilities
•China has emerged as a key actor in the field of emerging military technologies. This is something that will concern New Delhi in the days ahead. Some analysts believe that Beijing is in the lead position in emerging technologies with potential military applications such as quantum computing, 3D printing, hypersonic missiles and AI. If indeed, Beijing continues to develop hypersonic systems, for instance, it could potentially target a range of targets in the U.S. While the Chinese focus is evidently on U.S. capabilities, which China interprets as a potential threat, this is not without latent concerns for New Delhi. India might, in turn, consider developing some of these technologies which will create dilemmas for Islamabad. The cascading strategic competition then looks unavoidable at this point, and that is worrisome. And yet, it might be difficult to avoid some of these developments given their dual use.
•However, there is a need to ask how survivable India’s naval platforms are given the feverish developments of advanced sensory capability in the neighbourhood. Is it sufficiently prepared to face the new age wars? Has the urgency associated with these technological developments dawned on the security planners in New Delhi?
•It is in this context that we must revisit the government’s decision to set up the agencies to address cyber and space challenges. Clearly, this is a timely effort from the government to have finally decided to set them up — though they are not yet in place. It is unfortunate that unlike what was envisioned earlier, these agencies will be reduced in their powers and their standing in the pecking order of defence planning in the country. Moreover, reports indicate that the Space Command will be headed by the Air Force, the Army will head the Special Operations Command, and the Navy will be given the responsibility of the Cyber Command. If indeed that happens, their effectiveness in terms of tri-service synergy will be much less than anticipated. Even more so, given that the higher defence decision-making in the country is still civil services-dominated, despite the recent attempts to correct it, the effectiveness of these agencies will remain weak.
With political protests erupting in the region against the Citizenship (Amendment) Bill, the BJP has been put on notice
•The tiny States in India’s east, the Davids, have put the Goliath of political parties, the Bharatiya Janata Party, on notice with a carefully aimed slingshot that may hurt the giant.
Why the opposition?
•The Chief Ministers of Meghalaya and Mizoram, a representative of the Nagaland Chief Minister, and an ally of the BJP government in Tripura declared their unliteral, united and unhesitating opposition to the Citizenship (Amendment) Bill of 2016, which seeks to fast track citizenship to migrants of Hindu and five other non-Muslim groups from Bangladesh, Afghanistan and Pakistan. The carefully crafted North-East Democratic Alliance of non-Congress parties in the region has stumbled.
•Meghalaya’s Conrad Sangma, who runs a coalition government which includes the BJP, convened the meeting in Guwahati, the region’s political hub, challenging the BJP on its own turf. Interestingly, the Congress, which walked out of the Lok Sabha when the Bill was being passed, was initially muted. Now, it has said it will ask its MPs to vote against the Citizenship Bill in the Rajya Sabha.
•Amid the din of street protests across Assam and elsewhere, reference is made time and again to the Assam Accord of 1985, which laid down the criteria, strategy and structure for the deeply troubling ‘foreigners’ issue in the State. The Accord sought to calm a movement against illegal migration that had erupted in bloodshed and confrontation taking thousands of lives between 1979 and 1985. The key concerns that the Accord sought to address, through an agreement of the Centre, the State government and the All Assam Students Union, involved not only illegal migration from Bangladesh but also constitutional safeguards for citizens and economic initiatives for the State’s growth. Such growth would benefit the entire region since Assam, the largest of the eight States, drives the regional economy.
•When the BJP came to power at the Centre and in the State, it sought to fast track a key demand of the Accord, the updating of the National Register of Citizens (NRC), to ostensibly clarify the existence of large numbers of non-Indians in the State. This had been stymied by earlier Congress-led governments. However, a July 2018 NRC draft, which left out four million people, was sharply denounced as prejudiced and flawed. A group of senior retired officials wrote a letter to the Prime Minister drawing attention to what they saw as a deeply problematic process.
•The Supreme Court, which has been issuing a set of ad hoc directions for a project it is directly supervising, has given NRC organisers more time to fix the problems. This came after nearly 32 lakh persons filed challenges to their non-inclusion. The Citizenship Bill came plumb in the middle of this, with government officials in Delhi asserting that the Centre is committed to it and that the Bill is being misunderstood.
•By excluding Muslims from its ambit, thus making citizenship contingent on religion, the provisions in the Bill appear to be contrary to Article 14, which guarantees “equality before the law or equal protection of the law” in any part of India. The Joint Parliamentary Committee, which assessed the views of stakeholders, political and civil society groups across the country, asked the Intelligence Bureau (IB) for a figure of immediate beneficiaries of the Bill. The IB said there were just 31,313 members of these minority groups staying on long-term visas after claiming religious persecution in the three countries of focus in the Bill. But is it the Centre’s case that this small figure is the sum total of persons that it wants to benefit? This does not appear to be so, according to statements of BJP leaders in Assam, where lakhs of illegal migrants are said to have settled since 1971. However, there are no hard figures, only estimates.
•At the heart of the matter is a very simple issue. The 1985 Accord, by which everyone swears, is specific and unique. It is specific to a State (hence the Assam Accord) and an issue (illegal migration), and defines the effort to settle an issue which was swamped by discord. It cannot be undone by legislation that seeks to supersede it. The Accord was sanctioned by Parliament and has acceptance in the State across party lines.
Shifting goal posts
•That is why arbitrary efforts and manufactured consent are meeting such resistance. The goalposts are being changed without adequate dialogue. Lack of discussion and transparency are reasons why parts of this sensitive region erupt repeatedly. Delhi does not learn from the past. How could it expect the shifting of political goalposts to be accepted quietly? The Accord placed the cutoff year for deportation of illegals at 1971, when Bangladesh was created. The Bill changes that to 2014. Constitutional rights must be upheld. While the Bharat Ratna to Bhupen Hazarika is overdue and welcome, it cannot detract from the core questions that are being asked.
•The words of Mahatma Gandhi to the emissaries of Gopinath Bordoloi, later Assam’s first Chief Minister in Independent India, on December 15, 1946 ring true today. That was when the British Cabinet Mission, through constitutional trickery, sought to impose Bengal majority control over Assam. “If Assam keeps quiet, it is finished. No one can force Assam to do what it does not want to do. It must stand independently as an autonomous unit,” he said.
•Assam is speaking as are the peripheries. But is Delhi listening? The act of dialogue presupposes compromise by either side, especially the more powerful.
📰 Unemployment data based on draft report: NITI Aayog
Think tank debunks media report of joblessness at 45-year high
•The government’s think tank NITI Aayog on Thursday debunked claims of a news report that unemployment in 2017-18 was at a 45-year high. The NITI Aayog said the report of the National Sample Survey Office (NSSO), cited as the source for the report, was in fact a draft and not approved by the government.
•“This is a draft report,” NITI Aayog Vice-Chairman Rajiv Kumar said at a press conference. “We need to publish data on a quarterly basis. The July 2017-December 2018 data has just been received. Therefore, we don’t know the data or the veracity of the data. Citing this data or comparing it with the 2011-12 data will not be correct.”
Mirrors 1972
•A report in the Business Standard on Thursday, which cited the NSSO’s periodic labour force survey — that is yet to be released — said the unemployment rate was 6.1% in 2017-18. The only year of comparable data when the unemployment rate was higher was in 1972-73. It was at 2.2% in 2011-12.
•The NSSO report is a matter of much controversy, with the two external members of the National Statistical Commission citing the delay in its release as a major reason for their resignations on Monday.
•The data reportedly showed that joblessness was higher in urban India (7.8%) than in rural India (5.3%). Within this, it stood at 17.4% for rural males and 13.6% for rural females. In urban India, joblessness was at 18.7% among males and a huge 27.2% among females.
•Importantly, the data reportedly showed that the labour force participation rate (LFPR), the measure of people working or looking for jobs, declined from 39.5% in 2011-12 to 36.9% in 2017-18. This phenomenon — of unemployment rising while the LFPR dipped — is a cause for serious worry, experts say, explaining that it probably shows that people are simply giving up on finding jobs and have stopped seeking work.
‘People leaving low quality jobs’
•CEO of NITI Aayog and ex-officio member of the National Statistical Commission Amitabh Kant on Thrusday said, “Nearly 7.8 million jobs have been created. We have to take into account people leaving the low quality jobs. We are creating adequate number of jobs for new entrants. The problem seems to be the quality of jobs.”
•“India needs about seven million jobs and enough jobs have been created for new entrants,”
•Mr Kant was speaking at a press conference in response to a news report in the Business Standard which cited data from the National Sample Survey Office (NSSO) of unemployment being at a 45-year high.
•Vice-Chairman of the NITI Aayog Rajiv Kumar said the government in fact had evidence of increasing job creation. Stating that the NSSO report was only a draft that had not been approved by the government, he said: “The government will approve the report which has not been finalised yet. The reason for the delay is it was felt that there were other quarters of data to be made available.”
•“This is a situation where the NITI Aayog is holding a press conference on NSSO data, where the NSSO should have been holding it,” Madan Sabnavis, Chief Economist at CARE Ratings said.
•“Even with the release of the back series GDP data, it was NITI Aayog that did it. It is clear the government is not happy with the numbers the Central Statistics Office is putting out.”
•“Even with the release of the back series GDP data, it was NITI Aayog that did it. It is clear the government is not happy with the numbers the Central Statistics Office is putting out.”
📰 National Sample Survey Office’s unemployment data confirms crisis on the ground: experts
“The NSSO findings are not surprising, but they are alarming. The trends of rising unemployment were already visible,” said Amit Basole, lead author of a report, “State of Working India, 2018”.
•The National Sample Survey Office’s (NSSO's) data showing a record spike in unemployment in 2017-18, which was published in a news report on Thursday, is a validation of trends seen on the ground, according to labour economists, job-seekers and workers’ representatives. The government’s failure to release the NSSO report was the latest sign of a complete lack of transparency regarding jobs data, they said.
•“The NSSO findings are not surprising, but they are alarming. The trends of rising unemployment were already visible. Our analysis showed it was higher in 2015 than in 2011-12, and we expected demonetisation to have a harsh effect,” said Amit Basole, head of the Centre for Sustainable Employment at Azim Premji University in Bengaluru, and lead author of a report, “State of Working India, 2018”.
Data confusion
•Dr. Basole noted that the government’s decision to discontinue the NSSO’s five year surveys, failure to regularly release Labour Bureau data and delay in releasing the NSSO’s periodic labour force survey had led to “an atmosphere of uncertainty and confusion. Instead, the government kept citing job numbers based on EPFO’s payroll data and the Mudra loans, which are not helpful,” he said.
•“The data, as cited by the news report, shows that there has been a rise in unemployment and a decline in the labour force participation rate (LFPR) post demonetisation, which is in line with what we have also been saying,” said Mahesh Vyas, chief executive and managing director of the Centre for Monitoring Indian Economy (CMIE), which has done its own unemployment surveys.
•“The LFPR is a measure of people looking for jobs. So, if this is declining while unemployment is growing, it means that there is a very real and serious crisis in jobs. The government has to make the data public as soon as possible,” added Anamitra Roy Chowdhury, a labour economist with the Centre for Informal Sector & Labour Studies at Jawaharlal Nehru University.
•Thursday’s Business Standard report on the NSSO report said overall unemployment was at a 45-year high, with youth between the ages of 15 and 29 facing higher rates of joblessness than others. This comes as no surprise to Anupam, founder of Yuva Halla Bol, a movement of young job-seekers.
•“In the last couple of years, the simmering anger among educated youth has been clear. After demonetisation, we have seen that the labour force itself has shrunk,” he said, adding that urban women, who face an unemployment rate of 27% are worst hit.
•The informal sector employs more than 90% of the country’s workforce, and has witnessed a decline in available work and wages in the last two years, said Chandan Kumar, coordinator of the Working People’s Charter, an alliance of informal workers’ groups and unions. “Daily wage labourers say they used to get at least 20 days of work each month. After demonetisation, they get only ten days,” he pointed out.
📰 National Sample Survey Office’s unemployment data confirms crisis on the ground: experts
“The NSSO findings are not surprising, but they are alarming. The trends of rising unemployment were already visible,” said Amit Basole, lead author of a report, “State of Working India, 2018”.
•The National Sample Survey Office’s (NSSO's) data showing a record spike in unemployment in 2017-18, which was published in a news report on Thursday, is a validation of trends seen on the ground, according to labour economists, job-seekers and workers’ representatives. The government’s failure to release the NSSO report was the latest sign of a complete lack of transparency regarding jobs data, they said.
•“The NSSO findings are not surprising, but they are alarming. The trends of rising unemployment were already visible. Our analysis showed it was higher in 2015 than in 2011-12, and we expected demonetisation to have a harsh effect,” said Amit Basole, head of the Centre for Sustainable Employment at Azim Premji University in Bengaluru, and lead author of a report, “State of Working India, 2018”.
Data confusion
•Dr. Basole noted that the government’s decision to discontinue the NSSO’s five year surveys, failure to regularly release Labour Bureau data and delay in releasing the NSSO’s periodic labour force survey had led to “an atmosphere of uncertainty and confusion. Instead, the government kept citing job numbers based on EPFO’s payroll data and the Mudra loans, which are not helpful,” he said.
•“The data, as cited by the news report, shows that there has been a rise in unemployment and a decline in the labour force participation rate (LFPR) post demonetisation, which is in line with what we have also been saying,” said Mahesh Vyas, chief executive and managing director of the Centre for Monitoring Indian Economy (CMIE), which has done its own unemployment surveys.
•“The LFPR is a measure of people looking for jobs. So, if this is declining while unemployment is growing, it means that there is a very real and serious crisis in jobs. The government has to make the data public as soon as possible,” added Anamitra Roy Chowdhury, a labour economist with the Centre for Informal Sector & Labour Studies at Jawaharlal Nehru University.
•Thursday’s Business Standard report on the NSSO report said overall unemployment was at a 45-year high, with youth between the ages of 15 and 29 facing higher rates of joblessness than others. This comes as no surprise to Anupam, founder of Yuva Halla Bol, a movement of young job-seekers.
•“In the last couple of years, the simmering anger among educated youth has been clear. After demonetisation, we have seen that the labour force itself has shrunk,” he said, adding that urban women, who face an unemployment rate of 27% are worst hit.
•The informal sector employs more than 90% of the country’s workforce, and has witnessed a decline in available work and wages in the last two years, said Chandan Kumar, coordinator of the Working People’s Charter, an alliance of informal workers’ groups and unions. “Daily wage labourers say they used to get at least 20 days of work each month. After demonetisation, they get only ten days,” he pointed out.
📰 RBI lifts curbs on three PSBs
Banks exit PCA after capital infusion, fall in net NPA ratio
•The Reserve Bank of India (RBI) has decided to allow three public sector banks — Bank of India, Bank of Maharashtra and Oriental Bank of Commerce — to exit the PCA framework following capital infusion by the government and a decline in net non-performing asset ratio.
•The RBI, which conducted a review following a demand made by government to lift the restrictions in order to boost credit growth, said, “it was noted that a few banks are not in breach of the PCA (Prompt Corrective Action) parameters as per their published results for the quarter ending December 2018, except for return on assets (RoA).”
•“However, though the RoA continues to be negative, the same is reflected in the capital adequacy indicator,” it added.
•The PCA framework is triggered when a bank breaches one of the three risk thresholds, and crossing 6% net NPAs is one of them.
Higher provisioning
•Bank of India had made significant higher provisioning during the third quarter which saw net NPA ratio declining to 5.87% from 10.29% a year ago. Similarly, Bank of Maharashtra brought down its net NPA ratio to 5.91% from 12.17%. Both the banks reported heavy losses in the third quarter.
•OBC, which had made ₹145 crore net profit in the third quarter, reported net NPA ratio of 7.15% at the end of the October-December quarter. RBI justified its action by saying “though the net NPA ratio was 7.15%, as per the published results of third quarter, the government has since infused sufficient capital and bank has brought the net NPA ratio to less than 6%.” Earlier in the day, OBC had informed the exchanges about capital infusion of ₹1,186 crore by the government.
•“Hence, it has been decided to remove the restrictions placed on Oriental Bank of Commerce under PCA framework subject to certain conditions and close monitoring,” the RBI said.
•RBI said these banks have provided a written commitment that they would comply with the norms of minimum regulatory capital, net NPA and leverage ratio on an ongoing basis . “Further, the government has also assured that the capital requirements of these banks will be duly factored in while making bank-wise allocations during the current financial year.”
•With these three lenders out of PCA, there are another eight public sector banks which are still facing restrictions which were imposed due to deteriorating financial health.
📰 Giant cavity in Antarctic glacier signals rapid decay
•NASA scientists have discovered a gigantic cavity, almost 300 metres tall, growing at the bottom of the Thwaites Glacier in West Antarctica, indicating rapid decay of the ice sheet and acceleration in global sea levels due to climate change.
•The findings, published in the journal Science Advances, highlight the need for detailed observations of Antarctic glaciers’ undersides in calculating how fast sea levels will rise in response to warming.
•Researchers expected to find some gaps between ice and bedrock at Thwaites’ bottom where ocean water could flow in and melt the glacier from below, NASA said in a statement.
•The size and explosive growth rate of the newfound hole, however, surprised them. It is big enough to have contained 14 billion tonnes of ice, and most of that ice melted over the last three years.
•“We have suspected for years that Thwaites was not tightly attached to the bedrock beneath it,” said Eric Rignot of the University of California, Irvine in the U.S.
•“Thanks to a new generation of satellites, we can finally see the detail,” said Mr. Rignot, who is also associated with NASA’s Jet Propulsion Laboratory (JPL).
•The cavity was revealed by ice-penetrating radar in NASA’s Operation IceBridge, an airborne campaign beginning in 2010 that studies connections between the polar regions and the global climate.
•The researchers also used data from a constellation of Italian and German space-borne synthetic aperture radars.
•These very high-resolution data can be processed by a technique called radar interferometry to reveal how the ground surface below has moved between images.
•“(The size of) a cavity under a glacier plays an important role in melting. As more heat and water get under the glacier, it melts faster,” said Pietro Milillo of JPL.
•Thwaites Glacier is currently responsible for about 4% of global sea level rise, researchers said.
•It holds enough ice to raise the world ocean a little over 65 centimetres and backstops neighbouring glaciers that would raise sea levels an additional 2.4 metres if all the ice were lost, they said.
•“We are discovering different mechanisms of retreat,” Mr. Millilo said.
•Different processes at various parts of the 160-kilometer-long front of the glacier are putting the rates of grounding-line retreat and of ice loss out of sync, NASA said.
•The huge cavity is under the main trunk of the glacier on its western side — the side farther from the West Antarctic Peninsula.
•In this region, as the tide rises and falls, the grounding line retreats and advances across a zone of about three to five kilometres. The glacier has been coming unstuck from a ridge in the bedrock at a steady rate of about 0.6 to 0.8 kilometres a year since 1992.
•Despite this stable rate of grounding-line retreat, the melt rate on this side of the glacier is extremely high.
•“On the eastern side of the glacier, the grounding-line retreat proceeds through small channels, maybe a kilometer wide, like fingers reaching beneath the glacier to melt it from below,” Mr. Milillo said.
•In that region, the rate of grounding-line retreat doubled from about 0.6 kilometres a year from 1992 to 2011 to 1.2 km a year from 2011 to 2017, researchers said.
•Even with this accelerating retreat, however, melt rates on this side of the glacier are lower than on the western side, they said.
📰 Not kosher: on Chanda Kochhar case
The Chanda Kochhar case raises issues of corporate governance that go well beyond her
•The inquiry by former Supreme Court judge Justice B.N. Srikrishna into the allegations against former ICICI Bank CEO Chanda Kochhar has taken eight long months to confirm what seems apparent – that she did not conduct herself as she should have in relation to conflict-of-interest issues. It was only last week that the Central Bureau of Investigation filed an FIR against Ms. Kochhar, her husband Deepak Kochhar, head of the Videocon group Venugopal Dhoot and ICICI Bank executives for sanction of credit facilities in violation of rules, that caused a loss of ₹1,730 crore to the bank. The investigating agency has a long way to go before it establishes whether the loans were given in return for financial favours, a charge that is at the heart of booking them for criminal conspiracy, cheating and corruption. But clearly, Ms. Kochhar erred, and badly at that, in not disclosing to the bank’s board her husband’s business connections with the Videocon group, which was a client of the bank. Worse, she failed to display the correctness expected of her by sitting on committees that sanctioned credit facilities to Videocon when she ought to have recused herself. Just a day after a ₹300-crore loan was disbursed to Videocon International Electronics in 2009, Mr. Kochhar’s NuPower Renewables received ₹64 crore from the Videocon group. Whether this was a quid pro quo for the loan, as the CBI suggests, needs to be proved. But there is no denying that it made for poor, even suspicious, optics.
•The inquiry report holds her guilty of violation of the bank’s “code of conduct, its framework for dealing with conflict of interest and fiduciary duties, and in terms of applicable Indian laws, rules and regulations.” The bank’s board has accepted the report and decided to treat her voluntary resignation from the bank in October as “termination for cause”, also deciding to claw back all bonuses paid to her since April 2009, hold back unpaid amounts and divest her of her stock option entitlements. These are strong penalties, but the question is: how did the board give her a clean chit as recently as March last year? It had then reposed its full confidence and faith in Ms. Kochhar and commended her and the management team for their “hard work and dedication”. It is impossible to believe the board was not aware of the allegations against the CEO given that a whistle-blower had made them public in October 2016. Was the board then influenced by Ms. Kochhar into giving her a good conduct certificate? These are uncomfortable questions that raise doubts over the standards of corporate governance at one of India’s largest banks. The ICICI Bank episode is only one among several instances of governance lapses in corporate India in recent times. Clearly, regulators need to up their game.
