India: A Raja is arrested in 2G telecom scam: learning to deal with the messiness of democracy

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With all the excitement in Egypt even the BBC  covered the arrest of A. Raja only briefly. A. Raja is the former Indian telecom minister who is alleged to have sold the very lucrative 2G wireless phone licenses in 2008 at 2001 rates to private companies costing the Indian government billions of dollars in lost revenue. The Indian opposition parties,both on the right and left, are strangely united on this issue and have kept the pressure up for a joint parliamentary probe.

Meanwhile ,some companies who got the licenses in 2008 have sold them at windfall profits and there is some nervousness that as more details emerge beneficiaries of the scam might have to pay up. The latter is unthinkable given the enormous harm done to India's economic growth and globalization when Coca Cola and IBM were asked to leave in 1977, which I mention in one of my articles (see page 460 here ).

But hey, that's democracy and global businesses need to learn to deal with all these uncertainties as democracies evolve in different countries in the 21st century. For e.g. Raja is only  the second federal minister ever arrested on corruption charges and that's a huge step forward  for Indian democracy.

Now consider fledgling democracies, and you have different levels of  sophistication  with different complications in countries from Afghanistan to Iraq and now Egypt to be soon followed by other Arab countries  etc.

The point is that business-government (B2G) relations are much simpler in totalitarian regimes from a business's point of view because you deal with  a few defined decision makers. In democracies,just figuring out the players is complicated and staying  clear of basic controversy ( eg did you get the telecom license unfairly?) down the road is a challenge. Talk about the ability of companies to learn continuously!

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