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will IDFC Chief Nasser Munjee be the sacrifice in the face-off with the government

2004-04 Will IDFC Chief Nasser Munjee be the

Sacrifice in the Face off with the Government
Mr. Nasser Munjee Chairman GIS-ACG
Global InfraSys - Asia Consulting Group
Published: April 2004 by Business India

Bump
Ahead
No. 680 • BUSINESS INDIA ♦ M arch 29-A pril 11,2004

in this issue Corporate Reports footwear value chain, Mirza

Tanners is smartly
8
E ditorials
• It's election time and so
Advertising 106 UTI BANK positioning itself as the the rss gives in to the bjp
Banking 102 87 manufacturer of choice in the • The country's premier it
Books 150 high-end fashion association is
Businessmen in the News 24 footwear category descending into the
domain of the ridiculous
Business Notes 28 • Care in awarding
Career File 134 HERBALIFE terrestrial telecast rights
94 could avert ugly
Chatzone 12
A change in global strategy has episodes like we've
Column 49 witnessed lately
helped Herbalife customise its
Corporate Philanthropy 118
product and marketing 20
Corporate Reports 87 methods for the country Follow -up
Cover Feature 50 • On Sidbi we had written
CyberNews 18 that excess liquidity7in
As uti Bank celebrates its 10th BASKIN-ROBBINS the banking sector,
Economy 44 birthday, it looks forward to an 100 compounded by its own
Economic Indices 46 eventful future high cost of funds, had
Editorials 8 forced the institution to
look at new avenues for
Enterprise 116 MAN INDUSTRIES lending. Now we hear
Executive Focus 132 92 from reliable sources
Executive Track 130 With its expansion plans that Sidbi is going to
taking off, the pipemaker will convert into a bank
Feature 103 • We reported on the
join the Rs l,000 crore league restructuring at Jindal
Focus 64
by 2005-6 Stainless Limited. Now it
Follow-up 20 is going all out to reduce
For Your Information 16 MIRZA TANNERS its finance costs
Government & Politics 37 • In November 2003 we
96 Baskin-Robbins posts its first wrote about Samtel
Guest Column 109 After integrating the entire significant profit Color reporting a loss
India vs China 114 mainly on account of
Infotech 110 37 120 the suspension of supply
G overn m en t & P o litics Trade of natural gas by g a i l .
International Briefs 129 Now the c n g supply has
Interview 156 been restored, which
brings about an annual
Letters to the Editor 6
saving of Rs30 crore
Listening Post 14
Marketing 107 28
B usiness N otes
Marketwatch 126 • c e m represents an
Mutual Fund Monitor 125 exciting opportunity for
New Business 113 Indian business
A scorching summer will expedite the • Off late, Indo-UAE ties
Newscast 22 have been on an
new government's unwritten agenda India and Pakistan are the only
New Issues 122 Basmati producing countries in the upswing marked by
Panju’s Page 48 71 world and export almost the same high-level state visits,
trade agreements,
People 154 BI T raveller quantities
Sun, sand, spas. It’s summer time. business delegations
Portfolio Talk 121 and strategic
The good life is about to begin 156 co-operation
Retailing 108 In terv iew • There seems no bottom
Selections 147 102 In conversation with Business India, to the losses incurred by
B a n k in g K. Roy Paul, secretary, civil aviation power distribution
Special Report 58 After s b i , it's now the Bank of India said the delay in the announcement companies in Rajasthan
Telecom 111 which is grappling with the fallout of of the civil aviation policy had little to • The fast moving
Textile 112 the old b c c i scandal do with reforms in the sector, as consumer goods
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14 •
 C o n te n ts

COVER FEATURE

50
M uch ado
a b o u t id f c
i d f c chief Nasser
Munjee may be the
fall guy in the
face-off with the
government

SPECIAL REPORT

58
T he ca ll's in th e Suprem e Court
What started as a fight over fee cuts has become a battle for
independence of the iim s and the future of management education

FOCUS
64
Up o n th e d o w n sid e
The recent slide in the stockmarket is nothing
more than a correction, and can be used as a
buying opportunity, according to a wide
cross-section of the broking fraternity
b u s i n e s s i n d i a ♦ M arch 2 9 -A pril i i , 2004 C over F eature

i d f c chief Nasser Munjee may

his head be the fall guy in the face-off

with the government

ne of Nasser Munjee's passions the strength of the opposition to the move.

O
is jazz. But the md and ceo of It is no secret that the government has been
Infrastructure Development unhappy with the performance of idfc . While
Finance Corporation (idfc ) infrastructure has been close to the top of the
could well be taking to the blues Vajpayee government's agenda, idfc 's num­
these days. What started as a united manage­
bers show a lacklustre performance, idfc , on
ment revolt against the government's efforts its part, says that there have not been enough
to apparently cut the organisation down to viable infrastructure projects to finance; dis­
size has ended with Munjee as the last man bursements are taking off only now that the
standing. His colleagues have seemingly sued industrial climate has changed.
for peace. The government is willing to forgive Whatever the reality (more
and forget. But somebody must pay the price of that later), the truth is idfc
for this defiance (or arm-twisting, depending has been on the endangered
on your point of view). Munjee has been list for some time now. There
selected scapegoat. "If I must be the sacrifice, I was earlier a proposal to merge
am ready," he is reported to have told a friend. it with Infrastructure Leasing
To many lay observers, the entire idfc & Financial Services Ltd
affair seems to be a mountain made out a (il&fs). And, last fortnight,
molehill. They feel it would not have made the Industrial Finance Cor­
headlines at all if another institution - the poration of India's (ifci)
Indian Institute of Management - had not employee union proposed a
been under threat. Munjee's detractors say megamerger of ifci, idbi,
that in depicting himself as a beleaguered idfc , and the Kolkata-based
autonomous institution being threatened by Industrial Investment Bank of
government interference, he was hoping to India (iibi). Everyone is aware
garner public support and, more importantly, of the dire straits ifci and idbi
the backing of industry bigwigs (the way iim are in today. The less-known
has got N.R. Narayana Murthy and M.S. Banga iibi has non-performing assets
taking up the cudgels on its behalf). His sup­ (npas) in excess of 30 per cent.
porters say he had nothing to do with it; he If the much healthier idfc
has just been caught in the middle. (Munjee finds itself in this motley com­
declined to talk to Business India for this story.) pany, it is only a reflection of the space it occu­
Taking a step back and looking at things pies in public perception. The result: the
from a broader perspective, it does seem a lot reports that the government was thinking of
of ado over nothing. The immediate provoca­ turning idfc into an arm of sbi were found
tion was a move by the Government of India credible.
to transfer the 15 per cent Reserve Bank of Matters came to a head at a meeting of idfc
India (rbi) holding in idfc to itself (with the shareholders in Mumbai on 12 March. "We all
State Bank of India - sbi - being a possible knew that the meeting would be cataclysmic,"
vehicle). The government already holds 20 per says the representative of one international
cent in the company and sbi 6 per cent. This financial institution who was present. "And it
transfer would take the stake up to 41 per cent. was." Official of the finance ministry came
Add to this the 5 per cent held by the Indus­ aggressively batting for the marriage between
trial Development Bank of India (idbi) and the sbi and idfc . The finance ministry's point of
3 per cent by the Unit Trust of India (uti), and view was stated without any attempt at diplo­
the government would control 49 per cent. macy and circulated in a one-page wish list. In
A trial balloon was then floated: that idfc keeping with the traditions of the incestuous
would be merged with sbi. Though the gov­ world of Indian banking and finance, markers
ernment was from the very beginning publicly were called in, and favours were traded and
denying that a merger had been proposed, promised to drum up support for each side.
insiders say they were actually trying to gauge Even the non-executive chairperson of idfc ,

51 <
BUSINESS INDIA ♦ M arch 2 9-A pril 11, 2004 C over Fature

the venerable Deepak Parekh who also

heads Housing Development Finance
Corporation, was sent feelers from the
pro-SBi lobby.
The meeting was a stormy as well as
a melodramatic affair. The pro-merger
group was insistent that a strong lead­
ership by a richly endowed sbi would
greatly improve the working of idfc .
This group derided the point oft
stated by idfc managers that a valid
reason for their caution in financial
lending was the concern not to create
npas . "It is impossible for any devel­
opment credit institution to avoid
npas in the Indian context," a pro­
merger negotiator asserted.
Munjee, on his part, made an
impassioned defence of his record at
idfc . He especially argued the point
that idfc 's spending had become
more "aggressive in its risk manage­
ment approaches" in the current
financial year, citing the case of his
institution's lending to bpl Mobile
and bses Kerala in recent months.
Munjee drew attention to the fact
that idfc 's overall lending had
increased impressively in the current
financial year. At the same time, he
also offered to resign if the gathering
was not convinced of his record. Sur­
prisingly, he did not find too many
vocal supporters at the meeting.
Amidst this heated atmosphere, a
warning was sounded by two of idfc's
independent directors who were also Shah says Munjee's integrity and commitment are unquestionable
attending the meeting. They were
Gautam Kaji, who was participating offload their equity to sbi, at the rate The confusion about the tag-along
via videophone from Washington, to be given by sbi for rbi shares. In rights gave an opening to those trying
and Omkar Goswami, formerly chief turn this raised questions about the to work out a compromise. They
economist of the Confederation of ethics of a unilateral transfer of rbi forced through the formation of a
Indian Industry (cn). They raised shares to sbi without any internal subcommittee from the idfc 's board
questions about the implications of bookbuilding of the equity price. of directors. This panel was assigned
"sponsor" shares being passed on to Other institutions, particularly the the task of assessing and reporting on
an ordinary shareholder, that is, from foreign institutional investors (fiis), the issues at hand. The members
rbi to SBI. demanded procedures that would included Deepak Parekh, additional
Under the idfc charter, a mutual enable the best price for their share­ secretary in the finance ministry
transfer of shares between sponsors holding. Moreover, sbi chairperson Vinod Rai, sbi's Purwar, Sunil Mehta
does not change the structure of the A.K. Purwar, who was also present at of aig as the representative of the for­
ownership; but this proviso does not the meeting, was not willing to dis­ eign institutional investors (fiis), and
extend to any enhancement of equity close the overall size of the financial two independent directors including
of 5 per cent or above by a normal commitment he was prepared to bring corporate law expert Shardul Shroff.
shareholder. One independent direc­ to the table. Says the representative of The panel met for the first time at 7
tor pointed out that this amounted to one idfc shareholder: "It is difficult to pm on 19 March at the Chambers at
a situation that called for the applica­ believe; but none of us entered the the Taj in Mumbai. It had earlier been
tion of "tag-along rights" of the meeting having considered the impli­ decided to continue deliberations
Takeover Code, wherein all other cations of 'tag-along' rights. It was like until all fractious matters were sorted
equityholders would have the right to cold water over red cinders." out. By now the quarrel at idfc had
BUSINESS INDIA ♦ M arch 29-A pril 11,2004 C over F eature

become common knowledge. The Under the plan, the ipo was sched­ Though others were in the picture,
panel thus met with newshounds on uled for the fifth operational year idfc was supposed to be in the dri­
their heels. (2003; idfc was set up in 1997). But ver's seat, "idfc as a standalone
Earlier in the day, however, market conditions at that time were organisation has a balance-sheet size
Munjee and six of his colleagues had not conducive. Now, in 2004, with far of barely Rs4,000 crore," says Rai.
handed in their resignations to chair­ stronger markets, an ipo holds out the "The leverage of size is necessary."
man Deepak Parekh. Many consider promise of manifold returns to all The Rs50,000 crore infrastructure
this a tactical error on Munjee's part. shareholders. It makes sense for the fund is being handled by "a loose
When Parekh informed the
panel of this latest develop­
ment (though he added
that he had declined to accept
the resignations), Munjee's
detractors went to town. They
contended that he was a
"troublemaker" and that he
had resorted to similar "arm-
twisting tactics" in the past.
Privately, many were gleeful
that this was the opportunity
to ease him out. The six others
who had resigned could be
wooed back, idfc minus
Munjee was perfectly accept­
able to the merger camp.
Munjee made another tac­
tical error: he went to the
press. What got the govern­
ment's goat even more was
that the foreign media had
got into the act even before Doshi says the entire issue has been ineptly handled
the local pink papers. Finan­
cial Times of London described the government too, when privatisation amalgam of five others - icici Bank,
issue as "backdoor nationalisation". is top of mind. Life Insurance Corporation (lic),
Business Times of Singapore quoted a From Rai's side of the fence, a more idbi, Bank of Baroda (BoB), and Pun­
private idfc shareholder as saying malleable idfc is good news. It's not jab National Bank (pnb) - led by sbi,"
that it was "a retrograde step". "This just the babu penchant for being the says Rai. But there are reports that the
was a blatant attempt to influence for­ boss; idfc 's mandate is likely to be government wants idfc to be the sec­
eign shareholders in idfc ," says a enlarged massively soon. Finance retariat for managing the funds. It
government source. At a time of India minister Jaswant Singh had declared would make sense therefore if idfc
Shining, there was no place for India in his mini-budget that the govern­ were to become a subsidiary of sbi. An
Whining. ment was committed to disbursing ipo is still possible; sbi has several
No-one is talking about a merger Rs50,000 crore over the next three listed subsidiaries.
any longer. In fact, the panel itself years for infrastructure projects. Rai blames the imperatives of an
spent most of its time talking ipo for the current contro­
about an initial public offer versy. "idfc has to go in for
(ipo ). This would give the an ipo," he says. "Since rbi is
other investors a valuation the regulator, it cannot con­
and an exit route. (Nine for­ tinue to be a shareholder.
eign shareholders, including That is why it is exiting."
adb , ifc, and cdc , hold 20 More explicitly, he adds: "For
per cent; domestic financial the record let me say that the
institutions icici, ifci, and 15 per cent stake will only be
hdfc among them hold 11 transferred by rbi to the Min­
per cent.) Says Vinod Rai: istry of Finance. There is no
"The ipo will happen in the proposal to transfer it further
next 4-5 months." to any other entity."
Actually, an ipo is part of So where did the question
the original idfc agenda. of a marriage with sbi come

• 53 <
BUSINESS INDIA ♦ M arch 2 9 - April I I , 2004
"IDFC has to go in for an IPO"
The media have been saturated with all kinds of speculative and
contradictory reports in the last few days attributed to finance ministry
'sources'. Aarti Gupta caught up with additional secretary Vinod Rai, the
man behind the entire buzz, to clear the confusion over the matter
Q What is the rationale of realigning the
shareholdings of id fc ?
A What must be realised is that id fc as a
standalone organisation has a balance-
sheet size of barely Rs4,000 crore. That
level of lending by itself isn't enough for
one looking to approach the market to
raise funds. If it has to go in for an ipo it
needs the leverage of bigger organisa­
tions like sbi. That was exactly the case
when ic ic i was merged with ic ic i Bank
three years ago. That is why what we have
is a loose amalgam of five others - ic ic i ,
lic , id b i , BoB, and pnb - led by sbi for the
Rs50,000 crore infrastructure fund; the
leverage of size is necessary.
Q Then how viable is the merger option ?
A For the record let me say that the 15
per cent stakeholding will only be trans­
ferred by rbi to the Ministry of Finance.
There is no proposal to transfer it further
in? Informed sources repeat that it
was a trial balloon. Besides, even if
there isn't a merger technically, man­
aging Rs50,000 crore along with sbi is
no game for minnows. If Purwar and
Munjee match each other for clout,
the former will win hands down.
"sbi's infrastructure lending is of the
order of Rs24,000 crore," says Rai. "If
that isn't impressive, what is?” But Rai
doesn't say over what period sbi has
lent the money. In any case, with over
Rs 150,000 crore in assets, sbi has more
than enough funds to lend to infra­
structure projects if it chooses to.
As things stand, Munjee has clearly
been outgunned. The resignations
and the publicity they attracted have
been perceived to be detrimental of
the interests of all shareholders of
idfc . Even the fiis have endorsed this
line. On 20 March Rai and some other
members of the subcommittee briefed
finance minister Singh. The minister
was informed that all shareholders of
idfc were acting in a responsible
manner. One point prepared for his
to any other entity. That is also because
any change in the stakeholding pattern
beyond the three sponsors of id fc - rbi,
the government, and id b i - would entail
getting into tag-along rights, which we
want to avoid. So in effect there is to be no
change as far as the government share­
holding is concerned — rbi merely trans­
fers its stake to the ministry, id f c will
continue as a private institution.
Q Then what is the rationale of the whole
exercise at all, especially when it has kicked
up such heat and dust?
A The reason is Simple, idfc has to go in
for an ip o . Since rbi is the regulator, it can­
not continue to be a shareholder. That is
why it is exiting.
Q sbi already has a project finance division
and its record is pretty average. So what
kind of leverage is sbi or any other institution
consideration was that the creation of
a mega single-window financial
agency had several serious implica­
tions for the overall financial system
of the country, and its working.
Therefore, moves such as the possible
marriage between sbi and idfc
towards creating a behemoth infra­
structure investing entity needed to
be studied further.
On 24 March all fii shareholders
were informed by the subcommittee
that peace had been achieved at idfc,
at the expense of Munjee's ouster.
Not one shareholder has strongly
objected to this. It was also agreed
that Munjee's isolation would be
accentuated by asking the other six
to reconsider.
On 25 March a 30-strong idfc dele­
gation went to Delhi to meet Ministry
of Finance officials. The jumbo jam­
boree will cost idfc plenty. (A couple
of finance ministry officials could
have come down to Mumbai instead.
But some in idfc may have still been
confused about who is calling the
• 5 4 '
C over F eature
expected to bring?
A sbi' s infrastructure lending is of the
order of Rs24,000 crore. If that isn't
impressive, what is?
Q When is the ip o being planned, and
what size of funds will be mopped up from
the market?
A The ipo will happen sometime in the
next 4-5 months. No date has been fixed
yet; neither has any decision been taken
on the size of funds. ♦
shots today.)
The delegation was given the nec­
essary assurance that it would be busi­
ness as usual, idfc was doing great
work, they were told. And it would
continue to retain its autonomy. It
was also indicated that the six errant
executives who had resigned along
with Munjee would be forgiven. All
they had to do was abandon him.
Though Munjee is not particularly
keen to hang on to his post, he is not
likely to give up without a further
fight. It is clear that he is the victim of
a squeeze play between larger players.
Some say he was deliberately led up
the garden path by people he thought
were backing him. At the last moment
they fed him to the lions. The writing
on the wall is that his resignation will
be accepted at the next idfc board
meeting on 20 April.
Did this have to be a public specta­
cle? "The issue, to put it mildly, has
been ineptly handled," says chartered
accountant Kanu Doshi. "Whatever
the problems, equity demands that
BUSINESS INDIA ♦ M arch 2 9 - April 11, 2004
they be sorted out within the four
walls of the boardroom and not be
made a public issue."
"We still require a focused dfi
(developmental finance institution)
for infrastructure projects and idfc
has done a tremendous job," says
Vinayak Chatterjee, chairman of Feed­
back Ventures, one of the few compa­
nies operating in the same space as
idfc in the non-funding category.
"Nasser is a professional and his
integrity or commitment cannot be
doubted," says Pradip Shah, chairman
of IndAsia Fund Advisors. Shah feels
that while the pace of operations of
the institution can be debated, the
personal charges against Munjee are
meaningless.
Cut the personal charges; that's
just the icing on a cake baked in anger.
What is Munjee's report card at idfc ?
Why is it that there are some who feel
the organisation has failed to deliver?
There are two issues. They are
many in the government who think
that idfc isn't doing what it was set
up for. It may not be wallowing in red
like some of its counterparts, but trea­
sury operations contribute to a large
extent to its profits. Secondly, it is not
doing its job - disbursing funds for
infrastructure projects - fast enough.
How true are the charges? idfc was
set up in January 1997 as a specialised
financial intermediary to address the
financial requirements of the infra­
structure sector. The mandate was to
lead private capital into commercially
viable infrastructure projects, besides
playing a strong policy advisory role
to the government.
Over the past six years the com­
pany's income has gone up more than
C over F eature
fivefold from a little less than Rs 100 the project funds. Of the 85 recipients
crore in 1997-98. In 2003-4 it is of the gross disbursement 32 were in
expected to cross Rs 600 crore. The energy, 17 in transportation, and 22
profit after tax in 2004 is expected to in telecommunications. No doubt
be Rs 225 crore (see table). On an there was a slowdown in sanctions
equity base of Rs 1,000 crore the com­ and disbursement, particularly in
pany paid a dividend of Rs 100 crore in 2002-3. Approvals in terms of projects
2002-3, having paid dividends the dropped from 34 to 24, the total quan­
three previous years too. tum also declining by nearly Rs700
The numbers show that income crore to Rs 2,304 crore. Disbursements
from treasury formed less than 25 per also dropped by more than Rs500
cent of the total income in 2002-3. crore to less than Rs l,000 crore.
Infrastructure loans, around 71 per Deepak Parekh attributes this drop in
cent of assets in sanctions and dis­
2002- 3, will be bursement to "a
around 80 per cent
id fc also provides paucity of bankable
of total assets in consultancy services projects, some of the
2003- 4. to a host of o th e r sponsors going slow
Since its incep­ segm ents. It was on projects, projects
tion the company especially in the tele­
provided assistance credited w ith th e com sector not
to over 150 projects. conceptualisation of reaching financial
Gross approvals by th e National Highways closure, and pruden­
March 2004 are esti­ D evelopm ent Project tial norms con­
mated to be in the straints on telecom
region of Rs17,000 assets".
crore. Over the past two years, how­ While the disbursement may
ever, volatility in the interest markets, appear to be slow, it needs to be appre­
as also the easy availability of funds, ciated that the overall project devel­
led to many project developers pussy­ opment climate in the country over
footing over taking the funds sanc­ the past three years has not been
tioned. Non-availability of clearances healthy. Developers have been were
also led to a spate of cancellations, as dragging their feet on new projects.
did projects turning non-viable for And in the volatile interest rate sce­
other reasons. Gross approvals net of nario there have not been many takers
these cancellations are expected to be willing to lock in funds at a particular
a little over Rs l 1,000 crore for 85 pro­ level.
jects. Outstanding disbursement net Even a cursory examination of the
of prepayment (again due to cheaper other dfis brings this out. In the
funds and ease of availability) is case of idbi there was a sharp drop in
expected to be around Rs 5,250 crore. terms of direct assistance. In 2002-3
Energy, telecommunications, and direct finance sanctions dropped by
transportation were the three broad more than 75 per cent, while disburse­
categories that received the bulk of ment dipped by a third. Project
finance, which forms a major con­
stituent, also showed a similar drop.
Sanctions dipped sharply to Rs557
crore from Rs4,447 crore in 2001-2.
Others like ifci and sbi were not
significantly better.
Besides sanctions and disburse­
ment, which are of a quantifiable
nature, idfc also provides consultancy
services to a host of other segments. It
was credited with the conceptualisa­
tion of the National Highways Devel­
opment Project. It was the secretariat
to the Prime Minister's task force
(1998-2000) advocating the use of the
►56<
BUSINESS INDIA ♦ M arch 2 9-A pril 11, 2004 C over F eature

annuity model, which was accepted our successors worry about recovery,"
by the government in implementing says an idfc insider. "But the last
some of the projects. "I would give full thing we want to do is to act as a con­
marks to idfc for its role in developing duit for funding. Show me one good
an enabling environment in roadways project that has suffered for lack of
which could actually see the prime funds. The problem is not funds.
minister's dream project take off," says There is no dearth of funds."
Chatterjee of Feedback. The idfc insider gives a long list of
It is also common knowledge in the organisation's successes. "Our
places that matter that the Naresh achievements include innovative pro­
Chandra report on civil aviation was ject finance techniques; helping the
principally authored by idfc , as has telecom sector migrate to a revenue­
been a very substantive chunk of the sharing regime; serving as secretariat
Rakesh Mohan committee report on to the prime minister's task force on
the Railways, "idfc 's appraisals of infrastructure that catalysed the road
several private companies have investment programme; introducing
become the benchmark for such northeast states for further growth. the concept of private finance initia­
reviews for many other financial insti­ Over the past six years idfc has tive to India; pioneering annuity
tutions," says a leading Delhi banker. also developed good appraisal skills. financing of roads, working closely
idfc also devised a road map for Unlike banks, which are conservative with nhai (National Highways
power sector reforms and highlighted and spend forever assessing downside Authority of India); preparing the
the limitations of the multilateral risks, project appraisal requires a process report for port corporatisation
model. Incidentally it strongly forward-looking mindset and an and creating model documentation
resisted the persuasion to join the appetite for taking balanced risks, for the commercialisation of berths
consortium for funding the Dabhol knowing full well that there may not using a revenue sharing model at
project, in which idbi and icici be any collateral for a failed project. major ports; changing the focus of
have had to take major hits for their idfc has over the years acquired power-sector reform from generation
exposure. domain knowledge and built robust to distribution; facilitating opera­
For its bold initiatives in fostering risk management models. tionalisation of the first road fund in
public-private partnerships, advising "idfc is a new-generation develop­ Kerala; signing an agreement with the
states, rooting for sezs, and the new ment bank that can think differ­ World Bank for the Prototype Carbon
approach in segments including ently," says a corporate observer. Fund; contributing to the work of the
ports, airports, railways, and telecom, "This is the main differentiating fac­ civil aviation committee that will
idfc was regarded as an innovator. In tor. And this is what will get lost if it form the basis of the new civil avia­
its ventures with the states or the Cen­ were to become part of sbi." tion policy; establishing the 3i Net­
tre, idfc was slowly emerging as the There is a defence to the slow rate work in partnership with iim
preferred port of call for professional of disbursals also. If idfc had been Ahmedabad and iit Kanpur, which
advice on key policy issues. In a bid to doling out money to all comers, it publishes the annual India Infrastruc­
work closely with the states it has would have gone the way of idbi and ture Report; and establishing an
already set up joint ventures with the ifci. The latter need rescue packages equity fund with investments com­
governments of Kerala, Karnataka, because of their huge level of npas. mitted of Rs865 crore and a target of
and Uttaranchal, and is looking at the idfc has relatively clean skirts on Rsl,000 crore."
this score. As on But all these achievements evi­
31 March 2003, dently matter little when the govern­
net outstanding ment decides to flex its muscles. Not
funded dis- that Munjee is particularly worried.
bursements He has told people that he has
stood at enough on his plate besides idfc . He
Rs2,695 crore. is the chairman of such diverse
Of this, only organisations as Jazz India and the
Rs29.6 crore Aga Khan Rural Support Programme.
was classified as He is also very involved with the
substandard. Make a Wish Foundation. The only
"It would wish he would make today would be
have been easy that the organisation he built survive
for us to dis­ and grow, rather than a wish for his
burse money own personal future.
very aggres­ « ANUPAM GOSWAMI, DAKSESH PARIKH

sively and let a n d AARTI GUPTA

57