Sahara: The Untold Story; Tamal Bandyopadhyay; Jaico Books; Rs.450; Pages 344 AT THE TIME OF writing this review of Tamal Bandyopadhyay™s much awaited and deeply- researched book, Subrata Roy, the high-profile founder and ˜managing worker™ of the Sahara Group of 479 companies, is lodged in Delhi™s Tihar jail. Roy™s offence is that Sahara failed to comply with a Supreme Court order dated August 31, 2012 to refund a sum of Rs.24,029 crore to 29.6 million investors who had deposited the said sum with it by purchasing its OFCD (optional fully convertible debentures) since 2009. Earlier, in 2010, the Securities and Exchange Board of India (SEBI) had prohibited two group companies ” Sahara India Real Estate Corp. Ltd (SIRECL) and Sahara Housing Investment Corp. Ltd (SHICL) ” from issuing OFCDs on grounds that the identities of the purchasers of these debentures were shrouded in mystery and that the companies had indiscriminately accepted deposits without adhering to mandatory KYC (know your customers) norms. Sahara™s defence was that the majority of purchasers were poor and often illiterate peasants uncovered by the organised (including public sector) banks, who provided rudimentary addresses. Moreover the OFCDs were purchased by people associated with one or more of Sahara™s 479 companies, and therefore were private placements of securities, and as such beyond the purview of SEBI whose jurisdiction is restricted to publicly listed shares and securities. Behind Roy™s arrest and incarceration for contempt of the apex court ” significantly, not on any criminal charge ” is a story of the relentless hounding of a creative, even if corny, over-the-top entrepreneur with a genius for resource mobilisation by the country™s regulations-obsessed rather than outcomes-driven bureaucratic establishment which has transformed an inherently entrepreneurial society into a nation which ranks #138 on the World Bank™s Ease of Doing Business Index. The author is strictly neutral in setting out this narrative of the rise and fall of Subrata Roy, the engineer of this massive conglomerate with claimed assets of Rs.152,000 crore including a land bank of 36,000 acres. But it™s quite clear that Roy has aroused the resentment and suspicion of bureaucrats who control the Reserve Bank of India (RBI) and the country™s 27 rules-driven and red-tape ensnarled public sector banks for doing what they have conspicuously failed to do: provide depository and credit services to the 60 percent bottom-of-the-pyramid population. Quite the contrary, establishment bureaucrats believe that the Sahara parivar is a massive money laundering operation for the undeclared ill-gotten gains of politicians and anti-socials. The most enlightening chapter of this facts-filled narrative which surprisingly lacks a subject index thus sharply reducing its value as a reference text, is perhaps Annexure I which traces the history of ˜shadow banking™. According to government babus non-banking chit funds, housing finance, and consumer goods finance companies taking deposits and investing them, constitute a grave threat to millions of illiterate and ignorant citizens who could be left high and dry by their promoters. Consequently, one after the other their operations have been curbed or banned…
