There’s a memory lapse within the country’s smug establishment and middle class that the national Covid-19 lockdown has ruined thousands of small-scale businesses and resulted in an estimated 18 million job losses in industry, especially in the small-scale sector which pays meagre wages to 90 percent of the country’s 420 million labour force.
Against this grim backdrop and latest news indicating that the national economy has contracted by 24 percent in the first quarter of 2020-21, a Times of India (August 28) report flashed the tragic news that the annual remuneration of N Chandrasekaran, chairman of Tata Sons Ltd, the holding company of the salt to steel Tata Group of companies (annual revenue: Rs.827,025 crore), plunged to Rs.58 crore in 2019-20 from Rs.66 crore in the previous year.
In his path-breaking book Capital in the 21st Century (2013), French economist Thomas Piketty laments that since the 1980s, income inequality around the world has become sharply pronounced. Although he advocates additional taxation of wealthy citizens, this option is unacceptable in India and other third world countries, because profligate, untrustworthy governments are notorious for wasting tax revenue and likely to dissipate it by way of additional establishment expenditure and/or vainglorious projects. For instance, currently over 20 percent of the tax and other revenue of the Central government is swallowed up by establishment expenditure (salaries, rent, perks). In sharp contrast, a mere 1.87 percent of the revenue of Reliance Industries Ltd, India’s largest private sector company, is spent by way of establishment expenditure. Unsurprisingly, there’s huge resistance to higher income, wealth and other taxes. Hence, the sky-high pay packets of dozens of mediocre CEOs – including N Chandrasekaran — of India
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The plain truth is that N Chandrasekaran is over-harvesting the fruit of Tata Consultancy Services, the sole Tata Group company solidly in the black. And it’s pertinent to recall that TCS was built byte-by-byte by Fakir Chand Kohli — widely acknowledged as father of India’s booming IT industry – during his long tenure (1968-2000) as CEO of this now globally respected software development and ITES (IT enabled services) company (annual revenue: Rs.157,000 crore; headcount: 443,676). Since the mid- 1980s, TCS has been contributing over 80 percent of the net profit of the Tata Group of 30 major companies.
A visionary and champion of quality foundational STEM education, Kohli was a staunch supporter of this then struggling education-focused publication. With his support in 2007, we introduced the annual TCS EducationWorld Teachers awards under which the country’s best dozen government and private schools primary and secondary teachers selected by an eminent jury after testing and interview, were awarded modest cash prizes, given media coverage and felicitated at a grand annual function.
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But as soon as N. Chandrasekaran was appointed CEO in 2009, he terminated this TCS- sponsored project (annual expenditure Rs.5-6 lakh) on grounds of “unaffordability”. In the very same year, his annual remuneration doubled to Rs.16 crore. Admittedly there is animus against this latter-day Scrooge whose remuneration has been doubling every year. Res ipsa loquitor.