As September comes around with the promise of the first harvests in a few weeks, data released by the Ministry of Agriculture on Friday indicate that the overall kharif season sowing acreage as of the end of August is 0.5% less than the previous year.
This year, farmers across India have moved decisively away from what were once profit-making crops such as oilseeds as well as jute, whose profit margins continue to remain insignificant. The equilibrium in sowing acreage comes almost entirely from an 18% increase in cotton acreage and 9% increase in sugarcane acreage.
This sowing acreage data only covers oilseeds and foodgrains such as cereals and pulses. Horticulture production, however, has outpaced other foodgrain production for five consecutive years now and is the reason for India’s continued agricultural growth.
Farmers across the country have chosen to invest more in cotton this year. The highest increase comes from Telangana, which has sown 18.24 lakh hectares of cotton against last year’s 12.5 lakh hectares, representing a 5% increase.
At 3.57 lakh hectares, Telangana’s pulses acreage is far lower than that of other states. However, this represents a significant drop of 50% from the previous year, when farmers in the state sowed pulses across 7.13 lakh hectares.
Sowing of pulses has also declined sharply in other parts of central India, including the large producer states of Maharashtra and Karnataka. However, farmers in Rajasthan, which is the largest producer of pulses in India, sowed more pulses this year than the previous year, as did farmers in Madhya Pradesh, with mostly urad being sown.
Much of the decline in pulses comes from arhar, also known as tur. Farmers across the country sowed arhar between 4% less in Madhya Pradesh and 40% less in Telangana. This was one of the crops against whose low market prices farmers had protested in June.
Cereal production continues to remain low. While rice sowing in Assam had peaked in 2015-’16, its acreage dropped sharply the next year and dipped once again this season. Meanwhile, farmers in Bihar and Uttar Pradesh, India’s largest producers of rice, continue to steadily sow more of the cereal.
Oilseeds, particularly soyabean, have also declined by 7% in this sowing season. India’s markets are flooded with cheap oil imports, which has resulted in lower prices for oilseeds across the board, particularly soyabean. Farmers in Madhya Pradesh had gone on strike and protested violently in June after the market price of soyabean dipped below the minimum support price offered by the Union government. Soyabean acreage in this state has dropped by 8%, though some farmers at least seem to have sown more of sesame this year than last.
Groundnut sowing increased in Gujarat, despite distress there due to low prices.
The Agriculture Ministry tracks the historically important jute in its own data field. The fibre continues to decline in West Bengal, which grows half of the jute produced in India. It has also almost dwindled entirely out of Assam and Bihar.
Despite a global slump in sugar markets, sugarcane, a crop known to guzzle water, continues to be popular in Uttar Pradesh and Maharashtra. Acreage increased from 6.33 lakh hectares in 2016-’17 to 9.18 lakh hectares in Maharashtra, and from 21.79 lakh hectares to 22.66 lakh hectares in Uttar Pradesh.
Behind the garb of wealth and success, white collar criminals are hiding in plain sight
Understanding the forces that motivate leaders to become fraudsters.
Most con artists are very easy to like; the ones that belong to the corporate society, even more so. The Jordan Belforts of the world are confident, sharp and can smooth-talk their way into convincing people to bend at their will. For years, Harshad Mehta, a practiced con-artist, employed all-of-the-above to earn the sobriquet “big bull” on Dalaal Street. In 1992, the stockbroker used the pump and dump technique, explained later, to falsely inflate the Sensex from 1,194 points to 4,467. It was only after the scam that journalist Sucheta Dalal, acting on a tip-off, broke the story exposing how he fraudulently dipped into the banking system to finance a boom that manipulated the stock market.
In her book ‘The confidence game’, Maria Konnikova observes that con artists are expert storytellers - “When a story is plausible, we often assume it’s true.” Harshad Mehta’s story was an endearing rags-to-riches tale in which an insurance agent turned stockbroker flourished based on his skill and knowledge of the market. For years, he gave hope to marketmen that they too could one day live in a 15,000 sq.ft. posh apartment with a swimming pool in upmarket Worli.
One such marketman was Ketan Parekh who took over Dalaal Street after the arrest of Harshad Mehta. Ketan Parekh kept a low profile and broke character only to celebrate milestones such as reaching Rs. 100 crore in net worth, for which he threw a lavish bash with a star-studded guest-list to show off his wealth and connections. Ketan Parekh, a trainee in Harshad Mehta’s company, used the same infamous pump-and-dump scheme to make his riches. In that, he first used false bank documents to buy high stakes in shares that would inflate the stock prices of certain companies. The rise in stock prices lured in other institutional investors, further increasing the price of the stock. Once the price was high, Ketan dumped these stocks making huge profits and causing the stock market to take a tumble since it was propped up on misleading share prices. Ketan Parekh was later implicated in the 2001 securities scam and is serving a 14-years SEBI ban. The tactics employed by Harshad Mehta and Ketan Parekh were similar, in that they found a loophole in the system and took advantage of it to accumulate an obscene amount of wealth.
Call it greed, addiction or smarts, the 1992 and 2001 Securities Scams, for the first time, revealed the magnitude of white collar crimes in India. To fill the gaps exposed through these scams, the Securities Laws Act 1995 widened SEBI’s jurisdiction and allowed it to regulate depositories, FIIs, venture capital funds and credit-rating agencies. SEBI further received greater autonomy to penalise capital market violations with a fine of Rs 10 lakhs.
Despite an empowered regulatory body, the next white-collar crime struck India’s capital market with a massive blow. In a confession letter, Ramalinga Raju, ex-chairman of Satyam Computers convicted of criminal conspiracy and financial fraud, disclosed that Satyam’s balance sheets were cooked up to show an excess of revenues amounting to Rs. 7,000 crore. This accounting fraud allowed the chairman to keep the share prices of the company high. The deception, once revealed to unsuspecting board members and shareholders, made the company’s stock prices crash, with the investors losing as much as Rs. 14,000 crores. The crash of India’s fourth largest software services company is often likened to the bankruptcy of Enron - both companies achieved dizzying heights but collapsed to the ground taking their shareholders with them. Ramalinga Raju wrote in his letter “it was like riding a tiger, not knowing how to get off without being eaten”, implying that even after the realisation of consequences of the crime, it was impossible for him to rectify it.
It is theorised that white-collar crimes like these are highly rationalised. The motivation for the crime can be linked to the strain theory developed by Robert K Merton who stated that society puts pressure on individuals to achieve socially accepted goals (the importance of money, social status etc.). Not having the means to achieve those goals leads individuals to commit crimes.
Take the case of the executive who spent nine years in McKinsey as managing director and thereafter on the corporate and non-profit boards of Goldman Sachs, Procter & Gamble, American Airlines, and Harvard Business School. Rajat Gupta was a figure of success. Furthermore, his commitment to philanthropy added an additional layer of credibility to his image. He created the American India Foundation which brought in millions of dollars in philanthropic contributions from NRIs to development programs across the country. Rajat Gupta’s descent started during the investigation on Raj Rajaratnam, a Sri-Lankan hedge fund manager accused of insider trading. Convicted for leaking confidential information about Warren Buffet’s sizeable investment plans for Goldman Sachs to Raj Rajaratnam, Rajat Gupta was found guilty of conspiracy and three counts of securities fraud. Safe to say, Mr. Gupta’s philanthropic work did not sway the jury.
The people discussed above have one thing in common - each one of them was well respected and celebrated for their industry prowess and social standing, but got sucked down a path of non-violent crime. The question remains - Why are individuals at successful positions willing to risk it all? The book Why They Do It: Inside the mind of the White-Collar Criminal based on a research by Eugene Soltes reveals a startling insight. Soltes spoke to fifty white collar criminals to understand their motivations behind the crimes. Like most of us, Soltes expected the workings of a calculated and greedy mind behind the crimes, something that could separate them from regular people. However, the results were surprisingly unnerving. According to the research, most of the executives who committed crimes made decisions the way we all do–on the basis of their intuitions and gut feelings. They often didn’t realise the consequences of their action and got caught in the flow of making more money.
The arena of white collar crimes is full of commanding players with large and complex personalities. Billions, starring Damien Lewis and Paul Giamatti, captures the undercurrents of Wall Street and delivers a high-octane ‘ruthless attorney vs wealthy kingpin’ drama. The show looks at the fine line between success and fraud in the stock market. Bobby Axelrod, the hedge fund kingpin, skilfully walks on this fine line like a tightrope walker, making it difficult for Chuck Rhoades, a US attorney, to build a case against him.