Citizens' Issues
Should the chairman of a tainted bank be appointed the president of FICCI?

FICCI has a say in major economic and industrial policies. Its office-bearers interact with top ministers and government officials. Its new president is the chairman of HSBC which has a spotty reputation overseas while in India it is alleged to have been involved in large and crude havala transactions. Is this desirable?

Federation of Indian Chambers of Commerce and Industry (FICCI) is the oldest apex chamber of commerce in India. It covers the country, and represents all sizes of industry, and trade. It consists of numerous specialist and generalist associations. Unlike the other two apex chambers it is not confined to manufacturing companies or to those mainly with foreign shareholding control.


As an apex chamber FICCI has a say in major economic and industrial policies of India. Its office-bearers interact with top ministers and government officials. They are expected to be objective, above any suspicion of vested interest, and represent views of industry and trade for the good of the country. The general reputation of their organizations and themselves must be spotless.


The election of the first woman president of FICCI last week raises concern. A senior and experienced person she is a well-known public personality. She will be the first banker to head FICCI. She has had work experience in three foreign financial institutions—Grindlays (now Standard and Chartered), Morgan Stanley and HSBC. In HSBC she has risen to heights no Indian has before. She is chairperson of the bank in India. Her connections and networking among politicians, administrators and businessmen in India is enviably wide and would be very useful to FICCI in making its voice heard.


Her appointment would normally be very welcome. I am acquainted slightly with her and have no personal animosity to her or her employer.


The latest issue of the ‘Economist’ writes about the big banks (HSBC, Standard and Chartered, UBS, etc) and their illegal activities for which they have paid unusually large fines in the USA. It calls these banks “too large to fail” and that hence their top executives are not in jail. HSBC alone paid a staggering $1.9 billion as fines in the USA to settle charges that included money laundering. The LIBOR scam in the United Kingdom resulted in some banks paying large fines in the UK and the US. The ‘Economist’ says that American regulators wanted to avoid criminal trials of the top executives of the concerned banks including HSBC because these banks are huge and such trials and convictions could have disrupted world financial markets. HSBC has thus a spotty reputation overseas.


In India there have been reports about HSBC being involved in large and crude havala transactions. It was reported that their representatives would collect rupees from homes and offices in India and guarantee that they would be deposited in overseas safe havens on which the depositor could draw cheques. Such transactions are unlawful under Indian laws. No investigation or action by the government has so far been reported. No political party has yet made an issue of this. The allegations may well be false. But they have not been disputed.


Naina Lal Kidwai who has been in HSBC for many years at the highest levels has been elected as President of FICCI. This is despite her bank in the USA being punished for wrongful activities. In India HSBC is alleged to have been involved in what if proven, are criminal acts. Such crimes must have been committed during her time at the top of HSBC India. If the allegations are true, they may have been committed without her knowledge. A full investigation may also clear the bank in India from these charges.


HSBC exposed US to terror fund, money laundering says a panel


The image of industry has taken a beating in recent years (spectrum scam, coalgate, land grabs, and others). The FICCI president must belong to an organization that has a spotless record, as must its representative. All associations (chambers, trade, sports, professional) must follow this good practice.


Read here about Arvind Kejriwal’s HSBC expose.


(Surendra Laxminarayan Rao is a columnist in leading Indian newspapers. He has written or edited fifteen books, many papers and hundreds of articles. His latest book is "Powering India - A decade of Policies and Regulation". He was also the first chairman of the Central Electricity Regulatory Commission)



sohan modak

4 years ago

HSBC has carried out unauthorized m9oney transfers from India in favour of at least one foreign Government against which a complaint has been filed with ED, RBI,, FIU, Income Tax and Service Tax authorities. Such bank representatives should never be allowed to head an Indian organization.

nagesh kini

4 years ago

Why not when a Chairman of a corporate raided for tax evasion sits on the RBI Board?

chandra shekhar

4 years ago

* US-n-UK have not found anything against HSBC to proceed with criminal trials ... if, penalised thats in accordance to theit Law-of-Land ...!

** even in INDIA there are no cases of wrong doings in any courts against HSBC ... !!

*** aam-aadmi-party & IAC have been leveling allegations but, neither they have ever offered any Solutions till date nor they
have shown any Action except mere WORDS ...?

**** since, there is a mention of acquaintance with the Chairperson & the first woman President of FICCI ... if, HSBC
is tainted and its sufficient ground for disqualification of Kidwai as President, Ficci then, by the same yard stick AAP & IAC
are also tainted cause of your acquaintance (as admitted by you) with the Chair AND now, that AAP-n-IAC are political, you have a vested-interest too ??

***** this apart, the whole story is contradictory, under such circumstance "should Chairman of a Tainted Bank, become President of Ficci" doesnt hold water ...

****** also, not a single FICCI member (who are mostly Corporates) have Objected or Opposed Kidwai's candidature, how than a non-member can...???



4 years ago

The fault here lies with mainstream media as well. They have quoted wrong examples to show success of women in corporate sector. There could have been better examples.

Babubhai Vaghela

4 years ago

If tainted Bureaucrat PJ Thomas could not be CVC, Naina Lal Kidwai also cannot be President FICCI considering Institutional Integrity being at stake. President of India should tell FICCI to remove her as President.

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