Satyam issue a setback for India Inc: PM's advisory panel

The Satyam fraud is a setback for Indian business and will continue to be an irritant for India Inc in the global market place, the Prime Minister's economic panel said today.

"The odour of this scandal will continue to be an obstacle and irritant for Indian businesses in their efforts to conduct business, acquire assets and secure finance in the global market place," said a review of Indian economy for 2008-09 by the panel.

The Prime Minister's Economic Advisory Council said it is imperative that the regulator and investigating agencies get to the bottom of this scandal and bring the guilty to book.

The review said the development should act as a reminder as to how much more careful an emerging economy needs to be in its efforts to maintain growth and secure a position in the world community.

"The recent fraud and possible embezzlement of funds... is a setback for Indian business and for the economy at large. It has undercut confidence among customers, investors and employees in the industry," the report said.

"Satyam is really a setback, there's no doubt on that. But I think the government has taken swift steps to minimize the damage," panel Chairman Suresh Tendulkar told reporters after releasing the review.

However, Tendulkar expressed confidence that the big Indian IT companies would not be much impacted by Satyam scandal, saying they have announced good results and are quite optimistic.

"I think our IT industry at one level has always surpassed everybody because they have managed to increase their productivity. That is quite remarkable. From that point of view, I don't expect the impact to be very significant," he said.