Biz chambers say case against Birla is 'unsubstantiated'

Expressing serious concerns over "unsubstantiated" legal cases against industrialists like Kumar Mangalam Birla, top industry chambers today said such developments can create a "trust deficit between industry and government" and hurt investor sentiment.
"Despite the growth and investment-friendly stance of the new government, we are today in a situation where some unsubstantiated legal cases are being pursued against well established and credible business groups and highly reputed and leading industrialists like Kumar Mangalam Birla, based on dated perceptions, interpretations and mere inferences," Assocham President Rana Kapoor said.
Ficci Secretary General Didar Singh said: "While we have the highest regard for the judicial process, such developments do have a bearing on the overall investor sentiment.

"At a time when the government is making all efforts to create a transparent, efficient and equitable regime for investments and a business-friendly climate, such developments tend to create a needless trust deficit between industry, Government and society".
The comments came a day after former Prime Minister Manmohan Singh, Birla and former Coal Secretary P C Parakh were summoned as accused by a CBI court in coal scam case.
Yesterday, another industry body CII had said such a development could create "uncertainty and anxiety among investors" and dissuade them from investing in the country.

"It is our belief that Birla represents the progressive face of the Indian industry, which does not indulge in crony capitalism and carries out his businesses by the book," it had said.

"A great degree of caution and judiciousness is needed in re-visiting decisions as in the absence of the same we could see the business environment getting vitiated. Today, investments are critical to revive India's growth and generate the much-needed employment.
Aditya Birla group flagship firm Hindalco had also said that none of its officials, including Chairman Kumar Mangalam Birla, had pursued any unlawful or inappropriate means to secure allocation of Talabira-II coal block in Odisha.
"Carrying forward investment cycle requires strengthening of the entrepreneurial spirit behind business decisions. The very act of placing capital at risk to generate economic value thus needs to be encouraged with both predictability and certainty of a stable policy regime," Singh said.

If India needs to grow at its potential growth rate of 10 per cent or above, it is critical to ensure a conducive, fair and transparent environment where industrialists and corporate leaders can openly consult with members of the government, bureaucracy and regulators as a part of their normal business conduct, without the fear of future legal and investigative repercussions, Kapoor said.
Stating that it fully commends the government stance against corruption, Assocham said cases such as the Kumar Birla situation, where the concerned corporate is fully cooperating with the investigating authorities, be resolved on priority and expeditiously.