Frontline On Air | India’s lawless financial capitalism fosters a culture of scams

Cheered on by the state, it has infused an alarming disregard for ethical conduct and public accountability.

Scams have centred around malpractices in corporate governance: owners and promoters of companies have defrauded investors to enrich themselves. | Photo Credit: Getty Images/iStockphoto

Starting in early 1989, the Indian stock market index, the Sensex, began scaling new heights. The spectacular rise through April 1992 was a puzzle: politics was in chaos, the economy was troubled, and yet the Sensex kept climbing, in a near-vertical ascent towards the end.

That episode, known since as the “Harshad Mehta scam”, is largely forgotten, and certainly dismissed for contemporary relevance because it was the creature of a unique moment. However, scams have recurred all too frequently and today are often a way of doing business. The costs to India’s economy and society have been large.

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