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Indian scandals a blessing in disguise: Industry

A series of scandals, which have shaken Indian bourses and the central government, will not affect corporate investments, a leading industry body said on Wednesday.

Raghu Mody, president of the Associated Chambers of Commerce and Industry, said the scandals would act as a blessing in disguise as they would force a clean up of the system and lead to greater transparency.

"These disclosures would make the authorities sit up and plug the loopholes which encourage unethical practices and that should be very good for business," he said.

Mody said businessmen had learned to take a long-term view of investments and were unlikely to abandon a venture because of the outbreak of a scandal of some sort.

"Sure, our confidence has been shaken but it would be wrong to believe these scams will affect business plans already chalked out," he said on the sidelines of a business conference.

"We would have been concerned had there been any attempt made to slow down economic reforms," he added.

Last month, a secretly shot video showing politicians, military officers and bureaucrats apparently taking money to promote a fake arms deal forced the resignation of Defence Minister George Fernandes and the chiefs of two parties in the ruling federal coalition.

Domestic stock markets are currently facing the worst crisis in nearly a decade following allegations of price manipulation and payment frauds.

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