Editorial Viewpoint
A Central focus
Few institutions hold as hallowed a niche in the Zoroastrian psyche as the Central Bank of India. Founded, funded and managed by community members, the Bank was not only a leading national financial institution but it symbolized Parsi enterprise and for some, the lack of it. Columnist Bachi Karkaria once stated in an article in the erstwhile Illustrated Weekly of India that there were two types of Parsis: those who worked in the Central Bank and those who didn’t. While the creation and running of the Bank reflected the Parsi entrepreneurial spirit, employment in the Bank was viewed as a sinecure. A bank job came to symbolize, often wrongly, that Parsis lacked initiative, were unadventurous and sought employment security above all else.
A plus point was the legendary image of Parsis being honest individuals which resulted in their being ideal candidates to work in banks, especially the cash department.
Even Prime Minister Indira Gandhi trusted a Zoroastrian, Rustom Sohrab Nagarwala to store alleged undeclared wealth in, of all places, the State Bank of India. When he allegedly betrayed her faith and withdrew 60 lakhs from the bank under false pretexts, he was imprisoned. Gandhi, however, was untouched by the legal machinery.
After Gandhi nationalized the leading Indian banks in 1969, the Central Bank and others ceased to offer a safe haven for community members. A bank job became a prized position. Slowly quotas, political clout, rigorous screening and competitive tests for applicants saw fewer Parsis in the banks.
As the execrable, politically influenced, socialistic culture of the government crept into the nationalized sector, financial norms were often discarded. Loans without adequate scrutiny or collateral were sanctioned. Loan melas were held where money was handed out indiscriminately. Indiscipline and militant unions reduced the country’s banking system to shambles. One needed to have an account in at least two banks in case one was on strike on any given day.
Slowly as the element of competition was introduced, existing foreign banks were allowed to expand and new ones permitted to enter, the management of the banks were able to assert more rigorous norms. Where strikes or go-slows were the order of the day, discipline was tightened. Managers were promoted on merit, more than influence.
Soon a level playing field began to be established between nationalized and non-nationalized banks. While the laws tightened around the functioning of banks, they also had greater autonomy to participate in a market driven economy.
And the first taste of independence came when the nationalized banks were allowed to go public. From government control, the powers were gradually being returned to individual and institutional shareholders. What once largely belonged to the Zoroastrian community may not come back to us but now at least any one so desiring can buy a share in Parsi memorabilia.
And adding lustre to the Central Bank’s initial public offering is the fact that a Zoroastrian is the chairperson and managing director of this august institution at this time, the first community lady to hold this high office. None could be better suited than this no-nonsense, hard driving and pragmatic chief to steer the Bank through this transitory period.
Government actions have affected many community commercial institutions and interests over the past three quarters of a century. The land to the tiller policy denied many Parsi/Irani landlords their properties. Prohibition dealt a jolt to many Parsis who controlled the trade in some areas (just as the crackdown on the opium trade over 150 years ago upset not only the Parsi businessmen but the entire economy of Bombay city).
Tata Airlines fell victim to then Prime Minister Pandit Jawaharlal Nehru’s admiration of the Soviet communist system where the government occupied the commanding heights of the economy.<s
A plus point was the legendary image of Parsis being honest individuals which resulted in their being ideal candidates to work in banks, especially the cash department.
Even Prime Minister Indira Gandhi trusted a Zoroastrian, Rustom Sohrab Nagarwala to store alleged undeclared wealth in, of all places, the State Bank of India. When he allegedly betrayed her faith and withdrew 60 lakhs from the bank under false pretexts, he was imprisoned. Gandhi, however, was untouched by the legal machinery.
After Gandhi nationalized the leading Indian banks in 1969, the Central Bank and others ceased to offer a safe haven for community members. A bank job became a prized position. Slowly quotas, political clout, rigorous screening and competitive tests for applicants saw fewer Parsis in the banks.
As the execrable, politically influenced, socialistic culture of the government crept into the nationalized sector, financial norms were often discarded. Loans without adequate scrutiny or collateral were sanctioned. Loan melas were held where money was handed out indiscriminately. Indiscipline and militant unions reduced the country’s banking system to shambles. One needed to have an account in at least two banks in case one was on strike on any given day.
Slowly as the element of competition was introduced, existing foreign banks were allowed to expand and new ones permitted to enter, the management of the banks were able to assert more rigorous norms. Where strikes or go-slows were the order of the day, discipline was tightened. Managers were promoted on merit, more than influence.
Soon a level playing field began to be established between nationalized and non-nationalized banks. While the laws tightened around the functioning of banks, they also had greater autonomy to participate in a market driven economy.
And the first taste of independence came when the nationalized banks were allowed to go public. From government control, the powers were gradually being returned to individual and institutional shareholders. What once largely belonged to the Zoroastrian community may not come back to us but now at least any one so desiring can buy a share in Parsi memorabilia.
And adding lustre to the Central Bank’s initial public offering is the fact that a Zoroastrian is the chairperson and managing director of this august institution at this time, the first community lady to hold this high office. None could be better suited than this no-nonsense, hard driving and pragmatic chief to steer the Bank through this transitory period.
Government actions have affected many community commercial institutions and interests over the past three quarters of a century. The land to the tiller policy denied many Parsi/Irani landlords their properties. Prohibition dealt a jolt to many Parsis who controlled the trade in some areas (just as the crackdown on the opium trade over 150 years ago upset not only the Parsi businessmen but the entire economy of Bombay city).
Tata Airlines fell victim to then Prime Minister Pandit Jawaharlal Nehru’s admiration of the Soviet communist system where the government occupied the commanding heights of the economy.<s
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From the archive