What does the PNB bank fraud mean for Brand Modi?
Topping Twitter trends today was #MaunModi. It’s the type of taunting hashtag that, till a year back, one would never have seen about Prime Minister Narendra Modi. Could the extended and unusual honeymoon period that Modi has enjoyed as head of state finally be over?
Ashraf Engineer, principal consultant, Pitchfork Partners says that, “ The Nirav Modi brand is of course affected, But, the sheen could be beginning to wear off Brand Narendra Modi as well. He had talked about bank reforms and yet non performing assets have risen in his time. And the coincidence is such that the defaulter’s name is Nirav Modi and therefore #ChotaModi has emerged. And such a tag can stick for a long time.”
Shoebahmed Shaikh, director, Ideosphere Consulting, agrees with the assessment, adding that, “ A strong and rousing election phrase by our Prime Minister, Shri Narendra Modi, amounting to putting corruption on a starvation diet is now coming back to haunt him.”
To further complicate matters, Nirav Modi has accused PNB of acting in haste and damaging his reputation. He said in a widely reported letter, released this week:
His picture with the prime minister at Davos in January 2018, just before the scam broke has given the opposition further fodder:
Impact on opposition
For any opposition, a scam of this proportion, would be a heaven sent opportunity to rally opinion against the Modi government in the crucial pre-election year. Observers say that while the Congress could be a lot more energetic in taking up the issue, Rahul Gandhi is well poised to take up the challenge.
Engineer points out that Rahul Gandhi, president, Indian National Congress, has undergone a remarkable transformation in his public persona and communications style.
“When is the last time you heard the #Pappu tag being used to describe Rahul Gandhi”, asks Engineer?
Engineer adds that, “Gandhi is not afraid anymore to speak out. He has also campaigned extensively in Gujarat and the results showed. They were neck to neck with the BJP. The impact has also been seen in the recent assembly by elections in states like Rajasthan.”
Faith in the media declining
A scam of this magnitude is the type of catastrophic event that can take down governments. As it eventually did with UPA and the 2 G, coal and commonwealth games controversies. Modi in 2014, rode the anti-corruption wave to win big at the centre.
Yet, when India is hit with one of the biggest bank frauds, Narendra Modi seems to shake it off. The outcry is not as strident as it should be. Will ‘Teflon Mod’i ride this out too?
According to Engineer, “The media is not doing its job as stridently as it should be. They are not asking the kind of questions that need to be asked. I don’t really believe in anyone being Teflon. Modi has been co-opting various arms of the media. An outcry is a function of how well the media is doing its job and the Indian media needs to do its job.”
Engineer adds that the media is being curious because the Modi government has coincided with a time of tremendous churn and pressure on revenues for the media and it may be reluctant a notoriously anti-mainstream media prime minister.
Fixing the Un-fixable?
Shaikh says that when a crisis of this magnitude breaks the Richter scale, where does one begin to look for answers?
Ideosphere’s Shoebahmed Shaikh pictured right says PNB faces what can only be described as an existential crisis.
He adds, “Can the people deputed to be the guardians of the banking galaxy be trusted to mop up quickly, justly and for certain? PNB faces what can only be described as an existential crisis. It needs to be quick in complying with authorities to recover whatever assets can be salvaged. Same applies to banks with exposure to the fraud. Sitting back and playing the waiting game will lead to more erosion of trust (is there any left?). The government needs to show it is serious in bringing defaulters to justice. Better to cut an infected arm than let the gangrene spread. The political implications are so vast, there is a disenchantment in the public that the perpetrators will ever be brought to justice.”
Abhishek Sood, account director, Blue Lotus Communications agrees saying that “During the press conference, Punjab National Bank’s chief declared that the bank had the capability to resolve the problem, but failed to highlight how a repayment plan will be worked out, and how liability would be assumed amongst the various banks involved in the controversy. In such a scenario the bank should have focused on explaining how the problem will be investigated or resolved in the coming future and then accordingly make amends.”
Tara Kapur, CEO & chief strategy officer, Stellar Communications India (http://www.stellarcommsindia.com/ ) says , “A PR fix would only go hand-in-hand with real systemic changes. There will have to be a new strong system of checks and balances, which will have to be explained to the public in an understandable and assuring manner with the help of a trustworthy ambassador. A good example of such a campaign is in the aftermath of the worms in the Cadbury chocolate debacle, where Mr. Bachchan stepped in vouching for the new stronger packaging.”
“There will have to be a new strong system of checks and balances, which will have to be explained to the public, as was done by Cadbury via Amitabh Bachchan over the ‘worms’ crisis”, says Tara Kapur.