With the Rs 7,800-crore (Rs 78 billion) fraud at Satyam Computer leaving India's IT sector gasping for breath, Infosys chairman Nandan Nilekani sees the fiasco as a blessing in disguise, as it will make authorities enforce better regulations and auditing mechanisms for the industry.
At the fourth edition of the Jaipur Literature Festival, where he spoke about his recently released book "Imagining India", Nilekani said he was appalled at the scam, which would have larger ramifications on the image of India's software sector.
"It is shocking and appalling. The Satyam-scam not only hit hard the company's stake holders, but also had a larger impact on people like me, who have been promoting the Indian software brand and the enterprise in this country," Nilekani said.
"But I also hope there is a silver lining to this episode. I believe the tolerance of investments auditors and regulators to bad behaviour will come down, forcing major improvements in mechanisms," he said.
Commenting on the financial meltdown that was, among other things, sparked off by the sub-prime crisis in the US, Nilekani said it was an example of too less regulation in the open markets.
"The failure occurred because innovation was way ahead of regulation, which should not have been the case," he said.
Describing his book "Imagining India" "as an agenda of change and a safety net of ideas," he said it tracks the importance of technology in carrying reforms to every nook and corner of India and the lessons India should learn from the failures faced by the developed nations on their path to development.
"A large part of my book is about avoiding negative things that are happening in the western countries and about how India should chart its own way to development learning from their mistakes," he said, adding it was important to strike a right balance between the two set-ups.
The Infosys chief also pointed out at the change in India's collective attitude towards technology in the last three decades to the present state where a complete "democratisation of technology" has taken place in the country.
Nilekani, who has advocated a massive overhaul of the education system in his book, said the fact that more than a quarter of people were still left out of the development process makes the need to revamp education all the more clear.
"All founders of Infosys come from a background of middle class non-business families. We could make it big because we had access to education, but this is not true of a large section of people in India."
Noting that reforms are about taking the process of development to lower sections, he also faulted the Indian middle class for maintaining a silence on issues of public importance.
"Middle class has detached itself from the troubles of this developing country. They have their water supplies, they used generators in times of power cuts, the only thing they complain about are the roads because there is no escape to that," he said.
