Isn't it unethical for a company to trade in its own shares? How then does the Company Law in India permit it?

Shyamal Chatterjee, Durgapur

Share capital, historically, was held too sacrosanct to be trifled with, but the financial engineers in the US couldn't restrain themselves. They went overboard, and the result was legislation that not only permitted purchase of a company's shares by the company itself, but also allowed the company to keep them on its portfolio for buying and selling in a cycle of investment activities. This is insider trading at its worst. The UK government showed some restraint and its law mandates that the shares bought back must be cancelled forthwith. This is a lesser evil and India hasfollowed the UK model.

Medical tourism

Isn't the Indian medical tourism success story more a reflection on the economics of treatment here rather than its quality?

Bhargav Rajan, Gainesville, Florida

I think that would be uncharitable, because medical treatment is too serious a matter to be frugal with, even if one is in dire straits financially. It is true that the cost of a surgery in India is way below what it takes in the US, for example, especially if one is underinsured, but that isn't the only reason why Americans are making a beeline to Indian hospitals. Despite the negative campaign, discerning people see both savings and quality medical care in Indian private hospitals.

What is the idea behind the Swiss auction model?

Manish Chowdhry, Gurgaon

The idea is to encourage a project which would cater to the larger public good, like an expressway or a causeway above a large water body. The originator of the proposal is not awarded the project straightaway but is asked to wait till others interested offer better terms. The originator is allowed to have the last laugh by being entitled, in his capacity as the originator, to the privilege of doing away with the competition by initially padding up his quotation and bringing it down in a manner of double-take. This is why critics aver that the model encourages crony capitalism.

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(This article was published on August 7, 2011)
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