Zombies in the age of the Coronavirus

Indian Printer and Publisher 42nd anniversary issue

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Zombie companies fail to repay neither their loans nor the interest to service these loans.
Zombie companies fail to repay neither their loans nor the interest to service these loans.

In a recent article in The Times of India, Ruchir Sharma wrote about ‘zombie’ companies. These are companies that can neither repay their loans nor the interest to service these loans. They cannot even pay dividends to shareholders unless they are stealing from somewhere – either the banks or from their employees or suppliers.

The pages of the financial dailies are littered with the troubles of the larger zombies. Some even blame the failing Indian economy and the reforms that don’t work as expected. Then comes the truly global Coronavirus pandemic with total unpredictability. Unlike the disasters of 11 September 2001 or the financial collapse of 07-08, there is no cathartic end in sight. Every individual and every business is affected. And the large number of freelance, informal, adhoc and casual workers are ground to dust. All the glib talk about the gig economy turns to bile.

It is the small and medium publishers and printers who are now the zombies. Unable to repay the so-called loans taken at extortionate interest rates and with so much collateral that there is no risk to the lenders, we are unable to pay the interest, let alone the EMI’s on our loans. Despite us being straightforward brick and mortar enterprises, the soft loans and private equity go to the dishonest borrowers who flee. To the ‘startups’ and the vaporware racketeers that specialize in presentations about their losses. Even in our industry, many companies borrow and grow their top lines with hypercompetitive pricing, only hoping to be acquired by some foolish foreign investor.

The question is which foreign investor who is serious about business and creating wealth will invest in a company in an environment ruled and created by an authoritarian government? A government keen to gather more power to itself so that it can rewrite textbooks with false history and pseudoscience to feed its inferiority complex. The keenness to drunkenly assert your past and future greatness come only from a sense of inadequacy and failure.

Which investor will see merit in a government that nurtures an undemocratic and anti-scientific environment of hatred and intolerance? A government that tells lies about its provocative actions and watches while a minority community is slaughtered and its’ places of business and worship are incinerated in broad daylight while the police stand by. A government that cannot tolerate criticism and a government that undermines the constitutional role of the judiciary by openly corrupting judges and offering them lollipops to do its bidding.

Sometimes the penny only drops when there is a catalyst such as a Coronavirus that forces us to clean our spectacles. I shall not vent or rant on since this is our 42nd-anniversary issue, once again barely finished on a Saturday afternoon. Nevertheless, even after so many years, we are happy that we can pick up the phone and speak to some of our friends. We may not agree about everything, but we will continue to defend not only our mutual rights of self-expression but those of every citizen and resident of our country.

I only want to thank the hundreds of companies, both publishers and printers, and input suppliers who have helped and, at times, even saved us. It’s been an exciting time, and we have learned much about our fellow citizens and our readers. We only hope that as they have given us the courage to speak out for what is right and wrong, that we have also been of some help or at least amusement to them. That we have pointed them in the direction of finding things out for themselves. And for sharing their experiences and their ideas.

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