COUP D'ETAT: Gupta will chair the US India Business Council

It's not yet official. But once it is-June 18 is the red-letter day-the Indian diaspora in the United States will turn a fresh corner with Rajat Gupta, chief executive officer of McKinsey, taking over as chairman-designate of the United States India Business Council (USIBC). As its new head, Gupta will be responsible for shepherding the growing US business interests in India.

Gupta will become the first Indian-American to hold this position of remarkable clout. At the head office in Washington D.C., USIBC brings together government representatives, the global and regional offices and India-based managers. The council represents the voice of corporate America-almost half of the Fortune 100 companies are its corporate members-in matters related to India.

"Having spent 21 years in India and the next 30 here, I am obviously involved in both countries," says Gupta. "In that sense I am happy to contribute to the bilateral relationship between the two countries."

With a regional presence in New York and the Silicon Valley, USIBC is launching a new initiative-Access USA and Access India-with the US Chamber of Commerce to foster relationships between medium-sized companies. The staff strength of the lobby will likely go up to 3,000 in the next four years.

Almost eight years ago, Gupta became the first Indian-American to break into the top league when he took charge at McKinsey, aged 45. Ironically, the management graduate from Harvard University was earlier turned down by McKinsey's md Walter Daniel because of lack of adequate work experience!

Gupta was the first person approached when the hunt for USIBC's new chairman started a couple of months ago. And he "declined about 15 times", says a board member, before relenting. "When a number of board members ask you, it is difficult to say no," recalls Gupta.

Though the appointment was "unanimous", it has rankled some. Reports say there were moves to stall the appointment over the tenure of Gupta's stint as McKinsey's chairman-he has a little over a year to go before his final three-year term ends. Since the chairman is appointed for a two-year period, the council's bye-laws would make it piquant for Gupta to continue in the post. Critics also apprehend that Gupta's appointment would compromise the effectiveness of USIBC because as an Indian-American he would not enjoy the same clout as a foreigner would and also that Gupta could face a conflict of interest while pushing for a better policy framework with McKinsey acting consultant to several state governments.

Senior USIBC officials, however, dismiss the arguments. "The USIBC is a corporate body requiring regular rotation even at the senior-most level," said an official.

Gupta has not decided his course of action once his tenure concludes on July 1 next year. "As of now I believe I will stay on in McKinsey and do chairman-type of work," he says, adding: "I am not involved with the work my company is doing for state governments. It is completely independent. Besides, we have put in place Chinese walls of confidentiality. I don't think there can be conflict of interest."