My first thought: he's getting senile and needs to retire. Even so -- why did the others in the room stand there and laugh rather than oppose this action? That, to me, is the big issue.
My next thought: this is not the first time I've heard of sexual abuses by so-called holy men of Eastern traditions. Makes me wonder what goes on in the temples behind closed doors.
People in the West often idealize the East, believing that people of the East are more pure and spiritual and their leaders don't sexually abuse people like leaders in the West do. But sexual abuse is not about sex, it's about power. And humans with power abusing their power is not an East or West thing, it's a human thing.