Today, as hes humbled all rivals, and battled A Rajas blatant favouritism, the question being asked as he headed out to Africa: did he leave because regulatory favouritism killed the business or did he leave because, after a certain size, Indian firms just have to go looking for new markets overseas Naturally, its a combination of the two. In any case, Mittal continues to invest a lot here (he just spent Rs 13,000 crore on buying thirteen 3G licences) and is reinventing Bharti to become an entertainment company, a money transfer agent, a debit card, a bank
All of which is really Indias story, of humble beginnings, of grit, of attracting foreign investors, of controversies, of political patronage, of superb managerial and technological talent so high class the developed world is vying for it. All of which ties in with the ingredients weve lined up for you on this opinion page spread today. Shobhana points to the role of stock markets and foreign investors, the same ones that continue to bankroll Mittal, in Indias growth story. Indias so hot, she says, that if equity funds just moved gear to neutral, this would result in a lot more billions pouring in.
Investors, needless to say, arent here to eat, pray, love. Shailesh explains the move from the early 1990s when FDI was restricted to the Perfettis and Kelloggs coming in with $50-odd mn to 2010 when Bharti alone spent $10.7 bn to buy Zain. Though India continues to have abysmal education standards on the whole (see the oped page package today), Shailesh points to enough graduates coming out of colleges, and enough R&D in select pockets, for Indias patents to shoot up. As a result of India Inc pulling itself by its bootstraps21 firms have Deming prizes and 153 the TPM award from the Japan Institute of Plant Maintenance (JIPM)weve reached a stage where around 40% of what India Inc produces is exported.
The impact of all of this, as Arvind tells us, is the sharp surge in consumer spending ($700 bn more by 2020); NCAER-CMCR talks of how 37% of Indians will be middle-class by 2025 and McKinsey sketches the impact of Indias huge urbanisation that will see the equivalent of a Chicago being constructed each year from now to 2030. Combine this huge surge in demandfor licences, for land, for clearancesand you understand the surge in corruption that the political class is so ham-handedly trying to cover up. You could worry about this or you could keep in mind that, as the middle class becomes dominant, it demands a different value system, a different type of politician, more focused on clean, more focused on deliveryPoonam Gupta and Arvind Panagariyas study on the oped page traces some of this.
As in business, so in politics. Barring the top 3 or 4, the list of Indias 10 richest businessmen has changed each decade, and even the top 3 or 4 are constantly reinventing themselvesnewcomer DoCoMo forced Sunil Mittal to lower tariffs and its 3G tariffs will determine his. Theres a lesson in there for our political class to read, to understand, to emulate. As FEs tagline puts it, Read to Lead. Have a great year ahead!