Dhirubhai Ambani was a rags-to-riches Indian tycoon whose company Reliance is now one of India's major corporations. Ambani's sons Anil and Mukesh, who took over after their father's death in 2002, are worth $43 billion and $42 billion respectively, but their relationship is anything but amiable. Demonstrating the complicated links between government and big business, this account is not only the riveting story of one of the wealthiest families in the world—including their infamous feud—but also an illustration of India's transformation into a global economic powerhouse.
Dhirubhai Ambani was a rags-to-riches Indian tycoon whose company Reliance is now one of India's major corporations. Ambani's sons Anil and Mukesh, who took over after their father's death in 2002, are worth $43 billion and $42 billion respectively, but their relationship is anything but amiable. Demonstrating the complicated links between government and big business, this account is not only the riveting story of one of the wealthiest families in the world—including their infamous feud—but also an illustration of India's transformation into a global economic powerhouse.
Mahabharata in Polyester: The Making of the World's Richest Brothers and Their Feud
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Overview
Dhirubhai Ambani was a rags-to-riches Indian tycoon whose company Reliance is now one of India's major corporations. Ambani's sons Anil and Mukesh, who took over after their father's death in 2002, are worth $43 billion and $42 billion respectively, but their relationship is anything but amiable. Demonstrating the complicated links between government and big business, this account is not only the riveting story of one of the wealthiest families in the world—including their infamous feud—but also an illustration of India's transformation into a global economic powerhouse.
Product Details
| ISBN-13: | 9781742240114 |
|---|---|
| Publisher: | UNSW Press |
| Publication date: | 11/01/2010 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 432 |
| File size: | 2 MB |
About the Author
Hamish McDonald is the Asia-Pacific editor of the Sydney Morning Herald and a former editor of the Far East Asian Economic Review. He is the two-time recipient of the Walkley Award and an inaugural fellow of the Australian Institute of International Affairs.
Read an Excerpt
Mahabharata in Polyester
The Making of the World's Richest Brothers and Their Feud
By Hamish McDonald
University of New South Wales Press Ltd
Copyright © 2010 Hamish McDonaldAll rights reserved.
ISBN: 978-1-74224-011-4
CHAPTER 1
Protean capitalist
In January 2007 a Bollywood movie had an unusual launch in three corners of the globe. The full-length Hindi feature film, incorporating the usual song and dance sequences, was shown simultaneously in Mumbai, Toronto and Sydney – thereby claiming to being in the vanguard in the globalisation of Indian popular culture, although in Sydney at least audiences were almost exclusively of Indian origin.
The 'purely fictional' film was titled Guru and told of the rise of one Gurukant Desai, son of the local headmaster in the Gujarat village of 'Idhar'. After a spell of trading spices in Istanbul, the ambitious young Guru moves to the textile markets of Bombay, where he lives in a chawl tenement with his new wife.
He battles to break into a closed trading circle controlled by an aquiline-featured, wealthy young textile mill owner, prone to golfing in plus-fours and driving about in an open sports car. Intense, active and always looking for loopholes to push through, Guru manages to build up his company, Shakti Trading, diversifying into the manufacture of polyester and raising his capital from adulatory shareholders, to whom he delivers inspirational speeches at mass meetings held in a sports stadium. He wins the friendship of newspaper baron Manikdas Gupta, but the publisher becomes alarmed and insulted by Guru's bribery of his staff – from the peon's polyester safari suit to the editor's new car – and sets Shyam Saxena, a bright young journalist of his newspaper Swatantra, to expose him.
Posters summarised the film story as 'Villager, Visionary, Winner'. That the film was meant as more than just entertainment is clear from the 'foreword' that Mani Ratnam wrote for the cover of the digital video recording later put on sale:
If you are ambitious, if you have dreams, India is the place for you – today. But it wasn't like this always. After independence we were a huge nation, a young nation, where abstinence was respectable, ambition was not, where society took precedence over the individual. Today we have moved from left of centre to the right. When did this happen? How did this happen? Or did it happen in front of us and we couldn't see it? Guru is a revisiting of that time, of three decades during which India changed slowly but surely. And the mirror to that change is the life of one man – Gurukant Desai.
The film asserted, sometimes crudely, that Guru was a revolutionary figure, representing a raw new India pushing against the constraints of remnant colonial power structures and nostalgic doctrines. 'I've worked enough for the white man,' says Guru when announcing his decision to strike out in his own business. His dismissive rivals include Parsi business leaders, dressed in the white robes and tall black hats normally worn at fire temples to make the point. 'Neither you nor your khadi army can stop me,' Guru declares to newspaper baron Gupta, referring to the home-spun cotton dress of his generation of freedom fighters against British rule. There is a defiant address to supercilious judges looking into the allegations raised by Gupta's newspaper. He tells his shareholders the establishment is against them all 'because we are commoners, middle class'. One of the most contentious figures in contemporary India was being turned into celluloid myth.
Sixteen years earlier, the man being played by one of India's hottest hearth-throb film stars, with music by the famous score-writer A.R. Rahman, had dropped his name on our doorstep in New Delhi. In January 1991 a messenger delivered a card, elaborately embossed with a picture of the elephant-headed deity Ganesh, improbably carried on the back of a much smaller mouse: Dhirubhai and Kokilaben Ambani invited us to the wedding of their son Anil to Tina Munim in Bombay.
The young couple's courtship had been a stormy one. The bride, Tina Munim, was a girl with a past. A film starlet, Tina had had a well-publicised affair with a much older actor before meeting Anil. The groom was the tearaway one of the two Ambani boys. His parents had frowned on the match. Bombay's magnates usually tried to arrange matches that cemented alliances with other powerful business or political families. This one was not arranged, nor did it bring any more than a certain popularity. Hired assailants had been sent with acid and knives to scar Tina's face, so went the gossip (apocryphal: Tina's face turned out to be flawless). Anil had threatened suicide if he could not marry Tina, went another rumour. Finally the parents had agreed.
The father, Dhirubhai, was no less colourful and even more controversial. Ambani had gone into polyester manufacturing in a big way and got huge numbers of Indians to invest in shares of his company Reliance Industries. In India, the home of fine cotton textiles, it seemed that people couldn't get enough polyester. The only constraint on local producers like Reliance was the government's licensing of their capacity or where they built their factories. To increase his capacity, Ambani had become a big political fixer. It was said his executives had been shuttling briefcases of cash to politicians all over Delhi. There had been epic battles, with the press baron Ramnath Goenka of the Indian Express and with a textile rival from an old Parsi business house, Nusli Wadia. A year or so earlier, a Reliance public relations manager had been arrested for plotting to murder Wadia. The man had been released, and nothing was moving in the case. Was it genuine or a frame-up? Indian colleagues were not sure: no conspiracy was accepted at face value.
* * *
The wedding was going to be big, so big that it was to take place in a football stadium, the same one where Dhirubhai Ambani had held many of his shareholder meetings. But it began in an oddly casual way.
As instructed, in mid-afternoon we went to the Wodehouse Gymkhana Club, some distance from the stadium. There we found guests milling in the street outside, the men dressed mostly in lavishly cut dark suits and showy ties, moustaches trimmed and hair brilliantined. The women were heavily made up, laden with thick gold jewellery and wearing lustrous gold-embroidered silk saris. Anil Ambani appeared suddenly from the club grounds, dressed in a white satin outfit and sequinned turban, sitting on a white horse. A brass band in white, frogged tunics struck up a brash, repetitive march, and we set off in separate phalanxes of men and women alongside the groom towards the stadium. Every now and then, the process would pause while the Indian guests broke into a provocative whirling dance, some holding wads of money above their head. The stadium was transformed by tents, banks of marigolds and lights into a make-believe palace for 2000 of the family's closest friends and business contacts. They networked furiously while a bare-chested Hindu pundit put Anil and Tina through hours of Vedic marriage rites next to a smouldering sandalwood fire on a small stage. Later, the guests descended on an elaborate buffet on tables that took up an entire sideline of the football pitch, starting with all kinds of samosas and other snacks, working through a selection of curries and breads and finishing with fruits and sweets wrapped in gold leaf. The next day the Ambanis put on the same spread – if not the wedding ceremony – at another reception for 22 000 of their not-so-close friends, employees and second-echelon contacts.
The lavishness was eclipsed by bigger displays of wealth in following years, but at the time it was seen as a gesture that Dhirubhai Ambani had made it through the political travails of the previous few years and was unabashed – and certainly not strapped for either cash or friends.
At an interview a month later, Dhirubhai Ambani came limping around a huge desk and sat down at a white leather sofa. Despite the obvious effects of a stroke in a twisted right hand, his mahogany skin was smooth and healthy, his hair plentiful and slicked back decisively in a duck's tail. His attention was unwavering. Disarmingly Dhirubhai admitted to many of the youthful episodes that were the subject of rumours and responded evenly to the criticisms commonly levelled against him. He didn't mind people calling him an 'upstart' or even worse names. It just meant they were trapped in their complacency while he was racing ahead. But the disputes were now 'all history' and the former critics were now all his 'good friends' who bought their polyester and raw materials from him.
'The orbit goes on changing,' he declared airily. 'Nobody is a permanent friend, nobody is a permanent enemy. Everybody has his own self-interest. Once you recognise that, everybody would be better off.'
However, Ambani did point to an unfortunate trait in his countrymen. 'You must know that, in this country, people are very jealous.' It was not like in Hong Kong or other East Asian countries, where people applauded each other's success, he claimed. In India success was seen as the prerogative of certain families. But he didn't really mind. 'Jealousy is a mark of respect,' he said.
The Reliance public relations office continued to be attentive, supplying advance notice of newsworthy events. But the company's history of political and corporate activity had put a sinister shadow across the gleaming success. All through the government changes of 1990 and 1991, the press carried references to a certain 'large industrial house' supporting this or that party or being behind certain politicians. Scores of party leaders, ex-ministers, senior bureaucrats and heads of the big government-owned banks and corporations were said to be 'Ambani friends' or 'Ambani critics'. Mostly it was the friends, it seemed, who got the jobs. At a meeting of shareholders in a big Bombay engineering firm named Larsen & Toubro late in 1991, convened to approve a takeover by the Ambanis, this undercurrent of hostility welled up into a physical mêlée. In the shouting and jostling, the two Ambani sons Mukesh and Anil had to flee the stage. The controversies kept continuing right through the 1990s.
Dhirubhai Ambani attracted adulation or distrust. To his millions of investors, who had seen their share prices multiply, he was a business messiah. To one writer, he was a 'Frankenstein's Monster' created by India's experiments with close government control of the economy. 'There are three Dhirubhai Ambanis,' one of his fellow Gujaratis told me. 'One is unique, larger than life, a brand name. He is one of the most talked-about industrialists, and for Gujarati people he has tremendous emotional and sentimental appeal. He is their ultimate man and has inspired many emulators. The second Dhirubhai Ambani is a schemer, a first-class liar who regrets nothing and has no values in life. Then there is the third Dhirubhai Ambani, who has a more sophisticated political brain, a dreamer and a visionary, almost Napoleonic. People are always getting the three personalities mistaken.'
In a legal chamber lined with vellum-bound case references, a senior lawyer took an equally stark view. 'Today the fact is that Ambani is bigger than government,' said the lawyer in all seriousness. 'He can make or break prime ministers. In the United States you can build up a super-corporation but the political system is still bigger than you. In India the system is weak. If the stock exchange dares to expose Ambani, he tells it: "I will pull my company shares out and make you collapse. I am bigger than your exchange." If the newspapers criticise, he can point out they are dependent on his advertising and he has his journalists in every one of their departments. If the political parties take a stand against him, he has his men in every party who can pull down or embarrass the leaders. He is a threat to the system. Today he is undefeatable.'
Phiroz Vakil, another senior advocate at the Mumbai bar, paused in his tiny chambers in Bombay's old Fort district, stuffing Erinmore Flake tobacco into his pipe, before looking up intently and warning me that people would suspect that writers asking for stories and opinions about Ambani were being used as a stalking horse by the Ambanis themselves to draw out information. For some others, favourable write-ups of the Ambaris in the business media still rankled. 'I suppose you think he's a hero,' said the retired Finance Ministry official and Cabinet Secretary Vinod Pande, down the phone.
Others just seemed too battle-weary. When I telephone the Orkay Silk Mills chairman Kapal Mehra and asked to meet him, there was a long pause. 'I'm afraid that won't be possible,' Mehra said. The former prime minister Viswanath Pratap Singh did not reply to a letter and giggled nervously when I cornered him at a cocktail party in New Delhi. No, he could not possibly talk about any one company, Singh said, easing away quickly into the crowd. Those who did agree to talk for the most part insisted on anonymity: they had to live in India, they explained.
Reliance and Dhirubhai Ambani meanwhile went on to greater fame and fortune – and more controversies. After his death in 2002, the subsequent split of the Reliance group between his sons and their continuing rivalry make the story of this man and his methods pertinent to understanding the return of India to eminence in the world economy.
CHAPTER 2A persuasive young bania
Among all the 550-odd princely rulers left to run their domains in the last years of the British Raj, few were more eccentric than Mahabatkhan, the Nawab of Junagadh. The Nawab's family had run this fiefdom, one of several on the Saurashtra peninsula in Gujarat, since the Mughal warrior Sher Khan Babi founded his own subordinate dynasty in 1690. Two and a half centuries later, this warrior's descendant, best known for his love of dogs, Mahabatkhan had 150 of them, with an equal number of dog-handlers on his payroll and individual quarters for all the canine retinue. The Nawab was the first political target to come into the sights of Dhirubhai Ambani. It was during a movement aimed at overthrowing the Nawab's rule and securing Junagadh's accession to India during the Partition of British India in 1947 that Ambani, then a teenage high school student, had his first experience of political organisation and his first brushes with authority.
It was the only moment in modern times that Junagadh has figured in the calculations of statesmen. Even today, Junagadh and its surrounds, a region known as Kathiawar, remain one of the quietest, most traditional regions of India and until the end of the twentieth century one of the least accessible in the otherwise busy north-west coastal area of the country.
The land itself is dry, open, arid and stony. The monsoon rains quickly run off down the short rivers and nullahs that radiate from the rocky hinterland and out to the Arabian Sea. The roads are lined with stunted pipul (fig) trees; the stony fields are fenced with straggling rows of cactus. The standard building material is a porous dun-coloured stone cut by saws into ready-made blocks from pits near the seashore. There are few of the modern ferroconcrete extravagances built by the newly rich, or the industrial plants and their residential 'colonies' extending into farmland in other Indian regions.
But if the landscape is monotonous, Kathiawar's people compensate for it with riotous colour where they can. The women drape themselves with cotton scarves tie-dyed in red and orange. The local scooter-taxi is the Enfield motorcycle, grafted to a flat tray resting on two wheels at the back, the handlebars decked with coloured lights, electric horns and whirling windmills. The homes of wealthy merchants are adorned with mouldings of swans, peacocks, flamingos, parrots, elephants, lions and tigers. Massive double doors, twelve-panelled and with heavy iron studs, open tantalisingly on to huge inner courtyards.
A blood-drenched history and complicated mythology are attached to the landmarks and constructions of Kathiawar. On the coast to its west, at Dwarka, is the place where the deity Lord Krishna is said to have died. To the south, the temple of the moon at Somnath is a destination for Hindu pilgrims from all over India. In the steep Girnar hills above the city of Junagadh, long staircases take pilgrims to Jain temples that date back to the third century BC. The city was an important centre for Hindu rulers of Gujarat in the first millennium. Then Junagadh suffered four centuries of sackings until Mughal rule gave it some stability, with Muslim rulers controlling its largely Hindu population. Both its rulers and its people were onlookers in the contest for India's trade among the English, Dutch and Portuguese, whose galleons fought vicious battles off the Gujarat coast. At night, seen from the coastline at the south of Junagadh, processions of navigation lights travel left and right along the horizon. The seaborne traffic between the west coast of India and the Arabian ports goes on as it has for millennia, ever more intense.
(Continues...)
Excerpted from Mahabharata in Polyester by Hamish McDonald. Copyright © 2010 Hamish McDonald. Excerpted by permission of University of New South Wales Press Ltd.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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Table of Contents
Acknowledgements1 Protean Capitalist
2 A Persuasive Young Bania
3 Lessons from the Souk
4 Catching Live Serpents
5 A First-Class Fountain
6 Guru of the Equity Cult
7 Friends in the Right Places
8 The Great Polyester War
9 The Paper Tiger
10 Sleuths
11 Letting Loose a Scorpion
12 Business as Usual
13 Murder Medley
14 A Political Deluge
15 Under the Reforms
16 Housekeeping Secrets
17 Dhirubhai's Dream
18 The Polyester Princes
19 Corporate Kurukshetra
20 Mother India
21 The Ambanis Apart
22 Goodbye Gandhi
Notes
Index