Sunday, November 1, 2009

Reliance didn't grow on permit raj: Anil Ambani

Anil Ambani, Reliance Industries Vice-Chairman









Reliance Industries has denied charges that the group had thrived on the pre-reform 'licence raj' of the 1970s and 1980s to become the country's largest private entity, and attributed the growth to the vision of group's patriarch Dhirubhai Ambani.
"The licence raj prevailed for everybody, not only for us. You can get an industry licence to set up a plant, but that doesn't raise your financing, it doesn't raise your technology, it doesn't produce your quality, it doesn't market your products, it doesn't help you raise money from the capital markets. You don't suddenly get 3-4 million shareholders into the company," said Reliance group Vice-Chairman Anil Ambani, in an interview conducted by Vir Sanghvi for Star Talk.
"India went for reforms in 1991. The growth for Reliance has been the highest in the last ten years than it was in permit raj. I don't see any harm in building relationships with people whether it's my customer or my vendor, whether it is my shareholder, or somebody in a position of power who we need to convince about our case.
Nobody can say that we have run away with anybody's money. Though I can tell give you a list of Indians who've taken their companies bankrupt," said Ambani.
Ambani spoke about various aspects of his life, his education and his business. Excerpts:

On what life has taught him:"I think I'd like to put it differently, and look at what have been the key messages thrown at us over the last two or three decades that I've been in corporate life. And those have certainly been my father's core values that were ingrained in us: being down to earth, being humble, and being very simple. That's how he is even today and I think that's a big message for us.
On childhood memories:Many years ago, our family lived in the backstreets of Mumbai, in a chawl at Kabootarkhana, which was a co-operative housing society, where over six hundred families lived together. Everyone has a one-bedroom accommodation. People find it shocking that neither I nor Mukesh drink or smoke, are vegetarian, are god fearing, and don't gamble.
These are not values that are passed on by any sort of action, but more a part of one's upbringing. Praying to god, respecting other individuals… I think it's been really put together by my mother. My father was very, very busy.
On his parents:My mother is a very simple down-to-earth person. My grandfather, that's my mother's father, was a postman. He rose to become the in-charge of a post-office in Jamnagar in Gujarat. So she comes from that background.
Her marriage to my father was, obviously, an arranged one. My paternal grandfather was a schoolteacher. Soon after my parents got married, they went of to Aden in Yemen. That's where he started working as a gas station attendant (a petrol pump attendant in Indian parlance), and typically he went there to raise capital, conserve capital and come back.
My mother really supported my father through those tough times. I don't think I recall -- during my entire school or college career -- my father spending time with me, sitting with my homework or my tuitions or anything of this sort.
My mother really supported my father through those tough times. I don't think I recall -- during my entire school or college career -- my father spending time with me, sitting with my homework or my tuitions or anything of this sort.
My father looked at it very simply, saying "I think we are going to give you the best upbringing to help create the best values for you. I believe you have the brains so you should study hard. You don't have the financial problems that I had when I wanted to study. Well you don't have any monetary problems, so go and try to look for the best school, college, university that you can go to."
Time and again I've asked him what he misses most, and he always said that it has been a good education. He wanted to study, but he didn't have the resources. Fortunately, in our case, we had no such problem.
I was 10-years-old when we moved out of the chawl. I have clear memories of living there. It had one bedroom; we were seven members in the family, including my grandmother. There was a common bathroom and toilet for a hundred families together in the chawl.
It was on the fourth floor, that's about a flight of 50-60 steps. We stayed at Kabootarkhana, Bhuleshwar; I think it was called Jaihind Estate.
On values:We moved to Usha Kiran later. But nothing came very easy. We had no lack of monetary resources, but we were given sort of goal-oriented finances. This was very important; my father would ask us to do something to earn.
For example, if we played a match or went hiking or trekking or walking or whatever else…. At the end of the trek he would give us a choice of two things: we could have one drink and one snack, or two snacks and no drink. The budget was five bucks, and it didn't change for a long time.
I recall it was the summer of early 1970s and he said to us, "Look this is the mango season, I know you guys are very fond of mangoes, but the only ways you can get a full box of mangoes is if you travel by the lower deck on the Bombay to Goa steamer. And, you know, our incentive was the mangoes, not the trip to Goa!
He could afford to send us by air, yes. But he wanted us to go through that "lower deck experience", where there was no reservation and everybody was puking. He just wanted us to go through that event because he believed that there is no way we could ever buy that sort of experience.

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