Ratan Tata, and his rapidly fulfilling list of wishes
In his first post-retirement interview in December 2012, Ratan Tata had laid out a rather busy plan for himself—flying, taking piano lessons and spending time with the Tata Group’s philanthropic trusts which he would be heading. Ten months down, he has been busier, not just with these, but by playing a major role in many of the group’s new initiatives. Though he anointed Cyrus Mistry as chairman of Tata Sons and made way for him last December, it is common knowledge that Ratan Tata’s influence reigns supreme in the steel-to-software conglomerate.
Tata had made it clear that after retirement, he did not want to have his “shadow hanging over the group; a ghost walking in the corridors...”—but it seems the group can’t do without his image and brand equity. Corporate watchers feel Mistry would have to rely on the Ratan Tata brand name till he is able to steer the group his own way. “Ratan Tata is a great advantage to the group. This is a transition period for it and his name will be there. For a group this big, there has to be a transition for some years,” says T.V. Mohandas Pai, chairman, Manipal Education.
It was during these failed attempts that he first met PR lady Niira Radia (see box on pg 42). At that stage she was a consultant with SIA. In February this year, the Tata Group entered into a three-way joint venture with Malaysia’s fastest growing low-cost airline, AirAsia, to launch a budget airline in India. Ratan Tata is believed to have played a major role in the initiative. Says former Air India executive director Jitender Bhargava, “Behind the scene or as a hidden hand, Tata has always had an emotional connect with aviation. The group has always been keen to get into this sector.”
Apart from the obvious historical context, there’s no denying that coming from the Tatas, there is a lot of expectation that this born-again venture will improve things in Indian aviation. Aviation entrepreneur and founder of India’s first budget airline Air Deccan, Capt G.R. Gopinath, says, “Competition will bring down sky-high fares by breaking the kind of cosy cartel that seems to exist, and simultaneously improve the quality of service and product offerings. It is good news for the gloomy aviation sector.”
Even initial problems—like apprehensions voiced about the Tata-SIA deal by Arun Bhatia, a co-partner in the AirAsia JV—have been sorted out. Though it has Ratan Tata’s imprint all through, the Tata-SIA venture is being led by the Group’s nominees—Prasad R. Menon, who will be chairman of the venture, and the group’s brand custodian Mukund Rajan, according to a company statement. A Tata Sons spokesperson says, “The goal is to realise the original vision of launching a full-service, world-class airline that India can be proud of; the Tata group’s own contribution to the aviation industry in this country is also well-known, and the group hopes to carry forward the legacy of having launched in past decades one of the world’s most admired airlines, Air India.”
People connected to the sector feel that the Tata-SIA deal may have been pushed by the government itself. It appears the UPA is trying to make amends given the brouhaha after the Jet-Etihad deal (which led to questions about the manner bilaterals were given away by the government). By bringing in the Tatas, it could achieve two objectives. Firstly, appeasing and fulfilling Ratan Tata’s dream of getting into aviation. And secondly, helping airports in large cities that were modernised with huge investments and whose business and traffic were threatened when existing carriers were given permission to fly from smaller cities to international destinations. Finally, it helps to be in the good books of the Tatas months short of general elections.
That said, no one expected Ratan Tata to be totally detached from the group’s affairs after retirement. That’s because the Ratan Tata brand equity is still the most saleable commodity across Indian and overseas investors. Corporate watcher and journalist Paranjoy Guha Thakurta says, “It is not surprising that he still calls the shots, directly or from behind the scenes. His name, his clout with the government, is still a big factor. Foreign investors know that the Ratan Tata name still carries weight in the corridors of power in New Delhi, in North and South Block and in Udyog Bhawan.”
Corporate experts believe that in a way, Tata was a victim of his own policy of setting a retirement age for his group chieftains, a policy for which he had to fight a bitter battle when he took over the reins of the group in the early 1990s.
Anyway, all the hard business hasn’t slowed Ratan Tata’s other role—to be an elder statesman and propagate the group name across the world. While Tata was involved in rebranding the Nano, his pet project, in June, he was selected among a group of industrialists and experts as part of Virgin group chief Richard Branson’s Plan-B project, which helps transform business from a profit-only focus to align with the government and the social sector. In September, he was nominated as a member of the board of trustees of the American thinktank, Carnegie Endowment for International Peace.
What then about Mistry’s report card? Experts say it’s too early yet to form a view on his first ten months at the helm of a large and diverse group. “Cyrus Mistry will obviously use the sagacity and wisdom of Ratan Tata to guide him and that remains at his disposal,” says Anirudh Dutta, former head of research at CLSA. That’s evident. But for now, all the flourishes in the Tata group are coming from the man who bears the famous last name.
By Arindam Mukherjee with Lola Nayar
The article on Ratan Tata’s indirect and direct control over the affairs of the Tatas was revealing (The Aviator Emeritus, Oct 14). Not only should they have been allowed to set up an airline 15 years back, it’s still not clear how India gained by nationalising their airline and then ruining it.
Ashok Lal, Mumbai
Well, Nano was used to mop up funds to finance overseas acquisitions like Jaguar and Corus. What product is he bringing out to fund his airlines?
Kishore D., on e-mail
What is inter-personal interaction about? It seems, that people can say anything to anyone, and the reason always stems from not making a living. So, if a person feels you are not helping him in his peace of mind, so that he can earn more of a living, then he can say anything to you. Apparently, the politician sees this state of affairs also. He is helping others, and also the self pertaining to the identity. Is the politician an administrator, social service worker, or a person who advises others about how to live their lives, and wants to implement how he/she wants others to live their lives, by exercising force and coercion, a. k. a. politics? It seems, the politician has been messing up, and messing around with people's lives. The reason why Mayawati is a Dalit like no other, according to the Congress and B. J. P., is because she can be as uncivil to senior B. J. P. and Congress Senior members, as the B. J. P. and Congress are to themselves. Those who are in high positions of profession, didn't know what they were getting into. They were influenced by govt., and were actually simple innocent and naive, and when they did embark on their profession, they weren't, but were more enfranchised. How is this, the state of affairs of India, then?
Response to 4/D: Apparently, this isn't a problem, like it wasn't a problem initially for Mr. Ambani, Dhirubhai. Today, Reliance can also leverage funds, if the need arises, and not by raising shares like they do usually. The strange dichotomy that is extremely vexatious is, that when it comes to setting up industry for the Reliance Group, people want to help, thereafter, the business has extreme cut-throat competition in functioning. It is generally said, that the Reliance Group sets up businesses and industries, and lets them run themselves. Now, the people are who run the businesses and plants. This seems to be the democracy that the govt. might both endorse, and not endorse. People might not know, whether they have a job, or whether their job is for any interest to anyone, particularly or generally, pertaining to particularly to self or public interest, or generally to the national interest
Nano was used to mop up funds to finance overseas acquisitions like Corus and Jaguar.
What product is he bringing out to fund his airlines?
I really want Air India to be privatised, and for the TATA group to manage it. It seems, that Singapore Airlines can have a joint venture, whereby Air India and Singapore Airlines collaborate keeping singular identities. Singapore Airlines can fly to airports closer to Singapore, and important overseas airports further, and Air India can fly to airports at a comparable distance, and also to the same important overseas airports. Airlines like Singapore, and Virgin Atlantic are extremely important to aviation. I like flying Air India, if I ever happen to.
Virgin Atlantic notwithstanding, airlines like British Airways, Air France, and very particularly, J A L, are very interesting to fly. I think some U. S. airlines either merged, or changed identity, which is very sorry. I like Delta.
"He has a patriarchal approach..."
"He has a patriarchal approach..."
What does the author mean?
And how exactly is 'patriachy', worse than ( for eg.) 'matriachy'?
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