Friday 28 October 2016

Money Talks, Power Listens

Respect for the Tata brand and its bankroll has characterised the group’s ascendancy

“There is no friendliness at the political level, but there is at the people level. The people are always friendly. Only when there is friendliness at the political level will we think of it,” said Ratan Tata, at the AGM of Tata Global Beverages in Calcutta a couple of months ago, when asked about his investment plans in West Bengal.

Friendliness with political leadership has been one of the hallmarks of how Ratan Tata has been known to proceed with his investment decisions, be it in West Bengal, Kerala, Gujarat or Chhattisgarh—in the latter, he has been able to get the state government to sign, for the third time, a memorandum of understanding to set up a mega steel plant despite persistent opposition from tribals in the Bastar region.


When prospects soured for Tata’s ambitious Nano project at Singur, that famous SMS from Gujarat chief minister Narendra Modi assuring all help paved the way for the project to be shifted to Sanand. In 2003, a year after the communal riots in Gujarat, Tata was reported to have been a less-than-enthusiastic participant at the Vibrant Gujarat summit in Surat. But he soon changed his stance, saying in 2007, “It is stupid if you are not in Gujarat.” It is believed that Tata’s former PR lady Niira Radia played a big role in shifting the plant to Gujarat.

To believe that Gujarat is alone in having dispensed special favours to Tata would be wrong. By and large, most state governments have been known to bend over backwards to accommodate Tata Group projects—sometimes at the cost of other companies offering similar terms and technology. The Tata brand works here obviously. The fact that the Tata trust provides election funding to all the major parties may be an influencing factor as well. A cheque for Rs 27 lakh returned by Mamata Banerjee to the Tata electoral trust fund coffers is an indication of how past hardships are often overlooked to pave the way for the future.

At the central level too, Tata has gained in stature in UPA’s Delhi—this ascent comes after an indifferent run through the 1990s, when he failed thrice to start an airline with Singapore Airlines. Now, he is a part of such prime minister-led policymaking bodies as the Investment Commission, the PM’s council on trade and industry, the National Hydrogen Energy Board and the National Manufacturing Competitiveness Council. There is no doubt Tata has come to be a powerful voice of Indian industry—that explains in part why the 2G spectrum scam did not really sully his image.

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