Outlook had emailed a set of queries to Adani Group chairman Gautam Adani for this week's cover story. His responses came to us after we had gone to press. This therefore appears only on web.
Your group has seen phenomenal success in a relatively short period when other business groups have not grown that much. How have you achieved this?
While we were an extremely successful trading house, we always had ambition to build large assets. In 1995, the Government of India and the Government of Gujarat through Public Private Partnership (PPP) model created opportunities for the private sector to build large Infrastructure assets. This was the right opportunity for us at the right time and we grabbed it.
We have been able to sense the basic business driver that is the demand and supply. We could understand our country's need and the formula to deliver it in the shortest possible time in a most cost-effective way. Our trading background gave us understanding of port and shipping operations and that is how we started our infrastructure journey with the Mundra Port. Trading and Port business created opportunity for power business and the only major missing piece was of coal mining, a sector which we entered at an appropriate time. This gave us very unique but solid and integrated infrastructure business model which created the foundation for our success.
Our story is all about spotting the opportunity, speed of converting it into reality, having perseverance to make it successful, to be grounded to make it sustainable and to be sensitive to the aspiration of our stakeholders.
Barring Adani Wilmar, your primary focus has been on infrastructure. Is there a particular reason for this?
Infrastructure sector is all about building assets for the country. It is part of nation building. Our country's infrastructure requirement is huge, be it ports, power plants, transmission lines or mining. We started our journey of infrastructure sector through ports and went into power, transmission lines and mining sector. With the passage of time, we realised the potential of these sectors and focused our approach towards these areas. We were confident of these sectors and we are continuing our wonderful journey of fulfilment.
The Mundra Port is one of the largest. And now you have moved to the eastern coast/ Would you replicate the Mundra success in the east?
Mundra port is the number 1 port of India. After Mundra, we developed Dahej and Hazira Ports. Both the ports are fully operational and the Goa Port will be operational by April 2014. Later, in December this year, the Tuna Port at Kandla will also be operational. These developments have given us a good presence in the West coast of India. However, our overall traffic at country level is very low. But we are sure that it will grow.
As part of our strategic planning, we have already started scouting for opportunities oin the east coast of India to capture the potential growth in the port sector. We are already operational at Vishakhapatnam Port. We have won the bid of Container Terminal at Ennore Port and we are looking at an opportunity in the east coast of India to replicate our Mundra Port experience.
Apart from consolidating our Pan-India presence, we are also looking at global opportunities and we are sure that one day we will be one of the largest globally admired port entities.
What is your vision for the group, in terms of turnover and growth, in the next 5-10 years?
We have articulated our vision 2020 which is as follows:
To be a globally admired leader in integrated infrastructure businesses with a deep commitment to nation building. We shall be known for the scale of our ambition, speed of our execution and quality of our operations.
In terms of numbers, we are working for 200 million million tones per annum of coal mining and movement, 200 million mtpa of cargo handling at our ports and 20,000 MW of power generation by 2020. We are working extremely hard to convert our vision into reality.
Some of the projects in your group have been facing environmental clearance issues here. What is the status of those projects?
All our projects are fully complied with all the statutory clearances including environment clearances. There is no stoppage of any of our existing projects or its operations. We would like to mention that we have carried out 1500 hectares of mangrove afforestation till date. No other company in our country has done such large scale mangrove afforestation work.
Your mines in Australia are also facing environmental clearances issues and a fresh study has been ordered.
Our Australian project is on track and progressing as per plan. We are in compliance with all the environmental requirements and are closely working with the concerned government agencies.
Your power company has been bleeding and making heavy losses including in the last quarter. What is the reason for this and when do you see this getting arrested?
We have created more than 9000 MW power generation capacity across the country in last 5 years. We are one of the largest private sector players in power sector in India and our commitment to the sector is extraordinary.
Business is all about risk taking and managing uncertainties and turbulence. Change in law in Indonesian imported coal, short supply of coal through domestic linkages and non-provision of these factors in Power Purchase Agreement (PPA) are the reasons for our losses.
The recent CERC order is a big support to the sector which will partially overcome the pain and minimize the hardship.
Why is there a general belief that you are close to Narendra Modi and that has helped in your business? Recently issues about use of your plane has also cropped up. Is this an advantage or are you being victimized publicly because of this?
We are in the infrastructure sector. Government policies, government facilitation, and support is very critical in implementation of large projects like ours. Thus we have to work closely with the government.
Today we are practically operating out of all the states of India, be it Gujarat, Maharashtra, Rajasthan, Tamil Nadu, Goa, Andhra Pradesh, Madhya Pradesh, Haryana, Punjab, Chattishgarh, West Bengal , Jharkhand, Odisha and Himachal Pradesh. We are the serious infrastructure entity having a successful track record of implementing and operating large Infrastructure projects across the country. We would like to put it on record that we are getting sufficient support from all the states and this is understandable as this sector is the priority sector for the government and the backbone of the growth for the economy.
But your closeness to Mr. Modi came out in the open when you withdrew your sponsorship of the Wharton Forum after Mr. Modi's name was dropped as the keynote speaker.
We had withdrawn the sponsorship much before the program.
Why is your group being politically targeted by the AAP?
We are a responsible corporate citizen and we are focused on creating world class infrastructure assets for the nation. We do not comment on political parties and their motives.
How is your relationship with Narendra Modi different from that with Keshubhai Patel or other chief ministers and leaders?
We have been having cordial relations with all elected representatives and administrators across all states where we have business interests as our objectives are dovetailed with the national growth and development objectives.
Have you ever considered joining politics?
We are a business house and focused on expanding our business in India and globally.
