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Not that the business suffered because of it; the diversified conglomerate that he has headed for more than two decades now has grown 20% annually since FY92 and at an even more impressive 30% in the last six years to March, 2012, a feat that not too many other business groups have been able to match. With a bit of luck, it may have done better but the fact remains that Tata chose to keep his distance from the political class and fortunately, for him, there weren’t too many occasions on which he needed to engage with it. On the few times that there was a skirmish, he took tough decisions as during the critical agitation over land in Singur West Bengal when the plant was re-located to Sanand in Gujarat. But more moving out, the Tatas had offered to buy 400 acres and gift it to the affected farmers in return for the land Tata Motors had used to set up its car plant. It was a fine gesture and the kind of generosity that sets the Tatas apart from the country’s other large industrial groups.
Tata’s biggest contribution to India though would have to be the confidence that he instilled in India’s engineers backed by his own conviction that they could produce an indigenous car at an affordable price and his determination to see the projects — both the Indica and later the Nano — succeed. As he himself said in interviews following the launch, he was surprised at the interest that the Nano — priced at just R1 lakh — evoked around the world. That the Nano didn’t sell the kind of volumes it was expected to must have been disappointing for Tata. As must have been the debilitating losses in the telecom piece — an effort to explore new areas in a liberalised economic regime — or the ambitious $12-billion acquisition of the Anglo-Dutch steelmaker Corus which has left Tata Steel hugely leveraged, an attempt at making the group global.
No doubt the Tatas has the financial muscle to foray into new spaces but there was also the appetite for risk; some of the global buys may not have been well-timed, a fact that Tata has graciously conceded. But there’s no doubt many of the buys – the hotels for example – hold out promise. The spectacular turnaround at the loss-making Jaguar and Land Rover bought for $2.3 billion in March 2008 – critics carped that the Tatas would never be able to sell luxury brands in unfamiliar markets – in less than three years was proof of the group’s technological and marketing skills.
But it’s a fact that TCS accounts for a tenth of the group’s turnover, a higher third of the profits and half of the market capitalisation. However, sceptics who believed the Tatas would never do well in the consumer space have been stumped by the success of a Titan or even a Westside. The biggest asset that Tata will leave for Cyrus Mistry, of course, is a capable cadre of CEOs. But without its ‘ratan’ the Tata Group can never be the same.
