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No Stopping India Inc

Jan
8
2008

India is changing fast, and changing with it, is also its perception and image around the world. It’s a change happening so quickly, it’s hard for many – outside India – to keep up.

Take, for instance, the latest bid by Ratan Tata – chairman of one of India’s largest conglomerates, the Tata Group – to buy Ford’s Jaguar and Land Rover, that went up for sale in Britain last year. Tata is prepared to spend $2 billion for the purchase.

India Inc. – as the loose affiliation of Delhi- and Mumbai-based multi-national corporations is known – has been on such a buying spree that news about this proposed acquisition was received with a jaded oh-yet-another-global-takeover kind of response, nothing extraordinary about that.

Except, if you stop and think about it, it is quite extraordinary. Here is a as-British-as-it-can-get brand that has been associated with luxury and lavishness as well as colonial exploration for the better part of this century. It’s being bought by a company owned by a man born when India was still ruled by the British, who now marches around Europe waving his billions and buying the ex-colonizer’s iconic brands. What’s more, he’s replacing the American firm – an auto company whose history is almost part and parcel of American history – as the owner of the British brand. Everything is extraordinary about that.

Also, this is not the first, and from the looks of it, certainly not the last of Tata’s global acquisitions. Last year, his company acquired Corus, formerly British Steel, for an impressive sum of $12 billion, something that figured in Time Magazine’s Top Ten Best Business Deals.

But it’s not all love and kisses. Late last year, Tata was the news over an unfortunate incident with Orient-Express Hotels Ltd – a hotel chain not as familiar with the East and the changes it’s undergoing as the name implies. One of Tata’s many subsidiaries is ‘The Indian Hotels Company’, which owns the luxury hotels chain The Taj, in India and around the world. In the past few years, they’ve acquired New York’s famed Pierre and the and The Taj Boston (once a Ritz-Carlton).

Indian Hotels is also one of the largest shareholders of the super luxury hotel brand – The Orient Express, headquartered in Burmuda. Late last year the Indian group asked to create a more public alliance with the chain, which includes well-known hotels in the U.S., Italy and Asia, suggesting the two brands join forces in marketing and other business related activities.

What ensued, however, was an unpleasant exchange. Orient Express CEO Paul White rejected this offer and responded with a somewhat unfortunately worded letter that got the goat of the Indian company, not to mention the media. Indians in general minced no words in condemning, what they perceived, as White’s racist remarks. He was certainly direct: “Any association of our luxury brands and properties with your brands and properties would result in a reduction of the value of our brands and our business,” White wrote Tata.

It’s good evidence of how far India’s image in the world has come and how much change is still before this country. Indian companies like the Tatas have come a long way, and as time goes by they are getting more and more powerful in the international arena as India’s economy grows and stabilizes. The new Indian company is not bashful about belonging to a developing nation, instead, it is using that to its advantage as it sweeps up prominent brands while eying other prospective ones.

Orient Express may not relent, but that only makes it an exception that definitely does not prove the rule.

Share  Posted by Gopika Kaul at 5:22 AM | Permalink

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