JRD Tata

Today I am writing about the few incidents from the  life and times of JRD Tata.

JRD was 15 years younger to first PM Jawaharlal Nehru, whom he admired as the heroic knight in armour and an apt leader for independent India. However four decades later his opinion changed, and he wrote ‘ I have often thought that if fate had  decreed that Sardar Patel instead of Nehru would be the younger of the two and became PM, India would have followed a very different path and would be in a better economic shape than it is today.’ Now what caused JRD’s opinion to change over the 4 decades. Well it must have been the combination of several factors :

The most crucial being the govt’s approach or rather the lack of it, towards economic development in the first three  decades after independence. The nature of the Tata’s business in core sectors like steel, electricity and locomotives made it imperative for all their companies to be heavily dependent on govt orders and anti dumping protection. This required  Tatas to maintain a fine balance between British Raj and India’s freedom movement. Whether under British rule or post independence, their key focus of dialogues with govt of the day was always on the subject of India’s Industrial development. It has been said in the govt circles in those days, whenever Tata group Chairman visited Finance ministry before budget, the focus was not on the wish list of the things for the Tata group alone but for the full industrial sector. A Secretary to the govt and former Governor of RBI once mentioned that whenever JRD approached him he always talked about  the whole industry and nor for Tata group , he wanted no favours, but only fairness.

I has been recorded in the history that in 1944 some of the most eminent industrialists of India were invited by Tata Chairman to propose  ‘ A Plan of Economic Development of India’. This was later known as ‘Bombay Plan’ or “Tata -Birla Plan’. That time, this Rs 10,000 Cr  Plan, put forth several recommendation on improving per capita income, health, education, housing, agriculture and industry. It was the first plan prepared by industrialists/capitalists, which had strong emphasis on social welfare. It looked for a largely deregulated economy with govt investments in industries of national and strategic importance.

When newly formed govt of India adopted centralised economic planning, there was no precedent of economic planning and liberal democracy going together. But  Nehru after visiting China in 1954, was impressed by Chinese mode of socialism and he adopted  socialist pattern of society from second five year plan.

Nehru once told JRD that ‘ I hate the mention of word profit’. JRD replied that ‘I am talking about the need of Public sector making a profit’. Nehru again said ‘Never talk to me about word profit, it is a dirty word.’

The above incidents made JRD realised that what ever Nehru is doing may not be good for the country in longer run, and his predictions came true in 90s when India had to leave socialistic economic pattern.

JRD was also disillusioned by the Nehruvian approach to socialism, centralised planning and nationalisation of key industrial sectors. He was getting more worried when after 1957 general elections Communist Paty of India emerged as second largest party in parliament. JRD had realised that for democracy to survive country needed a strong opposition and the Communist party will further the damage  the prospect of free enterprise.

In 1959, C Rajagopalachari left Congress, and  requested JRD to support Swatantra Party. Naval Tata asked JRD to exercise caution, as public support to Rajaji would displease Nehru. After 2 months JRD agreed to support Swatantra party, and being a transparent man he communicated his decision to Nehru, when he met him next. Nehru blew his top and said ‘You have no business to do that.’ JRD, then wrote a long letter to Nehru mention that ‘ we have been perturbed by any responsible and organised  democratic opposition, which we feel is an equally requirement of democratic govt or society. It is indispensible in the national interest that effort should be made do displace Communist party as the second largest party in parliament. We will keep on on contributing to the congress’s election fund. Although on lower scale fund Swatantra Party also.

In the general elections of 1971, Naval Tata (Ratan Tata’s father) decided to  stand for elections as an independent candidate from the South Bombay constituency. It is believed that PM Indira Gandhi was displeased with Tata’s attempt at contesting against Congress candidate. Furious and unforgiving she said to JRD ‘So the Tata group wants to set up  a front against me.’

In the late 80s. JRD based on his five decades of business experience said ‘ When I joined business there was no Black money. There was no corruption. When you did not have system of govt control, for whom you were to corrupt. In the early days taxes were also very low.Black money will always be there as long as taxes and controls are high.’

Between 1947 and 1984, the most difficult days for Indian businesses, the Tatas retained the number 1 position despite an unsympathetic relationship between business and bureaucracy.. Someone asked him in 1979 why Tata group is not grown as others during this licence raj, and his reply was ‘ if we had adopted the means the others have, we would have grown twice as big, but we do not do business that way. I would not want it in any other way.’ Even his successor Ratan Tata also said in 2017 ‘ I would be lying if I said there were not moments when issues came up and decisions had to be made (on taking short cuts with govt). Happily every time, boards and leadership stood together saying that’s not we do.’

Such was JRD’s  leadership values and traditions of Tatas, which Ratan Tata followed religiously and  ensured that the Tata group’s values are known world wide.

Awaiting your views/comments/feed backs.

Anil Malik

Mumbai, India

8^th Jan 2019