Author: Somindu Shah
Publication: DeshGujarat.com
Date: October 10, 2008
URL: http://deshgujarat.com/2008/10/10/narendra-modis-blitzkrieg-a-savior-for-brand-india/
In his book "India's Century" Commerce
Minister Kamal Nath has made some very interesting observations on Indians.
He says The Indian is an "Insta-Preneur" (a portmanteau word for
Instant Entrepreneur). He further argues that "For India, entrepreneurship
is a unique way of seizing the day. Be they at the bottom of the pyramid,
the middle or the top, what comes most naturally to Indians is the ability
to spot an opportunity to do business. This is quality that some societies
have and some don't."He gives example of one of the common man from his
constituency Chinndwada to prove his argument. Gujarat's success in getting
Nano, not only vindicates his definition it goes beyond that.
Once Tatas decided to park themselves to "Safe
Gujarat", there has been huge relief from all the quarters, especially
India Inc. A lot has been written on how Gujarat won it. But I would like
to point out one fact which has largely gone unnoticed. When emotional Narendra
Modi said he will pursue this project as National Spirit, he definitely helped
Indian cause in great way. I had argued (or suggested) in my last article
about emotional need (besides rational ones) for Tatas to look at Gujarat
with Indian interest in mind. But Narendra Modi gave even larger emotional
reason for going out of his way to woo Tatas.
He said he could not bear the news that some
other countries have invited Tatas for investment. Whether Tatas seriously
considered offer from outside is not known. But if not Gujarat, imagine what
could have happened. All those so called front runner states had one form
or another opposition politician waiting to seize the opportunity ala West
Bengal style. So one more state and same tragedy would have tarnished carefully
build India's Brand image into pieces.
Let me drive the point from global investor's
view point. In the midst of the controversy where all the investors were looking
to India, WB CM tells Tata to compare other states and was confident that
all states will have opposition to land allocation. Almost scaring global
investors by implying that you are not safe anywhere in India. Mr. Yechuri
uses the analogy of asking for safety against burglary before building house.
Either he does not know what Ram Rajya meant or does not know the world all
over has flattened and there is very less margin of error. Or take example
of Congress Spokesman Dasmunshi. He was asking Tatas not to threat leaving
and even suggests Tatas should increase car price. Again a classic case of
no values for commitment or least understanding of how important this project
is for India. What kind of message we were sending to world investor community?
If Nano project were without new site for say a couple of weeks more, you
would have seen terminals of Bloomberg and Reuters filled with "India
Growth a Myth" stories. Leading to either decreased confidence in India
or raising India's risk premium.
Already there were strong murmurs among global
investor community about the bad treatment India is giving to Tata (our most
respected business house). They were saying if you could do this to Tatas,
what will happen to us. This was mentioned openly by USA, Japan, Western European
countries. The carefully created Indian image after 2003 would have busted
and it would have taken us at least a decade back if not to 1991. The humiliation
as a word would not have sufficed the situation. And we Indian would have
started blaming each other. For Tatas huge amount of time, money and energy
was already wasted. A mere offer to relocate was not enough. Something extra-ordinary
had to be done to bring the positive confidence back.
And luckily for India precisely that happened.
The savior came in the form of Narendra Modi's Gujarat. It was not about Narendra
Modi's offer, but the way he and his team executed made the difference. There
was clarity, consensus, conviction, full control and above all care and compassion
for investor. The kind you will see either in South East Asian nations or
China. Investors do understand and appreciate this language. I guess Kamal
Nath and his team must be thanking Narendra Modi for this. The welcome (unlike
WB) was across the board in Gujarat from men on the street to Modi's administration
team who gave up their Navratri holidays to work round the clock just for
one goal. The emotional pitch of Modi was icing on the cake and must have
brought relief to Mr. Ratan Tata and his budding engineers. Other states must
also learn that rational issues (like sops and other tangible benefits) normally
preside but its the emotional ones (must do spirit and long term commitment)
that become deal clincher.
One classic living example is Mentor Minister
of Singapore Mr. Lee Kwan Yew. When Singapore became independent, the only
source of survival for them was FDI. And only available resources were Human
Resource. He used his monetary resources carefully and used it to build right
infrastructure, reformed fiscal policies but most importantly created drive
for cleanliness and created many lush green gardens, emphasizing good quality
of life. Whenever he met any prospective investor, he would show them the
gardens and say it was quite painful process to build them and maintain them.
But we have taken good care of our gardens so they have flourished and look
nice. In the same way we will take care of your investments. We will be gardener
to make sure your Investment tree grows here. Modi's tone was of similar nature
when he said to Tata to speed-up the project. Ratan Tata mentioned in the
news conference that Modi has told him that since this is smallest car, I
want you to build your plant in shortest of time. Tata must have been relived
that he has chosen the right place to plant his tree. The guardian and residents
here will take care amply.
For the State this is indeed a "force
multiplier" opportunity. When Nissan was looking for their mother plant
in India, Gujarat was in the race but lost it to Chennai as a Gujarat did
not give any special favor. It seems this time Gujarat did give incentives.
However there is a difference and one must see the sops in a larger sense.
Unlike Nissan's case, India cause in Global context was at stake. The global
meltdown is going to touch the Indian shore very soon. Even USA is opening
tax-payers' coffers to salvage their banking system. In Tata's case this is
positive sops. Considering this was for national cause as argued above I guess
only those with limited knowledge of economy will oppose it. As they say in
Gujarati Proverb "Laxmi Kapale Chanllo karva aave tyare mou dhova na
javay" (You do not go to wash your face when Goddess Laxmi bestows to
offer tilak on your forehead). The benefits both for Gujarat and India (read
Why Narendra Modi's sweet offer is good for Nano Milk) are far greater.
The obvious spillovers of Nano effect are amply discussed elsewhere including
direct and indirect employment and realty growth. Some even talking of Ahmedabad
finally giving some competition to Mumbai. The positive brand image of state
created by Nano, will benefit Gujarat based industry as a whole. May be Investment
bankers advising Gujarati companies (looking for technical alliance or strategic
investor) will start talking about charging Gujarat premium (for being safest
and most investor friendly place) while negotiating deals.
But sensing Gujarati spirit and how a wider
spectrum of society will be benefited, I can see a whole new "NANO inspired
Economy" taking shape in Gujarat. We already heard Nano Garbas (read
Nano's songs on Gujarat's Dandiya grounds). NANO wave will only escalate in
coming days. One can easily visualize Nano Crackers (for Diwali) Nano Jalebi,
Penda (Sweets for New Year) , Nano Patang (popular kite for Uttarayana), Nano
colors (Holi) the list can go on. With a tongue in cheek, I wouldn't be surprised
if on Sanand Highways one day you will see "NANO BHAJIYA HOUSE"
every kilometer with sub-hoarding "Juna ane Jaanita or Amari biji koi
Shakha Nathi (meaning Old and famous or the genuine ones with no other branch).
The insta-preneur (as mentioned in the beginning of article) Gujaratis must
be jumping to ride on Nano Parva (festival). After all States' slogan says
Come to Gujarat where Life is celebration.
I am sure whole State will speak in one voice
of good host and treat Tata Motors employees with great respect. This to only
reinforce confidence of global investor in India story.
