How did the value of the Indian company Tata become more than the GDP of Pakistan
In my childhood, I heard a saying that people are stronger than men, better than shoes and better than goods.
It is not known how true it is, but in recent days it has been revealed in the Indian media that the total value of the Tata Group of Companies has reached 365 billion dollars, which makes it the most powerful company in India. Its value is more than the Gross National Product (GDP) of Pakistan.
You may be hearing every day that Reliance Group Chairman Mukesh Ambani has become one of the richest people in the world or that billionaire businessman Gautam Adani has overtaken him. But you don’t hear mention of Tata in them.
From Tetley tea to Jaguar Land Rover cars and from making salt to flying planes and setting up hotel groups, Tata’s influence is seen in various walks of life.
According to Indian media, Tata Group’s market capitalization was around $365 billion in February 2024, while recently the International Monetary Fund (IMF) estimated Pakistan’s GDP at around $341 billion.
If we talk about Tata Consultancy Services alone, it is worth USD 170 billion, which is the second largest company in India. It is worth almost half of Pakistan’s economy.
Establishment of Tata Company
However, it has not all happened in a day. It took more than one and a half hundred years, but it has been India’s first company in many walks of life.
While laying the foundation stone of Lonavala Dam on February 8, 1911, Sir Dorabji Tata, the then chairman of the Tata Group, spoke about the ideals of his father Jamshedji Tata, who had founded the company in 1868. It is now a group of 30 companies with ten verticals and offering its services in over 100 countries across six continents.
Durabji Tata had said: ‘For my father, the acquisition of wealth was only a secondary thing. He gave priority to improving the industrial and intellectual condition of the people of this country. The various institutions that he started from time to time in his life were mainly aimed at the development of these important aspects of India.
The company’s website states that its mission is to “improve the quality of life in diverse communities” around the world.
In the late 19th century, Tata founder Jamshed Ji Tata is said to have been denied entry to an expensive hotel in Mumbai because of his complexion.
Jamshedji was deeply affected by this incident and decided that he would make a better hotel than this one in which Indian nationals would also be allowed.
The first luxury hotel
Thus, in the year 1903, the Taj Hotel was established on the shores of Mumbai. It was the first building in the city to have facilities like electricity, American fans and German elevators and was staffed by British handymen. Now it has branches in nine countries including India, USA and UK.
Jamshedji was born in 1839 in a Parsi family. Many of his ancestors were religious leaders of the Zoroastrian religion.
They made good money in cotton, tea, copper, brass and opium (the trade of which was not illegal at the time).
He was an all around person and was very impressed with new inventions.
During a visit to Britain, observing the cotton mills in Lancashire, he realized that India could compete with its colonial masters in this business.
The first textile company
Therefore, in the year 1877, Jamshedji opened the first textile mill of the country under the name of ‘Maharani Mills’. The Maharani Mill was inaugurated on the same day that Queen Victoria was crowned as Queen of India.
Jamshedji’s vision for the development of India can be understood from the Hindi word ‘swadeshi’ which means ‘made in one’s own country’ and this idea was part of the Indian independence movement in the early nineteenth century.
He had said that ‘for the development of a nation, instead of supporting the weakest and most helpless people, it is necessary to help the most worthy and God-given people so that they can serve their country. can.’
The first industrial city
His biggest dream was to build a steel factory but he died before realizing this dream but then his son Darubji fulfilled his father’s dream after his death and in 1907 ‘Tata Steel’ Production started. And thus India became the first country in Asia to have a steel factory.
A city was built around this factory which was named Jamshedpur and is known today as the Steel City of India.
Jamshed ji gave instructions to his son Durab to settle an industrial city through a letter and wrote that ‘the streets of this city should be spacious, there should be space for trees, sports fields, parks and religious places of worship. Should.’
The Tatas themselves introduced policies for the welfare of their employees without any legal restrictions, including pensions in 1877, eight-hour working hours in 1912 and benefits for women who became mothers in 1921.
First air service
Another member of the Tata family, Jahangir Tata, became the chairman of the company in 1938 at the age of 34 and held the position for nearly half a century.
He had a passion for being a pilot more than an entrepreneur which was born after he met ‘Louis Bluwright’ who was the first pilot to fly across the English Channel.
JRD was the first person to complete pilot training in India from the Mumbai Flying Club. His air license was number 1 which he was very proud of.
He started India’s first air mail service and often carried passengers along with mail.
Later this postal service became India’s first airline ‘Tata Airlines’ which was later renamed to ‘Air India’.
But once again he has bought this company from the government. After the acquisition of Air India, Tata Sons now has three airlines. ‘Air Vistara’ in which they have a partnership with ‘Singapore Airlines’ and they have a partnership with Malaysia in ‘AirAsia’.
On the acquisition of Air India, Tata Sons Chairman N Chandrasekaran issued a statement in October 2021 calling it a “historic moment” and said it was a matter of pride to own one of the country’s leading airlines.
Chandrasekaran also said in his statement: “Our endeavor will be to run a world-class airline that every Indian can be proud of.” He said, “The return of Maharaja will be a true tribute to JRD Tata who started aviation in India.’
Step into the world of computers
The Government of India earlier made JRD Tata, the head of the Tata Group, as the Chairman of Air India and he held the position till 1978. Since then, it has been held by the officials of the Government of India.
In 1968, he continued his family’s tradition and started a business that was often attributed to developed countries, i.e. computer related business.
Tata Consultancy Services, or TCS, supplies software worldwide, and is currently one of the most profitable companies in the Tata Group.
In 1991, Ratan Tata, a distant relative of his, took over the reins of the company and under his leadership, Tata expanded its business worldwide. Tata bought companies like Tetley Tea, AIG Insurance Company, Ritz-Carlton in Boston, Daewoo’s heavy vehicle manufacturing unit and Corus Steel Europe.
Today’s Tata and the secret of success
Tata Sons is the primary investment holding company and promoter of Tata companies. 66% of Tata Sons’ equity share capital is held by philanthropists who support education, health, livelihoods and arts and culture.
We tried to contact Tata Company Corporate Communications but could not get through to them. Although the Tata company has not yet disclosed the figures of the company’s value, but as of July 31, 2023, they had estimated their worth at $300 billion and also said that the company would have more than a million employees worldwide.
According to the company, each Tata company or enterprise operates independently under the guidance and supervision of its respective Board of Directors.
When we spoke to economist Shankar Iyer about Tata’s exemplary success, he said the name Ambani or Adani comes from the fact that their companies are private, while Tata is a collection of different companies and is run by a trust. So it is not mentioned in this way.
Speaking over the phone, he said that although he does not believe such comparisons are valid in the corporate world, the Tata company is a leader in many matters in India.
Nagesh Talwani, former managing director of Alstom India at energy giant GE India and now managing director of Housing India Limited, told the BBC over the phone: ‘Tata’s growth is largely due to its ethics. , is fair and transparent behavior that creates a strong connection with employees and fulfills commitments with them.’
Speaking on the phone from Pune, Mr. Talwani described Tata’s specialty with a few pointers. According to him, Tata has a clear vision and a clear strategy towards investments and the best example of this is the acquisition of Starbucks, Croma Concept, Jaguar brand etc.
They avoid a ‘no-nonsense’ approach and strive to work attentively without making any noise with their silence.
He further said, ‘Conscious positioning of the brand through corporate social responsibility has made consumers across the country connect with them and feel secure because they believe the brand is trustworthy and honest. .’
Mr. Talwani said that another key point of his development is “avoidance of emotional and irrational business decisions and portfolio diversification and very clear governance process to balance risk.”