Business Maharajas

Piramal, a business historian who came from an Indian industrial family, wrote profiles of leading Indian business figures based on extensive interviews, published shortly after the 1991 liberalisation.

The subjects include Dhirubhai Ambani of Reliance, Rahul Bajaj of Bajaj Auto, Aditya Birla, Bharat Ram, Brij Mohan Khaitan, Rama Prasad Goenka and Ratan Tata. Piramal had access to most of them directly.

The substantive value is in what the profiles reveal about doing business under the licence system. Until 1991, Indian industrial production required government permission specifying what could be produced, in what quantity, and where, and expansion required fresh approval. Capacity, imports, foreign exchange and technology licensing were all controlled. Piramal documents how each subject navigated this: the relationships with officials and politicians, the use of licence applications to block competitors, the practice of applying for more capacity than intended to deny it to others, and the specific skills that this environment rewarded, which were political and procedural rather than operational.

Dhirubhai Ambani's profile is the most detailed and the most instructive. Piramal traces his construction of Reliance from a yarn trading business into a vertically integrated textiles and petrochemicals group, the use of retail equity raising to fund it when institutional finance was closed to him, and the intensity of his engagement with the licensing system.

The book was published in 1996 and captures a business class at the moment its operating environment changed fundamentally. The subjects' subsequent trajectories diverged sharply depending on whether the capabilities that suited the licence system transferred to a competitive one, which is the natural question the book raises and cannot answer.