The maharajas of business

What a colourful cast of characters parade through this giant volume. From across the ocean come swashbuckling adventurers like Thomas Parry and Charles Forbes whose names, if nothing else, are still with us today.

Sprung from local soil are scores of merchant princes like Jamsetji Jeejeebhoy, Dwarakanath Tagore and Nusserwanjee Wadia.

Towering above them all is the giant figure of Jamsetji Nusserwanji Tata who, in an era of horse-carts and carriages, dreamt of steel mills and hydroelectricity.

This book is the distillation of a lifetime's work. Professor Dwijendra Tripathi has been conducting research into Indian corporate history ever since he joined the Indian Institute of Management - Ahmedabad, back in 1964 and realised that he was setting out to explore relatively untrodden territory.

About 13 years ago he conceived the idea of a magnum opus that would cover the entire sweep of Indian corporate history from the Jagat Seths who helped to overthrow Siraj-ud-daula at Plassey to our modern day billionaires like N R Narayanamurthy and Dhirubhai Ambani.

The result is a history book that is learned, packed with detail and also a compelling read. It begins around 1700 with powerful local merchants like the Nagarsheths of Ahmedabad who became dominant figures in their home towns (Nagar Sheth was a title awarded after a rich merchant Kushalchand dipped into his own coffers to prevent a marauding raid by the Marathas).

Then come the foreigners like Parry with their managing agencies who jumped into a vacuum and dabbled in almost anything that might turn a profit.

Parry, for instance, experimented with everything from shipping, to marine insurance and leather tanneries.

As the eighteenth century unfolded fortunes were made in opium and an entirely new cast of characters occupied centrestage.

This was also the heyday of the Parsi community with names like Readymoney and Jeejeebhoy springing to prominence.

Jamsetji Jeejeebhoy went on trading expeditions to China and made his fortune by taking great risks to supply much-needed cotton to Britain during the Napoleonic Wars.

Meanwhile, on the eastern coast Dwarakanath Tagore was building his short-lived empire in everything from coal to insurance, indigo, sugar and silk.

My favourite chapter, undoubtedly, is titled 'An Insane Interlude' which deals with the stock market bubble of the 1860s and the crash that followed.

This is a story that has been told by others, but Tripathi clinically dissects the scene that unfolded after the American Civil War pushed up Indian cotton prices to astronomical levels.

As wealth poured into Bombay reclamation and beautification schemes became the order of the day. Behind it all was the figure of Premchand Roychand who became a key figure in the Back Bay Reclamation Company.

Inevitably, the boom turned to bust the moment the American Civil War ended and cotton prices tumbled.

The result was: "Gripped by an unprecedented panic, the city went entirely mad. Investors rushed to dispose of their shares in the bubble companies, for which there were no buyers. The banks and financial institutions that had advanced them funds found themselves in an utterly hopeless situation."

Indian corporate history has, over the decades, been a victim to two schools of thought. On one side were the cultural determinists who started with the premise that the Hindu systems of caste and the belief in karma prevented them from seizing the opportunity and becoming powerful businessmen.

The second school of thought was that India's economy was stopped from growing by the colonial power which saw to it that Lancashire thrived at the expense of Ahmedabad and Bombay.

Tripathi doesn't subscribe to either of these schools. He studies the evidence and draws conclusions accordingly. Why, for instance, did the east evolve differently from the west? Was it because the failure of Dwarakanath Tagore discouraged others?

Modern India begins after the speculative craze of the 1860s had died down. The new figures emerging are millowners like Tata, Morarjee Gokuldas and Khattau Makanji.

Tripathi, however makes no secret that Tata deserves pride of place in Indian corporate history: "What has won for him a towering, almost unique, position, are the gigantic industrial projects that were conceived and launched during his lifetime but were completed by his successors."

In the new century, dozens of new 'native' houses made their appearance. And Tripathi points to the curious fact that from World War I onwards the 'native houses' were going from strength to strength while the expatriate-controlled empires were stagnant.

Did they realise that the end of Empire was coming? Says Tripathi: "To imagine that the investment decisions of the expatriates after 1919 were guided by their apprehensions about something that was still some 30 years away would be to believe that they were endowed with uncommon foresight, denied to normal businessmen."

As the 20th century progressed yet more colourful characters emerge on the scene. There is, for instance, Walchand Hirachand who made a fortune in construction but also conceived a high-risk plan to break into the shipping industry which was controlled by the British.

"The venture that caught his imagination was quite unusual "" so unusual, that his contemporaries would have doubted his sanity."

Walchand and his partners persisted despite the fact that the British blocked the sea lanes in every way possible. The result was Scindia Shipping.

Later he conceived another visionary scheme to make aeroplanes and formed a company called Hindustan Aircraft.

This was during World War II and, as the Japanese advanced rapidly on different fronts he was ordered by the British to see that the factory could be blown up swiftly, if necessary. When he refused they took it over.

Tripathi follows the tale all the way to the merchant princes of our own era. Can the merchants of software and polyester compare with the adventurous giants of the opium trade or the pioneers who built hydroelectric plants in the wilderness? Perhaps we should wait for a century or so before answering that one.

THE OXFORD HISTORY OF INDIAN BUSINESS

Dwijendra Tripathi
Oxford University Press
Pages: 336/ Price: Rs 1,500