. On December 26, Deepak Shantilal Parekh attended five weddings. That's par for the course; there are days when the 60-year-old Housing Development Finance Corporation (HDFC) chief attends half-a-dozen parties.
Hectic networking? I tease. No, there's no need for that, he replies with equanimity. "It's just that I can't say no to anybody."
I can vouch for the fact that he's pretty good at demurring, though. He never quite refused my invitation to Lunch with BS, but it took me the best part of the year to actually pin him down. So here we were, finally, at Wet Wicket, the bar at the Cricket Club of India.
The choice of a bar instead of a more conventional restaurant was not driven by the need for a midday drink. Indeed, Parekh rarely drinks at the myriad parties he attends, restricting himself to the odd glass of 30-year-old Ballantine, with a friend at home.
He chose Wet Wicket because it was not crowded, so conversation would be easier. The added attraction was a cricket match between CCI and Lords & Commons (a team of select British MPs from the House of Lords and Commons) on the lush, green CCI grounds.
Parekh is a self-confessed cricket fanatic. Just that morning he'd switched on to catch the Pakistan-Australia Test match at Melbourne.
Of course, it's not cricket that's kept him from accepting Business Standard's invitation. Running one of India's largest financial services companies "" with activities ranging from housing finance, banking, insurance, credit rating, mutual funds, and even BPO operations "" is work enough.
But Parekh also seems to have had a monopoly on memberships to key government committees "" the Malhotra committee on insurance reforms, the Narasimham committee on banking reforms and the panel that did the groundwork for a housing finance regulator.
He helped chalk out the rescue plan for the former Unit Trust of India during its first crisis in the late 1990s. Now, he is on the Manmohan Singh government's newly-set up committee on foreign direct investment.
We decide to order before small talk settles into more serious conversation. Parekh opts for a beer to keep me company with my minestrone soup. For the main course, we opt for Parsi fare; he insists I eat prawn but I opt for mutton dhansak while he chooses akuri "" the spicy Parsi scrambled egg "" and toast.
I ask him about his role as the government's unofficial crisis consultant; it turns out that he's also a stringent critic. His current irritation is at the dilly-dallying over airport privatisation.
"Five-and-half years ago our panel recommended that airports should be privatised. Jaswant Singh and George Fernandes were on that panel. Nothing has happened till now. Is the government concerned about the state of the airports and customer service?"
As he points out, the government has received expressions of interest for Delhi and Mumbai. Why does it have to wait for six months for the technical bids? "Why can't it put a gun on the heads of the bidders and tell them to put in the technical bids right now?" Parekh asks.
He answers his own question. "Once a State Bank chairman told me that he was there because he did not take any decision. The biggest decision is not to take any decision so that you can never go wrong. That's our system...The government does not want to take decisions."
Parekh detects the same penchant for non-action when it came to Dabhol Power. "It's over two years and we have not been able to sort out the DPC problem. Its assets are rotting. Every stakeholder must take a hit and get the project going. The power situation is grave in Maharashtra. But nobody bothers about this," he says.
He points to the progress in the telecom sector as an example. "If we can do this for telecom, why can't we move forward in power, airports and ports?" he asks.
For roads, Parekh's suggestion is to go for the annuity-based system where the builder of the road is given the responsibility for its maintenance for the next 10 years or so, at a cost that is factored into the construction.
Housing and tourism, according to him, are the two most crucial sectors for India, which can generate employment both directly and indirectly. For the housing sector, Parekh has some valuable suggestions. "Flats must be sold based on the carpet area and not the super built-up area. Why should customers pay the price for space they don't get? Similarly, when a consumer buys a car or a TV there is warranty for the goods. Why can't there be warranty for flats, which are the most expensive fast-moving consumer good?" he asks.
As Parekh finishes his akuri and helps himself to a bit of the dhansak gravy and a spoon of rice, I ask him what went wrong with the Infrastructure Development Finance Corporation (IDFC). Why did the government want to merge with it with State Bank of India?
Parekh, who is also chairman of IDFC, says a few bureaucrats and some of the financial institutions were against it when Chidambaram, during his earlier stint as a finance minister, gave Rs 1,000 crore to start IDFC.
"It was never meant to be a term-lending institution. Its job was to lead the private sector into infrastructure and help the government decide on policy matters. It has not failed. If the government delays in taking decisions for infrastructure projects, what can IDFC do?" he says.
Now I come to the big question: How long will HDFC continue to stand alone? Why is Parekh resisting its merger with HDFC Bank? Parekh's explanation is that the merger will require Rs 9,000 crore worth of investment in securities to meet the statutory liquidity reserve ratio.
"In a rising interest rate scenario, when you mark the investment portfolio to market, it will kill both HDFC and HDFC Bank."
Does that mean they will continue to remain separate entities? "There are many options. What's the harm in remaining separate entities? The parent does not come in the way of the bank's growth. We have allowed it to go for a second ADS even though it will bring down HDFC's stake in the bank."
And he's proud of HDFC's performance, so much so that he can reel off statistics on it at will. HDFC on a year-on-year basis has been growing its balance sheet by 30 per cent, and profit by 20 to 25 per cent.
"Our cost to income ratio is 13 per cent against HDFC Bank's 48 per cent. We will keep the spread intact at 2.2 per cent in the next seven to 17 years. What's the problem?" asks a confident Parekh.
I get a plum cake as dessert as part of the fixed menu while Parekh asks for chocolate ice cream. I remind him of his dream of making HDFC India's GE Caps. He admits that this dream cannot be fulfilled unless the regulator allows the group to set up a holding company.
"Globally, the holding company concept is accepted. HSBC has 76 subsidiaries under its umbrella. Ideally, HDFC should be listed and all other outfits should be its wholly-owned subsidiaries. But that's not possible unless you have one regulator."
As he points out, HDFC is regulated by the National Housing Bank, the bank by the Reserve Bank of India, the mutual fund by Sebi and the insurance companies by IRDA.
"How do I go for the holding company structure in this scenario? It is high time the government set up another Narasimham Committee to explore the UK's Financial Services Authority model for the Indian financial sector," he says.
I finish my cake but there is no sign of Parekh's ice cream. I ask him about his plans. "I have lived a full life. I would like to slow down now. Next year when my term expires as chairman of HDFC, I will request the board to excuse me from the executive post. I will continue as the non-executive chairman. I would like to indulge in golf... I need to give three hours to golf every day, which is not possible now," he says.
Instead, he indulges in bridge for four hours every Saturday at Congress MP Murli Deora's house. His other passion is chocolate cookies, which he buys by the bagful during every trip abroad. "I mainly like plain chocolate but I think Britannia has some excellent chocolate cookies," he says.
His chocolate ice cream arrives after much delay (the waiter thought he had asked for iced tea and not ice cream).
When the bill comes, Parekh insists on settling it, in contravention of Lunch with BS rules. It's a small price to pay, he explains, for the inordinate delay in accepting our invitation. As he jokes, being a banker he cannot deny me the interest.
