It’s the adventure, the adrenaline-flowing, risk-taking in outdoor activities that attracts me.
Indians have very good engineering capabilities, and that is why, if an industry focuses on innovation, you will have a far greater chance of success, rather than the model which is based on just being a production machine.
I am an analog, slide-rule kind of guy.
I had my own motor boat which we would take to Khadakvasla, but that was 40 years ago.
We are working with the power industry all over the world. We are meeting customers in aerospace and getting them to tour our plants.
From an operational perspective, exports challenge companies to design, develop, manufacture and supply products to discerning customers in global markets. This, in turn, motivates companies to scale up the value chain, which results in higher realisations.
Before 2000, we were unable to design a single car; all the cars were designed in Japan, Europe or somewhere else. We were just converting.
The most important part of any acquisition is your ability to culturally integrate the people in the companies you acquire and your company.
Import and substituting imports with domestic production are a big opportunity. With a devaluation of the rupee, imports get expensive, and for Indian manufacturers, this creates a huge opportunity.
We book our exports forward for more than a year, and so we have a fixed rate. We do not get the spot rate that we see in the market every day.
We have done a lot of work on cost reduction, getting ourselves lean, reducing our breakeven, reducing our fixed cost and increasing exports. All of these factors help because our export basket is not just automotive but also includes industrial products, railways and others.
Our strategy should be based on indigenisation and import substitution. The government must provide opportunities for domestic companies to participate in sectors in which the country continues to depend on imports.
The emphasis on innovation and technology in our companies has resulted in a few of them establishing global benchmarks in product design and development, manufacturing practices and human resource capabilities. However, there is no room for complacency.
India is still considered a preferred destination for many multinationals to manufacture cost-competitive high-technology products for domestic consumption as well as for global demand.
Bofors was a steelmaker that became a forgings company and then went on to build guns. Companies like Krupp and Thyssen were in steel and forgings before entering defence. There are similar examples in the U.K.; it is a natural progression.
I had the option of building a career in the U.S. Many of my friends who went at the time did not come back, but for me, building the family business and being with family was worth it. I became a general manager within four months, as I used my education to improve productivity and output.
The Indian business has largely grown on the back of exports. The domestic markets, as far as our Indian business is concerned, actually have contracted because of the contraction in the medium and heavy commercial vehicle space.
We have got into Indian railways and are trying to get into the railway locomotive business in Europe and the United States.
Our company is very diversified, both in terms of geography and in terms of products.
The commodity price easing really does not play too much role in our margins because our basic raw material – steel – is not really a commodities engineering steel.
The year 2013 has been very difficult, with a lot of headwinds in almost every region and every business.
In 2014, we have some new activities and new order wins in the non-automotive space.
Our real focus is going to be what can we do with our existing capacities, what new things can we do, and how much more demand can we fulfil with our existing capacities.
I am able to compete not because my labour is cheap, but because I can use technology better than others.
I don’t think one party has a bad vision over the other party. I have no doubts that every Indian and every Indian political leadership would like to see this country get to a much better level. We would all like to see inclusive growth.
In 2006, the global economy was doing well. In India, the political and economic situation was stable. All key macroeconomic indicators reflected an economy that was in robust good health.
Subsidies on petroleum products and fertilizers should be phased out in a defined, time-bound manner. The resources that would get freed up could then be used to fund various social sector programmes in education, healthcare and other priority sectors.
India has the capability to create a fairly extensive defence manufacturing capability in many areas, and as a country and as an industry, we have matured in terms of technology and capability to make this happen.
The period from 2002 to 2007 was probably our best period. We created a strategy to build global scale, footprints in each of the geographies and dramatically built our international business.
In the U.S., we didn’t have scale, and without scale, it’s difficult to operate.
If India has to achieve exponential growth, it would have to be on the back of strong growth in the manufacturing sector.
Challenges give me a kick. The day I stop getting challenges, I would quit.
We should have an inclusive growth model in India. Agro-interest is also as important as industrial interest.
We are a heterogeneous society. We have to accept that. Growth has to be such that the most backward sections also benefit from it. Otherwise, it will be a very imbalanced growth.
I am a self-taught water skier and wind surfer.
I have what is probably the largest big bike collection in the city: a Fat Boy, a sportser Harley Davidson and two Yamahas. All these are 1200cc-plus bikes. Riding these bikes is something I still do and some trekking as well.
In business, you try to minimise risk.
I am sick and tired of the process where everybody tells you that Indian companies don’t have the technology and capability. We need to put money where our mouth is and make things happen, and that is what we are trying to do.
Prior to 2001, hardly any company in North America or Europe would buy from India.
India is the most competitive manufacturing destination on this planet. If we are able to take advantage of that competitiveness for our domestic markets, this country would be humming with activity; industrial production will grow at 10-11% per year.
Everywhere in the world, whether manufacturing, trade or whatever, it is controlled by one apparatus and one policy perspective. Here we have one prime minister with good intentions, and six ministries running their own empires. This creates problems including the import culture.
We need to just study what other countries have done. There are examples of a strong partnership between the defence establishment and the private industry.
We passionately set up a programme that we call the Indian gun programme. I challenged Colonel Bhatia, who heads our defence business, that let’s build an Indian gun. There’s a belief that Indian companies aren’t capable of this, and we want to prove them wrong, as we did in components.
We’ve made two products; one is a 155 mm 52-calibre gun with self-propelling and towing capability. This is a field gun – the mainstay of the Indian army like the Bofors guns. Our gun is similar but of a longer range. That was 39 calibre; this is 52. The calibre denotes the length of the barrel and the range.
There is a feeling within our system that defence equipment can’t be made here and should be imported. I wanted to break this myth, so we spent our money and made a product to prove we have capability in this country, so don’t just brush us aside.
India is the second biggest defence procurer in the world after the U.S.
At the Bangalore air show, we got a contract from Boeing for supplying structural components, and we are already supplying jet engine components to Rolls Royce. Both these are titanium-based, not steel components.
Fundamentally, we have broken our aerospace business into three parts – large parts which go into the wings and fuselage, components for jet engines, and specialised structural components for landing gear.
You cannot make an aircraft without forged components.
I am a very hands-on person, and I like to be involved in driving my business.
With liberalisation, Indian industry gained international exposure because of which it became imperative for companies to rework their strategies to become globally competitive.
We manufacture automotive components including critical engine and axle parts for passenger cars, diesel engines and medium & heavy commercial vehicles. Till 1997, our focus was almost entirely on the domestic market with a relatively insignificant portion of revenues from exports.
One of the criteria for a global company is that it should have a manufacturing presence in multiple countries and should not only be an exporter.
When I returned from the Massachusetts Institute of Technology in 1972, my father was running a forging business with a turnover of Rs 3.5 crore. But I had no patience and wanted to grow the business via exports.
If my strength is technology, financial structuring is my son’s skill.
We can reorient our products and business strategy because we are an agile organisation.
We anticipate countries increasing their spending on infrastructure like railways, airports, power plants and ports. Our heavy forging plant has the capacity to cater to each of these segments.
Politicians said that with our cheap labour, we could be competitive in the world. Nothing could be further from the truth. We were the most uncompetitive country with that cheap labour.
If somebody told me you’d be a one and a half billion dollar company and be the largest in the world, I wouldn’t have believed it myself.
Which country in the world has the kind of talent India has in numbers?
I give strong advice, but I don’t expect it to be followed.
So far, the general perception, including the perception in India, was that we are not capable of using high technology. They simply refused to believe an Indian can do it! I somehow was not ready to accept that this is not possible.
The first reactions from Germany and German industry was quite negative. People right from the start were saying that we will steal technology and take it away and move the plant to India and use low cheap labor to compete.
The advantage comes out of the capability of Indian engineers and the competitiveness of their capabilities and the cost at which they can create those capabilities.
We believe in the vision of ‘Make in India,’ and our proposed joint venture with Rafael is a step in this direction.