Investors will lose faith in India if the post-virus recovery game is won by a narrowing number of tycoons
By Andy Mukherjee
Two years ago, India rolled out a laudable plan to unlock the capital trapped in some of its smaller airports. But the actual outcome from privatization was less than reassuring: All six airfields put on the block went to one bidder.
If that wasn’t enough, multiple media reports now say that Ahmedabad, Gujarat-based billionaire Gautam Adani NSE -5.92 %, an early and enthusiastic supporter of Prime Minister Narendra Modi, might also succeed in taking control of the already-privatized Mumbai airport, as well as a new one coming up on the financial center’s outskirts.
The splashy 2016 entry of tycoon Mukesh Ambani in 4G mobile was a huge boon. The richest Indian single-handedly crushed data charges for customers to 9 cents a gigabyte, the lowest in the world. But a field that once boasted a dozen players is now effectively a duopoly. The fate of a third service will be decided by a court order about how much time Vodafone Idea Ltd. has to pay its share of the $19 billion demanded by the go nment from telecom firms as past dues.
If Ambani’s vision of a carriage, content and commerce triple play is sexy enough to attract investment from the likes of Facebook Inc. and Alphabet Inc.’s Google, Adani’s ambition of owning ports, airports, railway tracks, power plants and energy distribution utilities, is humdrum but lucrative.
The worry is that dominance by a handful of capitalists may not leave enough space for others. But then, who’s even ready or willing to compete, especially in sectors where state policy has a big role in determining winners? Barring some notable exceptions, the Indian business class is overextended, trapped in the debris of assets created with the help of syndicated loans from pliant state-run banks. Politicians even have a name for it: phone banking, where they make the calls and tell bankers to whom to give loans.
It’s impossible to carry on this way. After the Covid-19 disruption, go nment-owned Indian banks will require as much as $28 billion in external capital over two years to raise their loss provisions on bad loans to 70% and double credit growth from last fiscal year’s abysmal 4%, according to Moody’s Investors Service. Much of this money will have to come from a go nment that can’t keep a lid on its borrowing costs. A sharp, private credit-fueled recovery for the economy appears to be out of the question.
Why hire such illiterate stupid moronic journalist
Instead, let's hire a semi-literate massacring hate-mongerer chaiwala as the PM, and a criminal murdering goon as the HM.
now no more lockdown, private companies will start to flourish.
If this is true, hope go nment takes proper measures to curb monopoly and remain as the go nment for the growth of India
Hari Krishna Johri
On the contrary ,It appears Govt is helping to create this monopoly.
It was reported that India is being run by a group of 50 big business houses of India.
not 50 but only 5 India moved from self reliance to only Reliance
Now Indians are sl ve of some rich peoples.
Salute Ambani, the richest person on the earth.
Venugopal Reddy Kalva
I’m allout supporter of Shri Na Mo, unfortunately I’m not able to digest the Monopoly of Adani & Ambani, they are wealth creators , but that should happen with their inherent strengths, not out of favouritism shown by the go nment
Someday they will eliminate NA Mo , we don’t need Congress for that
Systematic loot introduced by East India Companies continues unhindered!
Absolutely true Sir.... Govt shouldn't allow a Soap manufacturer to run Airport, Auto maker top run a Hospital, Pharma comapany tp manufacture textiles and a textile comapny to manyfature Stell !!! India is slowly becoming a Banan republic...!!! Banana grower can become and Aircraft manufacturer and an Apple seller can become a Railways owner !!
政府不该让肥皂制造商去运营机场、汽车制造商运营医院、制药公司生产纺织品! ! !
Giri Sidda Mallaiah
This is India!
Don't worry, soon we will be atma nirbhar on very few param atmas
Ideally to ensure transparency in bidding process and to discourage Monopoly, in bidding process there is need to put Cap that one promoter directly or indirectly cannot participate in more than 3 bids.