Geography Reference
In-Depth Information
2000. More significant was the takeover of South Korea's Daewoo truck manufacturer in
2004, which showed that a company in India's largely unimpressive and uncompetitive
manufacturing industry had the nerve and managerial ability to venture abroad and learn
new skills. This marked what was becoming a turning point in Indian industry's self-con-
fidence, which then grew rapidly in the mid to late 2000s, with many companies going
abroad - and sometimes overextending themselves in terms of financial and managerial re-
sources.
Tata Motors bought Britain's Jaguar Land Rover car business in 2007 from Ford Motor
for $2.3bn, which became a winner because Tata had the energy, finance and managerial
strength to capitalize on design work started, but not carried through, by Ford. Less suc-
cessful was a $11bn takeover of Europe's Corus steel business that left Tata Steel heav-
ily indebted, but together the cars and steel acquisitions helped to turn Tata into Britain's
biggest private sector employer with about 48,000 people on its payroll. By the time Ratan
Tata retired, the group had become the first in India to record $100bn revenues (2011-12)
and its interests ranged from tea to telecoms, software to hotels, wristwatches to defence
rockets, and coffee (Starbucks) to power and steel with 450,000 employees worldwide.
No one has bestraddled Indian business in the way that Ratan Tata did. There has been
no other Indian business figure of similar stature in the post-reform era, and no one near
to being able to take his place as a symbol of managerial ethics and success despite the
group's mixed reputation on environmental controls.
7
Economics
The reforms had a surprisingly limited impact on sustained economic growth. In the 1960s
and 1970s, the GDP growth rate had averaged only 3.5 per cent per year when other de-
veloping countries were growing much faster. The tentative reforms of the 1980s saw just
under 5 per cent growth (5.6 per cent, if a 1988-91 boom is included), but that was largely
6.7 per cent growth in 1994-95, but that slowed to 5.4 per cent in the second half of the
1990s, averaging 5.7 per cent over the decade - almost back to the 1980s' levels. India
then entered what was billed as its shining years in the first decade of the 2000s, spurred
as much by favourable global conditions as by the cumulative effect of the reforms, with
growth nearing an unsustainable rate of 10 per cent. By 2013, however, it was back to not
much more than 5 per cent as a result of adverse world economic conditions and insur-
mountable supply-side constraints within the country, ranging from bad infrastructure and
skills shortages to weak and corrupt government institutions and blockages caused by en-
vironmental and other regulations.
