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Obituary: The Enduring Legacy of Ratan Tata

By Prosenjit Nath 10th October 2024

Sir Ratan Tata, a name synonymous with integrity, innovation, and philanthropy, has left an indelible mark on India and the world. Born on December 28, 1937, into the illustrious Tata family, Ratan Tata was destined to play a significant role in shaping the industrial landscape of India. His academic journey took him to Cornell University, where he graduated with a degree in architecture. However, his true calling lay in the family business, which he joined in 1961. Ratan Tata inherited leadership at a time when India faced tremendous challenges, including the impact of World War II. His ability to navigate these complexities and transform Tata Group into a global powerhouse stands as a testament to his vision and leadership skills.

Under Ratan Tata’s guidance, Tata Group diversified into various sectors, including steel, automobiles, and information technology, marking significant milestones along the way. One of his crowning achievements was the establishment of Tata Consultancy Services (TCS), which emerged as a global leader in IT services. This move not only showcased India’s potential in technology but also established a model for how businesses could thrive on a global scale. Ratan Tata’s foresight in acquiring iconic brands like Jaguar Land Rover and Tata Motors redefined the automotive sector in India, integrating global standards of quality and innovation.

Ratan Tata’s leadership philosophy was grounded in the principles of ethical governance and corporate responsibility. He firmly believed that the success of a business should not solely be measured by financial performance but also by its contributions to society. This perspective was woven into the very fabric of Tata Group, fostering a culture of integrity, sustainability, and community engagement. His vision extended beyond profitability; he aspired for businesses to serve as vehicles for positive change in society.

Philanthropy was an integral part of Ratan Tata’s legacy. Continuing the traditions set by his ancestors, he championed numerous initiatives aimed at uplifting marginalized communities across India. The Tata Trusts, which hold a significant portion of the group’s wealth, have funded initiatives addressing healthcare, education, and poverty alleviation. Ratan Tata’s unwavering belief in the transformative power of education drove him to invest in various educational institutions and programs that aimed to provide quality learning opportunities for underprivileged youth. He understood that education was a pathway to empowerment and economic independence, and his contributions in this area have had a lasting impact on countless lives.

In the realm of healthcare, Ratan Tata was a staunch advocate for accessible and affordable services. His investments in medical research and the establishment of hospitals focused on providing healthcare to underserved populations. Under his leadership, Tata Group made significant contributions to public health initiatives, addressing critical issues and improving health outcomes in vulnerable communities. Ratan Tata’s commitment to enhancing healthcare access illustrated his vision of a healthier, more equitable India.

Ratan Tata’s dedication to social causes extended to environmental sustainability, reflecting his understanding of the interconnectedness of business and the planet. He recognized the importance of protecting the environment for future generations and led the Tata Group in adopting green technologies and sustainable practices. His advocacy for corporate social responsibility encouraged other businesses to embrace sustainability, creating a ripple effect across industries. Ratan Tata’s emphasis on sustainable growth highlighted the necessity of integrating ecological considerations into business strategies, ensuring that economic development did not come at the expense of the environment.

Throughout his illustrious career, Ratan Tata embodied the essence of visionary leadership. His ability to anticipate market trends and adapt to changing landscapes distinguished him as a leader who could navigate complexities with agility. His tenure at Tata Group earned him numerous accolades, including honorary doctorates and international recognition for his contributions to industry and society. As he stepped down as chairman of Tata Group in 2012, he left behind a legacy of excellence that continues to inspire business leaders and entrepreneurs globally.

The news of Sir Ratan Tata’s passing on September 9, 2024, reverberated through the nation, marking a profound loss for India and the world. His departure leaves a void that is difficult to fill, as he embodied the ideals of leadership, integrity, and service. The outpouring of grief from leaders, business figures, and citizens alike reflects the profound impact he had on countless lives. His life was a testament to the belief that businesses can serve as powerful instruments for positive change, capable of driving economic growth while addressing pressing social issues.

Ratan Tata’s contributions to education and healthcare have paved the way for transformative changes in these sectors. His initiatives aimed at enhancing access to quality education and healthcare for underprivileged communities underscore his deep understanding of the challenges faced by marginalized populations. His support for skill development programs and vocational training has empowered countless individuals to build better futures for themselves and their families. His vision for education was rooted in the idea that knowledge is a powerful tool for social mobility, and his efforts have opened doors for many.

The impact of Ratan Tata’s philanthropic endeavors extends beyond immediate contributions; it has inspired a culture of giving within the corporate world. His commitment to social causes has set a benchmark for corporate philanthropy in India, encouraging other businesses to engage in meaningful initiatives that address societal challenges. The Tata Trusts continue to be a leading force in various philanthropic efforts, ensuring that Ratan Tata’s legacy of compassion and service endures.

Ratan Tata’s vision for a just and equitable society resonated through his active engagement in public discourse on important social issues. He utilized his platform to advocate for change, sparking conversations about economic inequality, education, and healthcare. His perspectives challenged the status quo, inspiring a collective effort to build a more equitable society. His involvement in various forums and initiatives showcased his commitment to nation-building, emphasizing the importance of collaboration among diverse stakeholders to address pressing challenges.

The legacy of Sir Ratan Tata is a reminder that true leadership extends beyond personal success; it encompasses a deep sense of responsibility towards society, a commitment to uplifting others, and a vision for a better future. His life serves as a powerful illustration of the potential for individuals to effect change and create a positive impact. In an era marked by numerous challenges, his dedication to social justice, education, and healthcare offers a guiding light for those striving to make a difference.

As we reflect on Ratan Tata’s life and contributions, we must recognize the values he championed integrity, empathy, and a relentless pursuit of excellence. His departure is not only a loss for the Tata Group but for the entire nation that benefited from his vision and commitment to social betterment. The ideals he embodied will continue to resonate, encouraging individuals and organizations to strive for excellence while making meaningful contributions to their communities.

In the wake of his passing, leaders in business and society must honor Ratan Tata’s legacy by upholding the principles he championed. The need for compassionate leadership, social responsibility, and sustainable practices has never been more pressing. Ratan Tata’s vision of a compassionate and equitable world remains a guiding light for those aspiring to make a difference in their communities.

The world has lost a remarkable leader, but his influence will continue to inspire countless individuals to follow in his footsteps. As we mourn the loss of Sir Ratan Tata, we celebrate a life dedicated to excellence, compassion, and innovation. His legacy will endure in the hearts of those he touched and in the institutions he built. Ratan Tata’s unwavering belief in the potential for business to drive positive social change will echo through the annals of history, encouraging future generations to embrace the ideals of service and leadership. His contributions to India and the world will be remembered as a testament to the power of one individual’s vision to create lasting change, paving the way for a brighter and more equitable future.

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The Wind Beneath Air India Wings

By Kunal Bose 12th October 2023

There is magic about glamour, which, however, is an abstraction. It could relate to an exclusive line of clothing, haut monde, destinations beyond the reach of hoi polloi or to stretch it to the maximum owning an airline. It is because of the indefinable glamour factor some high net worth individuals in every part of the world would from time to time be in this cash guzzling venture of flying people and cargoes from one point to another. Legend has it that deep pocket is a precondition to owning an airline.

But as it has been seen over the decades, owning big money may facilitate an entry into the industry, but access to funds (read capacity to borrow and finding favour with banks and one’s own money) will not underpin success or be an insurance against disastrous consequences. So many privately owned airlines have perished over the decades and dreams of promoters turning sour.

Who could believe that Trans World Airlines (TWA), which in the 1980s was carrying half of all passengers between the US and Europe would land in bankruptcy in January 1992 leading to winding up of operations. TWA owning proved to be ruinous for the reclusive Howard Hughes and thereafter the enormously rich American businessman and investor Carl Celian Icahn. The airline had been on ropes for a long time, not least because Icahn went on loading the company with debts – this remains the bugbear of many operating airlines – and refusing to buy new, more efficient planes. No doubt, for the highly egoistic corporate raider Icahn filing of bankruptcy of TWA was a hugely humiliating experience. He later told the Washington Post: “I’ve lost on TWA; it has been the worst investment I’ve made in the last decade.”

Not TWA alone, but the iconic Pan Am, which had to its credit a series of firsts in the world aviation industry, including pressing into service wide body 747 jumbo, was done in principally by a series of oil crises, introduction of the US Airline Deregulation Act giving fillip to competition and finally the 1988 Lockerbie disaster killing 270 people. Though never a flag carrier of the US, Pan Am had a unique identity, representing the country’s leadership of global air travel. That, however, was not enough to negotiate the headwind that would come Pan Am’s way at regular intervals.

The British airline industry too had a chequered history as the events leading to privatisation of British Airways, resulting from merger of BOAC and British European Airways in 1974, under the oversight of prime minister Margaret Thatcher would show. Thatcher, as she made it clear on more than one occasion, never had faith in government ownership of businesses. The Conservative government that she headed presided over the privatisation of number of industries and utilities from steel to railways and from electricity to water.

What supposedly motivated privatisation were hopes of employee productivity improvement, better management practices under private ownership, sparing government of debts and encouraging wider share ownership. Japan Airlines was privatised more or less at the same time as BA. From time to time, governments, most notably in Europe, have divested ownership in airlines in favour of the private sector. At the same time, governments have retained significant ownership in Finnair, SAS, Air Serbia and Turkish Airlines. In Air France-KLM, the government has retained minority holding. Interestingly, Moscow has divested as much as 49 per cent of national carrier Aeroflot.

There is a lot of pull for governments to get out of airline business altogether, thanks to mounting debts, ballooning of losses and growing trade union pressure. Then the skies are coming to be dominated by slick no frills carriers operating largely domestically and the likes of Emirates, Qatar, Etihad and Gulf Air with their hubs in the Middle East expanding their global networks all the time and in the process increasing their market share. The writing is there on the wall that state involvement in airline running will bring miseries for all stakeholders.

ALSO READ: Tata Buys Wings For Maharajah

Air India is an interesting story. It was a modest size airline flying to a few foreign destinations before New Delhi stepped in as the sole owner some years down the Independence. At the same time, the country in the 1950s had a number of small airlines operating domestic routes. Whatever critics may say their nationalisation in 1953 made sense. They were not in a position to mobilise funds to acquire a modern fleet and critical mass, which alone could underwrite profitable operations. Jawaharlal Nehru knew what kind of ambition the founder of Air India JRD Tata had for the airline and though the ownership vested with the government, Nehru was not to ask for a change in the helmsman. So JRD was free to draw on the marketing knowledge of his lieutenant Bobby Kooka to make Air India among the preferred airlines in the world and unarguably the best in Asia.

All this became possible because bureaucrat-politician clique would not dare interfere in the airline running as long as Tata remained chairman. Even though Tata group no longer had any financial stake in Air India, JRD would find all the time for something he was obsessively in love. Beyond Nehru, JRD enjoyed full freedom in growing Air India the way he wanted during the prime ministership of Lal Bahadur Shastri. But bureaucrat-politician clique had the last laugh when an antagonistic Morarji Desai saw the easing out of the no-nonsense JRD. Soon thereafter Kooka was shown the door. Bureaucrats were only waiting for the exit of JRD followed by Kooka, who was credited with giving Air India the Maharaja mascot and lured droves of foreigners to experience Indian hospitality on board, to seize control of the airline.

Even then, the rich legacy that JRD left behind, including able managers at all levels saw Air India doing well for a long time. Interestingly, the performance would peak when somebody from the private sector – in this case, YC Deveshwar of ITC – would be drafted to lead the airline. The farsighted Prime Minister Narasimha Rao would commission the services of legendary manager Russi Mody to head both Air India and Indian Airlines. Such prime ministerial interventions would usher in a brief spring in Air India. In retrospect two moves that did considerable damage to finances, services and operational efficiency of the airline are: decision to leave the charge of running the Air India to members of Indian Administrative Service and merger of Air India and Indian Airlines. Incidentally, Air India started suffering losses every year since the domestic carrier’s ill-advised merger with it in 2007-78. The inevitable result was mounting losses requiring the government to keep the merged entity to limp along with financial support.

The bruised airline in every sense with market share down to around 10 per cent compared with over 60 per cent for private group Indigo was passed on to the Tata group in January 2022. A few months ahead of 100 per cent sale, Air India had piled up debts of Rs61,562 crore, but 75 per cent of that was transferred to a special purpose vehicle of the government before its handover to the Tata group. In the past, the government made several attempts to sell the major portion of Air India equity to a private group but without success.

The compulsion for privatisation was summed up succinctly by a government spokesperson in the following way: “We want to finish the handover quickly, because we are paying Rs20 crore a day to run the airline. The new owner will need to put in a lot of capital because they have to do capital expenditure to improve aircraft, refurbish and give new orders for aircraft. Only then they may be able to turnaround.”

With this acquisition, the group now has four airlines: Air India, Air India Express, Vistara and Air Asia India and according to Air India CEO Cambell Wilson, “The four together have a market share close to 30 per cent. But we will be adding aircraft and expand capacity considerably.” What Wilson will emphasise is that the group is not to chase capacity for the sake of it. But it will continue to build capacity to “ensure that we are a credible significant competitor.” If all things go according to plan, Air India transformation will happen over a period of five years. Getting rid of historical baggage will be no less a challenge than to create a new airline that will do JRD proud.

Tata Group: Merger Of Air India, Vistara By March 2024

By LokMarg 29th November 2022

The Tata Group on Tuesday announced the merger of its two airlines Vistara and Air India. With this consolidation, Air India will be India’s leading domestic and international carrier with a combined fleet of 218 aircraft, making it India’s largest international carrier and second-largest domestic carrier.

Vistara shall be merged with Air India post-receipt of requisite approvals. As part of the merger transaction, SIA shall also invest Rs 2,059 crore in Air India. Post the consolidation, SIA shall hold 25.1 percent shareholding in Air India. The transaction is estimated to be completed by March 2024.
Air India, an airline fully owned by Tata Sons, has been the flag carrier of India. Tata Sons, via its fully-owned subsidiary Talace Private Limited or Talace, acquired a 100 percent stake in Air India on January 27, 2022.

Vistara, a 51:49 joint venture between Tata Sons and Singapore Airlines Limited (SIA), had been established in 2013 and is India’s leading full-service carrier with international operations in the Middle East, Asia, and Europe.

On this occasion, N Chandrasekaran, Chairman, of Tata Sons, said: “The merger of Vistara and Air India is an important milestone in our journey to make Air India a truly world-class airline. We are transforming Air India, with the aim of providing a great customer experience, every time, for every customer. As part of the transformation, Air India is focusing on growing both its network and fleet, revamping its customer proposition, enhancing safety, reliability, and on-time performance.”

The Chairman added, “We are excited about the opportunity of creating a strong Air India which would offer both full-service and low-cost service across domestic and international routes. We would like to thank Singapore Airlines for their continued partnership.”

Goh Choon Phong, Chief Executive Officer, of Singapore Airlines, said: “Tata Sons is one of the most established and respected names in India. Our collaboration to set up Vistara in 2013 resulted in a market-leading full-service carrier, which has won many global accolades in a short time.”

“With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market. We will work together to support Air India’s transformation programme, unlock its significant potential, and restore it to its position as a leading airline on the global stage,” the CEO said. (ANI)