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The Rediff Business Interview/Henning Holck-Larsen

The Great Dane

He was one of the few Europeans who refused to leave India when the British did. And went on to became a legend in his lifetime, setting up Larsen and Toubro, India's largest engineering company, a firm that most fresh-eyed engineers aspire to join. Henning Holck-Larsen came to India before its Independence, in 1935, and stayed on to celebrate his 90^th birthday last year.

The fledgling company he set up in partnership with fellow Dane, Soren K Toubro, in 1938 is currently worth Rs 54 billion. The chairman emeritus certainly has reason to be happy while leading a retired life in the quiet surroundings of his company guesthouse.

Strangely, the man who led an engineering giant did not look too happy when I took out a dictaphone to record the interview. He said he would prefer it if I took notes the good old-fashioned way! But little else about Henning Holck-Larsen was rooted in antiquity as he, speaking slightly slowly, remembered his tryst with destiny in India and saw a bright future for India.

How come he never quit along when being a gora (white) in India was certainly not an advantage? Holck-Larsen smiled and replied that both he and his partner knew than an independent India offered much scope for his company and his skills. Over the years, he was never tempted to leave India, and would only visit Denmark twice a year. Strangely, while most prefer to visit Europe during summer to escape India's heat and dust, Holck-Larsen used to do so in the monsoons and at Christmas time. He obviously did not mind the Indian summers.

Like most sagas of famous pairs, Larsen and Toubro had simple origins. "We went to the same school and then joined the same company: F L Smith and Co," recalled Holck-Larsen. The firm manufactured cement-making machines and set up cement factories.

Toubro landed in India first. "The company sent him either in 1933 or 1934 to set up a cement factory in Coimbatore. I came in 1935," he said. Coincidentally, the cement factories set up by Holck-Larsen and Toubro would go on to become part of Associated Cement Companies, India's leading cement conglomeration. Then came the government order for three more cement factories, which kept the duo back in India.

By now, Larsen and Toubro had seen business potential in a fast industrialising India and formed a partnership in 1938. They began by importing dairy equipment from their home country. Not content at being mere traders, the very next year the twosome began manufacturing the very equipment they were importing.

The start of World War II nearly ended it all. The company diversified into demagnetising ships and laying cables. From then onwards, there has been no looking back, as Larsen and Toubro went from strength to strength.

Despite being part of the country's scenery for so long, the company refused to imbibe one obnoxious Indian practice. It never hired the relatives of the company's top management staff, keeping the management strictly professional. Inheriting a company in India is virtually considered a birthright by the promoters, even if they are minority shareholders. However, the company did employ the offsprings of workers.

As his company chairman, his relations with the workers were exemplary. "I used to shake hands with them and knew many of them by their names," he said. In the late 1970s, inter-union rivalry turned violent and a worker was killed. At the funeral, Holck-Larsen addressed his company's employees… in Hindi! The effect was electric, and only endeared him further to his staff.

As the company prospered, India too changed and Holck-Larsen would notice them. "In 1947," he said, "it was difficult to find good Indian engineers. Now, Indians are among the world's best. India has a wonderful higher education system."

Holck-Larsen insists that being a foreigner was never a handicap in India. "Once, right in the beginning, we were told that our company had too many foreigners and that we should Indianise the management," he said, adding "The government was right in saying so."

And though critical of the licence raj ("You needed a licence to set up even a small factory"), he insisted that never was government sanction used to discriminate against him simply because of his alien origins. But like thousand of Indian entrepreneurs, he too suffered at the hands of babudom.

He cites an example: "We used to make 300 tonnes of cement annually, and wanted to double our capacity. The officials did not give us permission," he said. This at a time when India desperately needed cement for various construction projects. "Indian civil servants were good, but some of them lacked vision, he added tactfully." Incidentally, L&T today manufactures 5,000 tonnes of cement annually.

Holck-Larsen blames the country's excessive population for many of its ills, such as keeping the per capita income low. "But family planning is such a sensitive subject that no politician is willing to touch it," he lamented. No wonder he admires the Chinese for having tackled the population difficulty head on.

In his twilight years, what makes him happy? "I have been very happy in India, to be part of L&T as it grew over the years," says Holck-Larsen, a smile on his face. "Even today, I am interested in the company. And I am fortunate that L&T has a very good and professional management."

After all these years in India, what does he think about it? "India has a great future, especially after the onset of liberalisation," he replied promptly. "It has been improving year after year."

L&T hoardings across Bombay proclaim: 'We make the things that make India proud'. Certainly, most Indians are proud of Holck-Larsen and his amazing success in a country that he entered as a visitor and went on to make his home.

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