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The Break Up Bug

Everyone does it here.

Political parties do it. Ad agencies do it. Business families do it. Cable television companies do it. Serious, heavy duty corporates do it. More and more married couples are doing it. Breaking up is the new mantra in India.

The Birlas were the first of the biggies to do it. Then the Dalmias and the Jains did it. The Goenkas followed soon after. The Modis did it with the beating of drums. The Singhanias did it. The Thapars did it. Now everyone is doing it. Recently, the Kotharis who make Pan Parag did it. Now Zee TV wants to do it, consciously and deliberately, as part of their overall growth strategy.

Yes, breaking up is the new mantra in India. Look at the Janata Dal, which has by now splintered into God knows how many silly little bits and pieces. Deve Gowda leads one. Sharad Yadav leads another. Ramakrishna Hegde leads a third and calls it Lok Shakti. Subramanyam Swami leads the original rump and calls it the Janata Party. Mulayam Singh leads yet another faction and calls it the Samajwadi Party. While three former prime ministers, V P Singh, Chandra Shekhar and Inder Gujral lead their own unnamed sects and pretend to be independent. The Congress too has gone through countless such upheavals, ending with the recent expulsion of Pawar & Co.

But it is not just in politics. Enterprise, market research, media, entertainment, public life. Fragmentation is in fashion everywhere.

The history of the ad industry in India or, say, our music industry shows how each success story spawned its own replicas as people quit the main company and set up their own shops. To do exactly the same thing that they were doing for others. That is how business grew, independent enterprise enlarged the cake and more and more players entered the market. So much so that it has now become a typical Indian trait. To break up. Every day there is a new story in the media about how a big group or institution or party is about to break up. Whether it is T-Series or Clea, Pan Parag or In Mumbai, the amoeba keeps splitting.

Meanwhile, globally, the scene has changed. The world is inching towards greater consolidation. And more togetherness, which is crucial for creating that competitive edge in an increasingly tough environment where only the best can survive.

Whereas we in India are quite happy to break up things quicker than we build them. Is it the fascination for independent entrepreneurship or are we, as a people, incapable of holding together? Are our egos too big, too fragile for us to work in cohesion to create collective wealth? Is that why every institution after it attains a certain critical mass finds it difficult to hold together? Is that why we have so many regional parties, so many factions, so much bickering? Is that why we pull a government down every few months to show each other how important we are? Is that why fissiparious pressures are growing more and more unbearable?

Look at the global scenario. The Internet is integrating the world by making possible quicker, easier, cheaper, smarter communication. Euro is trying to integrate Europe with one currency and so many nations have subjugated their own egos, their own political compulsions to join the move. Osama bin Laden is trying to piece together the complex jigsaw of resurgent Islam to form a global terror network of fundamentalism that can finance its own growth. While Hollywood, that great leveller, has finally reached a stage where it earns more from global revenue than US ticket sales.

The reason is simple. People have realised that integration is the key to survival in a complex, highly competitive global scenario. So consolidation is the buzzword there.

That is why the biggest banks are merging. So are the biggest oil companies, the auto giants, the most profitable pharma groups, the most famous fashion houses, the top studios. Fiercely independent French and Italian brands that for years fought each other in the marketplace for style are now owned by the same company and sharing shelf space side by side. So are competing soft drinks, soaps, toothpastes, television brands.

As a result, brands which are fighting each other in some markets are owned by the same company in other markets. Exactly like Sharad Pawar's Nationalist Congress Party which breathes fire and brimstone at the Shiv Sena-BJP alliance in Maharashtra but is ready to strike a secret deal with the BJP-led National Democratic Alliance at the Centre. Anything goes. As long as someone makes profit.

There are no permanent allies, no permanent rivals. Just brands on the shelf. Owned by huge faceless corporates, which are in turn owned by a complex maze of global investors. And, as globalisation grows, more and more people will invest across the world to maximise their returns. If India cannot deliver, the money will move to China. If China cannot deliver, the money will migrate to Indonesia. Or Singapore. Or wherever.

So, if we want to keep foreign investors and their money in India (as well as ensure that Indian investors continue to invest in India) we will have to do so not through fear of FERA but through the process of creating world class companies. Companies that will have global size, global quality. We have very few around today. Reliance has size. Wipro and Infosys have quality. But we need many more such companies in the businesses of the future.

It is futile building size in a sunset industry like steelmaking. It is equally futile building cement plants of high quality. The India of tomorrow will be a knowledge economy. An economy based on ideas, creativity, thought, talent, content, information. The rest we can afford to import. At prices much cheaper than what it would cost us to manufacture. It will also keep our forests intact, our air clean, our rivers unpolluted. The knowledge economy will absorb our huge workforce. Through self employment and jobs that can use talent and creativity. Not by creating a vast industrial infrastructure that we do need and cannot afford.

But to make all this happen, we need to create a strong, stable, unified India and strong, stable, unified institutions. We also need strong, stable, unified business houses that can compete with the best in the world. This requires more than ability. It requires the courage and the humility to subsume personal ambitions for the greater good so that one can build and leave behind something bigger than oneself. Be it a great company or an outstanding NGO or a world class institution. Or, what is most important, a strong nation that has faith in itself. In its people and its future.

If we stick to the way of the amoeba that may not exactly happen.

Pritish Nandy

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