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|February 3, 1999||
The Rediff Business Interview / Rahul Bajaj
'The reform process went with great speed from '91 to '94. Since then, it's been politics'
So do you see Indian business houses succeeding or failing in the increasingly global economy?
We have to wait and see. Actions are required at both the macro level by companies and at the micro level across the board. The main thing is there is genuinely a lack of truly multinational company of any significant size in India. To go there, one needs macro level decisions which companies have to take, and become more efficient, which means become more productive, lower their costs, and improve quality. If Honda and Toyota can keep improving every year, why can't we?
How do you rate the BJP's performance vis-à-vis the current state of the Indian economy?
The BJP's performance has been zero. Whether they need more time, I don't know. Ten months is not enough. Whether it is the fact that it is not a BJP government but a BJP-led alliance, whether that is a problem, I don't know. Whether the fact that people who matter like the PM don't see eye to eye with some of the philosophies of the RSS family, whether that is the problem, I don't know.
Are you satisfied with the reform process...?
Which reform process? Where is it going for the last three to four years? There is no reform. Except for Mr Chidambaram's dream budget which turned out to be a bad dream. For various reasons, partly uncertainty, that Budget didn't turn India into a dream.
The reform process went with great speed and satisfaction from 1991 to 1994. But from 1994, it's been politics. First, with the elections, then the United Front government which had no leadership and now, the alliance partners who object to what you want to do. So in the current climate, the gap instead of being bridged is getting wider.
Coming from the macro level to the micro level, to your own company, Bajaj Auto Limited, what are the key challenges ahead for you?
Well, we are not going to cry even though all those things I mentioned earlier I need even for my company. Anyway, interest rates don't affect me because I am not a borrower but a lender. I don't care two hoots where the interest rates go.
The higher the interest rates the better for Bajaj Auto. Because I get better return on my surplus Rs 15 billion whereas my competitors have to borrow and pay a higher interest rate. Purely from a selfish point of view, I am delighted with the present regime of higher interest rates.
But jokes aside, I think what we need is three or four things to become truly internationally competitive and till then things will be difficult. We need to become truly international on a micro basis where we cannot blame anybody by and large.
Four macro things we require anyway. First, technology. If five years ago, we had 120 people in R&D, today we probably have 450. Plus we import technology from wherever I can, like Telco did for the Indica. That also strengthens my R & D.
Second, we need to motivate the workers [as well as] provide the right to hire and fire workers like the Japanese are doing. This will enable us to catch up on quality and productivity with the rest of the world. Only technology won't help you do that.
Third, we have to build up a distribution network abroad. It's not that easy to do that especially for a vehicle. Spare part availability and after sales services is so important.
Fourth, we have to build enough brand equity and there today unfortunately, "Made in India" itself is a bad brand name. Products will have to become better, only money and advertising won't help build a brand name.
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