Anil Agarwal - Chairman, Vedanta Group
Wednesday, 18th September 2013
It was very interesting to attend a reception on Wednesday, 18th September 2013, evening for less than 100 selected Business Leaders at 10 Downing Street hosted by the UK Prime Minister and George Osborne, Chancellor of the Exchequer. It was an august gathering. Andrew Feldman (Chairman of the Conservative Party & Chairman of the Party Board) spoke first and said how important business people are in the UK for development. Then the Chancellor spoke and looked for suggestions to reduce the debt of the country, and again stressed UK development can only happen with business development and they are all ready to extend and help and take any suggestions in this regard.
Finally the Prime Minister addressed all & clearly stated the importance of developing infrastructure of the country, manufacturing, natural resources etc… He mentioned to use him for any part of the world where his presence can help to develop UK company businesses.
I was surprised at how vocal he was regarding how NGOs and the media some times are against development, and we have to fight because unless we develop our shale gas, oil & gas, freight corridors and new highways, but he was fully determined on taking development forward. He also said the only way the UK is coming up is as the economy and mostly everything is privatized in the country and he was very thankful to all the business leaders & CEOs of the corporations in participating in this. In India we have a similar situation where we have may be 250 state and central government companies. A lot of them must be listed and have a very good structure, but these companies are not progressing at all.
In India we can divest 51% of these companies in the market and with the caveat that no one can own more than 10% of these companies. The most important factor is the employees; they can be given share in the companies. This will allow them to make much more money than they currently make and their interests can be aligned. The most talented, professional management will be identified and fully incentivised so they can create world class capacity and quality with the possibility to make the company to 10 times bigger, including creating huge valuation. With this capacity companies may employ a further 50 million people.
For example ONGC can be another EXXON and SAIL and be like VALE.
When companies like L&T, ICICI Bank, and HDFC Bank can run world class organizations without being owner driven, I am sure these companies will also follow the example made by them and create huge value. This money can be used by the government to create infrastructure.
Ultimately the government should divest further and hold 26%.The Supreme Court has asked the government to auction Kolar Gold fields and the Bharat Gold mine. This should be done in 90 days’ time on a revenue sharing basis. With today’s new exploration techniques we will find a lot of gold and will be partially self-sufficient and it may interest a lot of foreign companies.
Aluminium is a natural metal to be produced in India. At the moment we’re producing only 2 million tonnes however we have the potential to produce 15-20 million tonnes as it will also replace wood. This will create 50 million jobs as a full production chain of bauxite, alumina, aluminium smelting coal mine, power plant, engineering construction, capital goods, and manufacturing for downstream. This will change the face of India as this is the most environmental friendly material.
This year I believe we have imported $19 billion of coal. The government should auction the coal block. Also Coal India is sitting with a lot of coal block; they should sell 51% of the various coal blocks to produce coal in India.
I thought I would share the above with you.
Anil Agarwal
Chairman – Vedanta Group
Date: September 26, 2013
We are inspired and motivated to hear this sir
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