Comment by Riaz Haq on March 30, 2023 at 5:08pm

India is Broken

https://www.scmp.com/comment/opinion/article/3215379/hype-over-indi...

by Ashoka Mody

Since the liberalising reforms of the mid-1980s, the manufacturing sector’s share of GDP has fallen slightly to about 14 per cent, compared to 27 per cent in China and 25 per cent in Vietnam. India commands less than a 2 per cent global share of manufactured exports, and as its economy slowed in the second half of 2022, the manufacturing sector contracted further.
Yet it is through exports of labour-intensive manufactured products that Taiwan, South Korea, China and now Vietnam came to employ vast numbers of their people. India, with its 1.4 billion people, exports about the same value of manufactured goods as Vietnam does with 100 million people.
Those who believe that India stands at the cusp of greatness usually focus on two recent developments. First, Apple contractors have made initial investments to assemble high-end iPhones in India, leading to speculation that a broader move away from China by manufacturers will benefit India despite the country’s considerable quality-control and logistical problems.

while such an outcome is possible, academic analysis and media reports are discouraging. Economist Gordon H. Hanson says Chinese manufacturers will move labour-intensive manufacturing from the country’s expensive coastal hubs to its less-developed interior, where production costs are lower.
Moreover, investors moving out of China have gone mainly to Vietnam and other countries in Southeast Asia, which like China are members of the Regional Comprehensive Economic Partnership. India has eschewed membership in this trade bloc because its manufacturers fear they will be unable to compete once other member states gain easier access to the Indian market.
As for US producers pulling away from China, most are “near-shoring” their operations to Mexico and Central America. Altogether, while some investment from this churn could flow to India, the fact remains that inward foreign investment fell year on year in 2022.

The second source of hope is the Indian government’s Production-Linked Incentive Schemes, which were introduced in early 2021 to offer financial rewards for production and jobs in sectors deemed to be of strategic value. Unfortunately, as former Reserve Bank of India governor Raghuram G. Rajan and his co-authors warn, these schemes are likely to end up merely fattening corporate profits like previous sops to manufacturers.
India’s run with start-up unicorns is also fading. The sector’s recent boomrelied on cheap funding and a surge of online purchases by a small number of customers during the pandemic. But most start-ups have dim prospects for achieving profitability in the foreseeable future. Purchases by the small customer base have slowed and funds are drying up.
Looking past the illusion created by India’s rebound from the pandemic, the country’s economic prognosis appears bleak. Rather than indulge in wishful thinking and gimmicky industrial incentives, policymakers should aim to power economic development through investments in human capital and by bringing more women into the workforce.
India’s broken state has repeatedly avoided confronting long-term challenges and now, instead of overcoming fundamental development deficits, officials are seeking silver bullets. Stoking hype about an imminent Indian century will merely perpetuate the deficits, helping neither India nor the rest of the world.
Ashoka Mody, visiting professor of international economic policy at Princeton University, is the author of India is Broken: A People Betrayed, Independence to Today. Copyright: Project Syndicate

Comment by Riaz Haq on April 3, 2023 at 7:35am

After Adani’s Crisis, India’s Vedanta Looks Vulnerable Too
Vedanta Resources is bleeding its subsidiaries dry as it struggles to deleverage

https://www.wsj.com/articles/after-adanis-crisis-indias-vedanta-loo...

Struggling Indian infrastructure heavyweight Adani 512599 -1.85%decrease; red down pointing triangle Group hasn’t tipped over any other large dominoes yet. But another sprawling Indian conglomerate—miner Vedanta Resources—is looking wobbly.

Market skittishness in the wake of the turmoil at Adani Group, which came under attack from short seller Hindenburg Research in late January, means that other indebted Indian companies—which otherwise might have muddled their way through the Federal Reserve hiking cycle—could increasingly find themselves under investors’ microscopes. A Vedanta Resources dollar bond due in May 2023 was yielding about 50% on Friday according to Refinitiv—about double the level at the end of January.

The fundamental problem is that London-headquartered Vedanta Resources, with several billion dollars of debt, is reliant on transfers from its Indian subsidiary Vedanta Ltd 500295 2.80%increase; green up pointing triangle. That unit has its own large direct debts, and holds the lion’s share of the group’s actual assets.

Moody’s downgraded the firm’s debt deeper into junk bond territory earlier in the month. The rating agency says it needs about $4 billion in cash to pay off debt and interest coming due over the financial year ending in March 2024.

The company hopes to pay with the help of chunky cash flows from its Indian subsidiaries, but their finances are under pressure too. And Indian politics could make some of those payments difficult to realize.

On Tuesday Mumbai-listed Vedanta Ltd. said it will hand out its fifth dividend of about $927 million for the current financial year ending this month. Vedanta Ltd., 70% owned by Vedanta Resources, has announced dividends of $4.6 billion in the last 12 months, more than double the fiscal year before. But the firm’s interim CFO resigned during the week. Local ratings agency CRISIL Ratings also downgraded its outlook on Vedanta Ltd. to negative from stable, citing possible higher leverage and lower financial flexibility because of big dividend payments to the parent.

Vedanta Ltd.’s unit Hindustan Zinc, partly owned by the government of India, also announced a fourth dividend for the current fiscal year of about $1.3 billion last week. And Hindustan Zinc has offered $3 billion to buy its parent’s international zinc assets, a deal the government has vehemently opposed.

The big cash payments are also coming at a time of moderating commodity prices. Moody’s expects Vedanta Ltd.’s consolidated adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) will be $4.5 billion to $4.8 billion during the 2024 fiscal year, down from $6.4 billion in fiscal 2022.

Comment by Riaz Haq on April 7, 2023 at 2:28pm

Adani’s business empire may or may not turn out to be the largest con in corporate history. But far greater dangers to civic morality, let alone democracy and global peace, are posed by those peddling the gigantic hoax of Modi’s India. Pankaj Mishra


https://www.lrb.co.uk/the-paper/v45/n08/pankaj-mishra/the-big-con


Modi has counted on sympathetic journalists and financial speculators in the West to cast a seductive veil over his version of political economy, environmental activism and history. ‘I’d bet on Modi to transform India, all of it, including the newly integrated Kashmir region,’ Roger Cohen of the New York Times wrote in 2019 after Modi annulled the special constitutional status of India’s only Muslim-majority state and imposed a months-long curfew. The CEO of McKinsey recently said that we may be living in ‘India’s century’. Praising Modi for ‘implementing policies that have modernised India and supported its growth’, the economist and investor Nouriel Roubini described the country as a ‘vibrant democracy’. But it is becoming harder to evade the bleak reality that, despoiled by a venal, inept and tyrannical regime, ‘India is broken’ – the title of a disturbing new book by the economic historian Ashoka Mody.

The number of Indians who sleep hungry rose from 190 million in 2018 to 350 million in 2022, and malnutrition and malnourishment killed nearly two-thirds of the children who died under the age of five last year. At the same time, Modi’s cronies have flourished. The Economist estimates that the share of billionaire wealth in India derived from cronyism has risen from 29 per cent to 43 per cent in six years. According to a recent Oxfam report, India’s richest 1 per cent owned more than 40.5 per cent of its total wealth in 2021 – a statistic that the notorious oligarchies of Russia and Latin America never came close to matching. The new Indian plutocracy owes its swift ascent to Modi, and he has audaciously clarified the quid pro quo. Under the ‘electoral bond’ scheme he introduced in 2017, any business or special interest group can give unlimited sums of money to his party while keeping the transaction hidden from public scrutiny.

Modi also ensures his hegemony by forging a public sphere in which sycophancy is rewarded and dissent harshly punished. Adani last year took over NDTV, a television news channel that had displayed a rare immunity to hate speech, fake news and conspiracy theories. Human Rights Watch has detailed a broad onslaught on democratic rights: ‘the Hindu nationalist Bharatiya Janata Party (BJP)-led government used abusive and discriminatory policies to repress Muslims and other minorities’ and ‘arrested activists, journalists and other critics of the government on politically motivated criminal charges, including of terrorism’. Last month, as the BJP’s official spokesperson denounced the BBC as ‘the most corrupt organisation in the world’, tax officials launched a sixty-hour raid on the broadcaster’s Indian offices in apparent retaliation for a two-part documentary on Modi’s role in anti-Muslim violence.

Also last month, the opposition leader Rahul Gandhi was expelled from parliament to put a stop to his persistent questions about Modi’s relationship with Adani. Such actions are at last provoking closer international scrutiny of what Modi calls the ‘mother of democracy’, though they haven’t come as a shock to those who have long known about Modi’s lifelong allegiance to Rashtriya​ Swayamsevak Sangh, an organisation that was explicitly inspired by European fascist movements and culpable in the assassination of Mohandas Gandhi in 1948.

Comment by Riaz Haq on April 17, 2023 at 9:08pm

This will blow your mind away! If life gives you a chance to become Yogi, be Swami Harshanand and not Adityanath. See the clarity in Swami’s thoughts and his love for inclusive India. We spoke to him at the peak of movement at Singhu border. This is a tribute to him now that Farm Laws have been repealed.

https://youtu.be/v3x-vpSSwzE

Swami Harshanand: "Modi is a hard core criminal. He should not be PM of India. He should be in jail. It's NAG company (Narendra Amit Gautam) ruling India. He did his MA before his BA. He's a madari (street entertainer). We don't know anyone who went to school or college with him"

Comment by Riaz Haq on April 20, 2023 at 6:48pm

#Indian court acquits 69 people of murder of 11 #Muslims during 2002 #Gujarat riots, overseen by current PM #Modi who was Chief Minister of Gujarat State. Former minister from ruling #BJP party among Hindus acquitted of killings in city of #Ahmedabad https://www.theguardian.com/world/2023/apr/20/indian-court-acquits-...

The case related to the deaths of 11 Muslims who were killed after their homes in the city of Ahmedabad were set alight by Hindu mobs who rampaged through the streets during communal riots that took place in February 2002. According to an investigation into the attack afterwards, “there was no police help received by the Muslims and they were simply at the mercy of the miscreants”.

Thursday’s verdict by the special court dealt another blow for those still fighting for justice for the Gujarat riots. Over the past two decades, the state has been accused of protecting alleged Hindu perpetrators – including those who now hold some of the most powerful political offices in the country – as well as obstructing justice, intimidating Muslim victims and recently releasing some of the few who had been convicted of rape and violence against Muslims in the riots.

Shamshad Pathan, who represented the victims, said they would challenge the court’s decision in a higher court. “Justice has eluded the victims once again,” he said.

The Gujarat riots began after Muslims were suspected of setting alight a train carriage carrying Hindu pilgrims, sparking revenge attacks by Hindu groups in what became one of the worst outbreaks of religious bloodshed in India’s post-independence history. Officially about 1,000 people died in the violence, mostly Muslims, but civil society groups say the number was much higher.

India’s current prime minister, Narendra Modi, who leads the Hindu nationalist BJP government, was chief minister of Gujarat at the time and was accused of complicity in the bloodshed by allowing the Hindu groups to carry out the revenge attacks and encouraging police and authorities not to intervene to stop the violence. Modi denies any role and a supreme court panel found there was not enough evidence to prosecute him.

In this particular case, 86 Hindus were accused but 17 had died during the trial. Among those acquitted was Maya Kodnani, a former minister for Modi, who was a lawmaker at the time of the riots. She was also an accused in a case relating to the murder of 97 people during the riots and was convicted but later cleared by a higher court.

Those involved in rightwing Hindu vigilante groups Bajrang Dal and Vishwa Hindu Parishad, which both have close links to them BJP, were also among the accused cleared of charges. As the verdict was announced, cries of “Jai Sri Ram”, a Hindu religious greeting that has been increasingly co-opted and weaponised by Hindu nationalists as a battle cry, were shouted outside the court.

“We have been saying from the first day that they were framed,” said the defence lawyer Chetan Shah. “Some of the accused were not present at the scene on the day of the incident.”

The acquittal of the 69 comes after the Gujarat government, which is still ruled by the BJP, recently decided to give early release to 11 Hindu convicts who had been sentenced to life imprisonment for the gang-rape of a Muslim woman and the murder of members of her family, one of the few convictions successfully made in the Gujarat riots.

Comment by Riaz Haq on April 25, 2023 at 7:08pm

Indian opposition party spokesman arrested for mocking Modi

https://www.washingtonpost.com/world/2023/02/23/pawan-khera-arreste...

Last week, the spokesman for the opposition Indian National Congress sat before television cameras and demanded a probe into Gautam Adani, an ally to Prime Minister Narendra Modi and business tycoon who has been at the center of an international controversy involving allegations of fraud.

Why has there been no investigation by the government led by “Narendra Gautamdas Modi?” asked Pawan Khera, who wryly swapped Modi’s patronymic middle name Damodardas with “Gautamdas” — implying the billionaire was so influential, he might as well be the prime minister’s father.

Khera glanced at his supporters, chuckled and claimed it was a slip of the tongue. But for many Modi supporters, the dig was neither accidental nor excusable.

As Khera traveled to his party’s national convention on Thursday, he was arrested and police escorted him off a plane at New Delhi’s airport on suspicion of a bevy of crimes including defaming Modi, insulting the Indian leader’s father, promoting enmity between groups, and criminal conspiracy.

Khera was released on bail seven hours later, after the Supreme Court intervened in the case. But the detention of an opposition leader, however brief, dominated national news and reverberated through Indian politics, offering the newest example of how those who oppose the Indian leadership face increasingly swift and heavy-handed retribution.

“The brazen misuse of the police force to lodge baseless cases against India’s main opposition and its leaders is an attempt to scare and threaten us,” said Supriya Shrinate, a Congress spokesperson who was traveling with Khera at the time of his arrest.

In a series of statements, the Congress party denounced Khera’s seizure as “undemocratic” and “dictatorial.”

Earlier this month, Indian tax officials spent three days rifling through the Delhi and Mumbai offices of the BBC and cloning some employees’ phones. The move came after the BBC aired a documentary critical of Modi’s handling of a 2002 sectarian riot.

Although tax officials said their search yielded evidence of financial irregularities, members of Modi’s Hindu nationalist Bharatiya Janata Party (BJP) openly described the tax raid as a response to what they said was the BBC’s record of airing propaganda attacking India.

Before Khera was seized, BJP officials similarly warned that he would face consequences. From Amit Shah, the powerful home minister, to local-level activists, BJP officials issued a flurry of statements condemning the Congress spokesman for what they argued was a low blow.

In a country where class and caste identities often represent powerful forces that mobilize voters and rouse passions, Modi and his supporters have often highlighted his humble roots — rising from assisting his father, Damodardas, at his tea stall to becoming India’s top elected leader — as a testament to his hard-working persona and populist bona fides.

By making a joke that touched on Modi’s parentage, Khera crossed a line, Modi’s allies said.

“Make no mistake- pathetic remarks by courtier Pawan Khera on PM’s father have blessings of the top levels of Congress, which is full of entitlement and disdain against a person of humble origins being PM,” Himanta Biswa Sarma, a member of Modi’s party and the leader of Assam state, said on Twitter on Monday, days before Khera’s arrest. “India will not forget or forgive these horrible remarks.”

Comment by Riaz Haq on May 11, 2023 at 7:50am

In Modi’s India, hatred toward Muslims is being inflamed by authorities

By Rana Ayyub


https://www.washingtonpost.com/opinions/2023/05/11/modi-india-musli...

In just the past four months, Mumbai and adjoining cities in the state of Maharashtra witnessed 50 anti-Muslim hate rallies attended by thousands of Hindus, often led and participated in by leaders of the BJP. I have attended four such rallies all across western India.

I saw vast crowds, from young children to 80-year-olds marching in the streets, expressing Hindu akrosh (Hindu rage), calling for “termites” and “bearded traitors” — all terms for Muslims in Modi’s India — to be wiped from the face of the country. I saw young women dressed in saffron performing traditional folk dances, holding placards asking Muslims to chose between “Pakistan or Qabristan” (Pakistan or the graveyard).

None of this has been spontaneous. Modi himself has been criticized for failing to take responsibility to stop the 2002 riots in Gujarat that killed more than 1,000 people while he was chief minister there — and even for inflaming passions in the run-up to the massacres.


Members of the BJP have continued to stoke hatred and intercommunal tensions since then. In but one recent example, Devendra Fadnavis, deputy chief minister of Maharashtra, held a rally last month in Ayodhya, near where a Hindu mob famously demolished the iconic Babri mosque in 1992. Modi’s government is planning to consecrate a new Hindu temple on the same site ahead of the 2024 general elections. Fadnavis was there to drive the point home. “Whether you [say it out loud] or not,” he said before a crowd, “the fact is India has a Hindu majority. And in that sense, it is already a Hindu rashtra (state).”

Last month, another provincial minister of the Modi government, who heads the northern state of Uttarakhand, stated that the Modi government would not tolerate “land jihad” — a dangerous dog-whistle to extremists who believe that Muslim immigrants are buying up land to displace the Hindu majority.

The poisonous rhetoric is having an effect. Shortly after these speeches, during celebrations commemorating the birth of Lord Rama, multiple attacks took place all over the country. The most prominent attack saw about 1,000 Hindu rioters set fire to a century-old Muslim religious school in the northern state of Bihar. The school’s library was burned down.


The dangerous provocations continue. “Tolerant Muslims can be counted on fingers. Their numbers are not even in thousands,” Satya Pal Singh Baghel, Modi’s minister of state for law and justice said at a rally this week. “Even that is a tactic. It is to stay in public life with a mask.” Meanwhile, Modi was praising an extremely Islamophobic new film at a rally ahead of local elections this month.


--------


As foreign dignitaries and celebrities continue to visit India ahead of the G-20 summit, they must not turn a blind eye to what is happening. As Zendaya, Gigi Hadid, Tom Holland and Penélope Cruz flocked to Mumbai for the opening of a major new cultural center, Hindu mobs danced to music glorifying the extermination of Muslims, brandishing swords outside mosques. And around the time that Modi welcomed the Australian, Japanese and Italian prime ministers and U.S. Secretary of State Antony Blinken, three Muslims were reportedly lynched.

Modi is making the case that he is an irreplaceable global leader who holds the key to world peace. Western leaders are looking to him as a partner to stand firm against a rising China and to push back on Russia’s naked aggression in Ukraine. Never before in his career of Hindu nationalist politics has Modi found himself more emboldened. It’s unconscionable that the international community remains silent in the face of what is going on.

Comment by Riaz Haq on June 21, 2023 at 4:39pm

Modi’s Vision for India Rests On Six Giant Companies


https://www.wsj.com/articles/modi-india-economy-reliance-industries...

Conglomerates are executing projects with a scale and speed that have eluded India in the past. ‘Era of great concentration.’


Prime Minister Narendra Modi says this is India’s decade. That claim rests heavily on a handful of dominant conglomerates.

Increasingly aligned with Modi’s priorities, the roughly half-dozen mega-firms—which include Reliance Industries and Adani Group, helmed by two of Asia’s richest tycoons—have the ability to raise vast sums of capital, and the experience and political connections to navigate India’s byzantine bureaucracy. Capitalizing on government subsidies and privatization plans, they are executing projects with a scale and speed that have eluded India in the past.

Among their ventures: A new airport for Mumbai, designed by the firm founded by the late Iraqi-British architect Zaha Hadid to look like a lotus flower, which is scheduled to start opening next year after the Adani Group took it over. When completed, it’s expected to connect to high-speed rail and handle 90 million passengers annually—only slightly fewer than Atlanta’s main airport, the world’s busiest, last year.

After spending more than $45 billion to build out telecommunications networks, Reliance Industries—a petrochemicals, textiles and retail juggernaut—is constructing factories to make solar panels and batteries for energy storage to position India as a credible alternative to China. It has pledged $75 billion in green-energy spending over the next 15 years.

The 155-year-old Tata Group, which took control of the formerly state-owned Air India last year, recently placed one of the largest orders in aviation history for 470 new aircraft. The salt-to-steel-to-software behemoth, which owns British automaker Jaguar Land Rover, is forging ahead with producing electric vehicles, military transport aircraft, smartphones and telecom hardware, with plans to invest $90 billion in India over five years.

Half a dozen conglomerates now control or have major stakes in 25% of India’s port capacity, 45% of cement production, a third of steel making, nearly 60% of all telecom subscriptions, and more than 45% of coal imports. An analysis by the Center for Monitoring Indian Economy, a research firm, shows that a quarter of all new investment proposals by private companies since 2014 have come from the companies.

“This is the period where it’s not the mad rush of entrepreneurs going out to build new capacities, to become great entrepreneurs—this is the era of great concentration,” said Mahesh Vyas, CMIE’s managing director.

Comment by Riaz Haq on June 21, 2023 at 4:40pm

Modi’s Vision for India Rests On Six Giant Companies


https://www.wsj.com/articles/modi-india-economy-reliance-industries...



Is this good for India, especially as it seeks to compete with China? The evidence is mixed. The mammoth firms can lead large breakthrough projects, but rising industrial concentration can also stifle competition and leave India’s plans vulnerable without broader private investment.

“It’s no longer that they’re taking the place of large public-sector firms, they’re now actually expanding at the expense of other private-sector firms,” said Viral Acharya, a former deputy governor of India’s central bank.

Recent research by Acharya, in a Brookings Institution paper, shows the largest conglomerates have since 2015 rapidly grown their market share, giving them greater power over prices for goods and services they sell. Prices have been rising faster than costs in some industries they dominate, such as cement, his research shows.

“People don’t see a point in entering any space where these big corporations are already,” said Rohit Chandra, an assistant professor at the Indian Institute of Technology—Delhi’s School of Public Policy. “You don’t want just a small group of companies winning everything over and over again.”

Together, the firms’ market capitalizations increased an average of 386% in the decade ending in December, more than double the broader market’s growth. Mukesh Ambani, who runs Reliance, is Asia’s wealthiest man. Beyoncé performed at his daughter’s wedding celebrations in 2018.

Gautam Adani, chairman of the Adani Group, became one of Asia’s wealthiest people, though his net worth has plunged this year.


The Adani Group’s tumultuous year so far exemplifies the danger of relying on a small group of conglomerates. A U.S. short seller in January targeted the energy and infrastructure business with allegations of stock manipulation and accounting fraud, leading Adani companies to lose tens of billions of dollars in market value.

The turmoil cast a cloud over the enterprise’s future expansion as it pays down debt to reassure investors. France’s TotalEnergies paused plans to partner with Adani to produce environmentally-friendly green hydrogen, saying in February the Adani Group “has other things to worry about.”

Adani Group has denied allegations that it committed fraud or stock manipulation. The company says it’s still expanding, including plans to redevelop Dharavi, a Mumbai slum featured in the 2008 film “Slumdog Millionaire.”

Academics and economists refer to the firms as “national champions,” a term that’s also been used to describe Chinese state-owned companies and South Korea’s private-sector chaebols. With state backing and coordination, the chaebols helped South Korea industrialize and turned it into an export powerhouse.

India’s model is shaping up to be a variant of the national-champions strategy, said Nouriel Roubini, an economist and emeritus professor at New York University. One difference with South Korea, he said, is that chaebols were nurtured by the state to be internationally competitive, while Indian companies are largely domestic giants.

The Modi government says it isn’t emulating the chaebol model. “I don’t know if Korea gave special dispensation to the chaebols, but in India, everybody competes on an equal footing,” Indian Commerce Minister Piyush Goyal said in an interview.

He said the conglomerates’ advantage comes from the fact that they have a legacy in India, people skills and managerial talent because of their size. “But other than that, all our projects are through transparent bidding mechanisms, and everybody has to compete to be able to get that business,” he said.

Comment by Riaz Haq on June 21, 2023 at 4:40pm

Modi’s Vision for India Rests On Six Giant Companies


https://www.wsj.com/articles/modi-india-economy-reliance-industries...


Modi’s supporters say his administration is seeking to partner with the private sector at large, not specific companies. Government policies, they say, have attracted multinationals such as Apple, which is diversifying its supply chains outside China, while also spawning an ecosystem for startups. On a visit to the U.S. this week, Modi is poised to strengthen defense and economic ties between the U.S. and India.

Harish Damodaran, an editor at the independent Indian Express newspaper and author of books on business, uses the term “conglomerate capitalism” to describe the country’s corporate landscape. While the government doesn’t typically direct the companies to make particular investments, he says the centralization of political power under Modi has led to a shift in their favor.

The firms find it easier to deal with a single power center in New Delhi rather than the patchwork of regional political heavyweights that flourished before Modi’s rise, and are aligning their strategies with his goals, he said.

Adani, who has a longstanding relationship with Modi, emerged as a key infrastructure builder over the past decade. His industrial group, India’s largest private port operator, controls a string of seaports and terminals. It is building highways, power-transmission lines and networks to supply natural gas, and modernizing airports that were previously state-run.

An Adani spokesman said the group has created a successful template for infrastructure development that draws on 20,000 vendor companies. A large country like India isn’t dependent on any one conglomerate or group of companies, the spokesman said.

The Tata Group didn’t respond to requests for comment. A Reliance spokesman said its expertise in executing large projects, including the world’s largest oil refinery in Modi’s home state of Gujarat, has benefited India. Reliance executives say it doesn’t receive special treatment from New Delhi, but that Modi’s goals and the goals of Ambani, Reliance’s chairman, overlap.

Reliance’s telecom venture shows what deep-pocketed conglomerates can do—and the potential pitfalls.

In 2010, before Modi became prime minister, Ambani set out to build India’s first 4G, or fourth generation, mobile network, a radical departure from Reliance’s main businesses at the time. Incumbent telecom providers such as Bharti Airtel and Vodafone Group were mostly focused on 3G. Average data prices in India at the time were among the world’s highest.

Launching in 2016, Reliance’s service, called Jio, ran advertisements on newspaper front pages with its blue logo, and below it a photo of Modi, who was elected two years earlier. “Dedicated to India and 1.2 billion Indians,” the ads said. After critics complained about what they called the inappropriate use of Modi’s image, the prime minister’s office said it hadn’t granted Jio permission, and Jio apologized.

Jio initially offered free voice calls and text messages. Unlimited internet data was free for the first six months and after that cost consumers a quarter of the industry average.

The result was a colossal data binge, with hundreds of millions of people getting online for the first time. It also caused a price war with rivals that put many out of business and collapsed competition.

Jio’s subscriptions grew rapidly, and now stand at 430 million, making it the top player. It has attracted billions of dollars of investment from Facebook parent Meta Platforms, Alphabet’s Google, and other investors.

As price wars dragged on, Jio’s rivals—who also faced other regulatory and judicial setbacks—warned that unsustainably low prices were pushing the heavily-indebted industry toward a crisis. India’s government had to step in with a relief package in 2021 that temporarily froze payments the companies must make to New Delhi for using airwaves, among other steps.

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