India - A Historical Perspective

India – A Historical Perspective

Excerpts from the lecture delivered by Prof. Dr. Anil Naik on 2nd July 2010 during the PGDM Foundation Fortnight at Welingkar Institute of Management

Introduction of Speaker: Dr Naik is a Phd in Turnaround Strategy, a graduate of the first batch of IIM Calcutta and the first batch employee of Tata Administrative Services and has worked for 11 years as a direct reportee and assistant to JRD Tata. He is also a distinguished professor at JBIMS, Fox Business School and Welingkar Institute of Management. He is also an Independent Director on the BOD of several listed companies.

India – A Historical Perspective

3800 B.C. – Mesepotemia, todays Iraq, the capital was Babylon. They built the first stone arch. They used rainwater harvesting, principles of gravitational force. They built the “Hanging Gardens of Babylon” to protect water co ntamination in th e desert.

3100 B.C. – Egypt – They were the original mathematicians. They evolved practices of star navigation. Evolved shipping and navigation techniques. They discovered the number system from 1 to 9.

2500 B.C. - Bhaskaracharya developed 0 in India and added it to the number system

2250 B.C. – Mohanjodaro and Harappa were built. Town planning introduced. Canal were built for the first time ever. Sea trade took shape. “Lothal” – A dry dock set up to build ships. Ship building began as an activity. Lothal is what we today know as Karachi.

1500 B.C. – Aryans came to India from North Pole. Average height of Aryans 6ft 4 inches. They came from Scandenevia. Aryans were highly innovative, lived in difficult terrain. They came down from the North Pole. One sect went to todays Germany, 1 sect to todays Russia and 1 to Persia. Their language was Sanskrit. “Shvetanal” = Beauty in Sanskrit, hence Russian name “Svetlana”

Aryans worshipped 3 Gods:

1. Fire – Agni

2. Natural Justice – Varuna

3. War Lord – Indra

Wherever Aryans went, they contributed significantly yo the community if they were welcomed. If not welcomed, they fought local resistence. They fought the Turkish tribes in Persia.

In India, they entered Punjab. Patiala welcomed them. They developed the Punjab region immensely.

Hindus worshipped 3 Gods too:

1. Brahma – The creator

2. Vishnu – The preserver

3. Mahesh – The destroyer


• The Chinese brought rice to India. Rice was initially cultivated heavily only in the North East and the East of India.

• Alexander the Great sent his ambassador “Megasthanes” to India. He was the first official ambassador ever sent to India.

• Megasthanes wrote letters to Alexander about the happenings in India. This collection of letters was called “Indika” – Meaning the Unknown Strength of India.

• When Tata Motors was looking out for a name for its car which was fully made in India, it called it “Indica”

• Maurya Dynasty also had a golden period of rule and influence on India. Chandragupt Maurya became a king at the tender age of 18. Magadh was the kingdom and Patliputra was the capital.

• Kautilya Chanakya was his advisor and backbone. Chanakya wrote “Arthashastra” in Sanskrit which became the first ever written book of Principles of Management. Many centuries later Peter Drucker – the father of modern management replicated some of the same principles in his Principles of Management, but in English.

• Chanakya – 323 BC said the same things as what Peter Drucker said in 1951

Vision - Prabhushakti
Mission – Mantrashakti
Motivation – Utsahshakti

Pillars of Governance:

Dharma – Ethics
Nyaya – Justice

Executive Officials – Chanakya had advised that there should be only 4 reportees to the King / CEO:

Mantri – Minister
Purohit – Chief Justice
Senapati – Defence Minister
Yuvraj – Prince

Chanakya also laid down qualifying standards for Executives:

Drudhachitta – Concentration
Shilavan – Character
Pragna – Thinking Capability
Daksha – Vigilance
Vangmi – Communication Skills

710 A.D. – 1st mosque built in India, outside Jaisalmer by the Arab traders who came to India during the period of Ramazaan, when they felt the need to pray.

21st May 1948 – Vasco De Gama landed 23 kms north of Calicut. He had 3 ships. 1 ship was damaged at Mauritious, it took him 6 months to repair the ship and hence reached 6 months behind schedule. His sailors and crew almost revolted. But Vasco saw the importance of Spice Trade, and stuck to the task.

Columbus landed at Barbados. Against conventional wisdom, he went towards west from Europe to find India but landed up at barbados. Hence it is called “West Indies”

1510 A.D. - Portuguese came to Goa. Portugal in a historic deal sold their spice trade to the Dutch who were famous for their International Trade. The king of calicut let the Dutch take away saplings of indian spice plants joking that the Dutch cannot do anything with it, they don’t have our weather or our soil. The Dutch then planted those saplings in Indonesia which was their colony with weather and soil similar to India and built an International Spice Trade empire. Today Indian spice trade is worth Rs. 600 crores, whereas Indonesia earns Rs. 1800 crores through Spice Trade.

31st  December, 1600 – East India Company was brought into existence by a statute in England.

1603 A.D. – East India Company which was started essentially as a trading company opened 2 offices in India in port cities of Mumbai and Surat.

October 1756 A.D. – Robert Clive of East India Company defeated the larger army of Siraj Ud Daula in the famous Battle of Plassey. The French established their settlements in Bangalore, Chennai and Krishnanagar.

1613 A.D. – The British Government took over the Each India Company.

1670 A.D. – The British Government took over the Indian Government.

• Slowly but steadily the British colonists wanted to exit India, so they sold their mills and businesses to local traders. The local traders therefore became Industrialists. The British sold the cloth mills to “Mafatlals” of Kheda District in Gujarat. “Singhanias” used to be tailors who stitched the uniforms of the British soldiers. Sir. Victor Sassoon, the British textile tycoon sold his Raymond mills to Singhanias. The major problem in India, which we notice till today is lack of long term vision emanates from the fact that most of the current industrialists have not originally been industrialists with long term business vision. They were traders who eventually became industrialists with acquired vision. The Indian industry went into the hands of the trading community.

Trading DNA – Short Term View

Industralist DNA – Long Term View

• Indian political ideology post independence was highly socialist. Highly influenced by Russia. Developed public sector. Developed rural and small scale industry. The policy was, whatever was left out from the scope of public sector and small scale industry could be licensed out. This led to the rise of License Raj.

• Import of technology available only through the countries which accepted rupee in currency viz. Russia, Czechoslovakia, Hungary, Yugoslavia, Bulgaria. Hence for a long time, cutting edge technology never entered India.

• Socialist era lasted from 15th August, 1947 to 31st October, 1984 till the day of Indira Gandhi’s assasination. Then Rajiv Gandhi assumed charge. UN invited Rajiv to address the member nations as the youngest PM. Rajiv addressed NRI’s in the US. He spoke about developing a new age India. 2 NRI’s who attended the said meet, came back to India in support of Rajiv. 1 of them was the Vice President of Hewlett Packard, came back and started Hindustan Computer Limited (HCL) – Mr. Shiv Nadar. He also started NIIT for computer Education. 2nd One was Mr. Sam Pitroda who was the lynchpin for Indian Telecom Industry.

24th July, 1991 – After Rajiv’s assasination, Narasimha Rao became the PM. Manmohan Singh was his FM. The First Economic Policy announcement was made and hence began the process of liberalisation.

• Hindustan Unilever Limited – Established in India in 1934. Initially led by only Dutch and British expats. Their only focus was on the urban population in India. In 1961, the first ever Indian CEO was selected in Mr. Prakash Lall Tandon. He immediately shifted the focus to the inherent potential of rural India.

• With this, “Lifebuoy” the first soap in red colour was born to fight ascorbic acid. The rural population understood red as the colour of danger. They saw red on traffic lights, on railway crossings and understood not to take the cattle across the tracks. Hence Lifebuoy was made in red and it found an instant connect.

• Tata’s observed that the cheapest 4 wheeler in the market was Rs. 2, 34,000. The cost of a 2 wheeler was Rs. 80,000. Therefore they decided to bridge the gap and hence the idea of the Nano car at Rs. 1 lakh was conceived.