The Swarj saga

Published : Aug 15, 1998 00:00 IST

Beyond Boundaries: A Memoir by Swraj Paul; Viking-Penguin India; 1998, pages 228; Rs. 395.

THIS book is a readable account of an extraordinarily successful business career. From modest beginnings as an entrepreneur in Jalandhar, The Lord Paul of Marylebone became (in 1996) a member of the House of Lords in the United Kingdom. His story of the origin and exponential growth of Caparo, the acronym for his industrial empire, based mainly in the U.K., and with manufacturing facilities obtained by acquisition in the United States as well, makes fascinating reading. The style is simple, the thoughts are expressed in terse, clipped sentences and the number of vivid one-liners is considerable.

In 1910, Swraj Paul's father had broken away from the traditional occupation of agriculture and set up a small manufacturing business in Jalandhar. The main items of manufacture were agricultural implements and household items like buckets. The business was successful and the family, consisting of a number of brothers and sisters, led a comfortable life. It was in this household that Swraj was born in 1931, at the height of the freedom movement led by Mahatma Gandhi, demanding swaraj, literally self-rule for India; hence the name Swraj, given to the new addition to the Paul family. The family was very closely knit; its members worked together and shared a communal meal at the end of the day, cooked by a caring mother, a woman who wore no jewellery because her sons were her jewels. She passed away in 1938, when in her thirties, and Swraj became motherless when he was only seven years old.

Swraj writes: "By the early 1940s World War II had come to India. War, as wars often are, was good for business. My father began manufacturing an expanded range of items." The business prospered and his father acquired a second-hand car, the first in Jalandhar. Shortly afterwards, Swraj's uncle, Khemchand, died of a heart failure. Swraj's father was deeply attached to his brother, and "the shock was unbearable" for him. Three months later, Paul Senior died, when he was only 55. Swraj was orphaned at 13 - his "childhood had ended".

Swraj's elder brothers, Bhaiji and Jit, were very supportive. Thanks to them, Swraj received a good schooling, and he went on to the Foreman Christian College in Lahore in 1945. The American Principal, Rice, and his wife (who was the sister of the president of the renowned Massachusetts Institute of Technology in Boston, U.S.) became very fond of him.

Unfortunately, the Partition of India and the bloodbath that followed interrupted Swraj's education. In mid-1947, Swraj was lucky to get back to Jalandhar in one piece. "I had been extraordinarily lucky," he writes. Swraj resumed his studies at Doaba College in Jalandhar, and graduated in 1949 with honours. He was accepted by MIT for enrolment the same autumn.

In spite of the financial strain, Swraj's elder brothers insisted on his joining MIT, which he did, though he had his misgivings and almost returned to India from London when he was halfway to Boston. MIT "helped to develop my personality." In 1952, when he was just 21, Swraj obtained both a Bachelor's and a Master's degree from MIT, and went back to India, planning to return later for his Ph.D.

From 1953 to 1966, the Paul brothers, now helped by the youngest sibling Surrendra, ran a successful business from their base in Calcutta. They were mainly engaged in steel imports, and made a foray into shipping. Swraj describes the red tape, especially in regard to steel specifications (a British legacy) which the bureaucracy was unwilling to modify. Swraj, however, managed to import Russian steel, and the red tape was cut at last.

IN 1956, Swraj married Aruna Vij, a Calcutta socialite, who gave birth to twin sons, Ambar and Akash, in December 1957. A daughter, Anjali, was born in 1959. And then came Ambika, in November 1963. She was destined to change Swraj's life, imperceptibly but also irrevocably.

"The story of Ambika is an inexplicable tragedy," Swraj recounts. She "was an enchanting child, lively and intelligent beyond her years," but she was born with leukaemia. In 1966, Swraj and Aruna managed to get the necessary foreign exchange to take Ambika to London for treatment. For a year and more, she lingered on with spells of normalcy followed by bouts of illness and hospitalisation - until she passed away in 1968. This was a poignant and traumatic event in the life of Swraj and Aruna. They decided not to return to India but "to make a new beginning and a new home in England... Another life dawned... I returned to work. In small steps and incremental advances Caparo came into being."

AMBIKA'S illness also led quite fortuitously to a strong friendship between Swraj and Prime Minister Indira Gandhi. In December 1966, Swraj's three children, who had been left behind in India, wanted to join their parents and ailing sister for Christmas. But foreign exchange restrictions made this impossible. In desperation, Swraj wrote a personal letter to the Prime Minister, and in no time the legal requirements were met, and the family was re-united. "This was one of those frequent acts of kindness which Mrs. Gandhi undertook," he writes.

To overcome his deep sorrow, Swraj turned to work. Beginning with a small tube factory, called Natural Gas Tubes, acquired with the help of a loan of oe 5,000, he embarked on a career of acquisitions on both sides of the Atlantic, usually in the steel products manufacturing industry. Chapter 5, 'Building Caparo', gives the details. "Today Caparo is a conglomerate of small and medium-sized companies, with total sales of over oe 500 million, and operating profits in excess of oe 50 million in 1995." Unlike the industrial empires in India, these companies are held privately by Swraj and his family, and managed by the family with the help of some select business associates.

In most cases, Swraj acquired an ailing company, modernised it, made friends with the workforce and turned it around into a profitable venture. The magic touch failed only once, in the acquisition of an electronics-manufacturing firm called Fidelity, which proved unfaithful and was quickly disposed of. Even Homer nods.

Swraj believes in continuing efforts towards modernisation and slimming. His motto is: "Think lean, act mean, stay keen." He is vigilant to avoid pretensions of omniscience "and the traps of sycophancy." One of his favourite sayings is: "Hubris precedes nemesis."

In his personal life, Swraj practises simplicity, as an example to his own family. In spite of all the pressures of entertaining and being entertained, he continues to be "a man of abstemious ways"- a teetotaller, a vegetarian, and a non-smoker. He follows the dictum, "Better to be a model than a missionary." He strongly believes in the unity of the family and in giving the younger generation the best possible education. "Financial resources can be dissipated; education cannot be lost."

Chapter 7 is devoted to Indira Gandhi, whose steadfast friend Swraj became, after her act of personal kindness in 1966. Through her years as Prime Minister; during the Emergency; when she was temporarily defeated; and when she came back as Prime Minister, Swraj remained totally devoted to her. He used his considerable influence and resources to mount a public relations campaign in England on her behalf. When her son Sanjay Gandhi died in an accident, Swraj called on her to offer his sympathy. Her reply, quoting her father, was: "Public figures cannot afford personal tragedies." Four years later, Indira Gandhi herself fell to an assassin's bullet. Swraj's requiem: "The lasting impression (of Indira Gandhi) is of a leader and a woman of indomitable courage."Chapter 8, titled 'Investing in India' is probably the chapter of most current interest to Indian readers. Its main content falls into two parts. The first relates to Paul's acquisition of a large number of shares in two well-known Indian companies - DCM, controlled by the Shriram family, and Escorts, controlled by H.P. Nanda. In the case of DCM, the Shriram family held only 10 per cent of the shares; in the case of Escorts, the Nandas held less than 5 per cent. Even so, this relatively small holding gave them a controlling interest because of the support given by public financial institutions and the backing, cultivated over the years, of politicians and the officialdom. In spite of Paul acquiring a larger share-holding than the Shrirams and the Nandas - all done openly through an established broker and normal banking channels - the shares were never registered in Paul's name, and finally Paul had to agree to sell them back "without loss".

The second instance is the account (pages 136-137) of the Paul family in India agreeing to invest in the establishment of a fertilizer plant, one of four authorised by the Government, involving a capital cost of some $300 million. Although the interest in this project began with some initial prodding by Prime Minister Indira Gandhi in 1984, further developments continued after her assassination and when Rajiv Gandhi was Prime Minister. Paul states that he was pressured to buy equipment offered by an Italian firm, Snam Progetti, although it cost $35 million more and their "equipment was not the best in technological terms." If indeed such pressure was applied - a contention vehemently denied by Rajiv's secretary Vincent George - Rajiv himself told Paul that he "should buy the best and the cheapest, and ignore everything else." Anyhow, in 1988, when the licence came up for renewal, Paul's licence alone was not renewed.

Both in Chapter 7, on Indira Gandhi, and in Chapter 8, on 'Investing in India', Paul's references to Rajiv Gandhi are disparaging and critical. Paul has written about Sanjay's death, but there is no reference to Rajiv's tragic end. On page 78 of his book, Paul has quoted extensively from Cicero. He may do well to remember another Latin saying - "De Mortuis, Nil Nisi Bonum" (Of the dead, nothing but good).

THE ninth and final chapter, 'Retrospect and Prospect', deals in part with Paul's involvement in Labour politics, and his friendship with, and admiration for, British Prime Minister Tony Blair, Foreign Secretary Robin Cook, and Chancellor of the Exchequer Gordon Brown. Even before Blair became Prime Minister, he had recommended to John Major, the Tory Prime Minister, that a peerage be bestowed on Paul. This recommendation was accepted by Major and approved by the Queen. The public announcement was made on August 21, 1996. Lord Paul took his seat in the House of Lords on November 12, 1996. He made his maiden speech 16 days later. With the Labour Party's resounding victory in the May 1997 elections, Lord Paul occupies a pivotal position, as a close friend not only of Prime Minister Blair but also of Cook and Brown.

Among Paul's many benefactions, two are significant. Both were for the benefit of Regent's Park Zoo in London. The zoo was in danger of being closed down in 1992 because of financial constraints. Paul came to the rescue with personal funds, and also erected a fountain as a memorial to his daughter, Ambika. The fountain is adorned by a sculpture of Ambika. In 1997, Paul funded "the Baroness Paul pygmy hippo enclosure, dedicated to Aruna Paul, in celebration of forty years of marriage (1956-1996)."

Recently Lord Paul was appointed "the first ever pro Vice-Chancellor of London's Thames University". Paul has an abiding interest in education, and his appointment will no doubt help the university "in its expansion and development abroad."

THE appendices are also well worth reading. Appendix I on India deals with his Indian heritage and the value system that it represents, especially the ancient concept of "Vasudhaiva Kutumbakam" - that the world is one family. The Indian influence also comes out in Appendix II, Paul's "Philosophy of Life". Two fundamental points are raised here. One is that we have today a global economy and no country can be an island. The second is the importance of manufacturing as an engine of a country's growth and development.

The book has important lessons for all men and women engaged in the pursuit of a career in business and industry in India. Lord Paul has shared his insights and the lessons he has learnt in the course of his own spectacularly successful business career spanning 45 years - from 1953 to this day.

I hope this important book, written in short, clipped sentences and eminently readable, will find a wide readership in India. The book is handsomely produced, and printed legibly on fine paper. There are some fine photographs of the important events in Paul's life, and also with members of his own family. The picture of Ambika, who passed away at so young an age, is very touching; also the photograph of the Ambika Fountain at the Regent's Park Zoo. Paul looks very impressive receiving the Padma Bhushan award from President Zail Singh in 1983, and every inch a lord in the full regalia of a peer of the realm (1996). The photograph of the Jalandhar house, the original home of the Paul family, only goes to show what a long way Lord Paul has come.

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