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The next generation shall inherit the corporations

The national economy is like an iceberg. You see only the tip of an iceberg but there is much more under the surface. And often what you do not see is more important than what you do see.

After six years of liberalisation, Indian industry has changed a great deal but you don't notice all the changes. After all, the same business groups and companies are operating, making more or less the same things, and run by also by more or less the same people or families.

Although families are the same, the men who actually run them are not always the same. A new generation is getting ready to take over from the old one, so fast that soon most of the big business houses will be run by young men in their 30s or early 40s.

Take Reliance, probably the fastest growing business house in the country. The Bombay-based company is the creation of Dhirubhai Ambani who single-handedly brought it to No 1 position.

Now, his young sons, Mukesh and Anil, will now be taking over from him. They are already directors in his father's firm, but the old man remains in charge. There were rumours on the eve of last annual general meeting that he would announce his retirement, but that did not happen.

In the case of Mahindra and Mahindra, also a Bombay-based group, a young Mahindra is waiting in the wings to take over from his uncle. The company was founded by two cousins and is now headed by Keshub Mahindra, the son of the elder cousin.

But Keshub has no sons, only daughters, and the torch will now pass on to his nephew, Anand, already a director in the company. Anand started his career in his father's company, Mahindra Ugine, before switching over to the main company.

The Birlas, certainly the biggest family-run group in the country, have a problem. The group was split up among the four brothers who started it nearly a century ago, and the different companies are now being managed by their respective sons and grandsons and in at least one case, by a great-grandson.

This great-grandson is Kumaramangalam, son of Aditya Vikram who headed the Hindalco group until his death two years ago. Until last week, Kumaramangalam had only a daughter, but now he is the proud father of a son, the only male child in the entire family. One paper has reported that the whole Birla clan is celebrating.

Kumaramangalam is only 30 and heads a group worth at least Rs 100 billion, nearly as big as Reliance.

Young men are preparing to take over in yet another a group, this time, the Bombay Dyeing group, headed by Nusli Wadia. His son, Jeh or Jehangir, was recently nominated a director on one of the Wadia group companies, though he is only 24 or so.

Though Nusli Wadia is a Parsi by birth, his mother was half-Muslim, and Mohammed Ali Jinnah's daughter. Jinnah's wife Ruttee was a Parsi, but the two separated soon after their daughter was born. This daughter married Neville Wadia, Nusli's father, before World War II. Nusli is his father's only son.

Further away in Delhi, at least two groups are about to pass the baton on to the younger generation. One is the Thapar group and the other is the Escorts group founded by Har Prashad Nanda. Between them, they may be worth about Rs 90 billion.

The Thapar group, which made its fortune in paper, is headed by Lalit Mohan Thapar who is expected to resign shortly and pass on the torch to his nephews. Lalit Mohan is a bachelor. There are at least four young men in the family waiting to take over from their uncle, and are in fact already more or less in charge of their small fiefs. The Thapars are not doing as well as they once did, but they are restructuring their empire and may soon bounce back.

The Nandas are more or less in the same position as the Mahindras of Bombay. There is only one son in the family who will inherit the whole lot. He is Nikhil Nanda, H P Nanda's grandson and Amitabh Bachchan's son-in-law. H P Nanda started Escorts after WWII as a small travel agency which then went into manufacturing. It is now one of the biggest engineering groups in north India.

With so many youngsters taking over from their fathers and uncles, what are the prospects for Indian industry?

Remember that the groups mentioned above add up to a grand total of nearly Rs 750 billion in turnover, maybe a third of the entire industry in the organised sector. It makes you think.