Notes - The Polyester Prince

October 17, 2024

Chapter 1. A Persuasive Young Bania

This chapter introduces Dhirubhai Ambani's childhood and early life, exploring the social and political landscape that shaped his formative years. It begins by describing Junagadh, the princely state where Ambani was born, ruled by the eccentric Nawab Mahabat Khan, renowned for his love of dogs. The Nawab's lavish lifestyle stood in stark contrast to the poverty endured by many of his subjects.

Dhirubhai was born into a Modh Bania family, a community known for its entrepreneurial spirit and strong business acumen. The author discusses the characteristics of the Bania community, including their frugality and relentless work ethic, which often fueled resentment in communities where they operated. This cultural background instilled in Ambani a natural inclination towards commerce and a drive to succeed.

The author discusses the Bania community's association with Vaishnavism, a Hindu sect emphasizing devotion and good deeds. This religious framework provided a moral justification for their commercial pursuits and social status.

Dhirubhai's father, Hirachand Ambani, was a school teacher known for his strictness and meager income. The family lived in a small, two-roomed house in a hamlet outside Chorwad. The author suggests that Dhirubhai's early exposure to poverty may have fueled his ambition to achieve financial security.

The author recounts anecdotes about Dhirubhai's childhood, including his visits to the home of a wealthier relative, where he was welcomed and treated with affection. These interactions may have exposed him to different lifestyles and further fueled his desire for a better life.

The author then shifts focus to the political climate of India during Dhirubhai's youth, describing the growing movement for independence from British rule. The author highlights the role of Mahatma Gandhi and the support he received from Indian industrialists, particularly G.D. Birla. This support was driven by a shared belief in Gandhi's vision of a decentralized, village-based economy, as well as a desire to counter the growing influence of socialist ideas within the independence movement.

The author describes Dhirubhai's early involvement in nationalist activities during his school years in Junagadh. Dhirubhai, despite living in a state that remained loyal to the British Crown, actively participated in protests and demonstrations, displaying a rebellious spirit and early signs of leadership. He co-founded a student organization called the Azad Student Sangh and organized events promoting Indian independence.

The author recounts an incident where Dhirubhai cleverly outmaneuvered the Nawab's police by exploiting a technicality in their agreement, allowing a prominent nationalist leader to deliver a pro-independence speech. This event highlights Dhirubhai's sharp wit and ability to manipulate situations to his advantage.

The author describes the political turmoil surrounding Junagadh's accession to India following independence. Dhirubhai, still a teenager, actively participated in the movement to integrate Junagadh into India, even confronting the state's police commissioner to defend a fellow activist. This incident demonstrates his courage and commitment to the nationalist cause.

The author concludes the chapter by reflecting on Dhirubhai's early life experiences, highlighting the impact of his impoverished upbringing, exposure to different lifestyles, and participation in the independence movement. The author suggests that these experiences shaped his character, instilled in him a drive to succeed, and honed his skills in persuasion and negotiation.

Chapter 2. Lessons from the Souk

In the early 1950s, officials in Yemen noticed a peculiar phenomenon: their silver Rial coins were vanishing from circulation. The trail led to Aden, a bustling British colony and trading hub at the entrance to the Red Sea. Ambani's journey to Aden in the early 1950s, at the age of 16, marked a pivotal point in his life. It provided him with an education in commerce and finance that would later prove invaluable in his business ventures back in India. The author uses the disappearance of the Yemeni Rials as a metaphorical representation of the entrepreneurial spirit that thrived in Aden's souk, a marketplace where shrewd traders could amass fortunes through clever arbitrage and exploitation of market inefficiencies.

Aden, a melting pot of cultures and a center for trade, was characterized by a vibrant marketplace known as the souk. The author notes that Aden was a key refueling stop for ships and aircraft, playing a strategic role in global trade and military operations. The diverse expatriate communities, including Indians, Arabs, and Jews, each contributed to the dynamic commercial environment of the port city.

Dhirubhai secured a job at A. Besse & Co, a prominent trading firm in Aden. He was initially assigned to the Shell products division, responsible for bunkering ships and marketing lubricants. The author recounts anecdotes that highlight Dhirubhai's early audacity and risk-taking, such as winning a bet by swimming through shark-infested waters. His job involved extensive travel across the region, exposing him to different business practices and fostering his understanding of international trade.

Despite his success at Besse, Dhirubhai was not content with a salaried position. He was driven by an ambition to achieve greater financial independence and control over his destiny. His roommate in Aden, Susheel Kothari, observed, "Right from the beginning he was determined to do something big. He was never comfortable in service. He was a born businessman." This ambition led him to the souk, where he began to trade commodities in his spare time, much to the disapproval of his brother Ramnikbhai.

Dhirubhai immersed himself in the bustling atmosphere of the souk, carefully observing the seasoned traders and learning the nuances of buying, selling, and profiting from price fluctuations. He initially focused on commodities like rice and sugar, engaging in speculative trading. His early experiences were marked by both successes and near-disastrous mistakes, which taught him valuable lessons about risk management and the importance of calculated decision-making. One such instance involved a damaged sugar shipment, forcing him to borrow money from colleagues to cover his losses.

The author emphasizes the importance of the souk as Dhirubhai's training ground, where he honed his trading skills, developed a keen understanding of market dynamics, and cultivated the ruthlessness and risk appetite that would define his later business ventures. The author notes: "Dhirubhai made some profits, and learned the fundamentals of business and money. But he also made some near disastrous mistakes, which almost wiped out his capital". The souk served as a microcosm of the larger business world, providing him with a practical education that no formal institution could offer. This experience would later prove invaluable when he returned to India and established Reliance Industries, utilizing his hard-won knowledge to navigate the complex and often unpredictable Indian business landscape.

Chapter 3. Catching Live Serpents

Dhirubhai returned to India at the end of 1958 with his family and limited savings. His time at Besse & Co. and his experiences trading in the Aden souk had given him a solid foundation in business, but his savings amounted to only about US $3,000. The chapter's title, "Catching Live Serpents," is a metaphor used by his former colleague Susheel Kothari to describe the risky nature of Dhirubhai's business ventures.

Dhirubhai's initial business venture in India involved importing spices from Zanzibar and exporting Indian textiles to Yemen. This was a natural progression, drawing upon his knowledge of international trade and connections in these regions. However, the real opportunity lay not in the goods themselves, but in the import licenses granted to registered textile exporters.

Under India's tightly controlled import-export regime, these licenses, known as REPs, were highly valuable. They allowed the import of raw materials worth a percentage of export earnings. Dhirubhai recognized the potential for profit in trading these licenses, as they could be bought and sold in a secondary market, even though some were officially non-transferable.

By aggressively offering higher margins than other traders, Dhirubhai quickly became a dominant player in the REP license market. His strategy was not simply to buy and sell these licenses, but to control the supply of yarn in the Indian market. This control gave him significant leverage in the textile industry, allowing him to dictate prices and influence the fortunes of textile manufacturers.

The author highlights Dhirubhai's bold risk-taking and his ability to exploit loopholes in regulations to his advantage. The chapter details his initial partnership with his second cousin, Chambakial Damani, in a trading firm called Reliance Commercial Corporation. Their partnership eventually dissolved due to Damani's apprehension over Dhirubhai’s high-risk business practices. This parting of ways underscores Dhirubhai's relentless pursuit of growth and profit, even in the face of potential setbacks.

Despite his success, Dhirubhai faced criticism and accusations of black marketeering. He responded to these allegations with characteristic audacity, challenging his critics with the question, "But which one of you has not slept with me?", implying that they had all benefited from his business dealings at some point.

The author also portrays Dhirubhai's personality, describing his practical jokes and whimsical nature. He recounts an amusing anecdote about Dhirubhai and his friend exhausting their host’s supply of mangoes through repeated requests for refills of mango juice, highlighting his mischievous side.

Ultimately, the chapter portrays Dhirubhai as a shrewd and ambitious businessman, willing to take calculated risks and navigate the complexities of India’s regulatory environment to achieve his goals. His early success in trading REP licenses laid the foundation for the vast Reliance empire he would later build.

Chapter 4. A First-Class Fountain

This chapter focuses on Dhirubhai Ambani's transition from a trader to a manufacturer and his growing political influence in India's complex regulatory environment. The title, "A First-Class Fountain," is a metaphor Dhirubhai used to describe his ability to conceal the less savory aspects of his business dealings beneath a veneer of respectability and success.

Dhirubhai's entry into manufacturing was marked by the establishment of his textile plant at Naroda, Gujarat, in 1966. This move signaled a shift in his business strategy, from focusing solely on trading to vertically integrating his operations. The Naroda plant was initially focused on the production of synthetic textiles, particularly polyester, a relatively new material in India at the time.

The author highlights Dhirubhai's astute understanding of the Indian consumer market and his ability to identify emerging trends. He recognized the growing demand for polyester, driven by its durability, affordability, and ease of maintenance compared to traditional fabrics like cotton and silk. Dhirubhai also understood the importance of branding and marketing. He created the "Vimal" brand, named after his nephew, and invested heavily in advertising, promoting it as a symbol of modern, aspirational India.

The author discusses Dhirubhai's approach to cultivating political and bureaucratic connections, which was crucial for navigating India's intricate "License Raj" system. This system, characterized by bureaucratic red tape and government control over industrial licenses and permits, often favored established business houses with deep political connections. Dhirubhai, as a relative newcomer, had to find ways to overcome these hurdles.

His strategy involved cultivating relationships with influential politicians and bureaucrats, utilizing a combination of charm, persuasion, and financial contributions. He famously stated, "I am willing to salaam [bow down to] anyone", acknowledging the necessity of appeasing those in power. He carefully nurtured relationships with key figures like T.A. Pai, the influential banker and politician, and Harkisan Das Parekh, the chairman of ICICI, securing their support and financing for his ventures.

The author provides an example of Dhirubhai's political maneuvering in the context of the "Higher Unit Value Scheme," introduced in 1971. This scheme, designed to promote exports, allowed companies to import raw materials worth a multiple of their export earnings. Dhirubhai leveraged this scheme to his advantage, aggressively exporting low-value textiles and utilizing the inflated import entitlements to secure large quantities of polyester yarn at significantly lower international prices.

This strategy allowed him to dominate the Indian polyester market, effectively controlling the supply of yarn to a vast network of small-scale textile weavers who relied on his imports. Dhirubhai's critics accused him of exploiting the scheme for personal gain, while his supporters argued that he was simply capitalizing on a government-created opportunity.

The author recounts an anecdote that encapsulates Dhirubhai's attitude towards his critics and his ability to conceal his methods. When confronted about his business practices, Dhirubhai allegedly responded with a cryptic remark: "Everything that I have done has been kept in the ground, and a first-class fountain has been built over it. Nobody will ever know what I have done." This statement, characteristic of Dhirubhai's opaque business dealings, suggests his awareness of the ethical ambiguities surrounding his actions, and his determination to maintain a facade of respectability.

The chapter concludes by highlighting Dhirubhai's growing influence and success, despite persistent controversies and accusations. He had transitioned from a small-time trader to a prominent industrialist, demonstrating his ability to adapt to changing market dynamics and manipulate India's complex regulatory environment to his advantage. The chapter sets the stage for the further expansion of the Reliance empire and the escalating conflicts that would come to define Dhirubhai's career.

Chapter 5. Guru of the Equity Cult

This chapter chronicles Dhirubhai Ambani's ascent to becoming a stock market icon in India during the 1980s, a period marked by his growing control over Indian politics and his pioneering role in popularizing equity investments among the Indian public. The title "Guru of the Equity Cult" aptly captures Dhirubhai's transformative impact on the Indian capital market.

Dhirubhai's meteoric rise coincided with a shift in Indian economic thinking, moving away from the socialist policies of the "License Raj" towards a more market-oriented approach. This shift was spearheaded by Nitish Sen Gupta, who became Finance Secretary in 1979. Sen Gupta encouraged companies to raise capital through the stock market, promoting the use of convertible debentures as a means of financing growth.

Dhirubhai embraced this new financial instrument with remarkable success. Reliance Industries was able to significantly reduce its debt burden by issuing convertible debentures and then converting them into equity shares at favorable prices. This strategy, dubbed "brilliant and unconventional" by business magazines at the time, allowed Reliance to continue raising substantial funds while minimizing its interest payments.

Dhirubhai recognized the potential of the stock market not only as a source of capital but also as a tool to build a loyal investor base and exert influence on the political landscape. He actively cultivated a "cult" following among small investors, promoting Reliance shares as a pathway to wealth creation. Reliance became the most widely held stock in India, boasting over a million shareholders by the end of 1985.

This widespread share ownership made Dhirubhai a formidable force in Indian politics. Politicians, particularly in his home state of Gujarat, were hesitant to oppose him, fearing the backlash from his vast network of investors. He had effectively transformed a large segment of the Indian public into stakeholders in his success, creating a powerful constituency that shielded him from criticism and regulatory scrutiny.

The author describes the frenetic atmosphere of the Bombay Stock Exchange, highlighting the chaotic nature of trading in the 1980s. Despite some modernization efforts, the exchange still relied heavily on traditional methods of trading, with brokers engaging in boisterous negotiations on the trading floor.

Dhirubhai mastered this environment, employing a network of brokers and utilizing innovative financial strategies to manipulate share prices and outmaneuver his rivals. He skillfully exploited the "badla" system, a traditional form of carryover financing, to corner the market and inflict heavy losses on those who bet against Reliance shares.

The author provides an example of Dhirubhai's aggressive tactics during a bear attack on Reliance shares in 1982. He countered the attack by demanding delivery of the shares his brokers had purchased, forcing the sellers to scramble for shares and driving up the price. This episode cemented Dhirubhai's reputation as a ruthless and formidable player in the stock market.

Dhirubhai's success in the stock market was not solely attributed to his financial acumen and aggressive tactics. He also invested heavily in public relations and cultivated a network of loyal journalists who helped shape a favorable narrative about Reliance. He understood the power of the media to influence public perception and utilized it to his advantage, promoting a positive image of Reliance and countering negative publicity.

This chapter concludes by acknowledging the criticisms levied against Dhirubhai and Reliance, particularly accusations of manipulating government policies and exploiting loopholes in regulations. However, the author suggests that these criticisms were largely ignored by his vast investor base, who remained enthralled by the Reliance growth story and Dhirubhai's charismatic persona. The chapter ends with Reliance Industries dropping the word "Textile" from its name, signaling Dhirubhai's ambition to expand beyond the textile industry and establish Reliance as a diversified conglomerate.

Chapter 6. Friends in the Right Places

This chapter explores the darker side of Dhirubhai Ambani's success, exposing a clandestine network of political maneuvering, market manipulation, and media control that underpinned Reliance's rapid growth. The chapter's title, "Friends in the Right Places," points to the crucial role played by Dhirubhai's carefully cultivated relationships in achieving his ambitions.

Building upon the previous chapters, which depicted Dhirubhai's rise from a trader to a manufacturing tycoon and his growing dominance in the stock market, this chapter shifts focus to the intricate web of connections he established within India's political, bureaucratic, and financial circles. While previous chapters hinted at his willingness to bend rules and exploit loopholes, this chapter explicitly exposes the systematic and deliberate nature of his manipulations.

The chapter begins by highlighting the existence of a "second operation" running parallel to Reliance's official business activities. This operation, concealed from public view, involved a complex system of share price manipulation, favorable policy engineering, and media management designed to perpetuate the Reliance success story and attract continuous investment.

Dhirubhai's network extended far beyond mere personal connections; it encompassed a vast and intricate system of patronage, influence peddling, and quid pro quo arrangements. He understood the power dynamics within India's bureaucratic and political structures and strategically placed his "friends" in key positions to advance his interests.

The chapter provides specific examples of how Dhirubhai utilized his network to gain an unfair advantage. He would often reward loyal bureaucrats with post-retirement jobs, provide business opportunities for their children, or offer indirect financial support to those facing difficulties. This created a culture of obligation and ensured that his "friends" in government ministries and financial institutions would act in his favor when the opportunity arose.

The chapter also exposes Dhirubhai's control over the media, revealing a system of "envelope journalism" where journalists were routinely bribed with cash, gifts, or shares in Reliance to publish favorable stories and suppress negative coverage. He cultivated relationships with key editors and media personalities, ensuring that the public narrative about Reliance remained positive, despite mounting evidence of questionable business practices.

Dhirubhai's control over information extended beyond simply bribing journalists; he understood the importance of shaping public perception and strategically planted rumors and gossip to influence market sentiment and undermine his rivals. His media network acted as an extension of his intelligence apparatus, gathering information about his competitors and disseminating favorable narratives about Reliance.

The chapter provides several detailed accounts of how Dhirubhai utilized offshore companies, often registered in tax havens, to manipulate Reliance's share price and circumvent Indian investment regulations. He used these companies to invest in Reliance shares during bear attacks, creating an artificial demand and propping up the price. He also used these companies to channel funds from overseas investors into Reliance, exploiting loopholes in regulations governing foreign investment.

One compelling example is the case of the "Isle of Man" companies, where a network of shell companies registered in the Isle of Man, a British tax haven, were used to funnel investments into Reliance. These companies, ostensibly owned by non-resident Indians, were later revealed to be controlled by Dhirubhai himself, demonstrating his elaborate and deceptive methods to manipulate the stock market and evade regulations.

The chapter also highlights Dhirubhai's close relationship with Manohar J. Pherwani, the chairman of the Unit Trust of India (UTI). UTI, a government-controlled investment institution with vast financial resources, was a major investor in Reliance, and Pherwani's support was crucial in propping up Reliance's share price and facilitating its expansion. Dhirubhai and Pherwani's relationship epitomized the nexus between business and politics in India, where personal connections and mutual benefit often trumped regulatory oversight and ethical considerations.

The chapter concludes by emphasizing the pervasiveness of Dhirubhai's influence, highlighting his ability to cultivate relationships across the political spectrum, from the ruling Congress Party to opposition leaders, and even within the bureaucracy. This network of "friends in the right places" allowed him to navigate the complexities of India's regulatory environment, secure favorable policy decisions, and effectively operate with impunity, despite mounting evidence of unethical and potentially illegal business practices.

The chapter ends on an ominous note, hinting at the growing number of Dhirubhai's critics and the potential for his carefully constructed empire to unravel if his political protection were to disappear. It sets the stage for the subsequent chapters, which delve into the escalating conflicts and controversies that would come to define the later years of Dhirubhai's career.

Chapter 7: The Great Polyester War

This chapter recounts the epic rivalry between Dhirubhai Ambani's Reliance Industries and Nusli Wadia's Bombay Dyeing, a conflict dubbed "The Great Polyester War". It vividly illustrates how Dhirubhai's intricate network of political influence, honed over the previous chapters, could backfire when challenged by a determined adversary.

The chapter starts with a misleading account in the tabloid Blitz, announcing a "Mahapolyester War" with Dhirubhai, Kapal Mehra of Orkay Silk Mills, and Nusli Wadia of Bombay Dyeing as the key players. While Blitz correctly identified the intense competition within the industry, they missed the key point that Kapal Mehra was already out of the running due to legal troubles. The real battle was between Dhirubhai and Nusli Wadia, with Bombay Dyeing on the ropes and Reliance initially in a position of strength.

The seeds of this conflict were sown when Dhirubhai felt slighted by Wadia at a party. While Wadia claimed to have no memory of the incident, Dhirubhai, according to sources close to him, felt humiliated and harbored a desire to see Wadia come to him for help. This personal animosity fueled the subsequent industrial rivalry.

The conflict intensified when Bombay Dyeing applied for a license to manufacture DMT, a key feedstock for polyester production. This move threatened to put Wadia in a position to control the supply of DMT and potentially dictate terms to Reliance, which was still reliant on imported PTA.

Dhirubhai, however, leveraged his political connections to thwart Bombay Dyeing's ambitions. Wadia's attempt to secure a license for the DMT plant was met with bureaucratic delays, attributed to Dhirubhai's influence within the government.

The political landscape shifted dramatically with the assassination of Indira Gandhi in 1984. Her son, Rajiv Gandhi, ascended to power, bringing with him a commitment to reform and a determination to curb corruption. This change in leadership proved to be a turning point in the polyester war.

Dhirubhai's access to the corridors of power was significantly weakened under Rajiv Gandhi. This became evident when the government abruptly changed import policies for PTA, cutting into Reliance's profits and signaling that Dhirubhai's influence had waned.

As Dhirubhai's political clout diminished, Wadia seized the opportunity to launch a counteroffensive. He found a powerful ally in Ramnath Goenka, the influential owner of the Indian Express newspaper chain. Goenka, known for his crusading journalism, saw in the Reliance saga a chance to expose corruption and hold the powerful accountable.

Goenka's newspaper launched a series of articles exposing Reliance's questionable business practices, particularly focusing on its alleged manipulation of import-export licenses and tax evasion. These articles, penned by S. Gurumurthy, a chartered accountant with strong nationalist leanings, brought the polyester war into the public domain and severely damaged Reliance's reputation.

The conflict escalated into a full-blown media war, with Reliance and the Indian Express exchanging accusations and counter-accusations. Dhirubhai, accustomed to favorable press coverage, was caught off guard by the ferocity of Goenka's attacks. Reliance responded with a series of full-page advertisements defending its actions and accusing the Express of a "corporate witch-hunt".

As the public scrutiny intensified, the government initiated investigations into Reliance's activities. The allegations of smuggling, excise duty evasion, and manipulation of import-export licenses raised serious concerns about the company's ethical standards and adherence to regulations.

Dhirubhai, facing a growing crisis, attempted to appease Goenka and Wadia by proposing a truce. He orchestrated a meeting with both men, hoping to negotiate a settlement and end the damaging media campaign. However, his efforts proved futile as Wadia, emboldened by the government's tougher stance and Goenka's unwavering support, refused to back down.

The chapter concludes with Dhirubhai facing multiple challenges: dwindling political support, intense media scrutiny, and investigations into his business practices. Despite these setbacks, he remained defiant, relying on his vast investor base and his ability to navigate the complexities of India's legal and regulatory systems to weather the storm. The polyester war, however, had irrevocably shifted the balance of power, exposing the vulnerabilities of Dhirubhai's empire and setting the stage for future conflicts and controversies.

Chapter 8: The Paper Tiger

This chapter picks up where the previous chapter left off, with Dhirubhai Ambani facing a barrage of negative press coverage and government scrutiny. The chapter's title, "The Paper Tiger," alludes to the central question of whether Dhirubhai's empire, built on political connections and aggressive financial maneuvering, could withstand the sustained attacks from a newly emboldened press and a reform-minded government.

The chapter begins with Dhirubhai's attempts to counter the damaging media campaign launched by the Indian Express. Recognizing that his usual tactics of silencing critics through financial pressure wouldn't work with the formidable Ramnath Goenka, Dhirubhai employed a two-pronged strategy:

However, these efforts proved largely ineffective. The Express, under the leadership of editor Arun Shourie and with S. Gurumurthy leading the investigative charge, continued to publish a stream of articles exposing Reliance's alleged wrongdoings.

Gurumurthy's investigations went beyond the initial allegations of import-export license manipulation and tax evasion. He uncovered evidence suggesting that Reliance had:

These revelations, backed by detailed analysis and documentation, further eroded public trust in Reliance and emboldened government agencies to take action.

The Finance Ministry, under the leadership of V.P. Singh, took several steps to curb Reliance's power:

Despite facing a multi-front assault, Dhirubhai remained defiant. He continued to maintain his innocence, portraying Reliance as a victim of a "corporate witch-hunt" orchestrated by envious rivals and a hostile press.

He also attempted to shore up his financial position. Facing a profit squeeze due to the government's policy changes, he launched a new series of convertible debentures, the "G Series", to raise capital.

The G Series issue, however, faced significant hurdles:

Despite these challenges, the G Series issue was ultimately successful. This demonstrated Dhirubhai's enduring appeal to small investors, who continued to believe in his vision and invest in Reliance despite the mounting controversies.

However, the victory came at a cost. The intense battle with the Express and the government had taken a toll on Dhirubhai's personal wealth and had exposed the vulnerabilities of his empire. The chapter ends with Dhirubhai still standing but significantly weakened. He had weathered the storm but was now operating in a changed environment where his political influence was waning, and the press was no longer willing to turn a blind eye to his questionable business practices. This marked a turning point in Dhirubhai's career, forcing him to adapt to a new reality and setting the stage for further challenges and conflicts in the years to come.

Chapter 9: Under Siege

This chapter portrays Dhirubhai Ambani and Reliance Industries facing escalating pressures on multiple fronts – legal, financial, political, and personal – truly under siege. The chapter highlights how the battles Dhirubhai fought were not just about business but about survival in a changing India.

A Multi-Pronged Attack

The chapter begins with Dhirubhai attempting to mitigate the damage inflicted by the Indian Express's relentless campaign. His legal maneuvers aimed at silencing the newspaper had backfired, and the public rebuttals had proven ineffective.

S. Gurumurthy, the chartered accountant leading the Express's investigation, continued his relentless pursuit of Reliance's alleged wrongdoings, focusing on:

Adding fuel to the fire, a US congressman, John Hershman, joined the fray. He started investigating allegations of Reliance's involvement with the Bank of Credit and Commerce International (BCCI) and possible violations of US export regulations.

A Change in Fortune

Adding to Dhirubhai's woes, V.P. Singh, the Finance Minister and a staunch critic of Reliance's practices, took a series of actions targeting the company:

These measures, combined with the negative publicity, placed immense financial strain on Reliance. To combat this, Dhirubhai attempted to float a new finance and leasing affiliate, Reliance Capital & Finance Trust Co., at a premium. However, the Controller of Capital Issues rejected this attempt.

Forced to find alternative ways to raise capital, Dhirubhai launched the Reliance "G Series" of fully convertible debentures. Despite facing opposition from the Express, which questioned Reliance's financial health and accused the company of misleading investors, the G Series issue was ultimately successful. This success underscored Dhirubhai's enduring popularity with small investors, who continued to support him amidst the controversies.

The Personal Toll

The sustained pressure took a toll on Dhirubhai's health. In February 1986, he suffered a stroke, leaving him partially paralyzed and requiring treatment in the United States.

In a strange twist, Jamnadas Moorjani, the leader of the All-India Crimpers' Association, who had been advocating against the anti-dumping duty on polyester yarn, was attacked and seriously injured by a group of unidentified men. Although no direct link to Reliance was established, suspicions arose, further tarnishing the company's image.

The Plot Thickens

Adding another layer to the intricate web of the Reliance saga, two forged letters purportedly written by a Fairfax investigator, Hershman, surfaced. The letters implicated V.P. Singh, Nusli Wadia, and Ramnath Goenka in a conspiracy to destabilize the Rajiv Gandhi government.

These letters, later proven to be fabrications, were used by Dhirubhai's supporters within the government to discredit his opponents. The Central Bureau of Investigation (CBI) launched an aggressive investigation, leading to the arrest of S. Gurumurthy on charges of violating the Official Secrets Act.

The CBI also targeted Nusli Wadia, subjecting him to investigations and eventually issuing a deportation order, branding him an "undesirable alien." The CBI's director, Mohan Katre, came under scrutiny for his apparent bias towards Reliance and against Wadia.

The Paper Tiger Roars

Dhirubhai emerged from this period of intense pressure battered but not broken. Despite the relentless attacks from the press, the investigations, and the government's policy changes, he managed to maintain control of his empire.

The chapter closes with a powerful image: Dhirubhai, like a paper tiger, had been poked and prodded, his weaknesses exposed. Yet, he remained standing, his resilience and cunning a testament to his enduring power. However, the battles of the 1980s had irrevocably changed the landscape, forcing Dhirubhai to adapt to a new reality where his opponents were no longer willing to back down and the stakes were higher than ever.

Chapter 10: Sleuths

This chapter chronicles the intense investigations into Reliance's activities and marks a shift from journalistic exposés to official inquiries. It highlights the challenges faced by law enforcement agencies in holding powerful corporations accountable and the complex interplay of politics, finance, and law in India.

The Investigation Begins

The chapter opens with the introduction of Bhure Lal, the newly appointed Director of Enforcement in the Finance Ministry. A former army captain and a close associate of V.P. Singh, Bhure Lal was tasked with investigating violations of India's strict foreign exchange regulations. His military background is emphasized, suggesting a disciplined and determined approach to his work.

Bhure Lal was particularly interested in the allegations raised by S. Gurumurthy in the Indian Express regarding Reliance's overseas financial transactions. These included suspicions of:

Bhure Lal's investigations focused on uncovering the sources of the non-resident Indian (NRI) investments in Reliance, particularly the funds channeled through shell companies in tax havens like the Isle of Man.

Challenges and Roadblocks

Bhure Lal faced significant obstacles in his pursuit of Reliance. The sources list several challenges:

Despite these challenges, Bhure Lal was determined to build a case against Reliance. He believed that his intelligence agency needed to tap into non-official sources to obtain the necessary evidence.

A Partnership Emerges

Bhure Lal's path crossed with S. Gurumurthy, who had been conducting his own parallel investigations into Reliance. Their shared interest in uncovering the truth about Reliance's activities led to an informal collaboration. They exchanged information and strategies, with Gurumurthy providing leads and insights from his journalistic investigations.

Gurumurthy, drawing on the resources of the Indian Express, had already engaged private investigators in London to trace the ownership of the shell companies linked to Reliance. However, these efforts had been met with limited success.

Enter the American Sleuth

Gurumurthy, during his investigations, learned of a Washington-based private investigation agency, the Fairfax Group, and recommended them to Bhure Lal. The agency, founded by former government investigator Michael Hershman, had a reputation for handling complex financial investigations.

Bhure Lal, with the approval of V.P. Singh, decided to engage Fairfax to assist in his investigations. A contingency fee arrangement was agreed upon, with Fairfax receiving a percentage of any recovered funds.

Fairfax's investigations focused on three key areas:

Fairfax's involvement brought a new level of sophistication and international reach to the investigations into Reliance. However, it also introduced an element of political risk, as the engagement of a foreign agency in a sensitive domestic matter could potentially backfire.

Danger and Intimidation

The investigations into Reliance and its associated entities attracted dangerous attention. Hershman, during his initial inquiries into BCCI, received a threatening visit from a Sikh man warning him to stop asking questions.

This incident highlighted the risks involved in challenging powerful interests and suggested that Reliance had connections to individuals willing to use intimidation tactics.

The Net Tightens

Bhure Lal and Fairfax made significant progress in their investigations. Bhure Lal traveled to the United States to meet with officials from the Internal Revenue Service (IRS) and Du Pont. He sought assistance in tracking down illegal "hawala" transactions and obtaining information about Du Pont's dealings with Reliance.

Bhure Lal also pressed Chemtex, another supplier of Reliance, for details about its equipment sales and payments. He was suspicious of the production capacity of Reliance's plants, believing it to be higher than what was officially declared.

A Political Turning Point

The investigations into Reliance reached a critical juncture when V.P. Singh was moved from the Finance Ministry to the Defence Ministry. This transfer, widely seen as a demotion, signaled a shift in the political landscape and raised doubts about the future of the investigations.

The Prime Minister's office took a keen interest in the Fairfax inquiry, demanding access to all the files. This suggested that the investigations were now viewed through a political lens, rather than purely as a law enforcement matter.

Rumors and speculation about the targets of the Fairfax investigation began to circulate, further fueling the political intrigue.

Forgery and Betrayal

The chapter takes a dramatic turn with the emergence of forged letters purportedly written by Fairfax's vice president, Gordon McKay. These letters, addressed to S. Gurumurthy, requested sensitive information about government activities and suggested a corrupt relationship between Fairfax, Gurumurthy, and Nusli Wadia.

The forged letters had a devastating impact. They discredited the Fairfax investigation, cast suspicion on V.P. Singh and his allies, and provided ammunition to Reliance's supporters.

The CBI, now under the control of Dhirubhai's alleged ally Mohan Katre, seized upon the forged letters and launched an investigation into Gurumurthy and Wadia. This marked a complete reversal of the earlier investigations, with the focus shifting from Reliance's alleged wrongdoings to the alleged conspiracy against the company.

The chapter ends with the arrest of Gurumurthy and the raiding of the Indian Express offices. The investigations into Reliance had been effectively derailed, with the focus shifting to the alleged "Fairfax affair" and the supposed conspiracy against the company.

This chapter highlights the complexities and challenges of holding powerful corporations accountable in India. It demonstrates how political influence, media manipulation, and even forgery can be used to deflect scrutiny and protect vested interests. The chapter ends with a sense of injustice, as the investigators who sought to expose wrongdoing are themselves targeted and silenced.

Chapter 11: Letting Loose a Scorpion

Chapter 11 recounts Dhirubhai Ambani's efforts to regain his political influence and navigate the complex political landscape of India in the late 1980s. The chapter's title, "Letting Loose a Scorpion," draws a parallel between Dhirubhai's cunning tactics and the unpredictable nature of a scorpion's sting. This metaphor emphasizes the potent and often unexpected ways in which Dhirubhai exerted his influence.

A Shift in Power

The chapter opens by highlighting the formidable challenge facing Dhirubhai. Rajiv Gandhi, who had initially shown some sympathy towards Dhirubhai's grievances against his brother Sanjay, had undergone a transformation after becoming Prime Minister. Influenced by advisors like V.P. Singh, Rajiv adopted a reformist stance, cracking down on tax evasion and seeking to dismantle the License Raj that had benefited businessmen like Dhirubhai.

V.P. Singh, the Finance Minister, spearheaded this reform drive, launching a series of raids on businesses and individuals suspected of tax evasion. This created a climate of fear among the business elite, who were accustomed to operating with impunity under the previous system of patronage and political connections.

The turning point came with the Bofors scandal, which erupted in 1987. The scandal involved allegations of kickbacks paid to Indian officials in a deal to purchase artillery guns from the Swedish company Bofors. Although Rajiv Gandhi himself was not directly implicated, the scandal tarnished his reputation and emboldened his critics within the Congress Party.

Playing the Political Game

Dhirubhai saw an opportunity in this political turmoil. With V.P. Singh emerging as a powerful rival to Rajiv Gandhi, Dhirubhai aligned himself with Singh's faction within the Congress Party.

When V.P. Singh was expelled from the Congress Party in 1987, Dhirubhai continued to support him, providing financial backing for Singh's new political party, the Jan Morcha.

The Fairfax Affair

Dhirubhai also exploited the Fairfax affair to his advantage. This affair involved the hiring of a US-based investigative agency, Fairfax, by the Enforcement Directorate, headed by Bhure Lal, a close associate of V.P. Singh. Fairfax was tasked with investigating the overseas assets of prominent Indian businessmen suspected of tax evasion.

When the Fairfax affair became public, Dhirubhai's allies within the government used it to attack V.P. Singh, accusing him of jeopardizing national security by engaging a foreign agency.

Dhirubhai's supporters also alleged that Nusli Wadia, a long-time rival of Dhirubhai, had secretly funded Fairfax through back channels. Although no evidence was ever found to substantiate this claim, it further fueled the political firestorm surrounding the affair.

The Scorpion Strikes

Dhirubhai's maneuvering in the Fairfax affair proved to be a masterstroke. He successfully deflected attention away from Reliance's own legal troubles and managed to discredit his main political adversary, V.P. Singh.

The chapter concludes with a sense that Dhirubhai, like a scorpion, had unleashed his venom with precision and achieved his objectives. He had regained a measure of political influence and positioned himself to benefit from the coming changes in India's economic and political landscape. However, this victory came at a cost. His tactics had further alienated him from Rajiv Gandhi and had reinforced his image as a ruthless and manipulative businessman.

Chapter 12: Business as Usual

This chapter portrays Dhirubhai Ambani's resurgence following a period of intense scrutiny and legal challenges. The title, "Business as Usual," suggests that despite the controversies and setbacks, Dhirubhai was able to return to his aggressive business practices and maintain his dominance in the Indian economy.

Political Alignment and Economic Favors

Dhirubhai skillfully navigated the shifting political landscape, securing his position by aligning with those in power. Although his relationship with Rajiv Gandhi had soured, Dhirubhai found allies in other key figures like Finance Minister Pranab Mukherjee and Indira Gandhi's secretary R.K. Dhawan. These connections enabled him to continue receiving favorable policy changes and government support throughout Indira Gandhi's second term as Prime Minister.

After Rajiv Gandhi came to power, Dhirubhai found himself facing renewed scrutiny and challenges. However, as the Bofors scandal engulfed Rajiv Gandhi's administration, Dhirubhai sensed another opportunity. He recognized that the scandal had weakened Rajiv Gandhi and emboldened his critics, creating a space for him to maneuver and rebuild his influence.

Dhirubhai strategically shifted his allegiance, aligning himself with V.P. Singh, a prominent figure within the Congress Party who had emerged as a vocal critic of Rajiv Gandhi. Dhirubhai provided financial support to Singh's faction and later backed his new political party, the Jan Morcha. This alignment proved beneficial when V.P. Singh briefly became Finance Minister in 1987, as he helped to shield Reliance from further legal action and facilitated favorable policy decisions.

Exploiting the Fairfax Affair

The Fairfax affair, involving the hiring of a US-based investigative agency to probe Reliance's financial dealings, became a political weapon that Dhirubhai wielded effectively. He and his allies successfully portrayed the investigation as a politically motivated attack orchestrated by V.P. Singh and Nusli Wadia, his long-time business rival.

Dhirubhai capitalized on the controversy surrounding Fairfax, using it to discredit V.P. Singh and divert attention from Reliance's own legal troubles. The affair ultimately backfired on V.P. Singh, contributing to his expulsion from the Congress Party and bolstering Dhirubhai's position.

Reliance's Financial Struggles

Despite his political maneuvering, Dhirubhai faced significant financial challenges. The company's profits in 1986 were disappointing, leading to a dividend cut and raising concerns about its future prospects. Delays plagued the completion of the polyester staple fibre and PTA plants, straining Reliance's cash flow and impacting its reputation for technological prowess.

The ongoing customs and excise evasion cases, along with the CBI's criminal investigations, posed a significant threat to Reliance's financial stability.

Government Support and Policy Manipulation

In response to Reliance's financial woes, Rajiv Gandhi's government, with Narain Dutt Tiwari as a key ally in the Commerce and Finance Ministries, stepped in to provide a series of favorable policy adjustments and financial assistance. These interventions aimed to bolster Reliance's position and alleviate its financial strain. The government implemented measures such as:

The government's support extended beyond trade policies, encompassing financial assistance as well. Government-run institutions, including insurance companies, banks, and investment funds, increased their involvement with Reliance, providing working capital loans, subscribing to debentures, and engaging in sale-lease-back arrangements for equipment.

Manipulating Financial Markets

Dhirubhai continued to demonstrate his mastery of financial markets, employing aggressive strategies to raise capital and further Reliance's expansion. These tactics, though often controversial, proved effective in securing the necessary funds.

One notable example involved the early conversion of the G Series debentures. Despite being issued just five months prior, the government approved Reliance's request to bring forward the conversion date, injecting a substantial Rs 5 billion into the company. This maneuver, though criticized for potentially disadvantaging debenture holders, helped to bolster Reliance's cash reserves.

Conclusion

This chapter illustrates Dhirubhai Ambani's resilience and adaptability in the face of challenges. By strategically aligning himself with those in power and exploiting opportunities created by political turmoil, he secured continued government support and weathered financial storms. The chapter concludes by highlighting the extent to which Dhirubhai relied on political influence and manipulation of financial markets to advance his business interests, raising questions about the ethical implications of his tactics and their broader impact on India's economic landscape.

Chapter 13: Murder Medley

This chapter narrates the most dramatic and controversial episode in the Reliance saga - the alleged conspiracy to murder Nusli Wadia. It's a tale of corporate rivalry, underworld connections, and political intrigue that shocked Bombay and raised questions about the lengths to which Dhirubhai Ambani was willing to go to protect his business interests.

Rising Tensions and A Threat

The chapter begins by setting the scene of escalating tensions between Dhirubhai Ambani and Nusli Wadia. Wadia, along with the Indian Express newspaper, had been relentlessly pursuing Reliance, exposing its alleged financial misdeeds and lobbying the government for policy changes that would hurt the company's profitability.

In this atmosphere of intense corporate warfare, Wadia received a chilling warning. Sharad Pawar, the Chief Minister of Maharashtra, personally informed Wadia of a plot to assassinate him in Bombay. The threat was serious enough for Pawar to arrange for police protection for Wadia, including armed escorts for his movements around the city.

The Arrests and the Accusations

The story takes a dramatic turn on August 1, 1989, with the arrest of Kirti Ambani, a Reliance general manager responsible for public relations and customs matters. Kirti, originally named Shah but so devoted to Dhirubhai that he adopted his surname, was charged with conspiracy to murder Nusli Wadia.

Arrested alongside Kirti was Mun Waghji Babaria, a flamboyant bandleader known as "Prince Babaria & His Orchestra". Babaria, with his connections to Bombay's business, film, and underworld circles, presented a stark contrast to the corporate world of Reliance. Notably, he had even organized the entertainment for the birthday party of Dawood Ibrahim, a notorious underworld figure, in Dubai.

The unlikely duo of a Reliance executive and a bandleader at the heart of a murder plot sent shockwaves through Bombay.

The Anatomy of a Conspiracy

As police investigated the alleged conspiracy, a complex web of connections and events began to unravel. Here's a breakdown of the key elements:

Doubts, Theories, and a Cover-Up

While the alleged plot seemed to implicate Reliance in a serious crime, doubts and alternative theories soon emerged:

The Case Fades Away

Despite the serious allegations and the intense media scrutiny, the murder conspiracy case never reached a conclusive resolution. The CBI investigation, hampered by allegations of political interference and the possible destruction of evidence, failed to conclusively prove or disprove the charges.

Kirti Ambani and Babaria spent several months in jail before being released on bail. The case remained in legal limbo, eventually fading from public attention amidst the tumultuous political events that engulfed India in the early 1990s.

Conclusion

The "Murder Medley" chapter offers a glimpse into the dark side of corporate rivalry in India. It raises disturbing questions about the use of violence and intimidation in business disputes and the ability of powerful figures to manipulate the legal system to their advantage.

While the truth behind the alleged plot to murder Nusli Wadia may never be fully known, the episode serves as a reminder of the high stakes involved in the pursuit of wealth and power in India.

Chapter 14: A Political Deluge

Chapter 14 focuses on the tumultuous political events of 1989-1991 and their impact on Dhirubhai Ambani and Reliance Industries. The chapter's title, "A Political Deluge," aptly describes the rapid succession of political upheavals, including the fall of the Rajiv Gandhi government, the rise and fall of V.P. Singh, and the brief and chaotic tenure of Chandra Shekhar. These events created a volatile and unpredictable environment for businesses, particularly for a company like Reliance that had become so deeply intertwined with the political establishment.

Rajiv Gandhi’s Fall

The chapter begins by describing the events leading to the downfall of Rajiv Gandhi. After the 1986 results, the Reliance share price collapse triggered a broader market decline, which the government attempted to mitigate by prompting institutions like the Unit Trust of India to intervene. The share market boom, initiated by Rajiv Gandhi's economic liberalization in 1985, had come to an end.

Rajiv Gandhi's declining popularity was further exacerbated by scandals like the Bofors affair and allegations of corruption within his administration. Growing public discontent and the unification of opposition parties, including the Janata Dal and the National Front, led to a significant loss of seats for Congress in the 1989 elections. This marked a turning point in Indian politics, ending the decades-long dominance of the Congress party.

V.P. Singh's Rise and Challenges

V.P. Singh, a former Finance Minister who had emerged as a critic of Rajiv Gandhi, became the Prime Minister heading a coalition government. Dhirubhai, who had previously aligned himself with Singh, faced a new set of challenges as his former ally now held the reins of power.

Singh's government implemented policies that directly impacted Reliance, such as scrutinizing tariff protection and enforcing price cuts on products like PTA. These measures aimed to reduce Reliance's dominance and create a more level playing field for other businesses.

However, Singh's government faced internal conflicts and external pressures. His deputy prime minister, Devi Lal, implemented populist policies like writing off small farmer loans, which undermined the financial stability of banks. Singh's attempts to revive economic liberalization were met with resistance, leading to a policy stalemate and further weakening his government.

The Mandal Commission's recommendations, implemented by Singh, to reserve government jobs for lower castes, ignited social unrest and violent protests. This decision, while aimed at addressing social inequalities, further destabilized the political landscape.

Chandra Shekhar’s Brief Tenure

Amidst this turmoil, the BJP withdrew its support for the V.P. Singh government, leading to its collapse. Chandra Shekhar, a veteran politician known for his deal-making skills, formed a minority government with the support of Congress.

Chandra Shekhar, despite his socialist background, continued the economic reform process initiated by his predecessors. His government secured an IMF loan with conditions requiring deficit reduction and deregulation. This demonstrated a pragmatic approach to address India's economic woes.

However, Chandra Shekhar's government was short-lived, plagued by instability and constant demands for funds from Reliance's political lobbyists. This situation highlighted the corrupt nexus between politics and big business.

Rajiv Gandhi's Return and Assassination

The 1991 elections saw Rajiv Gandhi attempting a political comeback, but he was assassinated during the campaign. This tragic event created a sympathy wave that benefited Congress, but also deprived India of a leader who had initiated economic reforms and might have shifted his stance toward Dhirubhai.

Implications for Reliance and Dhirubhai

The political deluge of 1989-1991 had a profound impact on Dhirubhai Ambani and Reliance Industries. The company faced policy changes, legal challenges, and intense scrutiny from a government led by a former ally. Dhirubhai's political maneuvering and financial strategies were put to the test as he navigated this turbulent period.

The chapter highlights the vulnerability of businesses dependent on political patronage and the challenges of operating in an environment characterized by instability and uncertainty. It also foreshadows the changing landscape of Indian business as economic liberalization gained momentum, requiring companies like Reliance to adapt to a more competitive and transparent market environment.

Chapter 15: Under the Reforms

This chapter explores the impact of India's economic reforms, initiated in 1991, on Dhirubhai Ambani and Reliance Industries. The reforms marked a significant shift in India's economic policy, moving away from the state-controlled "License Raj" towards a more liberalized and market-driven economy. This chapter examines how Reliance adapted to this new environment, the challenges it faced, and the opportunities it seized.

A New Economic Landscape

The assassination of Rajiv Gandhi in May 1991 ushered in a period of political uncertainty. However, the subsequent formation of a Congress government under P.V. Narasimha Rao provided the stability needed to implement economic reforms. The government, facing a severe economic crisis, embraced liberalization as a way to revive growth and attract foreign investment.

Finance Minister Manmohan Singh, a seasoned economist who had previously served as Finance Secretary and central bank governor, spearheaded the reforms. The reforms aimed to dismantle the "License Raj," reduce government control over industries, and promote competition. Key measures included:

Reliance's Response: Embracing the New Order

Dhirubhai Ambani and Reliance Industries, known for their political maneuvering and ability to exploit the "License Raj," initially faced uncertainty about how to navigate this new landscape. However, they quickly adapted to the changing environment and embraced the reforms, recognizing the opportunities they presented. Reliance's strategy involved:

Challenges and Controversies

Despite embracing the reforms, Reliance's journey was not without challenges and controversies. The company's aggressive expansion and financial strategies raised concerns about its corporate governance and ethical practices. Some key issues included:

Adaptation and Survival

Despite these challenges, Reliance adapted and survived the transition to a more market-oriented economy. The company implemented several measures to address concerns and improve its corporate governance, including:

Conclusion: The Reliance of the Reform Era

The economic reforms of 1991 marked a watershed moment for Reliance Industries. The company, initially accustomed to operating within the confines of the "License Raj," successfully adapted to the new era of liberalization. Reliance leveraged the reforms to expand its operations, diversify its portfolio, and access global capital markets.

However, the transition was not without its challenges. Reliance faced controversies related to corporate governance, share market manipulation, and ethical lapses. These issues highlighted the need for greater transparency and accountability in India's evolving market economy.

Despite these setbacks, Reliance emerged as a major player in the reformed Indian economy. The company's ability to adapt and evolve, coupled with its aggressive expansion and financial strategies, positioned it for continued growth in the years to come.

By the end of the 1990s, Reliance had transformed itself into a more sophisticated and globally oriented corporation. While the company's aggressive tactics and controversial past continued to raise concerns, its entrepreneurial spirit and ambition remained a driving force in the Indian economy.

This chapter provides a comprehensive overview of Reliance's journey during the initial years of India's economic reforms. It highlights the company's adaptation to the changing landscape, the challenges it faced, and the opportunities it seized. The chapter concludes by emphasizing the need for greater transparency and accountability in India's evolving market economy, while acknowledging Reliance's continued role as a major force in the country's economic growth.

Chapter 16: Housekeeping Secrets

This chapter explores the inner workings of Reliance Industries and the strategies employed by Dhirubhai Ambani to manage the company’s finances, public image, and relationships with stakeholders. It provides insight into the “housekeeping secrets” that contributed to Reliance's success but also raised ethical and legal questions.

Financial Maneuvering

The chapter reveals how Dhirubhai skillfully used financial instruments like debentures to raise capital and maintain control of Reliance. He offered high-interest rates on debentures to attract investors and then converted them into equity, effectively diluting the share base and reducing the cost of capital. This strategy, while innovative, raised concerns about transparency and fairness.

Dhirubhai also exploited loopholes in regulations and leveraged his political connections to obtain favorable policy changes that benefited Reliance. He secured loans from banks and financial institutions, often on questionable grounds, and benefited from tax breaks and customs duty exemptions. These practices, while not necessarily illegal, raised ethical questions about the use of political influence for personal gain.

Cultivating the Media

The chapter sheds light on Dhirubhai’s approach to managing Reliance’s public image and influencing media coverage. He recognized the power of the press and employed a combination of strategies to shape narratives and counter criticism.

Dhirubhai cultivated relationships with journalists, offering them financial incentives and access to Reliance events. He also engaged in “envelope journalism,” providing reporters with cash payments and gifts to ensure favorable coverage. These practices compromised journalistic integrity and raised concerns about the objectivity of media reporting on Reliance.

Control Over the Share Registry

Dhirubhai established a separate company, Reliance Consultancy Services Ltd, to handle the share registry and transfer agency for Reliance. This gave him significant control over the ownership details and paperwork of the company’s shareholders. While presented as an “in-house” operation, the separate entity allowed for potential manipulation and lack of transparency in shareholder records.

A Culture of Secrecy

The chapter describes a culture of secrecy and loyalty within Reliance. Dhirubhai surrounded himself with a close circle of trusted executives, many of whom had worked with him since his early days in Aden. These individuals were deeply loyal to Dhirubhai and often executed his directives without question.

Dhirubhai instilled a sense of fear and obedience among his employees. He was known for his quick temper and his tendency to “let loose a scorpion,” creating chaos and intimidation to maintain control. This management style fostered a culture of silence and discouraged dissent, making it difficult for anyone to challenge Dhirubhai’s actions.

The Consequences

The “housekeeping secrets” employed by Dhirubhai Ambani had significant consequences for Reliance Industries and the Indian business landscape.

Chapter 17: Pandava or Kaurava

This chapter discusses the moral ambiguity surrounding Dhirubhai Ambani's business practices and compares the situation to the ethical dilemmas presented in the Mahabharata.

The chapter begins by referencing a 1985 article in the tabloid Blitz that likened the "Great Polyester War" between Dhirubhai and his rivals to the epic Mahabharata. However, Blitz refrained from assigning the roles of Pandava (the virtuous side) and Kaurava (the evil side) to the participants in this corporate battle.

The chapter then goes on to explain that many individuals who opposed Reliance during this period had a clear conviction that they were fighting against deceit and for righteousness. They viewed Dhirubhai's actions, such as manipulating government policies, evading taxes, and potentially resorting to violence, as unethical and harmful.

However, there was also a significant portion of the public, especially among Reliance investors, who remained ambivalent about Dhirubhai's methods. They recognized the economic benefits brought about by Reliance's success and questioned whether some level of deception was simply a necessary part of being a successful businessman.

The chapter draws a parallel between this moral dilemma and the character of Yudhishthira in the Mahabharata. Yudhishthira, the eldest of the Pandava brothers, is renowned for his righteousness and adherence to dharma (duty and law). However, he is also forced to make difficult choices and engage in acts that compromise his moral principles in order to fulfill his duty as a ruler and ultimately triumph in the war against the Kauravas.

Similarly, Dhirubhai, despite his controversial methods, is credited with transforming India's business landscape and creating wealth for millions of investors. This raises questions about the trade-offs between ethical conduct and economic success.

Indian Culture and the Morality of Change

The chapter concludes by reflecting on how the controversy surrounding Dhirubhai Ambani reveals a broader tendency within Indian culture to grapple with the morality of change, success, and failure.

The chapter ultimately leaves the reader to ponder the question of whether Dhirubhai Ambani should be viewed as a Pandava or a Kaurava, highlighting the inherent ambiguity and moral complexities that characterized his rise to power.