Why India Can’t Produce One World Class MNC

How prosperous a country is, is directly dependent on the amount of Capital invested per capita.
Capital is earnings saved, not consumed.
If Mallya had collected all the money he needed as share Capital, instead of loans from the banks. most likely he would still be in business, and Kingfisher would still be up and flying.
Almost 70% of venture Capital invested vanishes, but the 30% that clicks makes up for more than the 70% lost.
But we as a people and country do not have the concept of mass investing in businesses. DB Ambani is famous to be the first man to convince ordinary Indians to buy shares of his companies. And they all prospered. Narayana Murthy of Infosys begged for years people to buy shares of his new company. Those who did, made a killing.
Shares for almost all Indians conjure up dreams of bagging shares in an issue, which would then open at premium, and make a fortune selling them. Or buy shares in top dozen companies and then wait for Harshad Mehta to jack them up so that you can sell to others who would be left holding the ball when the music stops.
And therefore Indian companies are forced to obtain loan from banks when they need Capital.
But unlike money collected as share Capital, loans have a bad habit of having to be repaid, along with the hefty interest. And they need to be repaid even if the business is not working well at the moment, or has sunk.
And therefore the circus starts in right earnest: the debtor fleeing, banks rushing to seize what they can lay their hands on, and chests start getting beaten to pulp in and outside parliament as to who sanctioned the loan, who was to recover it, and who was supposed to stop the guy at the boarding gate at the airport.
Leftists start writing in media and at social media as to how they were right that Capitalism is all about loot of “people’s money” through friendly corrupt bankers and politicians.
Many Mallyas get the lesson: keep away from starting a business in India.
Why people of India are not culturally inclined to invest in businesses, small amounts per head but by a very large number of people, is subject of another article, another day.
But fact remains that if people are not ready to risk part of their savings in the high risk instrument called share, they will never have high returns that a modern economy produces.
And to show for the businessmen, they will have only the wheelers and dealers and fixers and सूदख़ोर्स and tax thieves and politicians who manage to seize power through correct combinations of vote banks and retired bureaucrats who want to leave a business for sonny who could not make to the US.
And people will have son waiting endlessly for a decent job, and daughter getting overaged in waiting for a groom with a decent job.