Financial Daily from THE HINDU group of publications
Saturday, Nov 30, 2002
Industry & Economy
Corporate - Interview
`You can't open up economy with a small window' - Mr Hari N. Harilela, Chairman, Hong Kong-based Harilela group
IF India is to compete with China in economic development or attracting foreign direct investment (FDI), "the Indian politicians will have to do more than change the names of cities... from Bombay to Mumbai and Madras to Chennai," is the scathing comment of Hong Kong-based industrialist of Indian origin, Mr Hari N. Harilela, Chairman of the Hong Kong-based Harilela group.
In an interview to Business Line, the man who is adviser to the Chinese Government said, "Of course, bringing back ancient names is a good idea but politicians need to do more with the country's development and future progress." He says that though some parts of India had indeed progressed in the last 30 years, others had lagged behind. "There is no comparison with China's development. Look at Shenzhen... 8 to 10 years ago, it was barren. Today it is a bustling city with the best of hotels, shopping malls and business opportunities. Similarly, the PuDong area of Shanghai has developed dramatically over the last 6 to 8 years."
As an ethnic Indian, he says he feels "sorry that India, which I consider my own country (he came to Hong Kong in 1930) and which got independence 55 years ago, has lagged behind in economic development thanks to restrictions and Government policies. Once you open up the economy, you just cannot open a small window. You have to really open up and bring in international developers and experts to plan its development. You cannot let the Government and its bureaucrats who have been in India for so many years tell such people what to do, as so often happens in India."
Mr Harilela said he felt sad to see that India, which had "an edge over China as far as the English language was concerned... and which has a rule of law and a good legal system", was not really surging ahead on the economic and industrial front.
"Look at Delhi. It is the Capital and should have had the most modern infrastructure. It should be a clean, modern city, with an underground mono rail and other forms of rapid public transport. Look at its airport and compare it with the Pu Dong Airport of Shanghai or the Hong Kong airport. Is there any comparison? India can really be on top... like China it has to bring in American and British experts, or Indian experts working elsewhere and familiar with modern infrastructure."
Asked if the double speak of divestment was hurting FDI, he said, "I would say we have not progressed in the outlook on how to bring in huge foreign investment into India. India thrives on Indian people overseas.... in human export. Its labour force sends money back home and the Indian Government seems to be quite happy with that. India's stability and (foreign exchange) reserves are mainly related to the Indians overseas and nothing much beyond that. Nobody sends money here and yet we have a reserve of $200 billion in Hong Kong."
He added that though India's progress in IT and telecom was impressive, "it has still a long way to go in its roads, ports, airports and related sectors."
About his family's investment in India, he said, "My nephew has set up a huge IT facility in China and we provide services to Japan and elsewhere from there. As for India, we are keen to do business with India in the IT sector but I cannot decide on choosing India just because India is my country. I sent my people to India and they said: We will deal with India, but out of Singapore. They want to set up headquarters in Singapore. The currency is stable in Singapore, but with the Indian rupee there is always the threat of it depreciating rapidly."
Mr Harilela is now concentrating on the hotel business and has nine hotels in Australia, Europe, Canada, Hong Kong and South East Asia.
On his attempts to set up hotel ventures in India, he says his son is trying to set up a hotel in Delhi, "but nothing has been finalised yet. It is very hard to do anything in India."
He recalls that his attempt to start a hotel venture in India goes back three to four decades. He had once eyed a property that is now an Oberoi hotel. "That was nearly 40 years ago. The property was then $8 million and I told the then Tourism Minister that I would straightaway bring an LC for the amount. And he said I cannot take your money and give you the file. Things do not work like that in India."
It is with a lot of bitterness that he adds, "We're still trying, but in those days the enthusiasm was much larger. I wanted India to become the headquarters of my company. Well, that was 30-40 years ago. But then I was holding an Indian passport and India was like my own country. Culturally, even now, our family is very Indian. But a businessman only goes where the opportunities are available and sentiments don't come into play."
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