For many of us who spoke of India’s economic rise with pride and emotion, the Singh family selling out to Japan’s Daiichi Sankyo marks the end of an era. An era when there was hope that India’s knowledge-based companies, especially in two sectors, IT and pharma, would go out and conquer the world. But the hurly burly of the global marketplace intervened and has blighted that dream, if not shattered it altogether. A quick pointer: in his dash to grow Ranbaxy, Malvinder borrowed heavily, and around $400 million (Rs 1,680 crore) is sitting as debt on the company’s books. Analysts point out that with such levels of debt, it would have been difficult for Ranbaxy to sprint ahead, and Malvinder would sooner or later have to take a few drastic decisions to rectify matters.

This isn’t the first time that a foreign company has bought something Indian. Roughly a decade ago ICI bought into Asian Paints or slightly earlier the then Hindustan Lever bought over Tata Oil Mills while Coke picked up Thums Up. Then the debate spun around swadeshi vs videshi lines. This time around the debate, shaped largely by events over the last half a decade where a rampaging corporate India has picked up companies along the world and aggressively globalised, is different.

At one level there is an almost wistful feeling that Ranbaxy could one day have been up there with the Pfizers and GSKs of the world and that chance now has forever gone. (Though the company calls this is a strategic alliance and not a sellout, the fact remains that Ranbaxy is now the subsidiary of a Japanese MNC, which happens to have some dispersed Indian shareholding.)

Malvinder Mohan Singh, CEO and Managing Director, Ranbaxy with Takashi Shoda (R), President and CEO, Daiichi Sankyo during a press conference in New Delhi The Japanese company agreed to buy a majority stake in India's top drug company Ranbaxy Laboratories for up to $4.6 billion. (PTI)

But, aren’t today’s entrepreneurs from India supposed to be not just businessmen, but also enlightened patriots who have captured the world’s attention as much as the generation of politicians that won us Independence did decades ago? Aren’t they icons — individuals who march to the pop of flashbulbs, whose views shape government policy and, above all, are people who are expected to transform India into a 21st century powerhouse? Don’t our hearts swell with pride when we speak of Tata’s acquisition of Corus or Dr. Reddy’s buyout of betapharm?

Perhaps it’s unfair to burden our entrepreneurs so, but that’s the way it is. And if all that be true, then doesn’t it follow that their struggles be nothing short of heroic. Sallying abroad and winning new customers and markets is after all the modern day equivalent of colonising other nations. (Senior executives from Japanese and Korean MNCs will tell you that when their companies went global, they saw their mission not just as doing something for their company, but also for their country.)

To be sure, it is difficult being heroic when the tried and tested business model suddenly appears to fail and irate shareholders have laid low your stock price — the two pre-conditions which apparently set the stage for the Ranbaxy sale. But could Ranbaxy have done just that bit more to come out of its troubles?

With the Daiichi-Ranbaxy deal, this debate is just about beginning — in an increasingly globalised economy with all its pulls and pressures, how will Indian companies balance the at times conflicting needs of enhancing shareholder value (the dharma) versus keeping its identity intact (the karma).

My bet is that you will increasingly see two kinds of examples. One, where companies will be built up to a point and sold out, thereby encashing shareholder value, though stopping just short of making history. The other where companies will heroically fight all odds, including short-term calamities to build a global Indian institution. And while the markets may reward both, posterity will remember only one.

D.N. Mukerjea is a Senior Editor with the ABP group.
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