The selection of the 43-year old Cyrus Mistry as the next head of the Tata group is part of a larger generational change in Indian business. Ratan Tata has been an immensely successful business leader, but he is perhaps one of the last of the old generation who began their business careers in socialist India.
Most of the biggest Indian business groups are now being headed by men who were born after independence. They are also leaders who stepped into senior positions when India had already begun tentative reforms in the Rajiv Gandhi years. Some of their biggest successes have come in the era of globalization.
Cyrus Mistry to succeed Ratan Tata as chairman. (File photo)
Mukesh Ambani was born in 1957. So was Sunil Mittal. Anil Ambani is two years their junior. Anand Mahindra is two years their senior. Kumar Mangalam Birla was born in 1967. Anil Agarwal was born in 1954. Others such as Prashant Ruia, Rajiv Bajaj and Sanjiv Bajaj are driving change in their respective companies.
These men have seen a tremendous change in the corporate landscape as well. Many of the old business families split around the end of the 1970s. Some adapted to the new times after the economic reforms of 1991 while others such as the Mafatlals fell by the wayside. Even groups such as the Tatas and Essar went through trying times around a decade ago. The old unfocussed conglomerates had to be restructured; businesses were shut down, sold and bought. The best embraced globalization in the new century. Newer challenges have also emerged, including innovation and corporate governance.
The generational change in Indian business stands in sharp contrast with the lack of it in Indian politics. Consider the three most senior men in the Indian government: Manmohan Singh was born in 1932, Pranab Mukherjee in 1935 and P. Chidambaram in 1945. The 84-year old L.K. Advani still has an eye on the top job.
Gerontocracies are not necessarily to be scoffed at. Deng Xiaoping was 75-years old when he took power in China and began the astonishing transformation of his country. However, there is a strong case for a generational shift in Indian politics as well. Look at some of the current crop of global leaders: Barack Obama (born in 1961), Angela Merkel (1954) and David Cameron (1966). Hu Jintao is older, but China is also heading for a leadership change next year.
Age may not be the only factor, but there is a stark difference between the sense of fatigue in government and the dynamism in many of the large business groups. A younger group of leaders at the helm in New Delhi in the coming years could help.
Cyrus Mistry to succeed Ratan Tata as chairman. Mint editor R Sukumar and executive editor Niranjan Rajadhyaksha discuss the implications
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