Lord Swaraj Paul recalls how he made it big in UK

Forty-four years after he came to Britain, NRI industrialist Lord Swraj Paul has recalled how he broke the jealously guarded old boy's network to become one of the leading businessmen in this country.

Lord Paul, the deputy speaker of the House of Lords, the upper house of the British Parliament, reminisced his experience as a struggling industrialist in Britain in late 1960s and the difficulties he had to overcome in getting a firm foothold in the British industry.

Asked how difficult it was for him to deal with the protectionist environment, he said that initially it was not easy but finally what mattered was perseverance and skill.

In an interview to arabicknowledge@wharton, the journal of the Wharton Business School, Lord Paul recounted an episode on how he was made to wait for over two years for an order from a British company which he eventually bought over.

"I chased one company for two years for an order. Every year, they promised me (business). Even then, I used to sit on the bench, not even a comfortable chair, waiting for an appointment, and they purposely made me wait," he said.

"As luck would have it, two years later, I ended up acquiring the group that owned that company. When I went to visit the (managing director), he said to me, 'I know we thoroughly misbehaved. If you want me to resign, I'll do so'," the 79-year-old British peer recalled.

"I said, 'No, you stay right there .... (But) as long as you're working in my group, don't be so ridiculous to anybody.' He turned out to be a very good manager," he said.

In Britain since 1966, Lord Paul recalled how British industrialists, who were not doing too well at the time, looked at him with scepticism when he broached his idea of setting up a small steel plant.

"But I found (what) was lacking in Britain in industry at that time: A consistency in quality and on-time delivery.

"I saw the gap and said, 'I am going to make sure that I deliver something that is consistent with what I promised. I don't want to build a Rolls Royce, but whatever I want to build, it must be consistent.' Second, on-time delivery was rare," Lord Paul, the first Asian to be appointed deputy speaker of the House of Lords, said.

The founder of the one billion-euro Caparo Group recounted his initial days when he told his customer to try him out as a second source.

"Why don't you try me as a second source? You give them 90 per cent of your order; all I am looking for is 10 per cent," Lord Paul remembered.

"Once you are able to step in, performance matters," he pointed out.

Lord Paul, who had made takeover bids on Escorts and DCM in the 1980s, said that he also deserves credit for forcing the Indian economy to change.

"Nobody should get the credit for forcing India's economy to change except Swraj Paul (alluding to his acquisitions in the 1980s). But Indians are very poor at giving credit. They only know how to praise the government in power irrespective of the power, irrespective of the government. They will only give credit to them," he said.

Lord Paul, who had maintained that there was no transparency about the way Indian corporates were run, said that things have improved and he too had a role in bringing about the change.

"India is still not as transparent as one would like it to be, but it is certainly far more transparent now and I do think I deserve some credit for that," he added.

The founder of steel-to-hotels conglomerate said he bought shares of Escorts and DCM when he found that Rajan Nanda (of Escorts) and Bharat Ram (of DCM) went "around the world asking people to invest in their companies".

Nanda had less than 5 per cent of Escorts and Ram less than 10% in DCM. "I ended up buying 7.5 per cent of Escorts and 13 per cent of DCM, so I held more shares than them".

Lord Paul could not gain control of the Escorts and DCM in the 1980s but brought about takeover battles in the Indian industry.

He said his takeover attempt on the two Indian companies revealed abuse of balancesheets by the promoters.

"If you studied their balance sheets, there was so much of abuse the promoters felt threatened and tried to stop me," Paul recalled and added that they even went to the prime minister and "to other politicians etc and I ended up losing money."