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What the Rise of Family Businesses Says About India's Growth Story

What the Rise of Family Businesses Says About India's Growth Story

In many ways, India’s growth story has also been the story of the rise of its business families. It is well known how India’s storied business families set up the basic structure of Indian business over the past 75 years and even earlier. Today, no mention of India’s business and corporate environment can be complete without acknowledging the contribution family-owned businesses are making in powering the country’s economic growth.

In many ways, India’s growth story has also been the story of the rise of its business families. In many ways, India’s growth story has also been the story of the rise of its business families.

In many ways, India’s growth story has also been the story of the rise of its business families. It is well known how India’s storied business families set up the basic structure of Indian business over the past 75 years and even earlier. Today, no mention of India’s business and corporate environment can be complete without acknowledging the contribution family-owned businesses are making in powering the country’s economic growth. There are the Ambanis, the Adanis, the Birlas, the Bajajs, the Jindals, the Poonawallas, the Goenkas and many, many more who are playing a critical role in driving Indian business forward, investing in new projects, creating wealth and providing employment to millions across the country. (The Tata group is not counted as a family-owned business since it is owned by the Tata Trusts.) Let’s consider some figures to demonstrate this point. The family-owned businesses in the BSE 100 index together account for nearly half of its total market capitalisation. And the top 10 family-owned groups account for 25 per cent of the market capitalisation of all BSE-listed companies. That’s one example of the might of India’s business families.

In this Family Business Special Issue, helmed by Krishna Gopalan, we take a close look at some emerging trends in family businesses as independent India—powered by the ambition of 1.3 billion people—marches into the next 25 years. In the new global economic reality, where uncertainty and volatility are the order of the day, how are India’s biggest business families changing their outlook and strategies to keep pace with the rapid changes? Business Today’s reporters spoke to multiple business families, experts and analysts to bring you a package of stories on various facets of family businesses. As our cover story shows, the big trend now is the emergence in some of the largest business families of the next generation coming into its own. These gen-next leaders—many of them educated overseas—are ambitious and aggressive, but also very mindful of the legacies that their families have created. While these new generation leaders may be heading disparate businesses, the common thread among them is clarity of thought and strategy. Many of them, who began when they were even younger, are now firmly in the saddle and are harnessing technology across businesses and taking them to new areas in search of growth and value. Prerna Lidhoo and Smita Tripathi also tell you about the rise of the daughters in many of the business groups, while Ashish Rukhaiyar finds out how family offices are helping in protecting and growing the wealth of business families.

Elsewhere in this issue, Rajat Mishra travels to Ludhiana and then to Mumbai, tracking an export consignment of textiles to the Jawaharlal Nehru Port to get you a first-hand account of the problems exporters face along the way. He finds that while there are challenges which remain, many obstacles have also been removed thanks to the digitisation of some functions and the creation of the new central parking plaza at JNPT. Like many other reforms, this is also a work in progress.