In his book “India’s Century” Commerce Minister Kamal Nath has made some very interesting observations on Indians. He says The Indian is an “Insta-Preneur” (a portmanteau word for Instant Entrepreneur). He further argues that “For India, entrepreneurship is a unique way of seizing the day. Be they at the bottom of the pyramid, the middle or the top, what comes most naturally to Indians is the ability to spot an opportunity to do business. This is quality that some societies have and some don’t.”He gives example of one of the common man from his constituency Chinndwada to prove his argument. Gujarat’s success in getting Nano, not only vindicates his definition it goes beyond that.

Once Tatas decided to park themselves to “Safe Gujarat”, there has been huge relief from all the quarters, especially India Inc. A lot has been written on how Gujarat won it. But I would like to point out one fact which has largely gone unnoticed. When emotional Narendra Modi said he will pursue this project as National Spirit, he definitely helped Indian cause in great way. I had argued (or suggested) in my last article about emotional need (besides rational ones) for Tatas to look at Gujarat with Indian interest in mind. But Narendra Modi gave even larger emotional reason for going out of his way to woo Tatas.

He said he could not bear the news that some other countries have invited Tatas for investment. Whether Tatas seriously considered offer from outside is not known. But if not Gujarat, imagine what could have happened. All those so called front runner states had one form or another opposition politician waiting to seize the opportunity ala West Bengal style. So one more state and same tragedy would have tarnished carefully build India’s Brand image into pieces.

Let me drive the point from global investor’s view point. In the midst of the controversy where all the investors were looking to India, WB CM tells Tata to compare other states and was confident that all states will have opposition to land allocation. Almost scaring global investors by implying that you are not safe anywhere in India. Mr. Yechuri uses the analogy of asking for safety against burglary before building house. Either he does not know what Ram Rajya meant or does not know the world all over has flattened and there is very less margin of error. Or take example of Congress Spokesman Dasmunshi. He was asking Tatas not to threat leaving and even suggests Tatas should increase car price. Again a classic case of no values for commitment or least understanding of how important this project is for India. What kind of message we were sending to world investor community? If Nano project were without new site for say a couple of weeks more, you would have seen terminals of Bloomberg and Reuters filled with “India Growth a Myth” stories. Leading to either decreased confidence in India or raising India’s risk premium.

Already there were strong murmurs among global investor community about the bad treatment India is giving to Tata (our most respected business house). They were saying if you could do this to Tatas, what will happen to us. This was mentioned openly by USA, Japan, Western European countries. The carefully created Indian image after 2003 would have busted and it would have taken us at least a decade back if not to 1991. The humiliation as a word would not have sufficed the situation. And we Indian would have started blaming each other. For Tatas huge amount of time, money and energy was already wasted. A mere offer to relocate was not enough. Something extra-ordinary had to be done to bring the positive confidence back.

And luckily for India precisely that happened. The savior came in the form of Narendra Modi’s Gujarat. It was not about Narendra Modi’s offer, but the way he and his team executed made the difference. There was clarity, consensus, conviction, full control and above all care and compassion for investor. The kind you will see either in South East Asian nations or China. Investors do understand and appreciate this language. I guess Kamal Nath and his team must be thanking Narendra Modi for this. The welcome (unlike WB) was across the board in Gujarat from men on the street to Modi’s administration team who gave up their Navratri holidays to work round the clock just for one goal. The emotional pitch of Modi was icing on the cake and must have brought relief to Mr. Ratan Tata and his budding engineers. Other states must also learn that rational issues (like sops and other tangible benefits) normally preside but its the emotional ones (must do spirit and long term commitment) that become deal clincher.

One classic living example is Mentor Minister of Singapore Mr. Lee Kwan Yew. When Singapore became independent, the only source of survival for them was FDI. And only available resources were Human Resource. He used his monetary resources carefully and used it to build right infrastructure, reformed fiscal policies but most importantly created drive for cleanliness and created many lush green gardens, emphasizing good quality of life. Whenever he met any prospective investor, he would show them the gardens and say it was quite painful process to build them and maintain them. But we have taken good care of our gardens so they have flourished and look nice. In the same way we will take care of your investments. We will be gardener to make sure your Investment tree grows here. Modi’s tone was of similar nature when he said to Tata to speed-up the project. Ratan Tata mentioned in the news conference that Modi has told him that since this is smallest car, I want you to build your plant in shortest of time. Tata must have been relived that he has chosen the right place to plant his tree. The guardian and residents here will take care amply.

For the State this is indeed a “force multiplier” opportunity. When Nissan was looking for their mother plant in India, Gujarat was in the race but lost it to Chennai as a Gujarat did not give any special favor. It seems this time Gujarat did give incentives. However there is a difference and one must see the sops in a larger sense. Unlike Nissan’s case, India cause in Global context was at stake. The global meltdown is going to touch the Indian shore very soon. Even USA is opening tax-payers’ coffers to salvage their banking system. In Tata’s case this is positive sops. Considering this was for national cause as argued above I guess only those with limited knowledge of economy will oppose it. As they say in Gujarati Proverb “Laxmi Kapale Chanllo karva aave tyare mou dhova na javay” (You do not go to wash your face when Goddess Laxmi bestows to offer tilak on your forehead). The benefits both for Gujarat and India (read Why Narendra Modi’s sweet offer is good for Nano Milk) are far greater.

The obvious spillovers of Nano effect are amply discussed elsewhere including direct and indirect employment and realty growth. Some even talking of Ahmedabad finally giving some competition to Mumbai. The positive brand image of state created by Nano, will benefit Gujarat based industry as a whole. May be Investment bankers advising Gujarati companies (looking for technical alliance or strategic investor) will start talking about charging Gujarat premium (for being safest and most investor friendly place) while negotiating deals.

But sensing Gujarati spirit and how a wider spectrum of society will be benefited, I can see a whole new “NANO inspired Economy” taking shape in Gujarat. We already heard Nano Garbas (read Nano’s songs on Gujarat’s Dandiya grounds). NANO wave will only escalate in coming days. One can easily visualize Nano Crackers (for Diwali) Nano Jalebi, Penda (Sweets for New Year) , Nano Patang (popular kite for Uttarayana), Nano colors (Holi) the list can go on. With a tongue in cheek, I wouldn’t be surprised if on Sanand Highways one day you will see “NANO BHAJIYA HOUSE” every kilometer with sub-hoarding “Juna ane Jaanita or Amari biji koi Shakha Nathi (meaning Old and famous or the genuine ones with no other branch). The insta-preneur (as mentioned in the beginning of article) Gujaratis must be jumping to ride on Nano Parva (festival). After all States’ slogan says Come to Gujarat where Life is celebration.

I am sure whole State will speak in one voice of good host and treat Tata Motors employees with great respect. This to only reinforce confidence of global investor in India story.

Past articles by Somindu.S.

Why Narendra Modi’s sweet offer is good for Nano Milk