Gautam Adani (left), Damodardas Modi (middle) and Mukesh Ambani (right) are building modern India. Photo by Alberto Meiere /CNN/ Getty Images In March this year, a quiet coastal town in Gujarat, a western Indian state, could have competed with Davos and Kotchera. At that time, billionaires and movie stars from all over the world flew to Jam nagel, and private jets and charter flights flooded the small airport. They are all here to get together with Mukesh Ambani, the richest man in Asia.
The 67-year-old chairman of Reliance Industries, India's most valuable private company, held a luxurious prenuptial party for his son, inviting about 1,200 guests from Silicon Valley and Bollywood. Many famous people such as mark zuckerberg, Bill Gates and Ivanka Trump attended the event.
During the three-day celebration, the performances of pop singer Rihanna and magician David Bryan shocked India, further highlighting Ambani's growing global influence.
But Ambani is not the only Indian businessman attending the banquet. His amazing influence and wealth are reshaping the most populous country in the world.
Gautam Adani, founder of Adani Group, who is also a billionaire, was also invited. The infrastructure tycoon's rapid development in the past 10 years has shocked the world. In 2022, he once replaced Jeff Bezos as the second richest man in the world.
Rohit Lamba, an economist at Pennsylvania State University, said, "They are extraordinary ... entrepreneurs who can maintain steady growth and development in India's dynamic but sometimes chaotic political and business environment.
Investors have been cheering for their abilities in industries prioritized by Indian Prime Minister Damodardas Modi. Modi is currently running for re-election as Prime Minister of India.
This South Asian country is about to become an economic power in the 21st century, providing a real alternative to China for investors seeking growth and manufacturers seeking to reduce supply chain risks.
Reliance Industry and Adani Group are huge enterprise groups, each worth more than 200 billion US dollars, and have established businesses in fields ranging from fossil fuels and clean energy to media and technology.
Therefore, these three people-Modi, Ambani and Adani-play a fundamental role in shaping the economic superpower that India will become in the coming decades.
New Rockefeller family
In Mumbai, the Indian financial capital, the fingerprints of these two businessmen can be seen everywhere from the bustling international airport operated by Adani.
Adani Group is a large Indian infrastructure enterprise group. Noemi Casanelli /CNN Their names are plastered all over the city-from the bubble letters of the Adani Group logo erected on the highway to the high-rise apartment buildings marked with the Adani real estate brand, to the cultural institutions named after the Ambani family. Some spaces don't need names or bright labels, but their connection is equally obvious. Everyone in Mumbai knows who lives in Andilla, the private skyscraper of Ambani and his family. It is reported that the building cost billion to build and has a spa, three helipads and a 50-seat theater. This 27-story building is located on a street called Billionaire Street, and its prominent geometric buildings cover the whole community.
The power and influence enjoyed by these Indian tycoons have also appeared in other countries experiencing rapid industrialization.
April 17th, 2024, Andilla, the residence of Ambani family in Mumbai. Noemi Casanelli /CNN reporters often compare Ambani and Adani with john D Rockefeller, who became the first American billionaire in the 30-year gilded era in the last decades of the 19th century. During those decades, due to the rapid expansion of trains, factories and urban centers all over the United States, the wealth of industrialists rose to an alarming height. Other celebrities, including Frick, Astor, Carnegie and Vanderbilt, also shaped America's infrastructure.
Recently, in Asia, "chaebol" or large family enterprise groups have dominated the Korean economy for decades, and many of them, including Samsung and Hyundai, have become global leaders in the semiconductor and automobile industries.
"India is experiencing what the United States and many other countries have experienced. James Crabtree, the author of Billionaire Raj, said: "Britain in the 1820s, South Korea in the 1960s and 1970s, and China in the first decade of the 21st century."
He added that it is "normal" for developing countries to experience such a period of rapid growth, during which "income accumulation at the top, increasing inequality and a lot of crony capitalism".
The Indian economy has many such characteristics.
In 2023, it was worth .7 trillion, making it the fifth largest economy in the world, and it rose four places in Modi's ten years in power, surpassing Britain.
In the next few years, China's economy is expected to grow at an annual rate of at least 6%, but analysts say that if China wants to become an economic superpower, it should set its growth target at 8% or higher.
Continued expansion will push India into the ranks of the world's largest economy. Some observers predict that by 2027, this South Asian country will become the third largest economy in the world after the United States and China.
Despite these successes, the soaring youth unemployment rate and inequality remain persistent problems. According to the World Bank, by 2022, the country's per capita gross domestic product (GDP) will rank only 147th.
Coal to solar energy, oil to the Internet.
In order to stimulate growth, Modi's government began a large-scale infrastructure transformation, spending billions of dollars to build roads, ports, airports and railways.
It also vigorously promotes digital connectivity, which can improve business and daily life.
As the country began this revolution, both Adani and Ambani have become key allies.
"These conglomerates are very, very important and closely related," said Guido Cozzi, a professor of macroeconomics at the University of Saint Gallen in Switzerland. He pointed out that Adani Group and Reliance Industry were both established several years before Modi came to power.
"They are not typical stagnant monopoly enterprise groups. They are very energetic, "Cozi said. He explained that they not only play an "important role" in building infrastructure, which contributes to "direct growth", but also the two enterprise groups promote interconnection through digital innovation and help the country "indirectly" expand.
Anbani's father, Dilubai, founded a small yarn trading company in Mumbai in 1957. In the next few decades, it grew into a huge enterprise group spanning energy, petrochemical and telecommunications.
After his father died, Ambani inherited the company's main oil and petrochemical assets after a fierce quarrel with his younger brother. Then, he spent billions of dollars to transform it into a technology giant.
In less than ten years, Ambani not only subverted the telecommunications industry in India, but also became a top player in industries from media to retail.
After the launch of the mobile network Jio in 2016, Ambani revealed the growth of telecommunications and the Internet in India. Noemi Casanelli /CNN His ambition and suffocating expansion rate are comparable to those of Adani, a college dropout. Adani is now in charge of enterprises ranging from ports and electricity to national defense and aerospace. As the first generation entrepreneur, at the age of 62, he started his career in diamond trading, then established a commodity trading company in 1988, and later developed into Adani Enterprise Co., Ltd. (AEL).
According to a January report by Cantor Fitzgerald, an American brokerage firm, AEL "is the core of what India wants to achieve."
The company is an incubator for enterprises in Adani. Many companies have been spun off and become leaders in their respective fields. According to Kantor, the company's current focus on airports, roads and energy makes it "a unique long-term investment opportunity".
Although most of their wealth comes from fossil fuels, these two tycoons are now investing billions of dollars in clean energy. Their green energy strategy comes at a time when India has set some ambitious climate targets for itself.
The fastest growing major economies in the world also have other enterprise groups. Tata Group, which has a history of 156 years, has great power in many key fields, from steel to aviation, but it is usually not subject to the same scrutiny as the newer enterprise groups, mainly because it is controlled by charitable trust companies rather than operated in the form of family dynasty.
"too big to ignore"
Ambani and Adani are considered as Modi's voice champions. Famous politicians of India's opposition parties often question Modi's relationship with India's super-rich, and the rapid rise of Adani last year became a worrying issue.
On October 19th, 2013, Mukesh Ambani (right) and Damodardas Modi (middle) took a group photo at the university graduation ceremony in Gujarat. Amit Dave/Reuters/file In January 2023, the group suffered an unprecedented crisis, and an American short-selling institution, Hindenburg Research Company, accused it of engaging in fraud for decades. Adani condemned Hindenburg's report as "groundless" and "malicious". But this failed to stop the shocking stock market crash, and the market value of listed companies once evaporated by more than 100 billion US dollars.
Political leaders of India's main opposition parties strongly questioned Adani's relationship with the Prime Minister, and some even said that they were punished for pursuing this issue.
Since then, Adani's performance has been remarkable, and the share prices of some of his companies have hit record highs. Despite the scandal, the group has successfully attracted billions of dollars from new foreign investors, including American private equity firm GQG Partners.
Kanter said in its report: "Although the report exposed serious concerns, we believe that the company has taken actions to reduce liquidity risk, improve governance and increase transparency." "Therefore, at this juncture, we think that Adani is too big to be ignored. For India, we believe that the country needs Adani just as Adani needs the country. "
Adani operates the port of Mondra in Gujarat, which is the country's largest commercial port. Punit Paranjpe/AFP/Getty Images Now, with India's vote, Modi's relationship with billionaires is once again questioned by competitors. Pra Sang Na Tantri, an associate professor of finance at the Indian Business School, said that as far as crony capitalism in India is concerned, he had "no reason to believe that things were getting worse than before".
He added that some processes, especially improving the transparency of India's natural resources distribution and comprehensively revising the country's bankruptcy law, were important reforms during Modi's administration.
Experts say that a certain degree of intimacy between politicians and business elites will help the country develop faster.
Crabtree said: "The optimal level of corruption in an economy will never be zero." He added that India needs to establish more independent institutions to control corruption.
However, the uncontrolled dominance of such a large group may stifle competition and innovation, and eventually lead to economic stagnation.
The new government needs to encourage entrepreneurship and innovation, make it easier for small businesses to raise funds, and abolish outdated laws that hinder business development, including land and labor regulations. Failure to do so may stifle India's future growth.
Ramba said that some large enterprise groups can't absorb the 1 million people who join the labor force every month. He is also the co-author of Breaking the Stereotype published in 2023, which explores how the third largest economy in Asia can grow faster.
"It is impossible for India to get rich before it grows old by relying on several big companies such as Adani or Ambani," he said. "India should establish more companies."
Jesse Yang of CNN contributed to this report from Mengmai.