The brave blue world is a an insightful documentary that portrays a realistic picture of how mankind is embracing innovative technological procedures, to reassess the management of water resources. There are 7.837 billion people living on Earth, 1.1 billion of whom on a global scale, lack access to clean water and a total of 2.7 billion find water scarce. The question arises; Why the entire world despite running against the clocks is failing, in terms of alleviating these issues? Many states are endeavoring to claw their way out of the situation and resolve the crisis, but this is only deepening the problems. The water crisis is not an acute problem for the developing nations only, it has already begun to jolt out everyone, everywhere. We all know that there is no close substitute for water therefore, World’s massive blue potential needs to be utilized efficiently for a sustainable shared future. Oceans are a great unifier that links up all the countries. The value added by oceans to the global economy is estimated by the OECD to be $1.5 trillion yearly, with a potential increase to $3 trillion by 2030.
One of the most significant international marine routes links Europe and the Far East through the Indian Ocean. It transports the majority of the ultra-large containerships as it travels across the South China Sea, Strait of Malacca, Indian Ocean, Red Sea, Suez Canal, and Mediterranean until Atlantic. The nautical pathways of the ocean are essential for the global supply of energy. Nearly 40% of the world’s energy is thought to be transferred via its waterways from the Persian Gulf to Europe and Asia.
Blue economy; an offshoot of green economy:
Blue Economy is an appendage of the green economy. The green economy particularly focused on the sectors like energy, transport, agriculture, and forestry. Conversely, the blue economy emphasizes on harnessing ocean resources sustainably to generate employment, boost livelihoods, and spur economic growth while maintaining the health of the ocean ecosystem. To put it simply, the blue economy is increasingly becoming a pivotal policy discourse. Hence, an alarming protection is required towards the vulnerable ocean places. The immense ocean’s capital is a huge source of resources, best serving humanity’s interests economically and environmentally. Perhaps, the National Maritime policy despite all the internal and external obstacles must prioritize and accord the securitization of the blue economy. Scientists, researchers, and civil society have apprised exploration before exploitation for pursuing and maintaining societal and broader climatic goals. Given that, the blue economy is touted as the panacea to numerous economic woes faced by less developed coastal countries. Pakistan, a maritime state and one of the developing countries, has endorsed and incorporated the SDGs into its national development plans. Indian ocean is bordered to the north by Iran, Pakistan, India, and Bangladesh; to the east by the Malay Peninsula; to the south by the Southern Ocean; and to the west by Africa and the Arabian Peninsula. Many multilateral organizations in our region, including SAARC, APEC, the East Asia Summit, and the Indian Ocean Rim Association, are working to create supportive strategies and action plans for the sustainable development of marine resources. China has taken its One Belt, One Road program a step further and launched Five Years Development Plans for National Marine Economy, which regularly assesses the development of several marine industries.
Gwadar’s ability to become a smart port city:
With its ports in Karachi, Qasim, and Gwadar, Pakistan, a prominent coastal state in the middle of the Indian Ocean, conducts more than 95% of its trade by sea. In addition, Pakistan makes the most of its 290 000 sq km Exclusive Economic Zone and Continental Shelf for a variety of activities such as fishing, mining, exploration, and marine research. Every day, almost 15 million barrels of crude oil are transported from the Gulf States to Pakistan via the Persian Gulf. In addition, Pakistan provides the quickest maritime access to China, Afghanistan, and the Central Asian States. This emphasizes the geo-strategic and geo-military significance of Pakistan as well as the potential of its maritime economy. A fully committed development toward a common future is being established as a result of Pakistan and China’s everlasting friendship. Balochistan is developing through Gwadar Port despite the obstacles posed by CPEC’s skeptics. The western coast of Pakistan is crucial from a strategic perspective because of sea lines of communications (SLOCs) approaching from the Gulf of Aden and the Persian Gulf nearing Gwadar, Karachi, and beyond. As a matter of fact, Gwadar is pivotal for both China’s Belt and Road Initiative and the economic growth of Pakistan. Gwadar thus has the ability to expand into a smart port city.
Complacency and inaction decimated these sectors:
Pakistan’s current maritime revenue projection stands at 183 million dollars which is far less than that of Bangladesh and India. Pakistan’s early years were marked by a significant emphasis on development. In the 1960s, one of the most lucrative primary industries were agriculture, followed by livestock and fisheries. Later, we lost our way. Although some ascribe this to nationalization, I believe that “complacency and inaction decimated these sectors.” The sector’s officials, for whatever reason, failed to recognize the potential of advancement. The tertiary sector thus started to grow relatively soon. Fishermen in the coastal area of Pakistan still continue to practice conventional methods. In 2020, blue economy gained prominent importance and was referred as “The year of a Blue Economy”. The government of Pakistan did the right thing by reforming the Merchant Marine Policy, of 2001. The modified policy offers a broad array of financial incentives to private investors, including the right of first berthing for carriers, a margin tonnage tax, the approval of freight rates in Pakistani rupees instead of US dollars, and a long-term loan facility.
Maritime ecosystems contributing towards global tourism:
Who hasn’t fantasized about vacationing on a pacific island, gazing at the medieval ports, discovering the enigmatic seabed, and breathing in the magnificent mangroves? A whole economic structure known as the blue economy is hidden behind this enchanting postcard picture. Marine ecosystems promote up to 11.5 billion USD to global tourism. Over and above that, it serves to preserve our coasts from natural disasters like storms and floods, bestowing habitat for biodiversity. With regard to the global economy, approximately 90 percent of all traded goods are shipped by sea, internationally. Furthermore, the market value of marine and coastal resources and industries is estimated at US$3 trillion per year. Hence, biodiversity-based tourism opportunities can be developed to explore an eco-tourism in the coastal belt of Pakistan. Pakistan Institute of Development Economics implies that Pakistan has a potential for sustainable yearly growth of 8%. Pakistan, the fifth-most populous economy in the world with a population growth rate of about 2%, may experience unstable food security issues in the future. Due to the lack of financing, extending the economy beyond land-based avenues of development is extremely challenging in the post-COVID-19 era, but paradoxically, it is nevertheless a considerable alternative for Pakistan’s economy to flourish. After years of negligence, the government of Pakistan is now, to some extent, paying attention to the maritime industry. According to estimates, our fishery business has an untapped export market for seafood worth $US 2 billion. Utilizing this potential can boost the economy, especially in Pakistan’s underdeveloped coastal region. If we want to become a rising economic force in Asia in the coming decades, we will need to give our maritime sector more attention, particularly in areas like shipbuilding, fleet expansion, and port infrastructure improvements that will allow us to dock modern ships with much larger cargo carrying capacities, as is being done in some of our neighbors.
Development of Maritime Autonomous Surface Ships:
Pakistan is overburdened by technological gaps. Therefore, the Ports of Pakistan have no advanced capacity to handle cargo. All around the world, the shipping industry is evolving towards the development of Maritime Autonomous Surface Ships (MASS). Whereas, Pakistan is still operating its existing seaports manually which too requires a swift upgradation. It is the need of the hour for Pakistan to collaborate with the countries that have pursued the development of future-ready seaports. In the future, friendly and competitive sea ports could accommodate autonomous vessels and ships. 
In contrast to our neighbors, Pakistan has made little progress towards sustainability despite its reasonable efforts. Currently, Bangladesh’s maritime resources and tourism make up a remarkable portion of its GDP. On the other hand, Pakistan’s virgin beaches hinder its ability to attract both domestic and international investors. India has surpassed other nations in the shipbreaking business and is building a rim road that will link all of its ports.
New Industrial Revolution:
Worldwide, a new industrial revolution is being unfolded in our seas. Pakistan would be directly impacted by the blue economy on a social, economic, and environmental level. It will socially pull up the community’s marginalized groups, notably women and young people. Shared prosperity and inclusive economic growth would be made possible by the revolutionary prospects across numerous sectors. The maritime sector in Pakistan has enormous growth potential, but it requires regulatory frameworks and significant expansion to become a reality. Pakistan’s geographic strategic location gives it a critical or central role in the shifting dynamics of the Indian Ocean. If used, this potential may turn Pakistan’s expansive marine zone into a regional hub for the blue economy. Successful blue growth demands a strong political commitment to be accomplished.
Beyond shadow of a doubt, developing countries like Pakistan can no longer afford to turn a blind eye on its blue potential. It is time to think global and act local. A collaborative framework must be ensured with a range of stakeholders comprised of the federal government, global businesses, nongovernmental organizations, and local communities. All must work collectively from inception to completion. Few nations have the access to resources that Pakistan does, but unfortunately, because of sea blindness, we have completely disregarded these treasures. It has been a sore point for a while now that Pakistan’s 1046 km of coastline, which has tremendous blue potential, has remained untapped. A massive mobilization of people is required, who care about a shared future. The utilization of one of the most fundamental types of natural capital is inextricably linked to human prosperity. Pakistan’s coastal area potential will be adequately addressed if the focus is made on wholesome blue economy growth. Consequently, by formulating sustainable policies and strategies, oceans and coastal areas would not be seen as vast and empty wilderness.
The future prospects of China-Arab cooperation under the framework of the Belt and Road Initiative
The positive impact of the China-Arab cooperation on the regional situation
Arshia Shakeel, a student of Government and Public Policy at National Defense University, Islamabad
The future prospects of China-Arab cooperation under the framework of the Belt and Road Initiative
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The positive impact of the China-Arab cooperation on the regional situation
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The significance of China- Arab summit: Building a new world order
If we are going to analyses the main questions, related to: will China and Arab states seek new future cooperation? What role does the Belt and Road Initiative play in the cooperation between the two sides?
We will find out that the important of the Belt and Road Initiative and its projects to the region, which China presented as its own model for globalization, comes through the Belt and Road Initiative, which has become an essential part of China’s foreign policy to the extent of its inclusion in the Constitution of the Communist Party of China, as a Chinese attempt to build an integrated market that allows China to expand its influence across the regions of Asia, the Middle East, Africa and Central and Eastern Europe.
 Here comes the Importance of the Middle East, North Africa, the Arabian Gulf, and the Middle East in general in the Chinese Belt and Road Initiative.
 Within the framework of the importance of the Middle East region in the Chinese strategy.  China is the largest importer of energy resources in the world, while half of its imported oil comes from the Arab region in particular.  In light of the tensions that prevailed in the global oil markets, China’s openness to the Middle East region, and its attempt to enhance Chinese influence, has become one of the necessities of the strategies of the Chinese energy security calculations.
 With China’s intention to align the Belt and Road Initiative with the economic plans of the countries of the region and their integration with them, such as Egypt’s Vision 2030 and Jordan’s Vision 2025, the Kuwaiti Silk City project, and the Mohammed VI smart city project in the Moroccan city of Tangier.  These Chinese steps have become integrated with the internal economic trends, the long-term development goals and the plans drawn up by the governments of the countries of the region.
 China also launched a group of joint projects with Iran, the value of which exceeds 400 billion dollars, which allowed Iran to bypass many of the restrictions resulting from Western sanctions on it.  This coincided with the launch of a number of Chinese investment projects in Iraq, which focused on the field of reconstruction after the destruction that resulted from the war with the terrorist organization ISIS.
 The biggest real challenge for China remains, is the extent of its ability to build political alliances with the Arab and Gulf countries, which translates and reflects the growing economic relations between them within the framework of the Chinese Belt and Road Initiative, especially in light of those contradictions that govern China’s relationship with several conflicting regional parties among them.
  From a political and strategic point of view, China seeks to enhance its influence and presence in the region, and to compete with other major powers, especially America and Russia, as China is largely economically present in the countries of the region, in exchange for the American military presence, and therefore Chinese influence began to increase in some files and political crises such as the crisis  Syria, in which China used the right of veto more than once.
The Arab-Chinese summit is the first hosted by the Kingdom of Saudi Arabia, and an important beginning of the strategic partnership between the Arab countries and China, through 3 summits, including a summit between Chinese President Xi Jinping, Saudi King “Salman bin Abdulaziz”, and Crown Prince “Muhammad bin Salman”.
 The China Arab Gulf summit on December 2022, which takes place between the Chinese president “Xi Jinping” and the kings and princes of the Arab Gulf countries, which indicates that Arab-Chinese economic and development cooperation awaits great open prospects, in light of the international conditions witnessing great turmoil.
So, we can find out that the first China-Arab-Gulf States Summit on December 2022 is another milestone mechanism for China and Arab States to promote the development of bilateral relations after the China-Arab States Cooperation Forum. There are many kinds of cornerstone the China-Arab States Cooperation Forum has laid for the holding of the China-Arab States Summit, as this summit comes in light of developments in the international arena, starting with the US withdrawal from the Middle East, passing through the war in Ukraine and ending with the Chinese-American tensions, in light of the latter’s efforts to contain China as the strategic enemy of the United States according to the recently approved US National Security Strategy.
There are such positive impacts on the new visit of Chinese President “Xi Jinping” to the Saudi Arabia to  narrow the gap in economic development and easing the turbulent situation. Here, China expects to take advantage of the opportunity of the first Chinese-Arab summit to work with the Arab countries to consolidate the historical friendship, and to continue to deepen the formula of comprehensive, multi-level and wide-ranging cooperation between the two sides, in order to reach more consensus between the two sides in political dealings, economic and trade cooperation, as well as in building the Chinese society. Arab countries for a common future, including bilateral cooperation between the two sides in some traditional fields such as energy and agriculture, in addition to the digital economy and space.  In addition, the two sides are likely to expect to reach more common consensus on important issues in international forums, such as the Ukraine crisis and the recovery of the global economy.
The visit of Chinese President “Xi Jinping” to Saudi Arabia embodies a new reality and a historical turning point for the region, which has long been seen as an exclusive focus of influence for the United States, especially through its military presence. However, in light of the tense relations between Riyadh and Washington, another picture of the American-Saudi rapprochement has emerged.  This visit is also an indication of the change taking place in international relations, for a multipolar world that China, Russia and other countries want.  Of course, the Arabs have an interest in this transformation and rapprochement with the Chinese Asian giant.
 Where the convergence of the Chinese industrial and economic power with the Gulf and Saudi energy giants comes at a very sensitive time with the tension in Saudi relations with Washington, especially against the background of the issue of human rights, as well as Riyadh’s support for oil production restrictions before the mid-term elections that the United States will witness.
 All this at a time when US President “Joe Biden” considers the situation a global competition between democracies and authoritarian regimes, and makes it the focus of his presidential term.
 Here It seems that President Xi Jinping is seeking through his visit to the region and his holding of two summits, the first Gulf-Chinese, and the second Arab-Chinese, in the presence of the leaders of the countries of the region who began to flock to the Saudi capital.  According to the Chinese Foreign Ministry, President Xi Jinping’s program represents “the largest scale diplomatic activity between China and the Arab world since the founding of the People’s Republic of China.”
 As for Saudi Arabia, the gradual disengagement from Washington in the Middle East and the slow erosion of its security guarantees with the United States of America present an opportunity for China to achieve economic gains due to the tensions between the Gulf states and Saudi Arabia, which were reflected in relations with Washington.
 Although economic relations are still based on energy-related interests, bilateral relations have expanded in light of the Gulf renaissance in terms of infrastructure and technology, which is part of the diversification plans that are gaining importance as the world seeks to move away from fossil fuels.
Here, there Is no doubt that the Chinese president’s visit to the Kingdom of Saudi Arabia is a great opportunity for China to increase investments and strengthen strategic partnership with the countries of the region, which is a vital area for energy security and is located on the new Silk Road adopted by the Chinese president through the One Belt, One Road initiative.  After adopting the policy of soft power, China has now changed its strategic doctrine, as it seeks to protect its interests and win the Arab and Islamic countries to its side.
  This visit is certainly very important in promoting bilateral relations between China and Arab countries.  First, President Xi Jinping’s attendance at the first China-Arab Summit is China’s diplomatic move towards the Arab world, which is the largest and highest level since the founding of the People’s Republic of China.  China has confirmed that it will become a milestone in the history of Sino-Arab relations.  Since 2012, the China-Arab strategic partnership has continued to advance, and joint efforts to build the “Belt and Road” have achieved fruitful results. Initiative framework agreements were signed between China and twenty Arab countries.  On the other hand, the world is witnessing tremendous changes, and in the face of global challenges, there is common political consensus and great economic completion between China and the Arab countries, which greatly contributes to helping each of them overcome problems.
Take a trip to the southern Indian state of Tamil Nadu and you will see the frontier of Indian capitalism. There, you will find several solar factories that are powered by the sun. They are located on a 550-acre site. According to reports, Tata is currently making components for Apple’s latest iPhones, which is a significant step towards connecting India to the global supply chain. The project, which is part of a massive $90 billion investment drive by India’s biggest business, is not a one-off. It is part of a larger strategy by Tata, which is shifting its focus away from the global market and toward its home country. The company’s goal is to create multiple semiconductor facilities and electronics factories in India. The company’s new strategy reflects the changing mindset of global business leaders, who are now more focused on the future than the past. Some of these include the rebasing of manufacturing operations away from China and the emergence of a new energy system. Prime Minister Narendra Modi’s government is also working on developing an industrial policy that is expected to encourage more manufacturing in the country.
Most people who follow India assume that the country’s rapid growth is being led by two powerful business tycoons: Gautam Adani and Mukesh Ambani. These two individuals are known for their lavish lifestyles and are known to generate headlines. Together, they are expected to spend over $100 billion in the next five years. Despite the lavish lifestyles of these two individuals, Tata is India’s biggest business by market value. It is also one of the country’s largest software companies and steel mills. Its new strategy is significantly larger than that of other companies. In addition to electric cars, the company’s new plans include the establishment of multiple semiconductor facilities and the development of clean power plants. The company’s scale, reputation, and record make it one of the most important organizations in the world. With around 800 million to 900 million customers across various business lines, it is the largest listed firm in the world that employs over a million people. It is also the oldest firm in the world that has remained independent, having been founded in 1868.
Tata: Known as the company of Technocrats
When multinational companies such as Apple and Starbucks decide to expand their operations in India, they often look for a partner that they can trust. This is because, unlike the rich individuals in the country, the management of Tata is composed of technocrats who are not looking to make a name for themselves. To understand the future of India and Tata, it’s important to go back to the past. Through its various business lines, the company has been able to adapt to the changes brought about by the country’s political and technological developments. It was able to maintain its position as a leading multinational company by adapting to the changes in the white-collar work market. During the 1990s, the company started to introduce information technology outsourcing services.
Ratan Tata, who served as the chairman of the company from 1991 to 2012, spent the first decade of his career dragging the group into the 21st century. During this period, he was able to successfully expand the company’s global reach through cross-border acquisitions. Some of these acquisitions included the purchase of British carmaker Jaguar Land Rover and the steel company Corus. During this period, Tata was able to successfully expand the company’s global reach through cross-border acquisitions. He was able to share his belief in the potential of borderless commerce with other business leaders. During this time, the annual investment by Indian companies in other countries increased significantly. The company’s optimism and insecurity were the reasons behind the boom. In India, Tata was worried that the country was not providing a level playing field for its companies. It was also believed that foreign companies needed to be in the West to tap the country’s advanced technologies. During this period, the company launched the Nano, a car that was very basic. The era of reflexive globalism has come to an end. Due to the increasing number of multinational companies operating in different countries, the financial strength of these organizations has been affected by the geographical spread of their operations. For instance, in 2012, over two-thirds of Tata’s sales were outside of India.
The company’s net debt had increased to twice its gross operating profit. This strain caused a governance crisis as Mr Tata was unable to maintain his relationship with Cyrus Mistry, his successor. In 2017, Tata replaced him with N Chandrasekaran, who had been the group’s managing director and had led the thriving business unit that kept the company afloat. The rise of N Chandrasekaran to the top of the Asian business community shows the significant change that has occurred in the technological self-confidence of emerging markets. In the past decade, India has created a venture-capital scene and developed some of the most advanced payment systems in the world. This has helped fund over a hundred private tech companies that are worth over $1 billion. As the increasing number of it-services companies, such as Tata, has led to a doubling of their size and technical capabilities. Even though the company might not like to admit it, Mr. Ambani’s decision to invest over $46 billion in a domestic 5G telecom business, known as Jio, has shown that there is a huge potential for companies in developing economies to profitably deploy capital in cutting-edge technology. The increasing number of tech companies in India has been attributed to the country’s changing relationship with the state. Under the leadership of Prime Minister Narendra Modi, the government has been promoting the development of a new relationship between businesses and the state. There are numerous opportunities for companies in developing economies to capitalize on these changes. The usual suspects are not at their best. India’s state-run companies are failing. Foreign multinationals have not been able to create a conducive environment for industrialization and technological breakthroughs. The capital markets have also failed to create sufficient firms to take on big risks. The last investment cycle, which ended in tears, was the infrastructure boom of 2003-11. And the government and some of its officials now favor large companies. These include conglomerates and specialist firms such as HDFC Bank, which is in the process of completing a mega-merger worth over $140 billion.
Some of the prominent companies that have adopted this strategy include Mr. Ambani’s Reliance Industries and Adani Group. They believe that the country’s changing relationship with the state and the need for responsible business can be mutually beneficial. On the other hand, some of the more cautious companies are making a bet that the demands of the state and responsible business can be met. As the CEO of Tata Sons, Mr. Chandrasekaran is a quick and ultra-rational individual who is known for his ability to quickly respond to emails. He has also ordered the company’s subsidiaries to deliver on their performance. Since 2017, the company has written off around $10 billion due to various factors. Some of these include the company’s exit from certain businesses, and the recapitalization of its weaker divisions. Some of Tata’s domestic rivals have started to get their act together. The company’s cyclical steel business is thriving, and its market share in cars has increased, especially with the launch of the Nexon EV, which costs around $17,000 more than the Nano. The company’s clean-up operation is nearly two-thirds complete, and as a result, its return on capital has increased by 14%. The share of capital that is underperforming by 10% has significantly decreased. Leverage has also significantly decreased. Since 2017, the stock price of Tata Sons has outperformed the country’s stock market. The company’s legal battle over the succession of its CEO ended following the Supreme Court’s ruling in its favor last year. For the first time in over two decades, Tata has become more Indian. In 2017, the company’s sales from the subcontinent grew at a faster rate than that of foreign companies. The company’s plan for the next five years is to invest around $90 billion in various projects in the country. These projects are expected to help the company develop its technological capabilities and meet the government’s needs.
There are various plays that Mr. Chandrasekaran is currently focused on, such as manufacturing for export and growing consumption in India. He believes that the country’s growing middle class and increasing number of foreign direct investment can create a significant supply chain opportunity for global companies.
Chandra’s capex challenge
According to estimates, the company’s annual capital spending will increase to around $18 billion, which would make it India’s biggest investor. It is also expected that new high-tech businesses will start to emerge from its operations in the country. If all goes well, this could increase the company’s capital employed to half by 2027. These are significant shifts for both the company and the country. Around 77% of the company’s new investments will be in India. The company’s plan for the next five years is to invest around $90 billion in various projects in the country. One of these is the energy transition. Through its power subsidiary, Tata will spend around $10 billion on renewable generation over the next five years. It is also planning on building gigafactories in Europe and India, which will allow it to supply its own cars and other manufacturers. In addition, the company’s car operations in India will launch ten new models. It will also start manufacturing solar panels. One of the company’s other bets is in electronics. It has already invested $1 billion in the country’s electronics manufacturing industry, which mainly pertains to the company’s operations in Tamil Nadu. It is also planning on making 5G telecommunications equipment using the Openran standard. This will challenge Huawei, China’s hardware-focused champion.
In addition, the company is also planning on building a new semiconductor factory in India, which will be the company’s first fully fledged facility in the country. It is currently in talks with a foreign partner to build the facility, which could cost around $5 billion. The factory, which would not be as advanced as the one in Taiwan, would not be able to make chips as advanced as those made by the TSM. It would be a huge challenge for Tata Group, as Mr. Chandrasekaran noted that it would be a leap for the country. Other companies such as Foxconn and Vedanta, which are Indian-focused firms, have also shown interest in setting up a plant in Gujarat. On September 13, both Foxconn and Vedanta announced that they would be investing over $19.5 billion in a plant in the state. Another gamble that the company is taking is the Indian consumer. In April, it launched a digital platform called Neu, which aims to be a “superapp” for its customers. It has already managed to gain 17 million users since it was launched, but the company is planning on continuing investing in the startup ecosystem. This is because many of these companies are struggling to raise funds due to the global venture-capital crunch.
Tata overtaking other Businesses
Air India, which has been struggling for years, is another gamble that the company is taking. Before you get too excited, consider that it has acquired international slots and was able to get debt-free after it was purchased from the state. It is also planning on merging with another domestic airline, Vistara, which it has with Singapore Airlines. The goal of this project is to create a powerful national carrier, similar to what Lufthansa or Emirates have in the world. According to reports, Tata is expected to order around 300 new aircraft. As a conglomerate, Tata Group is planning on continuing to expand its geographic concentration. However, it is also planning on maintaining its sectoral diversification. In emerging economies such as India, conglomerates have advantages such as their brand presence and strong regulators. However, they can be very complex due to their multiple legal and operating subsidiaries. Mr. Chandrasekaran is currently on the board of several listed companies. Despite being a large company, Tata Group does not have global scale in various industries. Its $1 billion bet on the electronics industry is equivalent to 8% of Foxconn, which is a leading contract manufacturer. The company also has a huge investment in batteries, which is 40% of the plant of China’s top tech firm, known as catl.
In India, Reliance Industries has two main businesses: refining and 5g. This allows it to double the capital of its subsidiaries. However, lack of focus on these areas could make it harder for the company to achieve technological breakthroughs. One of the world’s biggest chipmakers is also skeptical that India can build a competitive semiconductor manufacturing facility. One of the biggest risks that the company faces is its ownership structure. Through its various charitable trusts, which are chaired by Mr Tata, the group has a total of 66% of its subsidiary, Tata Sons. These are asset-rich, but they are also very income-poor, with the dividends distributed to the trusts amounting to less than 1% of the group’s operating profits. The third layer is controlled by Mr Chandrasekaran, and these are the holding companies that he runs. Some factors could also destabilise the structure of the company. The death of Cyrus Mistry, as well as his father, in June, could cause his family to re-evaluate their 18% stake in Tata Sons. This would require the company to raise around $27 billion in order to fund the purchase. Even though Mr Tata is 84 years old, he is still physically frail and mentally sharp. When he retires from the trusts, it is not clear who will take over as the interim leader of the board of directors. The hope is that a consensus emerges and a credible candidate emerges who doesn’t meddle in the company’s operations. Another potential issue is the government. Prime Minister Manmohan Singh’s critics are accusing him of presiding over crony capitalism, which they claim is over the top.  In India, the country’s business scene is less concentrated, with the four largest companies having operating profits of 1.1% of GDP, compared with 1.2% in the US. Unlike traditional rent-seeking firms, the country’s large corporations are aggressively reinvesting in their operations. Even though Tata doesn’t consider itself a political organization, it has paid tribute to Mr Modi’s populist nationalism by visiting the headquarters of a Hindu-chauvinist group that supports the Gujarat Chief Minister. In addition, the company’s charitable trusts are working more closely with the state government. Despite this, Tata is still participating in the $26 billion manufacturing-subsidy program, which the company claims is too small to influence its investment decisions. Despite the positive signs that the government and Mr Modi’s firm have been able to bring about, the outlook for the country’s economy may change. Unlike the chaebol in South Korea, which made it rich by exposing the country to international competition, some of India’s large companies are only eyeing the domestic market. As the country’s large companies expand their operations, they will inevitably overlap, which raises questions about Tata’s ability to receive equal treatment. For instance, if some of its new ventures fail, can it still be assured that it can still exit even if it loses a significant portion of the country’s competitive landscape? Some of the reasons why Mr Tata was reluctant to invest in India during the 2000s remain. However, if the country can finally be industrialized and become a manufacturing hub for the world, then he and other large companies such as Tata can finally make a significant contribution to the country’s development.
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