I Wonder Why

I want to write about my travels through Germany, but between travelling, classes and other reading, there is no time to spare :(

Followed Tata Steel's proposed takeover of Corus Steel with some delight. My favourite company is now on the threshold of becoming an MNC! Natsteel and Millennium Steel were starters, both costing under $ 500 mn each. Corus will cost $8 bn and propel Tata Steel into the league of the world's top 10 steel producers. Tata Steel has choosen an interesting route to finance this acquisition, funnelling in a large part of the funds through its UK subsidiary rather than borrowing them itself. This will impose a greater interest burden on Tata, but will keep the parent's balance sheet clean and allow it to perhaps make more acquisitions! What a spectacle that will be!

I continue to wonder how things might have been had India liberalised in the 1960s - TISCO's annual production capacity would have surely grown faster than the 2 MT to 3 MT that it did from 1960 to 1990. I'm sure Indira Gandhi read Adam Smith's Wealth of Nations in her college days. It's all laid so clearly there - how the "invisible hand" of the market-mechanism can create the most wealth for a society, how tariffs hurt domestic consumers, how state control of firms leads to inefficiency...all so painfully clear :(

No use crying over spilt milk though. Since 1990, the Jamshedpur plant's capacity has already expanded to 5 MT. Including Corus and the other acquisitions of the last two-three years, Tata Steel will be producing over 20 MT of steel every year.

Everywhere I look, corporate India is booming. Growth in FY07 will exceed 8% - the fourth year in a row that GDP will grow by over 7.5%. Indian outward investment will exceed inward FDI this year. A Forbes survey recently put 23 Indian companies in the list of the best 200 small Asian companies - 4th highest, and not too far from the leader (Taiwan, 31).

The Indian Century might just have begun.

So why am I looking for a job abroad? I don't know :)