Lord Swraj Paul: The peer who changed India Inc's governance debate

No Indian-origin businessman in the United Kingdom (UK) became as much a part of the British establishment while remaining deeply engaged in Indian industry as Lord Swraj Paul.

 

He moved to London in 1966 to seek treatment for his daughter Ambika, who was suffering from leukaemia. Ambika survived only a year, leaving him distraught. In his own words, “sanyas was all I could do”. But after months of idleness and counselling from family and friends, he returned to work — a decision that led to the creation of Caparo Industries, with a strong presence in the United States (US) and India. 

An alumnus of the Massachusetts Institute of Technology (MIT), Paul launched his first venture in the UK with a bank loan of 5,000 pounds (repeat, 5,000 pounds). As Britain’s steel and engineering industry declined at the start of the millennium, he had to surrender all UK units to the administrator. Freed of that burden, Caparo turned its focus to India, while also expanding in the US into real estate and hotels. Paul, the richest member of the UK Parliament, had an estimated net worth of over 2 billion pounds. 

 

One of the last celebrated industrialists of his generation, Paul took a keen interest in politics as a long-time member of the Labour Party. His friends included Michael Foot, Neil Kinnock, Tony Blair and Gordon Brown. Yet, this alignment did not prevent Conservative Prime Minister John Major from recommending him to Queen Elizabeth for appointment as a life peer in 1996.

 

In his maiden speech in the House of Lords that year, Paul said his “presence among your Lordships signifies the reconciliation and friendship between the land of my birth and the country which is my home”. The underlying spirit in which Britain and India now relate to each other is a model for the world”. In fact, in his condolence message, Prime Minister Narendra Modi said Swraj’s “work to strengthen India’s ties with the UK will always be remembered”. 

 

The UK government appointed Lord Swraj Paul as co-chairman of Indo-British Roundtable from 2000 to 2005 (K C Pant, the deputy chairman of the Planning Commission was co-chair from the Indian side) and, in that capacity, his role in improving the dialogue on economic and political issues between the two countries was significant. As an ambassador for British business (1998-2010), Swraj made several visits to India to promote two-way trade and investments.

 

Beyond business and politics, Paul was passionate about education. He served as chancellor of the University of Wolverhampton (1998 until his passing), Thames Valley University (1998–2005), and the University of Westminster (2006–14). He encouraged greater enrolment of students from developing countries, including India, and shared Amartya Sen’s conviction that India’s demographic dividend would only be realised with investment in education and health.

 

A noted philanthropist, he supported causes ranging from reviving the London Zoo to funding institutions for education and health. He believed businessmen should make personal charity a habit, going beyond their companies’ corporate-social responsibility obligations. 

 

Though Caparo was busy building greenfield automotive components and steel pipe ventures in India for nearly the past two decades, Swraj earlier courted controversy with his attempts to acquire two iconic Indian business groups — Escorts and DCM. Since the Nanda and Shriram families had small ownerships in, respectively, Escorts and DCM, Swraj, with access to big money, managed to buy more shares than either owned in 1983-84. Much water flowed down the Yamuna, but Swraj could not get his shares registered. Swraj also did not have success in getting clearances for a gas-based fertiliser plant and a bank in partnership with a foreign lender. “You know, I have no regrets that I ended up with losses when I had to unload DCM and Escorts shares. I made a bid for the fertiliser factory and a bank well before the 1991 liberalisation. But I think my campaign made some contribution to companies now making greater disclosures and upholding corporate governance,” Swraj told this correspondent.   The writer is a Kolkata-based independent journalist