Business maharajahs

The key aspect of wealth that determines its acceptability, especially in a mostly poor society, is its legitimacy: how was it acquired and how is it being used? Robert Clive, answering charges of corruption and bribery, declared: "I am astonished at my own moderation." The maharajahs of princely India taxed their impoverished subjects to build the palaces and buy the baubles, which the coffee-table books celebrate today, but some of them also earned the affection of their subjects by doing good work. More recently, in the shortage-driven years immediately after Independence, politicians used to routinely threaten in their public speeches to "hang hoarders and black-marketeers by the nearest lamp-post". Now, the politicians themselves declare their wealth in crores (at acquisition price, not current value), some of them have been indulging in usury and causing farmer suicides, and the number of expensive SUVs in Parliament House's parking lot rivals any self-confessed watering hole of the rich.

In some ways, the boot is now on the other foot: there are now fewer questions asked about business wealth, and more about the sources and legitimacy of the politicians' wealth. Om Prakash Chautala has been accused of amassing Rs 1,400 crore, Natwar Singh and his son have been implicated in the Iraq oil for food scandal, and George Fernandes and his associates are accused of taking crores from an Israeli defence supplier. But it is also true that a long list of the heroes and heroines looked up to by India's youth (published in Business World) features just one businessman""Bill Gates""and it is not clear whether he is there because of Microsoft or the Bill and Melinda Gates Foundation, which has been trying to battle AIDs in India.

Business wealth looks more legitimate in India today than it might have in the past for three specific reasons. The first is that the majority of business billionaires in Business Standard's latest compilation of the super-rich are first-generation entrepreneurs. These are not people who were born with a silver spoon in the mouth, nor did they inherit businesses with established customer franchises. In other words, there is effort and achievement tagged on to the wealth. Second, many of the wealthy are both willing to share their wealth with their associates (like N R Narayana Murthy of Infosys) and contributing to society through philanthropy (the Azim Premji Foundation, set up by the second-richest Indian, is making a difference to the quality of education in thousands of schools). The third reason for greater legitimacy is that the super-rich today count the bulk of their wealth not in palatial residences or expensive baubles (though there is that too) but in the value of the shares of the companies they run or own. In other words, most of the wealth is productively deployed""and other than satisfying customers, it creates jobs and pays taxes. It also matters that most markets are competitive, so business success is not a free ride just because you have the start-up capital. And that is why it is good to celebrate the fact that membership of the Billionaire Club has nearly quadrupled in the last seven years. The success stories of these 391 people may excite envy, but it is more important that their enterprise and endeavour serve as examples to learn from and emulate.