Interview, :Allow companies to make money in India — and redeploy it there: Anil Agarwal

ET 7 Nov 2014

discussing ways ahead for revival of India’s economy. Anil Agarwal, chairman of Vedanta, spoke with Sanjiv Shankaran about India’s natural resource policy, his company’s Odisha experience — and why he shifted to London:

You talk about unlocking India’s resource potential — what does that mean?

Whether America or Europe, all have grown because of their natural resources. In India, we have either not made efforts to develop our natural resources or we’ve always thought we are an import-based economy — we import 90% oil, 100% gold and 100% copper. Import bill is going to grow.

We have a fear in India of depletion. When we took over Hindustan Zinc, we were told, you have a reserve of five years. We increased production by 10 times — today, we have reserves of 40 years.

We have so much natural resource which requires exploration. We need at least 30 of the world’s best companies, as China has . If any large country doesn’t meet at least 50% of its energy requirements, it will always remain poor.

Have you found governments open to this?

Yes. I’ve always said self-disclosure along with penalties instead of clearance is the best policy.

Have an open, transparent policy. Allow companies to come to India and make money. Create an atmosphere where they will redeploy the money in India.

Is there enough trust for self-disclosure?

You have to take a chance. In natural resources, on average, 60% of revenue goes to government. It is the biggest money earner for government which has to keep it transparent. Wherever there has to be exploration, we should be liberal. The biggest thing lacking in India is exploration policy. Thousands of miners should be supported for exploration.

As Vedanta head, how did you deal with recent uncertainty in India?

We have gone through a lot of pain. I am a son of the soil, i understand. In India, you need to have a lot of patience.

I’ve raised $30 billion abroad in the last 12-13 years and invested in India. Focus has started. I believe this government will be transparent.

What kind of contract would you want with government on oil?

If it’s revenue-sharing, it will be simple and straightforward. If it’s a question of exploration and development, it can go to the bidder willing to pay the highest royalty — but it must go through an auction-like process.

In a democratic country, people expect a transparent process.

You faced challenges in Odisha. Aren’t there trust issues now?

It has to be win-win. We have to carry our society. We have to find a way in a transparent manner.

We need these resources. We can either import or develop them in a sustainable manner. We cannot develop them in a wrong manner. I am hopeful.

Why did you move to London?

If i had not gone to London, i would not have been able to raise $30 billion.

My being there was to establish an Indian vehicle in Vedanta in London — where people can invest in Vedanta to be invested in India.

DISCLAIMER : Views expressed above are the author's own.