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It’s terrible to do business in India: Raj Kundra
Raj Kundra doesn’t need introduction in India, particularly after his high profile marriage with Bollywood actress Shilpa Shetty. Son of a Punjabi emigrant to the UK who worked as a bus conductor in London.
Raj Kundra doesn’t need introduction in India, particularly after his high profile marriage with Bollywood actress Shilpa Shetty. Son of a Punjabi emigrant to the UK who worked as a bus conductor in London, Kundra is said to have made his fortune in precious metals trading and a host of other businesses which included importing pashmina shawls into the UK, his first business venture.
In India, he co-owns Rajasthan Royals IPL team along with his actress wife and some others. The couple is also into gold (SatYug Gold) and real estate businesses now. “But it is terrible doing business in India because it takes months to get a new company registered while the same can be done in a day in London. India needs to simplify the processes,” Raj Kundra, once ranked as 198th richest person in the UK by a business magazine there, tells P Madhusudhan Reddy in an exclusive interview. Excerpts:
You own businesses both in India and the UK. Is it easy to set up business in India or the UK?
It’s really terrible and very very difficult to do business in India. If anyone comes from abroad, they think twice before investing– should they do business in the country or should they go back. But luckily, lots of doors open for me because of my investments in Rajasthan Royals, through Shilpa or through various other things. But for a common man, it would be very hard to do business in India. All done and said, sentiments in the markets turned positive after Modi government coming in. A lot of my NRI friends are ready to invest in India now. I think the government should make the process of setting up new businesses easy. To set up a company, it takes months in India while it is a 24-hour process in London. So, they need to make process faster so that people can be encouraged to invest in the country.
Are you looking at any other business opportunities in India?
Globally, we have a refinery in London and real estate investments in the UK as well. Now, my energies are focused on India. The real estate sector is good here. I am interested in two segments in real estate – at the bottom end which is affordable housing and the other is mid to high end category. Initially, we will focus in Mumbai and some other places though Hyderabad is not a bad idea. Besides real estate, I always enjoying doing metals business. However, it is difficult to do metals business in the country now. If construction business picks, the metals market also picks up. Otherwise, it is very difficult. I know a lot of people are suffering in the metals space. I have lots of friends who are into metals business. They are still suffering. They say it will take a year or more for the current government to clear the black log of the issues that cropped up during the previous regime. However, some say Sensex will double in next two years, which is reassuring.
Why did you enter into gold business?
For Indians, gold is the fourth most important thing after food, clothes and shelter. Every Indian loves to buy gold and we want that process of buying to be pleasant, less painful and easy. We set up our own gold refinery in Mumbai with an objective of maintaining gold quality. Besides, we have signed long-term contracts with gold mining companies from South Arica, Ghana and Peru so that we can source gold directly from them. The contracts help us in two days – to get quality gold and that too at discounted prices. In addition, we also roped in IDBI Trustees and Brinks for safekeeping of the gold and Karvy Computershare for the backend work. This is a unique concept in the sense that all the gold purchased by customers will go into safe custody of IDBI Bank and thereafter we will not have any control over the gold. So, customers will get their gold even in the event of our company going bust. Of course, that will never happen. But we have designed the robust business model by keeping the interest of customers uppermost in our minds. Through our SatYug Mera Gold Plan, people can accumulate gold by paying just Rs 50 a day. The payments are done on monthly basis and the gold will be deposited into the customer’s account on the same day we receive the payment. People can buy both jewellery as well as pure gold after enter the tenure. They can exit from plan midway too without paying any penalties.
