India's initial COVID-19 response too little too late, says Ratan Tata
All early signals of the spread of COVID-19 in India, which were underestimated, should have been tackled “with humility and seriousness,” Ratan Tata, chairman of the Tata Trusts, Mumbai, said today. The impact of the virus in the country, especially in terms of loss of lives and health, is “more devastating than expected,” he added.
Tata was conversing, at a virtual Khemka speakers forum, with Glenn Hubbard, director of the Chazen Institute at the Columbia University Business School, New York. The funding for the trusts come from ownership of stock in the Tata group of companies.
From 1991 till he retired in 2012, Tata was the chairman of major Tata companies including Tata Motors, Tata Steel, Tata Consultancy Services, Tata Power, Tata Global Beverages, Tata Chemicals, Indian Hotels and Tata Teleservices. During his tenure, the group’s revenues grew multi-fold, totaling over $100 billion in fiscal year 2012.
A million construction, manufacturing and other workers were on the streets of Mumbai, after losing their jobs due to the virus lockdown. Their employers were unwilling or unable to pay for their food and lodging and the government did not respond immediately, Tata, 82, said. The workers walked to their homes, even if it was a thousand miles away. Some of them died along the way and others spread the virus around the country, Tata noted.
“The initial focus, including at our trusts, was on providing masks, gowns and other protective equipment” to deal with the virus, Tata said. Now the response is more rational, including providing food and shelter. Based on government data, India has 7.4 million COVID-19 cases, the second highest after the U.S.; and 113,000 deaths, the third highest after the U.S. and Brazil.
Tata supports the Indian government’s 2014 law requiring businesses, with annual revenues of more than Rs.10 billion ($133 million), to donate 2% of their net profits every year to socially responsible charities. But, he adds, some Indian business owners and executives “are very good at short-circuiting rules and finding pathways” to get the money back into their own pockets. To avoid such abuse, he wants the government to identify charities which qualify for the corporate grants.
He also supports the setting up of about 120 hospitals to treat cancer patients in India. He adds that it is equally important to expand and strengthen primary healthcare centers to serve “the common folk.” .
Speaking of corporate leadership skills, Tata said the chief executive has to lead by example. “Some years ago, communal riots (between Hindus and Muslims) led to the killing of over 300. In the midst of the violence, I transported several car drivers, working for our companies, safely to their homes in the trunk of my car,” he said.
In November 2008, ten Islamic terrorists from Pakistan attacked the Taj hotel, run by Tata’s Indian Hotels, and other targets in Mumbai. At least 174 people died in the attacks, including employees of the Taj hotel.
“Several of our employees sacrificed their lives to protect our hotel guests,” Tata said in response to a question about the attack. “We paid salaries to their families and covered the education costs of their children, as if they were still employed by us” he added. Also, all Taj employees were paid for the twenty months the hotel was shut for repairs and they got their jobs back, when it re-opened in August 2010.
The Tata Trusts, which Ratan Tata chairs, is amongst India's oldest and largest philanthropic organizations. Since 1892, the trusts have been running hospitals, advanced learning institutes and funding education.
The philanthropy of the Tatas is unique. Several studies, including by the MacArthur Foundation, confirm what is widely known in India, namely that wealthy Indians give little, if anything, to the communities from which they derive their wealth. None of the eight Indian billionaires on the Forbes list of 400 wealthiest Americans, for instance, have made major donations to tackle the COVID-19 outbreak.
Many wealthy Indians believe that the poor and unfortunate are lazy and seek financial crutches from others to carry them through life. This belief is tied to their false perception that their own success is based on their hard work, with no aid from the government, society or others. So, unlike many wealthy Americans, Indians say they owe nothing to society for their financial success.
The primary excuse of the wealthy in India is avoiding the attention of the income tax authorities. Wealthy Indian engineers and executives in America though cannot hide from paying taxes since their wealth derives from publicly disclosed stock holdings in the companies where they work, own or fund.
Several wealthy Indians, in India and elsewhere, have figured out that donating to the top universities in America can help secure admission for their children, along with the glory of having professorships and buildings named after them. Charitable giving by wealthy Indians, if any, is also directed to politician-endorsed philanthropies and to gain social status or publicity.
Besides the Tatas, Indians do have good role models of philanthropy, notably in Azim Premji, founder of Wipro, an information technology services firm. Premji has so far committed $21 billion, more than 80% of his net worth, to fund philanthropic activities in India, mainly education programs. He has also given $150 million to fund the fight against COVID-19 in India. The Tata Trusts and companies have donated about $200 million to fight the virus.
Ratan Tata serves on the board of trustees of Cornell University and the University of Southern California and on the advisory boards of Mitsubishi Corporation and JP Morgan Chase.
In 1962, after receiving a degree in architecture from Cornell University, Tata joined the Tata Group, which was founded by his family. Twice, in 1971 and 1975, he completed the Advanced Management Program at the Harvard Business School. In 2013, the school opened Tata Hall, a 150,000-square feet complex of residential, administrative and classroom facilities dedicated to Executive Education. “I am so proud to give back to an institution that has done so much for me and for so many other people,” Ratan Tata stated. .
The earlier goal of the Tata trusts was to solve personal hardships: for instance, help individuals with cancer surgeries and other major health care problems. Today, Ratan Tata said, “our focus is to work with the Bill & Melinda Gates and other foundations to tackle causes like treatment for diabetes, reduce child malnutrition and provide safe drinking water.”