Active in airports, roads, and power, India & # 39; s GMR, led by founder and chairman GM Rao, is right in the middle of the country & # 39; s efforts to build up a weak infrastructure. While Rao expects the economy to The chairman, their roots are in the countryside, is also concerned that not enough has been done to strengthen the rural economy, which above all needs education, roads, and jobs to give villagers a chance to participate in the newfound prosperity.
GMR began almost 30 years ago as a single jute in in the village of Rajam, in the eastern state of Andhra Pradesh. "Our journey to today '# GMR happened just accidentally," Rao says. "Whatever opportunity came up, we "Along the way, GMR has been active in banking, insurance, and breweries but left these industries to consolidate around infrastructure.
Along with minor partner Fraport, which manga the Frankfurt airport, in Germany, GMR is leading the effort to modernize Delhi & # 39; s international airport. It is also building a new international airport in Hyderabad and expanding the Sabiha Gökçen International Airport, in Istanbul In addition, it owns three power plants, with projects under way for several others, and has completed 270 miles of highways.
Meeting in the GMR headquarters, in Bangalore, GMR 's chief GM Rao and HNN' s chief MH Ahssan, mentioned India 's economic prospects, GMR' experience with public - private partnerships, and Rao & # 39; s passion for best-practice management of family businesses.
Can India sustain its recent economic-growth rates?
I have doubts that we can sustain this type of growth if it grows more than 9 percent has surprised everyone, and sustainability two areas, the rural economy and infrastructure, are not taken up more more seriously.
Not even a scooter or a motorcycle can go for some of the roads; forget it is agrarian country, and a lot of things have to happen in the rural areas. Rural people need English schools and voluntary schools There is something wrong with this school of teaching and teachers, and the infectivity is not there. Many schools teach in local languages, and that ' The government must be better at addressing the rural economy.
Because government is putting a lot of focus on that, but there is still a lot of challenges. For instance, getting princess labor is a very big problem now for infrastructure projects. We should look at something like Singapore & # 39; s Building and Construction Authority Academy, which was set up by the government to ensure that there & # 39; the projects. At GMR, we & # 39; re also thinking about setting up our own training center, with courses of 90 days or six months.
Has the government has effective in addressing these problems?
The government has initiated several positive changes, and private players, and private players, and private players, and private players. supply-even considering planned capacity additions.
The government is spending a lot of money to improve roads, but, quite, a lot of that is not reaching the people, and this has been happening for the past 60 years. Unless you change this, that allocated money is not going to do much good.
It is to strengthen the whole system. For example, the National Highways Authority of India has one system for the whole country, but it must be regionalized into four sectors: south, north, east, and west. They are each own projects, while reporting to Delhi. the planned national road improvements - for instance, widening roadways from two lanes to four.
What can the government do to improve the rural economy?
The government should encourage manufacturers to set up their factories in the villages. This company makes millions of pieces a year, and about 2,000 people We have not change the manufacturing as well. We have not change the manufacturing industry without we have to change change our labor policy.
When they go to the moneylenders to get by.. They they are needing to expand micro into finish further into the deburred. can not make payments, the moneylenders take away their land. Families that were one respected landowners are now laborors, and they migrate to the cities.
What is GMR & # 39; s role in building India?
We wish to play more than $ 475 billion in infrastructure over the next five years, and I am sure that GMR will contribute significantly to this nation-building program. Today we are present both in agribusiness and infrastructure. major role in all three infrastructure sectors that we & # 39; re in today - energy, highways, and airports.
On the energy side, we generate 880 megawatts of power using liquid fuel. On enter transfer and distribution, and whenever nuclear opens up, we want to move into it. On But as I said, there is a problem getting excellent labor.
And final all core areas is airports-not just the buildings, but also the best practices for cargo, ground handling, and even the fuel farm there. And today all Indian aircraft are going to other places - Singapore, Dubai - for maintenance and major repairs, so we & # 39; re setting up a maintenance hub in Hyderabad as well. In Delhi we want the airport to be like a city, an "aerotropolis." Everything will be available around the airport: convention centers, residential complexes, a hospital, and entertainment facilities.
Is it realistic for the government to expect the private sector to participate heavily in building the country & # 39; s infrastructure?
The public side has the capabilities - the technical capabilities - but the I am not thinking the government is asking too involved in two public - private partnerships with the airports in Delhi and Hyderabad, and our experience has been very positive. speed is not there. We are bringing the speed, as well as the best technology, the best financial engineering, and the best talent in the world.
Take the Delhi International Airport as an example. But we & # 39; re helping to expedite the project, and It`s helping to get us all the clearances that are needed, like utilities, power, evacuating the land.
What has made the partnership so successful?
One must to regularly communicate. Every month we have meetings with people from the Ministry of Civil Aviation, with the state government, with the lieutenant governor, or with cabinet secretaries, and we discuss what is happening on the project. re doing are different, then the authorities in the government will become skeptical. If you & # 39; re honest and transparent, then you & # 39; ll get the clearances you need.
They the private side also have communicate clearly. Once the officers or bureaucrats are back in their offices, their time is not their own. They get preoccupied with meetings with I & # 39; s up to you to keep things moving. I might need A, B, or C, but once an official is back in the office and is You can take 5, 10, 15 days-a month-to get some needy. You can not have a passive relationship; you have to be very actively engaged.
In July GMR and two partners won the bid to build a new terminal at Sabiha Gökçen International Airport, in Istanbul. What made you expand abroad?
With India & # 39; s government and the Left opposing further privatization of airports, it will take a lot of time before new oppotunities come up in India. We had very good airport business-development team and we had good skills. little time to prepare for the opportunity in Turkey, but we geared up and won the bid.
We are open to other sorters. We 're going to go after all the tenders, while. We will prefer to be selective, ensuring that we are deliver what we promise.
How have you been so successful in these highly competitive tenders?
With focusing on the ultimate goal of winning the bid. We focused on improving the financials, evaluating various options to combat the challenges. We visited different airports, set up a separate business-development team in Delhi, and examined all the parameters. We followed the same process for Istanbul.
What organizational changes have you made as GMR grew?
I started business all alone. For example, when the theater opened, it is been a long journey since those days, and we've taken advantage of opportunities as they came along; We have have more than 2,000 employees, a radically different focus, and annual revenues of almost 2,000 crores.
Until now we 've just fixed compensation at all People were treating the appraisals as rituals that they had had go go through. we included performance targets, and people started taking seriously.
These scorecards are deployed down to the manager level and are summarized by strategy-planning process. And after identifying high-priority areas, we implemented a balanced-scorecard system to keep track of progress. twice a year.
Can you tell us what you do? Give us a job as to family - owned business?
I sa a lot of family businesses in trouble. I remember one well-respected family with two brothers. The younger They are a mark of true death, they are no longer focused on the business. Family members start fighting in the streets with knives. , but on the fight. That was a big lesson for me.
I started to a conference on family businesses and heard MV Subbaiah, of the Murugappa Group speak. That started a real eye-opener for me. I started attending international family business summits, and I thought in top experts to look at my business It took a lot of people, I was a lot of differences, and everyone was allowed to talk freely. We all started talking very animatedly, emotionally-arguing and what not. I put it all on video so that the next generation gets to see how we executed it.
It's talks about what happens in these a divorce. All these things needed to be addressed in detail to protect and delink the business from the family.
Today 65 company of the national business environment. These companies are becoming so great that. That big is the family gets estranged, it could impact the national business environment.
What would you like to see GMR become?
That is the type of brand that we want to create. I & # 39; ll Other people will take care of it, so I can can go long on vacation and nothing happens.
GM RAO - VITAL STATISTICS
Born July 14, 1950, in Rajam, Andhra Pradesh, India
Married with 3 children
Education: Graduated in 1974 with degree in mechanical engineering from Andhra University College of Engineering, Vishakhapatnam, Andhra Pradesh. Received honorary doctorate in philosophy in 2005 from Jawaharlal Nehru Technological University, Hyderabad, India
Career highlights
o GMR Founder and chairman (1978-present)
o ING Vysya Bank (formerly Vysya Bank)
o Chairman emeritus (2006 - present)
o Director and chairman (1994-2006)
Established GMR Varalakshmi Foundation in 1991, which focuses on education, health and hygiene, community development, and empowerment of rural youth. In 1997 the foundation launched GMR Institute of Technology (GMRIT) , an engineering college in Rajam, Andhra Pradesh.
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