gdpr-cookie-consent domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/u570418163/domains/altechbloggers.com/public_html/wp-includes/functions.php on line 6131The name Ambani symbolizes immense wealth and influence in India. But the story of how Dhirubhai Ambani built the Reliance Empire is full of ambition, cunning business methods and deep political connections. It is a story that shows how corporate battles are fought and how political leaders often take part. This in-depth investigation brings the journey from a humble beginning to becoming a powerful business force.
Dhirubhai Ambani was born on December 28, 1932, in a small village in Gujarat, India. His father was a school teacher. At just 19 years old, Dhirubhai left India for Aden, now a bustling port city in Yemen, in search of work. At that time, Aden was a main global trading center where things like gold, silver, sugar, textiles and spices were bought and sold.
Dhirubhai’s brother, Ramnikbhai, already worked in Aden. He gave Dhirubhai a. Helped to get a job as a clerk in the commodities section of Besse & Co. From this job Dhirubhai learned how Arab, Jewish and Indian traders sold goods and earned money. They learned to import things such as sugar, rice, and wheat from Europe and Australia, and found buyers before the goods reached Aden.
Silver coin scheme
During his time in Aden, Dhirubhai noticed something strange. The silver coins used in Yemen, called rials, were worth more silver than their face value. They began buying as many rials as they could, melting them into silver stilts, and selling the silver in London for a profit. He earned a lot of money from this clever step.
Yemen’s authorities soon noticed their silver coins disappearing from the market. An investigation revealed Dhirubhai’s large-scale purchase. The government finally stopped the purchase of riyals, but by then Dhirubhai had already earned lakhs of rupees.
In 1957, with the movement for independence in Yemen intensifying and anti-India sentiments rising, Dhirubhai decided to return to India. He settled his family in a crowded area named Pigeonkhana in Mumbai. The Ambani family, consisting of seven members, lived in a small one-room apartment in a chawl. The apartment had no private bathroom; they used a common bathroom with about 100 other people. It was in this modest environment that Dhirubhai’s second son, Anil Ambani, was born.
In February 1958, Dhirubhai opened Reliance Commercial Corporation in a small 350-square-foot office in the Wholesale Market, Mumbai. The office was so small that it had only one table and three chairs, which were shared with an adjacent doctor. Dhirubhai started his work by selling spices in Eden, Muscat, Oman and Saudi Arabia. He did not have much money, so he partnered with Trimbaklal Damani.
Entry into the world of textile
Dhirubhai soon made friends with other traders of his chawl who used to work as threads. He started a small business of buying and selling threads. At this time, India’s textile industry was moving away from cotton and silk to cheaper, quicker-drying and non-shrinkable synthetic yarns such as nylon and polyester. The demand for these synthetic threads was very high, but the supply was less because they had to be imported.
A special license was required to import synthetic threads. Only registered textile exporters could obtain this “Replenishment License”, or REP. In 1965, Dhirubhai and his partner, Champaklal Damani, fell out over how to run the business. Dhirubhai wanted to take risks, while Damani preferred a slow and safe approach. They separated, and Dhirubhai bought Damani’s share in Reliance.
After partition, Dhirubhai focused on synthetic thread business. He got help from friends and businessmen like Kantilal Vakharia and Krishnakant Vakharia. Krishnakant Vakharia, with the help of Gujarat Industries Minister Jaswant Mehta, helped Dhirubhai get land in Naroda, Ahmedabad. On this land, Dhirubhai built a small factory with just four knitting machines.
Reliance grew slowly. By 1967, the company’s sales reached Rs 90 lakh and profit Rs 13 lakh. In 1968, Dhirubhai moved with his family to a comfortable flat in a posh area of Mumbai. He re-invested all his profits in the factory. This strategy worked. Ten years after starting manufacturing, in 1977, Reliance’s sales amounted to Rs 68 crore and profit to Rs 10.5 crore.
After settling in Mumbai, Dhirubhai started influencing government policies. He partnered with emerging Congress leader Murli Deora in Mumbai to reach out to leaders and bureaucrats in Delhi. Dhirubhai adopted every method to speed up his business, including political donations, and soon made connections with top leaders. He was the son of Indira Gandhi’s private secretary Yashpal Kapoor and later R., who worked in the Prime Minister’s Office (PMO).K. Became close to Dhawan. He also made contact with opposition leaders like Atal Bihari Vajpayee and Chandra Shekhar.
A key mate T.A. Pai, whose family ran Syndicate Bank. After Indira Gandhi nationalized Syndicate Bank in 1969, Pai became the Minister of Industries, which greatly benefited Dhirubhai.
In 1971, Dhirubhai T.A. Convinced Pi to start a scheme under which it was allowed to import polyester yarn instead of exporting nylon fabric. This scheme was called Higher Unit Value Scheme, the objective of which was to promote the textile industry and prevent money from going out of India. Under this scheme, if a company exported nylon fabric, it could import polyester filament yarn.
Allegations of fake export
During this period, the demand for polyester in India was very high, but the country was dependent on imports. Polyester could be imported only by exporting nylon. However, Indian nylon had few buyers overseas as it was cheaper overseas.
Critics accused Dhirubhai Ambani of using fake nylon exports to get more polyester import licenses. According to one theory, they used hawala schemes, in which money was sent abroad to fake buyers who “bought” their exports. These goods were often shipped to free ports such as Singapore or Dubai to avoid custom duty, then sold cheaply, left to rot, or even dumped at sea. The purpose was to show exports only to get permission to import more polyester.
Then Dhirubhai would sell the imported polyester in India at 600 per cent more than what he had bought it for. Even after “disposing” his exports, he made profits of up to 425 percent in the polyester business. This scheme continued as long as Indira Gandhi’s government was in power, due to which Dhirubhai became the country’s largest polyester importer. Before leaving office in March 1977, Indira Gandhi’s government had also waived custom duty on REP licenses, giving Dhirubhai a profit of Rs 3.75 crore.
After the fall of Indira Gandhi’s government in 1977, the Janata Party came to power under the premiership of Morarji Desai. Initially, Dhirubhai continued to do good work, he also got help from Desai’s son, Kantilal Desai. However, on August 22, 1977, Commerce Minister Mohan Dharia abruptly cancelled the Higher Unit Value Scheme. The decision caused polyester license prices to fall sharply. Reliance was going to suffer a lot of loss.
But just 11 days later, on September 2, 1977, the old scheme was restarted. The most surprising thing was that Reliance managed to secure licenses worth Rs 100 crore in those 11 days. This period came to be known as “Dheerubhai’s 11-day miracle”. However, the Janata Party government discontinued the scheme for good in 1978.
Interestingly, by 1977, when Indira Gandhi was in power, Reliance claimed that between 60 and 70 percent of its cloth exports were abroad. But as soon as the government scheme ended, these foreign buyers disappeared. This suggests that the export was probably not real, although it was never fully proven.
Reliance became public
In October 1977, Reliance Textile Industries offered 28 lakh equity shares to the public at a price of Rs 10 per share. In January 1978, JM Financial’s trading platform BlinkX arrived, giving people a dependable and inexpensive way to trade the stock market. BlackX Zero offers brokerage trading and free expert research calls so traders can make informed decisions. Its plans start with ₹249 for two months, ₹599 for six months, and ₹899 for twelve months, facilitating unlimited trading in NSE F&O, equity, and IPO on the same app.
According to Hamish McDonald’s book ‘The Polyester Prince’, Dhirubhai Ambani helped bring Indira Gandhi back to power by funding her campaign and helping destabilize the Janata Party. This further strengthened his relationship with Indira Gandhi, which gave him unmatched power to influence government policies.
When Indira Gandhi won the 1980 elections, her supporters in Gujarat held a large party in Delhi, the entire expense of which was borne by Dhirubhai. Indira Gandhi remained on stage for two hours, and Dhirubhai stayed with her the entire time. His return was a golden period for Reliance.
Fast growth and impact on policy
In 1979, Reliance was a small company. But within five years, by 1984, it had become a large corporation. In 1980, Reliance received one of only three licenses issued by Indira Gandhi’s government to manufacture polyester yarn. There were 43 applicants, but Reliance was chosen, and production began in November 1982. Just a few weeks later, on 23 November 1982, Indira Gandhi’s government imposed an extra import duty of Rs 15,000 per tonne on polyester yarn.
The move forced Indian businesses to buy polyester domestically, benefiting Reliance. Dhirubhai also had a close friendship with Pranab Mukherjee, who was the Finance and Commerce Minister in Indira Gandhi’s government. Mukherjee allowed Reliance to produce more than its licensed capacity and helped the company save tax. Between 1977 and 1996, Reliance saved hundreds of crores by paying little or no income tax. The number of Reliance’s shareholders increased eightfold (800%) between 1979 and 1984. During this time, Reliance’s share price rose from Rs 10 in 1978 to Rs 131 in 1982. This tremendous growth made Dhirubhai Ambani a well-known personality, whose pictures started appearing on the covers of the magazine.
In the mid-1980s, Dhirubhai Ambani became involved in a fierce business battle known as the “Mahapolyster War”. His main rival was Nusli Wadia, owner of Bombay Dyeing. The Wadia family was a well-known Parsi business group from Mumbai, and Bombay Dyeing had been operating since 1879. Nusli Wadia had powerful connections, including his grandfather, Muhammad Ali Jinnah, and influential friends like Ratan Tata and Ramnath Goenka of the Indian Express Group.
This collision was concentrated on two raw materials used in making polyester thread: DMT (dimethyl terephthalate) and PTA (purified terephthalic acid). Bombay Dyeing had received a “Letter of Intent” for a DMT plant in December 1978, during the Janata Party government. However, the construction of the plant got delayed. Some believed that the authorities deliberately delayed it, and he later found jobs at Reliance.
Meanwhile, Dhirubhai Ambani also acquired the license to make polyester thread and started production in November 1982. In 1984, Reliance also received a Letter of Intent to build a PTA plant, an alternative to DMT.
When production finally began in April 1985 at Bombay Dyeing’s DMT plant, negative news began to appear in the press. Media reports claimed that the plant was outdated and that PTA, which was Reliance’s preferred raw material, was a modern alternative. These reports were often published by journalists who were sympathetic to Reliance.
Indira Gandhi was assassinated on October 31, 1984, and her son Rajiv Gandhi became the new Prime Minister. Within hours, Rajeev R.K. Dhawan removed from PMO and Pranab Mukherjee replaced by V.P. Singh was made the Finance Minister. With this step, two special associates of Ambani were ousted from power.
On May 29, 1985, Rajiv’s government put Raw Material PTA of polyester on the “Controlled Import List”, making it difficult to import. Dhirubhai, however, managed to secure a letter of credit for 114,000 tonnes of PTA, which was enough to meet Reliance’s needs until its own PTA plant was started in late 1986. But a problem came when Reliance was able to import only 14,000 tonnes and filed a case against the government for the remaining 100,000 tonnes.
During this legal battle, Reliance Bombay continued to spread negative news about Dyeing’s DMT plant. However, Dhirubhai also faced challenges. The CBI began investigating whether the decision to freeze PTA imports had already been leaked to Reliance. On October 26, 1985, Reliance was accused of evading excise duty of Rs 27.23 crore, the largest such charge in India’s corporate history at the time.
This was the time when Seth Ramnath Goenka, the famous owner of the Indian Express newspaper, joined the “Polyester Mahabharata”. Goenka was critical of the Congress Party and was a close friend of Nusli Wadia. In October 1985, after hearing about the media campaign against Bombay Dyeing, Goenka promised Wadia that he would investigate it.
Goenka met Dhirubhai Ambani and raised this issue. According to sources close to Goenka, Dhirubhai admitted that he had used his influence on the press to his advantage. He famously told Goenka, “I have a gold slipper and a silver one”. Whoever comes in front of me, I hit him either with a gold slipper or with a silver slipper” According to another version, he said, “Everyone has a price” Goenka took this as a challenge and vowed to expose Dhirubhai and Reliance at any cost. He worked as a chartered accountant with RSS background, S. Gurumurthy was assigned to lead the investigation.
Dhirubhai suffered a stroke and the sons took over the company
In February 1986, Dhirubhai suffered a stroke, which partially paralyzed the right side of his body. They U.S. for cure. Gone, and handed over the responsibility of running the company to his sons, Mukesh (29) and Anil (27). Under the leadership of Gurumurthy, Indian Express started publishing news making many revelations against Reliance. These reports detailed Reliance’s debt, its NRI share investment scheme and smuggling allegations. A major revelation was that Reliance was planning to set up a PTA plant of 100,000 tonnes per annum, but the license for the government Mathura Refinery’s PTA plant was reduced to 75,000 tonnes, while Reliance got a license of 100,000 tonnes. A secretary who had opposed this was transferred.
From 15 May 1986, Gurumurthy published a three-part series on Reliance. Another four-part series in June focused on alleged financial irregularities involving shell companies registered on the Isle of Man, a British island. The Indian Express reports had an immediate impact. Reserve Bank of India (RBI) ordered an investigation into the financial activities of Reliance. The CBI was already investigating the PTA import policy leak. There was pressure on Reliance from all sides. One report even revealed that nine banks had given loans worth Rs 1,000 crore to Reliance and its Associated Companies between 1985 and 1986, often to newly formed companies that had little capital.
Smuggling allegations
On 25 August 1986, the Indian Express printed another sensational report, claiming that Reliance had secretly smuggled another Rs 1 billion polyester plant in 1985-86. At that time, licensing and tax payments were required to import anything into India. The newspaper alleged that Reliance had earlier smuggled additional equipment from an oversized plant in 1982 and a yarn plant in 1985. The article claimed that changes were made in government policies to benefit Reliance’s smuggling activities. A team of CBI was sent to investigate Reliance’s factory in Patal Ganga. Although many meetings took place, the CBI team could not prove any wrongdoing against Reliance.
By April 1986, Pranab Mukherjee had been expelled from the Congress Party. As soon as Dhirubhai’s alleged transactions became public, Rajiv Gandhi started seeing smuggling factories and hawala payments as the basis for filing a case against Dhirubhai. Rajeev wanted to hear the entire story directly from Gurumurthy of the Indian Express.
Meanwhile, Finance Minister V.P. Singh had started a war against the black economy. He made Bhurlal the Enforcement Director (ED), and Bhurlal also started targeting Dhirubhai Ambani. Gurumurthy to Washington, DC. A private investigation agency, The Fairfax Group, was found out. He contacted its founder, Michael Hershman, on behalf of Goenka. In November 1986, Hershman came to Delhi and met Bhurlal. They agreed that Fairfax would receive 20% of any funds recovered from its investigation.
Dhirubhai needed to re-enter Delhi’s power circle, which was closed to him after Rajiv Gandhi became Prime Minister. A report in the Illustrated Weekly of India indicates that in October 1986, Dhirubhai fixed a meeting with Rajiv Gandhi through Amitabh Bachchan. In this meeting, Dhirubhai clearly told Rajiv that he had a lot of funds from Rajiv’s late mother, Indira Gandhi, and asked what to do with it. He also explained his industrial expansion plans, and showed how they match Rajiv’s vision for a high-tech India.
Dhirubhai successfully created the impression that his enemies were also Rajiv’s enemies. He V.P. Took advantage of the enmity between Singh and Amitabh Bachchan. Bachchan and V.P. Both Singh were from Allahabad, and Bachchan came into politics at the behest of Rajiv. Since V.P. Dhirubhai was facing problems with Singh’s policies, so he asked Bachchan and V.P. Took advantage of the bad relations between Singh.
Attacks on Gurumurthy and Bhurelal
The meetings between Dhirubhai and Rajiv had an impact. On December 2, 1986, the government announced that the CBI was investigating whether Gurumurthy had unauthorized access to government secret papers. On 21 December, the CBI raided Gurumurthy’s office in Madras and seized documents. On 23 January 1987, Rajiv Gandhi suddenly v.P. Singh was asked to become Defense Minister from Finance Minister.
On the night of 10 or 11 March 1987, two sensational letters were shown to Rajiv Gandhi. These letters, written to Gurumurthy from the Fairfax Investigative Agency, contained secret information about Amitabh Bachchan’s Swiss property and his brother Ajitabh Bachchan’s NRI status. The names of Ramnath Goenka, Nusli Wadia and Bhurelal were also among them. Rajeev began to suspect that V.P. Singh and Nusli Wadia, along with Ramnath Goenka, are targeting their old friend Amitabh Bachchan to ultimately target Rajiv.
Soon after receiving these letters, at 10:30 pm on 11 March, Bhurelal was removed as ED Director and transferred. At 1:30 am on 12 March, a team from the CBI raided Gurumurthy’s house and arrested him for criminal conspiracy and violating the Official Secrets Act. On 13 March, the CBI raided the Indian Express guest house in Delhi, where Ramnath Goenka, Nusli Wadia and Chandraswami were present. Wadia and Chandraswami were let go, but Goenka remained there.
During the search, Dhirubhai Ambani called Goenka and offered help, but Goenka disconnected the phone. Gurumurthy was interrogated for 48 hours, mostly about targeting Amitabh Bachchan. On 17 March, Gurumurthy appeared before a magistrate in Delhi, where Fairfax letters were mentioned for the first time. Gurumurthy said Fairfax was hired by Bhurelal, not him. He denied giving the money to Fairfax, and claimed that he had just forwarded the letters.
Calcutta newspaper The Statesman printed the first Fairfax letter on 20 March, revealing the whole controversy. Fairfax founder Michael Herschmann and his deputy McKay described these letters as fake and said they could not be so unprofessional as to write such details on paper.
The matter reached Parliament, where Congress members V.P. Singh accused of endangering National Security by including Fairfax, the agency that allegedly had links to the CIA. Justice M.P. Thakkar and S. An inquiry commission was formed under Natarajan. On April 12 V.P. Singh resigned from his ministerial post. Four days later the Bofors scam came to light, leading to V.P. The conflict between Singh and Rajiv Gandhi increased further. In July 1987 V.P. Singh was eventually expelled from the Congress party. The Thakkar-Natarajan Commission report concluded that V.P. Singh had endangered India’s security and Nusli Wadia played an active role in this matter.
In 1988, Dhirubhai Ambani announced a plan to apply for a license to build an oil refinery in Bharuch, Gujarat, which could produce 6 million tonnes each year. Oil refining was generally under the control of the government, so they had very few chances of getting permission. Dhirubhai was confident that the government would finally understand that Reliance was the only company that could meet India’s growing refining needs.
The polyester battle between Dhirubhai and Nusli Wadia had now reached paraxylene, the raw material of DMT and PTA. By 1988, Reliance’s paraxylene plant was making paraxylene from naphtha. But, Bombay Dyeing had to import paraxylene for its DMT plant. In March 1988, the government increased custom duty on paraxylene from 85% to 120%. Also, international prices of paraxylene also increased. This caused losses to Bombay Dyeing, as it was the only Indian company to import paraxylene.
In July 1988, Reliance got permission from the public sector Indian Petrochemicals Corporation Limited (IPCL) to purchase 120,000 tonnes of paraxylene at a reduced price, whereas initially it was allotted only 50,000 tonnes. Dhirubhai got a big benefit from this.
By the end of 1989, Dhirubhai Ambani was considered a big supporter of the Congress Party. His allies started returning to power. R.K. Dhawan, Indira Gandhi’s political manager and close to Dhirubhai, rejoined the Prime Minister’s Office in March 1989. Ramnath Goenka’s health was deteriorating, and the Indian Express Group was facing more than 230 lawsuits, withdrawal of government advertisements, and pressure from banks not to grant loans. The Express Group was on the verge of collapse.
Nusli Wadia suffered a major setback on 12 July 1989. Arriving at Mumbai’s Santa Cruz Airport from a trip abroad, immigration officials ordered him deported, declared him an “unwanted foreigner” and gave him 24 hours to leave India. Wadia appealed to the court, which stayed the order.
Meanwhile, a strange incident happened. Maharashtra Chief Minister Sharad Pawar, who was a friend of Wadia and not close to Dhirubhai, called Wadia to tell him about the conspiracy to kill him. On 1 August, Bombay CID arrested Kirti Ambani, who was the general manager of Reliance and handled Public Relations and Customs cases. Kirti Ambani was accused of conspiring to murder Nusli Wadia with the help of a band singer named Arjun Babaria. Babaria later confesses to planning Wadia’s murder, and states that the Hit Squad narrowly escaped killing Wadia multiple times.
The intrigue came to light in July 1989 when a gang member was talking about it while drinking at a bar and was overheard by a police informant. The police investigated, and the gang member confessed. Bombay Police Commissioner Vasant Sarab informed Chief Minister Sharad Pawar, who saw the evidence himself. Pawar ordered a special security and careful police investigation for Wadia. On 31 July 1989, Pawar called Rajiv Gandhi’s office, and Cabinet Secretary B.G. Told Deshmukh about this conspiracy. The investigation had progressed too far to be stopped, so the case was handed over to the CBI on 4 August.
At the same time, Indian Express reporter Manek Dawar published a report in which CBI director Mohan Katre was exposed. The report alleged that he had earned Rs 15 lakh from Reliance, which he had used to buy an apartment in Bombay, where Katre himself had often lived. Kirti Ambani’s superior Umesh Ambani told the CBI that Reliance came to know about Kirti Ambani’s involvement only after his arrest. This case soon disappeared from the public eye, and all the accused were gradually released on bail.
Rajiv Gandhi’s Congress Party’s seats were reduced from 415 to 192 in the November 1989 general elections. Although Congress was still the largest party, it did not have a majority. Rajiv Gandhi is out of power, and his opponent V.P. Singh became Prime Minister with the support of the opposition alliance.
V.P. With Singh’s new government, all of Dhirubhai’s opponents were returned to power. Former ED director Bhurlal became the Prime Minister’s Special Officer. The new Finance Minister, Madhu Dandavate, was a supporter of public sector industries and critical of Ambani’s business style. Old cases against Reliance were reopened.
On 12 December 1989, the Central Board of Excise and Customs issued a new order, in which Collector of Bombay Customs K. Vishwanathan was accused of taking wrong decisions and making serious mistakes to save Ambani in the extra polyester plant smuggling case. Bombay Customs’ new collector A.M. Sinha reopened the case. Another Customs scam came to light soon after, with investigations revealing a loss of Rs 3.03 crore in November 1982. In January 1990, B.V. Kumar was transferred from the Central Board of Customs and Excise.
In May 1990, Bombay Customs officials inspected Reliance’s Patal Ganga PTA and Paraxylene plant. He served a 170-page notice, claiming that Reliance had a license for a 75,000-ton per-year PTA plant, but had imported a 190,000-ton capacity plant. Similarly, the licenced paraxylene plant for 51,000 tons could produce 400,000 tons annually. Customs accused Reliance of saving Rs 1.2 billion in duty by underreporting capacity. Reliance responded that the machinery was mounted by Ventec, a company promoted by Bombay Dyeing, and was within the license limits.
Dhirubhai’s political moves
Dhirubhai Ambani and Reliance had started influencing the leaders of the ruling coalition and those supporting the government from outside. Just as Dhirubhai helped Indira Gandhi topple the Janata government in 1979, he is now V.P. Were looking for the weaknesses of Singh’s government.
V.P. Singh implemented the Mandal Commission report, which led to massive protests in some parts of the society. Meanwhile, BJP and RSS started their campaign for Ram temple in Ayodhya. Lal Krishna Advani started his Rath Yatra on September 12, 1990. Over the next two months, riots broke out between Hindus and Muslims across the country, weakening the government.
By September it was clear that V.P. Singh’s government is faltering. On 23 October, the Janata Dal government of Bihar led by Lalu Prasad Yadav stopped Advani’s Rath Yatra, causing a rift between the Janata Dal and the BJP. BJP immediately V.P. Withdrawn support from Singh’s government. At the same time, Rajiv Gandhi and another Janata Dal leader, Chandrashekhar, started breaking the Janata Dal MPs.
Dhirubhai supported Chandrashekhar’s efforts. On November 7, 1990, one-third of government lawmakers V.P. Voted against Singh, forcing him to resign from the post of Prime Minister. Three days later, Chandrashekhar became Prime Minister with the external support of the Congress. Due to this, Reliance’s influence in the government reached its highest level. However, on March 6, 1991, Rajiv Gandhi withdrew support from Chandrasekhar, forcing him to resign as Prime Minister. New general elections were held in 1991.
During the 1991 election campaign, Rajiv Gandhi was assassinated in Tamil Nadu on 21 May. Congress won 226 seats due to people’s sympathy. P.V. Narasimha Rao became the new Prime Minister. India’s economy was in crisis, heavily indebted, and needed major changes. Earlier, the government controlled India’s economy heavily through the “License Raj” system, where licenses were required for different businesses. To finish it, P.V. Narasimha Rao’s Finance Minister, Manmohan Singh liberalized the Indian economy, ushering in a new era.
By this time, Reliance had already become a huge company. In 1991, Dhirubhai Ambani made Mukesh Ambani Joint Managing Director. Mukesh was considered an expert in operations, focusing on completing big projects on time and within budget. Anil Ambani, who was more sociable, handled investor relations and financial markets. In 1994, Narasimha Rao’s government decided to allow private companies to extract oil and gas from the Arabian Sea, and Reliance was part of the winning group. Between 1992 and 1993, Reliance overtook Tata Iron and Steel to become India’s largest private company in terms of annual sales, operating profit, net profit, net worth and assets.
By the end of 1993, Dhirubhai’s old teammates of Aiden had retired, as Mukesh and Anil felt they lacked the energy to push the company’s expansion. He was replaced by new managers from across the country, which reduced Gujarati influence in the company. The Ambani family also divided their property. Dhirubhai’s brothers, Ramnikbhai and Natbhai, stepped down from the board of Reliance to focus on their personal business, understanding that Dhirubhai’s sons, Mukesh and Anil, were the real heirs.
As of June 2000, Reliance held 25% of India’s capital market. By 2001, Reliance controlled 51% of the polyester market, 80% of polyester intermediates such as PTA and MEG, and 50% of plastics. The market value of Reliance was equal to the total value of all other Indian private sector companies. On 24 June 2002, Dhirubhai Ambani suffered a second major stroke. He remained in a coma on life support for 12 days. Dhirubhai Ambani died on 6 July 2002, with Mukesh and Anil at the time. Anil recalled that his doctor had said that Dhirubhai would pass away on Saturday night itself so that no one faces any problem due to taking leave from work.
Dhirubhai Ambani’s rise from a humble background to one of India’s largest empires is a testament to his ambition, understanding of business and ability to move forward in the difficult world of Indian politics and corporate competition. His story paved the way for the next generation of Ambani leadership.
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