In his new book, “Fortune is looking,” economic historian Roman Mahadena reflects the lifting of the hat – and why their large network of Southeast Asia has not held.
Most Indian business stories focus on the Marvar and Bania community. But for those looking for, economic historian Roman Mahadena draws his attention to Natukotta -Chatiya, a trade community with Tamil Nadu, whose financial reach, which continued in Southeast Asia. By 1929 their assets were rated in ₹200 crowns, an unusual figure for the community a little over people. From the financing of the Burma Rice to the production of rubber and tin in Malaya, chettars built one of the farthest metropolitan networks of their time. In this interview, Hindustan Times Mahadena reviews his height, risk appetite and a possible decline. Exceptions.
Bankers of the East
Four were reportedly known as “Bankers of the East”. How powerful they were in their prosperity?
They were really big and economically quite influential. Some estimates suggest that the overall assets of the Chettar Community, which were rated around ₹10 kings in the 1880s, until 1929, rose phenomenally to approximately ₹200 crowns. Being in mind that it was a small community – some polls suggested that in the 1930s they numbered about 1.25,000 – it was a very impressive achievement. Their migration in the Far East climbed in the 1870s, a catalized opening of the Suez Canal, which effectively reduced the distance between Asia and the global markets. This had a huge impact on the entire commercialization process and created business opportunities that, in a sense, caused the Capital movement to the regions. For example, in Burma, while the Europeans had large rice factories, the financing of agricultural production was almost completely in the hands of hat. That’s where they made their money. Similarly, the world automotive industry required rubber and tin – both of which came from the little one – and again, the chettars financed the production of these goods. In Ceylon, they funded non -European coffee, tea and coconut plantations. The crisis began with great depression and deepened into World War II. Bringing out, you can say that if these world shocks did not occur, the economic landscape in India could be completely different. If hetters were able to return to India all this capital, they could become the fact that Marvars were in Bombay and Kolkata.
How did they differ from Marvis and Bania? One of the main differences was that the hatrs went abroad in large numbers. Marvari also went, but much less. While many Marvars were bankers, they were also traders. My theory is that the transition from trade to production is easier – their access to market and commercial intelligence gave a certain advantage of trade classes and gave them to industrial enterprises. In Western India, Marvis and Gujarati bars were able to move to paper, sugar and textiles. But the house trace of four was relatively limited until the 1930s, as most of their capital remained closed abroad.
What is more important because the profitability of investment through banking in Southeast Asia was much higher than in the Indian industry, there was no serious inclination to invest in industry. The risk that he took part in Hettia was also much greater than other business communities. Of course, all business communities are definitely risks, but hatters moving from South India to Southeast Asia and studying new languages, working in distant foreign regions regulated by different legal systems, suggest that they show great risk.
Another clearly unique system they developed so that they can use their capital investments well was an internal credit network where one chettar financed the other. This speaks of a high degree of enterprise and trust. This clearly testifies to the system where the mutual faith and the high degree of trust were the main enterprises for their enterprises.
While many chat firms faded after independence, several stable business houses built. What separated them? The four started repatriating part of their capital back to India to invest in the 1940s, when the Second World War created very profitable conditions for business.
In addition to the textiles, the main area was the plantations. Some hatters also dared to Bombay. One such examples is Alagappa Chettiar, which has invested heavy funds into insurance companies but lost from overcoming. The MCT group, which founded the Indian Foreign Bank, also invested in Ellphinston -Mlynin. But large -scale domestic investments remained limited.
After independence, you see figures such as Ma Chidambar, after which the cricket stadium is called, which makes more serious steps. It bought India’s automobile products, Scooters Lambretta manufacturers, and invested in diesel. Later, he diverged into chemicals.
MurugAppa group is a great example of success in Chattia. I think two factors placed them. For the first time, the domestic peasant ties were exclusively strong, and the elders in the family guaranteed that the united spirit was supported for generations. Most business families begin to fragment the third or fourth generation – but in their case it seems clear that it was expected and decided early.
Secondly, they supported disciplined attention to the major competencies in the engineering sectors such as pipe investment and Carborundum Universal. Only after consolidation in these sectors did they, for example, diversified, with the acquisition of Parry & Co., which was engaged in another business.
Lesson for entrepreneurs
What can you find out today about small and medium -sized enterprises in India on the chettar model – especially how to institutionalize trust, capital and scale throughout the generation?
I believe that the most important lesson that today’s entrepreneurs – small and medium – can draw – is the concept of trust and mutual location, the functions, the main one for the model Chantory. This will allow entrepreneurs to optimize costs and reduce competition. Export-oriented Industry Tiruppur Knitwear-Despite Modetar model.
The chettinad kitchen is famous for its fiery meat, but the community began as a vegetarian. Did they change their migration to their cuisine? Food is not my area of knowledge, but you can be right. The four were – and are – pious shavits, and vegetarianism was a natural discouragement of this faith. In fact, the Tamil word for vegetarian food is “Saiva SAPA”.
Yes, yes, for many years of exposure to foreign crops, they probably played a significant role in the evolution of their cuisine – from exclusively vegetarian to more inclusive cuisine. Their use of spices is also completely different from what you will find in other parts of South India, and even here you can see other influences.
You wrote about the efforts to ignite the chatter’s entrepreneurial spirit. What do you think it will go far? Many hatchers in the diaspora have moved to finances and IT, not traditional business. This shift is worried about some older generations who feel that there is an shutdown from their industrial heritage. Thus, conferences and public events were organized to revive this entrepreneurial diligence. But frankly, I think the time is over. The head of the Czech domination in the traditional sectors is closed.
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