 "Tata's Air India win to Zee-Sony deal: 2021, year that was for businesses")
With a Rs 18,000-crore bid, the Tatas were back in the Air India cockpit this October, 68 years after the airline they founded in 1932 was nationalised. The deal marked the end of years of struggle to privatise the heavily indebted state carrier. This was also the first privatisation in India in almost two decades. The Jawaharlal Nehru government had in 1953 paid Rs 2.8 crore for the carrier — the country’s first commercial airline.
India’s Covid-battered aviation industry will have two more airlines next year, with stock market investor Rakesh Jhunjhunwala’s Akasa Air getting a no-objection certificate from the civil aviation ministry in October andJet Airways’ revival plan in place. The industry, where budget airline IndiGo has over half the market share, faced the threat of consolidation amid Covid. These fears have now been put to rest and aviation experts see fares going down next year.
The Competition Commission of India in December suspended its nod to Amazon’s 2019 deal with Future Group, dealing a blow to the US e-commerce giant’s efforts to block Future’s $3.4-billion asset sale agreement with Reliance. The Jeff Bezos-led firm is engaged in a bitter fight with Mukesh Ambani’s Reliance Industries to dominate the country’s $1-trillion retail market. Caught in the mix is Kishore Biyani, whose Future Retail sold 49% in an unlisted firm to Amazon, a deal the e-tailer said Future was breaching terms of by signing a different agreement with Reliance.
In August, the Directorate General of Civil Aviation allowed commercial operation of Boeing 737 MAX, two years after the aircraft was banned after 346 people died in two deadly crashes — in Indonesia in 2018 and in Ethiopia in 2019. SpiceJet, the only operator of the 737 MAX in the country, marked the aircraft’s return with a special flight from New Delhi to Gwalior on November 23.
A bitter years-long legal battle between Tata Sons and Cyrus Mistry ended in March when the Supreme Court ruled in favour of Tata Group. The court said the 2016 ouster of Mistry as chairman was legal, rejecting the “mismanagement” allegations of the former executive whose family is the single-largest shareholder in the nation’s biggest conglomerate with an 18% stake. The court also upheld Tata Group’s rules on minority shareholder rights, making it difficult for investors to sell shares. Mistry had taken over as chairman ofTata Sons in 2012 from group patriarch Ratan Tata.
The board of Zee agreed to a merger with Sony Group Corp’s local unit in December amid a boardroom dispute between the founders of India’s largest publicly traded TV network and its largest shareholder, Invesco. US-based Invesco had called for the removal of Punit Goenka as CEO, alleging corporate governance concerns. Similar shareholder activism was seen in Dish TV, Eicher Motors and Balaji Telefilms.
When Ford Motor announced in September that it was exiting India, it joined American automakers General Motors and Harley-Davidson in ceasing production in the country. Ford entered India in 1995 with much fanfare, hoping to grab a pie of the world’s fifth largest auto market. It accumulated losses of over $2 billion in 10 years and managed to secure only 2% of the market share.
Bharti Airtel increased the tariffs of its prepaid plans by up to 25 per cent in November. The two other private telcos — Vi and Reliance Jio — followed suit, marking the end of the low tariff regime in the sector. This came months after the government approved a telecom package, which included measures such as a four-year moratorium on spectrum-related payments.
The government in November barred SpaceX’s Starlink from accepting pre-orders for its upcoming satellite broadband services, dealing a blow to Elon Musk’s ambitions to dominate satellite broadband in the country. The news came a month after its rival, Sunil Mittal-backed OneWeb, signed an arrangement with the commercial arm of Isro to launch its satellite in India. It plans to start services in the country in the second half of 2022.
A semiconductor chip shortage that began afflicting the world last year showed no signs of easing in 2021. From delayed car deliveries and weak supply of home appliances to costlier phones, customers and businesses continued to face problems. Apple slashed production of iPhone 13 by 10 million units, down from a target of 90 million.
It was a golden year for start-ups, with 42 of them turning Unicorns (achieving $1-bn valuation) at record pace. For perspective, India is now home to 79 Unicorns, and the first one — inMobi — got the tag back in 2011. In June, Byju’s became India’s most valued start-up. Founded by Byju Raveendran, it is also the world’s most valued edtech start-up. The firm is said to be in talks to go public in the US next year at $48-bn valuation.
The government in August decided to scrap a controversial 2012 law that taxed companies retrospectively for the indirect transfer of Indian assets. With this, the government moved to settle international disputes running into billions of dollars, indicating to global investors that India can course-correct. Cairn Energy and Vodafone are among the companies that will get refunds.