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DECEMBER 2001 Contents
Page 7 of 10
Telecom & Software - Trends & Future in South Asia
Ambaniís - Reliance
Father Dhirubhai - high school dropout from Corwad, Junagadh district.
Anil , a graduate of the Wharton School of Business.
Wealth Created about $ 7 - 20
story of the Ambani family is not simply a rags to richest story. With
every project the Ambanis have defied established wisdom and established
the largest operations of its kind . Starting from Reliance Textiles in
1980ís [ after a series of small build-ups of the various chemicals
involved in artificial fabrics - Reliance In 1991, started its most valuable project, at Hazira,
the largest single multi-feed ethylene cracker plant in the world. Hazira is a completely integrated
world class plant, manufacturing
polyethylene (PE), polypropylene (PP), polyvinyl chloride (PVC),
polyester terephthalate (PET) and other intermediates like vinyl
chloride monomer, mono-ethene glycol and pure phthalic acid (PTA). The
Hazira plant gives Reliance
50 % of the Indian market .
went through building up the Oil Refinery at Jamnagar with its own crude oil port. Reliance also is into Power
Generation and Insurance.
the Reliance Infocom project
that will comprise the largest Broadband Infrastructure project in India
is being rolled out at a speed that leaves the competition from the the
others [ Bharti Mittal, SNL ,
BSNL, GAIL, SAIL , Indian Railways] far behind.
a group they contribute about 5 % of
the Indian Governments Revenue. What is more surprising is that these
projects were often started, completed and went into production profitably
against the studies the Ambanis got done by foreign consultants.
Also the speed of execution of these Mega projects have been done are
noteworthy -- the oil
refinery was completed is 36 months with
a capital cost per ton about 30-50 % lower than other refineries in Asia.
The Ambanis' oil refinery accounts for about 25 % of the Indian refining
capacity. Ambanis' Reliance
a stroke and a heart attack laid the father to a more relaxed work schedule
, Anil and Mukesh have held the Ambanis' empire called Reliance
together . Anil handles Investments /Financial Markets [ both
Indian & International ] and Corporate Communications especially those
involving foreign Companies . Mukesh is the strong & silent type and
hands-on can do business race horse.
Projects are meticulously studied and alternative investment /capital
raising projects are kept
ready , should the need arise . As an example , when Chidambaram the
Finance Minister gave the approval for Reliance Industries to post a 100
year bond in USA , it took about 3 hours after that for the Ambanis to
confirm that the Bond had been placed .
A very human approach to people
management is also the hallmark at Reliance . From the
80,000 plus Construction workers at the Oil Refinery to executives
, only the best care is given. The best are identified and then brought
into the company.
Talking about the potential of
the Indian software engineers , Mukesh Ambani at a meeting of the Indian
Chamber of Commerce said that an Indian engineer can earn up to $20,000
annually ; if by 2020 India can produce about 50,000 engineers ,
then the potential income to India will be in Trillions of Dollars.
Bombay-based group is in the midst of building a 60,000 km (37,500 miles)
fibre-optic network using IP technology, linking 115 Indian cities and
towns in a drive to become a fully-integrated firm spanning telephone,
Internet and entertainment. The network is expected to cost 250 billion
rupees ($5.6 billion) to build. Reliance has entered the telecom industry
because of prospects for rapid growth in a market which has just over
three phones for every 100 people in a nation of one billion people.
Technology research firm Gartner expects India's fixed-line subscriber
base to jump to 83 million by 2005 from about 30 million now.
Infocom has set up the state of the art Data Center (IDC) in Navi Mumbai.
This is the first IDC set up by Reliance & soon to be followed at
Bangalore & Delhi beside other major cities. Reliance Data Center at
Mumbai is connected to Internet on E3 links and is shortly going to be
connected on STM-1 line to Tier 1 ISP at USA providing faster access to
& from Internet for its customers and the servers located at Data
Center. All Reliance Data Centers will be interconnected across country
providing Disaster Recovery (DR) and host of other value-added services
including VPN connectivity, IDC in Reliance with 24 X 7 support and
ensures that your site is up and running smoothly.
Indian companies are creating bandwidth but they are behind Reliance
Infocom's mega-project. Reliance Infocom has been laying optical fiber
cables at a speed of approximately 100 kilometers per day, an impressive
speed which other Indian broadband companies have not been able to
achieve. While most of Relianceís competition is laying 3 pairs of
cables, Reliance is laying 8 pairs of cables at 6 feet below ground level. It has
laid over 10,000 kilometers of ducts so far. By the end of 2002, RI would
have used 80,000 kilometers of HDPE pipes..
project is expected to support the growing demand for bandwidth by user
industry sectors. Increased availability and reliability of bandwidth is
expected to further increase business opportunities in computer services,
value-added telecom services, and entertainment services. RI's backbone
will also support the needs of India's ever-expanding Information
In Telecom, Reliance provides cellular and basic telephony services. It
has cellular licences for seven circles in 13 states. It also has the
basic telephony licence for Gujarat state where it started in March 2000.
It has covered 36 cities in the first phase of cellular operations and its
subscriber base is at 70,000 this year. It plans to expand its cellular
coverage to over 90 cities.
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