‘The economy has to be opened up or people will face trouble’, says Kushal Pal Singh
Kushal Pal Singh said without land, you can’t develop a township. I had no money. The company was bankrupt. Banks were not ready to finance, rather they were not allowed to finance.Updated: Jun 05, 2020 03:54 IST
Kushal Pal Singh, 88, on Thursday stepped down as chairman of real estate developer DLF Limited, and assumed the position of chairman emeritus. In a conversation with Rajeev Jayaswal, he reflects on the evolution of DLF and creation of the millennium city of Gurugram on in which the company played a pioneering role, and talks about how to revive the economy hit by the coronavirus disease (Covid-19). Edited excerpts:
You entered DLF at a time when the company was virtually closed and it was about to be sold for ₹25 lakh. But you stepped in and Gurugram was born. How do you reflect on the past?
The government nationalised the urban land business in 1957-58. DLF [at that time it was run by Chaudhary Raghvender Singh, father-in-law of KP Singh] went out of business. I was into manufacturing. I came into DLF when the company was completely closed, [the land] business was nationalised, there was no money, banks were forbidden to lend money and the sector was dominated by unauthorised players. So, how did I get involved?
I was not involved in DLF till 1973-74. I was running a company called Willard India, making batteries, and American Universal, making electrical motors. But it so happened that the company (DLF) closed its business in 1960 as Chaudhary Sahab was against any unauthorised development. There was an occasion to sell the shares of the company to another member of the family because DLF was a brand.
My wife and her sister were the shareholders of the company. There was no third shareholder. In the normal case, they would have signed anything their father would have sent. But something happened that day. These girls were known as DLF girls as it was a big brand. It came to their mind, ‘Oh god we are losing everything.’ That evening was the turning point. My sister-in-law said, ‘Bhai Sahab, hamari tabiyat nahi hai bechne ke liye. Sirf 25 lakh [rupees] ke liye. (We don’t feel like selling, just for ₹25 lakh). My wife said the same. Maine kaha ‘aapki tabiyat kya hai?’ [what do you feel like?] They said we must revive the company. I said I don’t know this business. They said ‘If you apply your mind you can do it.’
Something happened to me. I took one or two days thinking ‘should I put myself into this area which is completely nationalised?’ There’s no bank that can give money. But DLF brand was big in the 50s. So I took the challenge. Because I couldn’t do two things, I sold Willard. And I set about myself, firstly, to get the laws changed, because they were wrong laws. That’s how Gurugram was born.
How was Gurugram developed?
Without land, you can’t develop a township. I had no money. The company was bankrupt. Banks were not ready to finance, rather they were not allowed to finance.
How do I do it? When your back is against the wall, something comes up. God was kind, it guided me, let’s follow the route my late father-in-law had followed in the 50s. He had developed a good name and reputation with farmers. So I thought let me encash this reputation with farmers.
In Gurugram, there was not any land ceiling at that time although it was completely barren land. So it is where an entrepreneur’s vision comes and an entrepreneur’s ability to take risk comes in.
So, I went there and I said, okay, I will work very hard. I spent almost eight-nine years with villagers. I ate with them, sat with them in their huts, met them every day, drank more milk in my life than I ever did. I did everything honestly. I did it passionately. Not just for the sake of doing it. By the way, I still go there and meet them. I became one of them. When you become one of them, then they not only sold the land to you, but also become the lenders. Thus the entire financing of DLF took place by the same farmers. Buying land, some 5,000 acres, on credit is something unheard of anywhere in the world.
USAID (United States Agency for International Development) and Harvard teams came to India in the early 90s to do a study.
And they were stunned. They said ‘my God, how the same farmers you bought land from gave money and not a single litigation.’ That’s the history. I did all myself. No managers. I had only two low-key revenue officials who were like patwaris [book-keepers].
You have seen many ups and downs in life. Have you ever seen this Covid-like situation?
No. Frankly, I have not seen. I can tell you, and I hope I’m wrong, but to me it appears it’s going to be like the Spanish flu ... the numbers may come down, then they will go back again. It will carry on till such time you get a vaccine. And the good thing that our Prime Minister has done, is that he has inculcated a sense of discipline, voluntarily in all the people.
You cannot dictate to people to do something, but he carried the whole country with him. Once you get a vaccine, like for small pox, the diseases will go away. Till that time we got to learn to live with it, by taking precautions and safeguards
The economy has been battered by Covid-19. What is the solution?
The Prime Minister is doing the right thing. He is now slowly bringing economic activities [back to normal] and encouraging every state to open up the economy... in the bargain, undoubtedly certain peaks will go up. But the economy has to be opened up, otherwise people will start facing trouble. When people don’t have money, that will... cause much more damage than Covid.
So, what will you suggest to the Prime Minister?
I was very happy to hear his speech [made at an industry association on Tuesday] .
He said growth will take place in India. And he will bring around major structural reforms. I appeal to the Prime Minister to understand that the biggest element missing in India today is realisation of one factor — that the most important sector of the economy, after agriculture, is urbanisation of India. Urbanisation means real estate, construction, housing, roads. They form part of the infrastructure of urbanisation, which has been completely neglected.
Frankly, and particularly dealing with townships and housing, migrants live in apathetic conditions. Why are people living in slums? It means that something we have failed to anticipate. India is a democracy. People are bound to move from rural to urban areas. I think our planning processes failed in recognising that you need to provide large- scale facilities for these millions of workers. That calls for revamping the entire urban infrastructure plan. Trust me, economic activity will take only when an entrepreneur finds it profitable. Government cannot push economic activity in areas which are not profitable.
Today, you see in the eyes of the migrant, one thing very clear, they are dissatisfied with the way they were living here. Now they’ve gone back to their villages. Okay, but now soon they will get dissatisfied there because they will have no jobs. When they come back here, there’ll be no job for them here also. So imagine the potential law and order problems which will follow.
So the only answer for it... (the) government must restructure the entire urbanisation now for the future generation. And results will come minimum after one or two decades. It won’t come in a few years. But at least our children, grandchildren, for them there will be a good future; otherwise this problem is going to massive in India. Migration from rural to urban areas will happen, nobody can stop it.
You are still very active. What are your future plans?
Firstly, I’m not leaving DLF. I’ve become the chairman emeritus, which means I’m still involved, not actively, but I’m there. I also believe strongly that everybody should have hobbies. I’ve strong hobbies I’m addicted to playing golf. I love music and I travel a lot. I have my daughter Piya and son Rajiv to help and drive philanthropic activities. I believe that at 90 one should not be the executive chairman of a listed company.