'Being able to translate excellent Japanese systems into Indian systems was key to Maruti's success'

The chairman of Maruti Suzuki, RC Bhargava, on how his company learnt the ropes to make its value-for-money product propositions for India, and why Indians will continue to buy small cars, in an interview with Hormazd Sorabjee.

- Hormazd Sorabjee

How do you think India's journey has been from being a protectionist state to a liberal one independence?

India was never totally protectionist before independence. In fact, we were an absolutely laissez-fair economy that did pretty well on the industrial front, including the car industry. Both Hindustan Motors and Premiere Automobiles were established in the 1940s, as well as GM and Ford that came even earlier. So, the auto industry was pretty much there.

Things, however, changed after 1950, with the onset of the new industrial development policy, and the way India went with industrialisation because these meant that the car industry being in the private sector, was totally controlled and managed according to the priorities of the planners. There was really no growth, and what could have been a very flourishing industry in the country, came to a grinding halt. This continued till 1981 when the decision was taken to establish Maruti.

Do you think the Maruti story wouldn't have happened if it wasn't for Indira Gandhi?

Actually, my viewpoint is slightly different. Maruti happened because Indira Gandhi's son - Sanjay Gandhi died unfortunately in an air crash. Sanjay was absolutely committed to making a small car for India, and had acquired a license from the government, while also having established a plant. It's a different matter that he could not make much progress. But the fact was that the small car was very close to his heart.

After the sad demise of Sanjay, Mrs. Gandhi decided, I think largely for sentimental reasons, that his memory could be best kept alive if a small car was manufactured in India, and that too at the same place where he had set up his factory. That is why the assets were nationalised, and a government company - Maruti Udyog Limited - was established. That's how the project was started.