The country's business honcho Anil Ambani has been in the news not for good reasons. He faces jail sentence if his Reliance Communications (RCom) does not cough up around Rs 2 billion as the Supreme Court recently pulled him up for failing to pay ₹453 crore it owed as dues to the local subsidiary of Swedish telecom giant supplier Ericsson AB.
The Rafale aircraft deal, which has turned into a big controversy, has also Anil Ambani's name associated with it. And Congress president Rahul Gandhi, who has been hounding Prime Minister Narendra Modi over the deal, had this to say when a war-like situation caught the country: “While the Indian Air Force was defending the country, Modi stole Rs 30,000 crore from the force and put it in businessman Anil Ambani's pocket.”
Debt-ridden Anil is now believed to have lost 65 per cent or over $5 billion of his wealth in the last seven years. It is now estimated to be $1.9 billion from as high as $7 billion. Anil Ambani, besides trying to get financial support from his older brother Mukesh, is said to have sought immediate approval from its lenders to release about Rs 2.6 billion it received through refunds from the income tax department. His Reliance Capital informed the stock exchange its proposal to raise funds by inviting Nippon Life Insurance to take full control of the joint venture Reliance Nippon Life Asset Management.
Once among the top 10 richest people in the country, Anil’s downfall began with his bid to compete with his brother even at the cost of garnering as much debt as possible. It was a notorious battle with his older brother Mukesh over division of property after the death in 2002 of their father Dhirubhai Ambani who built the Reliance empire.
It took four years to finally split with the elder brother keeping the oil-refining and petrochemicals business. Anil got the prospective telecom business and financial services and power generation.
Firm on being if not at par with his brother but at least a shade higher, Anil went into large-scale borrowing which finally saw him run by into a mountain of debt.
His attempts to be close to political powers-that-be turned out to be misadventures. It was the cancellation of the non-compete clause between the brothers in 2010 that hastened Anil's downfall. Two things went wrong - Anil's self-assessment and the pack of idea of his brother's business acumen.
Under the non-compete agreement, Anil was the 'lord’ of telecom. But the scrapping of the agreement saw Mukesh's big entry into the telecom sector with Jio and the rest is a tale of Anil's fall from the top. The greater the height, equally greater is the impact of the fall.
The recent wealth report by Hurun Research said Anil’s wealth dipped by around 65 per cent when Mukesh's went up $30 billion - six times of what his younger brother lost. This catapulted him to be among the world's 10th richest person with a fortune of over $54 billion (Rs 3.83 lakh crore).
Anil now sees his wealth eroded, his RCom facing insolvency proceedings and his being thrown out of the elite club of the wealthiest Indians. His vaulting ambition to outdo his brother was his tragic flaw and now deep in debt, he will certainly regret that moment when he worked to scrap the non-compete agreement with his brother whose Jio has met with resounding success.