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India Soaring Above India’s Poverty, a 27-Story Home

Discussion in 'Breaking News' started by spnadmin, Nov 2, 2010.

  1. spnadmin

    spnadmin United States
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    MUMBAI — The newest and most exclusive residential tower for this city’s superrich is a cantilevered sheath of steel and glass soaring 27 floors into the sky. The parking garage fills six levels. Three helipads are on the roof. There are terraces upon terraces, airborne swimming pools and hanging gardens in a Blade Runner-meets-Babylon edifice overlooking India’s most dynamic city.

    There are nine elevators, a spa, a 50-seat theater and a grand ballroom. Hundreds of servants and staff are expected to work inside. And now, finally, after several years of planning and construction, the residents are about to move in.

    All five of them.

    The tower, known as Antilia, is the new home of India’s richest person, Mukesh Ambani, whose $27 billion fortune also ranks him among the richest people in the world. And even here in the country’s financial capital, where residents bear daily witness to the stark extremes of Indian wealth and poverty, Mr. Ambani’s building is so spectacularly over the top that the city’s already elastic boundaries of excess and disparity are being stretched to new dimensions.

    “One family is going to live in that?” said Prahlad Kakkar, an advertising filmmaker and prominent city resident. “Either it is a landmark, or a symbol, or it is Mammon.” He added: “There is shock and awe — both at the same time.”

    Mr. Ambani, his wife, Nita, and their three children are expected to move into the building after a housewarming party with 200 guests scheduled for Nov. 28. For his part, Mr. Ambani has refused to comment about the project and required his designers, decorators and other contractors to sign confidentiality agreements, as if a cone of silence could be erected around a skyscraper rising near the edge of the Arabian Sea.

    Predictably, and perhaps by design, the opposite has happened. Details have spilled out — many of them confirmed or disputed anonymously. Some reports have estimated the total residential space at 400,000 square feet, though people close to the project say the real number is a humbler 60,000 square feet. Press accounts also have estimated the value of the building at $1 billion, a figure disputed by people familiar with the project.

    Regardless, a gawking city has greeted the new tower with a mixture of moralizing and astonishment, envy and condemnation, all sprinkled with Freudian analysis of the most basic question: Why did he do it?

    “We are all sort of perplexed,” said Alyque Padamsee, a long-time advertising executive and actor in the city. “I think people see it as a bit show-offy.”

    A bit.

    For decades, the Ambani family has been India’s most famous corporate soap opera. The father, Dhirubhai Ambani, was a brazen, rags-to-riches tycoon who established Reliance Industries after rising out of the city’s Dickensian tenements, known as chawls. Today, Reliance is the world’s biggest producer of polyester fibers and yarns and accounts for almost 15 percent of India’s exports, according to the company’s annual report. The two sons, Mukesh and Anil, inherited and divided the empire and have spent years feuding, including a nasty recent fight over natural gas rights that brought a reprimand from the prime minister before India’s Supreme Court settled the case in Mukesh’s favor.

    Of the two brothers, Anil is the more flamboyant and outgoing, while Mukesh is regarded as more staid — less likely, at least, to build at 27-story house for himself. The new tower is located on Altamount Road, the same leafy residential street in south Mumbai where the father bought his first home after moving the family out of the tenements. Later, he purchased a 14-story apartment building named Sea Wind, where both Mukesh and Anil have lived with their families on different floors, even during their feud. (Their mother refereed from her own residence in the building.)

    Now Mukesh is moving into a tower that makes Sea Wind seem like a guest house.

    “It’s kind of returning with a vengeance to where they made it into the middle class and trumping everybody,” said Hamish McDonald, who chronicled the family’s history in his new book, “Mahabharata in Polyester: The Making of the World’s Richest Brothers and Their Feud.”

    “He’s sort of saying, ‘I’m rich and I don’t care what you think,’ ” Mr. McDonald said.

    Mumbai, once known as Bombay, is India’s most cosmopolitan city, with a metropolitan area of roughly 20 million people. Migrants have poured into the city during the past decade, drawn by Mumbai’s reputation as India’s “city of dreams,” where anyone can become rich. But it is also a city infamous for its poor: a recent study found that roughly 62 percent of the population lived in slums, including one of Asia’s biggest, Dharavi, which houses more than one million people.

    Real estate prices are among the highest in the world, pushing many working-class residents into slums, even as developers have brazenly cleared land for a new generation of high-rise apartment towers for the affluent. High-rises are considered necessary, given the city’s limited land, yet the rising towers have further insulated the rich from the teeming metropolis below. With his helipads, which still await operating approval, Mr. Ambani could conceivably live in Mumbai without ever touching the ground.

    “This is a gated community in the sky,” said Gyan Prakash, author of the new book “Mumbai Fables.” “It is in a way reflective of how the rich are turning their faces away from the city.”

    Along Altamount Road, which is also home to other industrialists, the reaction to the new neighbor is mixed. Some senior citizens along the street worry about the noise from the comings and goings of helicopters. But Utsav Unadkat and Harsh Daga, college students who grew up in the neighborhood, stared up at the tower on a recent afternoon as if it were a dream realized.

    “I heard he has a BMW service station inside,” said Mr. Unadkat, dragging on a cigarette (unconfirmed). “There’s also a room where you can create artificial weather,” Mr. Daga added (apparently true).

    Standing nearby, Laxmi Kant Pujari, 26, a decorator’s assistant, waited to carry glass samples into the building. If his samples are selected, Mr. Pujari, a migrant, would handle the installation — a task he considered an honor. “Whether it is a beggar or an Ambani, the desire to be rich is in everyone’s heart,” he said.

    Farther down the street, Sushala Pawar admitted struggling to comprehend the difference in Mr. Ambani’s life and her own. She cooks for a family in a nearby apartment, earning 4,000 rupees a month, or about $90. She sleeps on the floor of the hallway after the family has gone to bed.

    “I’m a human being,” she said. “And Mukesh Ambani is a human being. Sometimes I feel bad that I live on 4,000 rupees and Mukesh Ambani lives there.”

    But then, nodding toward the building, she perked up.

    “Maybe,” she said, “I could get a job there.”

    http://www.nytimes.com/2010/10/29/world/asia/29mumbai.html?pagewanted=2&_r=2
     

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  3. Sinister

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    i wonder what he has on the 13th floor?

    probably his giant scary ego is housed there before he goes off to bed
     
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  4. kds1980

    kds1980 India
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    Re: Soaring Above India’s Poverty, a 27-Story Home

    Dhirubhai ambani started culture of investing in shares in retail segment.The backbone of reliance industries were retail investors Now
    His sons are doing very good job eliminating this culture.Both Mukesh and Anil are cheater number no.1
     
  5. Sinister

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    ? im not sure i understand...if anything it was Dhirubhai who was the cheater.

    In the days of the permit raaj and a highly controlled economy, the 80's, trading and issuing sensex debentures was a very non-competitive sport. Financing was very hard to come by, retail was the only place that could finance debt, and a textile company from india would naturally be financed and in turn finance retail (as textile retail was the cash cow in India back then). Now the indian stock and bond market is far more developed, more liquid and not to mention, more competitive globally with massive investment from etf's and private funds (both foreign and domestic).

    Naturally as corporate capital grows as it did with Reliance corp., it looks for other instruments and diversified investors to finance its growth. With the higher market focus in petrochemicals it is natural to attract partnerships and investors of a different breed.

    what is troubling still is the amount of control this conglomerate has over the indian government and the bombay sensex trade commisions.
     
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  6. kds1980

    kds1980 India
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    Re: Soaring Above India’s Poverty, a 27-Story Home

    Well Dhirubhai may had used unethical means for business, But one can say that in India it nearly impossible to do business with ethics,But on the other hand he never betrayed his retail investors.After his Death ,and dispute his sons took over the business and since then Reliance stocks are now famous
    for jugglery.No investor know that when he/she can hear news that this company of Reliance is merged with this one with so and so ratio. the name of Reliance in telecom is also very bad ,as a result brand value of Reliance is loosing its value especially companies holded by his younger son Anil.

    Indians traditionally have been a habitual investor in gold ,but now it is time they should also invest in share market.One of the major worry of GOI is that Demat accounts in India are still not in good numbers.They want more and more retail Indian investors to participate in Share markets,but with people like Mukesh and Anil ,it is becoming more and more difficult
     
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  7. Sinister

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    Two things continue to shine in india, gold and real estate. Indians overall are very defensive investors, which may be the reason they faired better in the global economic debt crisis.

    but that habit of building defensive equity has to be broken eventually if industrial growth is a goal. The only way it can be broken is if investor confidence is boosted. The impression and realization that India is indeed a competitive free market that can regulate its companies, prevent fraud and promote transparency/shareholder rights by prosecuting fraud would help.

    The lack of investor confidence in public securities troubles developing markets more than developed markets, ive noticed. Even if the track records in the developed markets are just as bad.

    that satyam guy is already out on bail
     
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  8. kds1980

    kds1980 India
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    Real estate in India is one of source of Black money.The biggest jugglery happen in Real estate market.There is no economic justification of the price raise of 1000 to 20,000 times land in various indian parts from 60s and 70s to present.The area's where people used to struggle for living, are area's where same people are multi millionare .The bordering aree's of Haryana is prime example of this.

    Also Real estate is one of the prime reason that Indian families want that a son should be born in the house to protect their property from outsiders as well from their own relatives
    O/W many families could loose their properties
     
  9. Sinister

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    well the black money used in real-estate purchases is a way of getting out of paying taxes.

    real-estate has grown and will continue to grow with urban development...and irrigated agricultural land will continue to grow pricier with increased food demands...market decides the prices. The same can be said with gold...gold is a useless metal that has no industrial or productive value yet its price has gone up by a factor of 400% in just the past 2 years.

    they are both currency hedges...high inflation requires the next best thing

    a person would have to be a lunatic to invest all his apples in the indian rupee at this point in history.
     
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  10. kds1980

    kds1980 India
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    Re: Soaring Above India’s Poverty, a 27-Story Home

    Here is the gold price chart

    http://www.kitco.com/charts/historicalgold.html

    I don't think gold has gone over 400% in last 2 years.Anyway Gold internationally accepted currency since ages and its price is also determined in international market.

    On the other hand the main reason for rise in price of real estate in India is that it is the only investment that is accomadating Black money.If you have black money then the safest place to keep it in real estate.Here price actual paper and market value differ lot sometimes you have to give even less than 5% in cheque and rest 95 % in cash.Any economist will tell you that it is not a good thing for economy.


    Also land price in North India is much higher what is it in South or East,as result fewer companies are investing in North and much more are investing in South.
     
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  11. spnadmin

    spnadmin United States
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    The charts look like fill in forms. Not sure if that is what was supposed to display

    At this link you can see the actual fluctuations in various currencies. They begin in January of 1971 and continue to the present year.

    http://goldprice.org/30-year-gold-price-history.html

    In my own experience, this is the highest gold has sold from the time of the Gulf Oil Crisis in the Carter administration.

    Posting two charts for the US$$ and the India rupee. Other currencies are available at the link.
     

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  12. spnadmin

    spnadmin United States
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    Now I have a question. The USD chart and the Indian rupee chart begin to look very similar starting around January 2008. Otherwise they are very different.

    Does the convergence occur because of changes in the monetization of the rupee? Or the result of changes in monetary policy in India? Or are they the result of structural changes in financial markets in India? Or some other reason?
     
  13. Sinister

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    Gold has increased by more than 400% in the past 12 years not 2...apologies for the mistake.

    it is a whole range of things coming together to make the most recent uptick.

    Most of it has to do with the increased consumption of gold itself. (scrap gold, ie jewelry, makes up the majority of consumption, not gold investment coins, biscuits and bricks held by central banks, governments and or investment banks)

    major consumers of jewelry are India and China. western retail apetites for scrap gold were always modest. and it is well known that growth of a middle class in india and china are increasing demand for gold as well.

    this means that no matter what currency you held (even if that countries major export was gold), gold would have out-performed it, not due to monetization of a currency, but primarily because of increased consumption of the resource itself.

    secondly, we have to look at the increased price of production, due to higher energy costs (of, exploration, ore extraction and then processing)...also factor in resource depletion...and you have higher gold value.

    After these few variables are factored in (which are the major variables) we can get a picture of how much monetization of currencies themselves has affected the price of gold (we do this by looking at a range of currencies). Some currencies performed better than others.

    for example over a 10 year period

    gold price with the US dollar has gone up 425% in the past 10 years

    gold price with the Canadian Dollar (which is a country that is a net producer) it has gone up only 243% in 10 years.

    gold price relative to the Ruppee has gone up 395% in 10 years

    gold price relative to the chinese yuan has gone up only 192% (despite the chinese artificially lowering their currency)

    http://www.goldprice.org/spot-gold.html
     
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