Senior Agrawal was succeeded by his son who inherited his father's cunning and raw intelligence. While the father had used the American Civil War to further his business interests, Junior used the Second World War to do precisely the same. The British colony of India would provide over two-and-a-half million men and spend an astounding eighty per cent of its national income on the British war effort, and the man who would provide most of these supplies at hefty margins would be Agrawal junior. But Agrawalji was by no means on the British side. He was a shrewd man who had foreseen the future. He knew that it was only a matter of time before the British would have to quit India, and in anticipation of that event he made sure he doled out large donations to the freedom struggle too.
When Gangasagar was a little boy, Mahatma Gandhi had visited Kanpur and stayed with Agrawalji. Gandhiji had come from Allahabad to attend the fortieth annual session of the Indian National Congress. A crowd of twenty-five thousand people had gathered at Kanpur Railway Station to receive him. Agrawalji had escorted Gandhiji home. Mishraji had volunteered that little Gangasagar remain by Gandhiji's side to take care of him during his visit. Agrawalji had readily agreed.
Gandhiji then delivered a speech at the famous Parade Ground of the city and appealed to the throngs of people gathered to support the non-cooperation movement and make it a huge success. During a private moment after the event, Agrawalji asked the great leader, ‘Bapu, what gives you the conviction that you'll be able to fight the British?’
Mahatma Gandhi smiled. He said, ‘We shall win because we're in the third stage of our four-stage struggle.’
‘The four-stage struggle?’ wondered aloud Agrawalji.
‘First, they ignore you, second, they laugh at you, third, they fight you, and fourth—you win. That's the fourth stage, my friend, Agrawal,’ said the Mahatma simply. The little boy pressing Gandhiji's feet listened to the wise leader very carefully. He hesitantly asked, ‘Bapu, the British have guns and policemen. I'm but a little boy. How can I fight them? They are so much stronger!’
Mahatma Gandhi fondly placed his hand on little Ganga's head and said, ‘Strength does not come from physical capacity. It comes from an indomitable will. I can see that you have it, son.’
From that day on, Gangasagar knew that one day he would also possess the power to make or break empires.
Gangasagar sat before Agrawalji uneasily. He was dressed in Western clothes but they sat uncomfortably on him. His sideburns were long and wide at the bottom, Elvisstyle. His prominent nose provided ample parking space for a pair of very thick-framed spectacles. His hair was oiled back with a very visible parting towards his left. He wore a dull full-sleeved shirt that hung out of bellbottomed trousers that had seen better days. He was clean-shaven and had fair skin but was rather short, just a little over five feet in height and was wearing shoes that were at least two sizes too big for him. ‘I didn't know who else to turn to,’ said the young Gangasagar hesitantly. ‘Sir, I was hoping that you could give me a job. I'll do whatever you ask of me, I promise I'll work hard. Please help me,’ he pleaded.
Agrawalji took a puff of his saffron-and-cardamom-flavoured tobacco hookah and smiled at the youth. ‘I don't have sons of my own, Gangasagar. I'll hire you but I'll drive you like a slave. Your salary shall be twenty-five rupees per month. Agreed?’
‘You shall not regret this, sir. I am indeed blessed with good luck.’
‘Yes, I do believe in good luck, son. And I find that the harder I work, the more I have of it,’ Agrawalji joked.
The very first lessons were in bookkeeping and accountancy. Agrawalji's books were maintained by his trusted Marwari munim—his treasurer—who was given the task of explaining the intricacies of double-entry bookkeeping to the young man.
‘Gangasagar, what's two plus two?’ asked the munim on the first day.
‘Four,’ answered Gangasagar.
‘Wrong answer. I'll give you another try later.’
Several days later they had progressed to maintenance of primary books, ledger posting, and trial balance preparation. The munim once again asked him, ‘Gangasagar, what's two plus two?’
‘Four,’ answered Gangasagar.
‘Incorrect. You'll have another chance to answer it correctly.’
A few weeks later they had covered income recognition, expense estimation, and finalisation of the profit-and-loss statement.
‘Your final chance. What's two plus two?’ asked the munim.
The frustrated lad snapped, ‘It's whatever you want it to be!’
‘Correct answer,’ laughed the munim. ‘You've finally understood the beauty of accounting!’
Profit was in the Agrawal blood. Anything that could possibly be bought and sold for a profit was of interest to Agrawalji. Gangasagar soon realised that he was in the hands of a master teacher. One day, he sat in on a conference between Agrawalji and his munim.
‘Munimji, why aren't we trading in jute?’
‘The margins are terribly low, sir. Not worth the effort.’
‘But why not export it?’
‘Export prices are even lower than our domestic purchase prices. We'll end up buying the stuff and exporting it at lower prices. It's a loss-making proposition, sir.’
‘But what if we exported jute waste instead, and labelled it as jute? It is jute after all.’
‘But sir, who'll buy rubbish from us?’
‘I will.’
‘What exactly do you suggest, sir?’
‘What if we get Agrawal Hong Kong to buy your rubbish? You could buy jute waste here in India—which costs virtually nothing—and sell it to our own foreign subsidiary as jute.’
‘But the profit will be fictitious. Our Indian arm would show a profit while the foreign arm would show a loss. It would still be a zero-sum game.’
‘Not really, munimji. The government is offering import licences of equal value as incentives if we export the stuff. We may not necessarily make money on the transaction but we'll rake it in with the premium on the import licences!’
Gangasagar vowed to himself that he would work overtime to acquire the raw cunning of his mentor.
One morning, Agarwalji was taking a walk. His usual route went by his office. It was a cold wintry dawn and most of Kanpur was still asleep. The security guard outside saluted smartly as his boss strode towards him.
‘Ram Ram, saheb,’ he said.
‘Ram Ram, Gauriprasad,’ said Agrawalji. ‘Why are the lights on in the office? Who could possibly be inside at this hour?’
‘Gangasagarji switched them on,’ said the guard.
‘Gangasagar comes to the office so early in the morning?’ asked the incredulous Agrawalji.
‘No, saheb. On most days he doesn't come in early,’ answered Gauriprasad.
‘Good! He has a mother and two sisters at home. He ought to spend some time with them, too,’ said Agrawalji.
‘No, no, saheb. He doesn't come in early on most days because he doesn't leave the office on most nights.’
Gangasagar was with his boss in his office, discussing an idea. Agrawalji always had profitable ideas, the latest one revolving around gold. The Second World War had concluded and Agrawalji had reason for optimism.
‘The American dollar has always been linked to the value of gold. Till recently, a troy ounce of gold was worth twenty dollars, but the recent world war has changed all that. The dollar has now been devalued and the price of one troy ounce is now thirty-five dollars,’ said Agrawalji.
‘So?’ asked Gangasagar.
‘What it means, Gangasagar, is that a dollar is worth one-thirty-fifth of an ounce of gold.’
‘How's that an opportunity?’
‘Even though the American government has pegged the value of the dollar to gold, the intrinsic value of the dollar will continue to fall as they print more money to finance the war deficit.’
‘And?’
‘And as the intrinsic value of the dollar falls, the intrinsic value of gold must increase.�
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‘So there's an opportunity in this?’
‘Not just an opportunity—an arbitrage opportunity!’
‘I don't understand.’
‘Simple. If I own a dollar, I should be able to exchange it for one-thirty-fifth of an ounce of gold, right?’
‘Right.’
‘But the value of that fraction of an ounce of gold is intrinsically much more than the value of the dollar, right?’
‘Right.’
‘So, if we keep buying dollars and selling them in exchange for the official gold value, what happens?’
‘We're in profit?’
‘Right. So what are you waiting for?’
Agrawalji earned his company millions by arbitraging the dollar against gold. Gangasagar watched, listened and absorbed.
On another occasion it was cotton-trading. India had gained its independence from the British a few years earlier and a new government was running things.
‘The new industries minister plans to nationalise textile mills,’ said Agrawalji casually one day.
‘We're not affected. We're traders, not textile manufacturers,’ replied Gangasagar cautiously.
‘You're wrong, it does affect us. The industry will go into a slump.’
‘So?’
‘The price of cotton will fall.’
‘And how does this concern us?’
‘Short-sell cotton.’
‘Huh?’
‘Sell cotton today and buy it later at a lower price.’
‘But if nationalisation happens immediately, there won't be enough time to handle both sides of the transaction efficiently, sir.’
‘We must make sure the minister enacts his drama of nationalisation a little later.’
‘How?’
‘We show him how he can partner us in this profitable scheme.’
Gangasagar began to understand the incestuous relationship between business and politics.
It was late in the evening. Gangasagar was on his way out of the office when Agrawalji called him in to his cabin. ‘The planning commission has announced that over the next five years the country shall invest heavily in dams, roads and bridges,’ he announced.
‘But we're not in the construction business,’ Gangasagar gently reminded his mentor.
‘Then let's get in.’
‘But it's a very specialised industry. We're traders, sir. We don't know the first thing about construction.’
‘Just incorporate the company. Allot ten per cent of the shares to Lakshmi & Co. Register the company's name with suppliers of steel and cement.’
‘Why?’
‘You can start placing orders for construction materials.’
‘But we do not have any projects! Why would we buy materials without projects in hand?’
‘Because we plan to sell the construction outfit a year later.’
‘But who will buy a construction firm with no projects?’
‘Any of the other construction firms, because ours will be one of the very few that has huge stockpiles of cement and steel, both of which will be in very short-supply!’
‘And what if the finance minister accuses us of hoarding?’
‘How can he do that? His son-in-law owns Lakshmi & Co.’
‘I need you to go to Patna,’ said Agrawalji to Gangasagar.
‘I'm at your command, sir,’ said Gangasagar.
‘Don't you want to know why?’ asked his mentor.
‘If it's important, you'll tell me,’ replied the young man.
‘As you know, Patna is the state capital of Bihar. Bihar is rich in mineral deposits, particularly iron ore.’
‘And?’
‘The government is handing out mining concessions. We need to own a piece of the action.’
‘And what is it that you want me to do, sir?’
‘The government doesn't seem to know where the deposits are. I need to know what lies beneath before I bid, not after.’
‘You want me to take a shovel and dig for iron ore?’
‘No. I need you to go meet a friend of mine who used to be employed as a fighter pilot with the RAF. He lives in Patna.’
‘We plan to drop bombs to open up the earth?’
‘Enough with the sarcasm, Ganga. You'll see why you need him. It's a wonderfully simple and elegant solution.’
Squadron Leader Mohanlal was a typical scotch-and-soda gentleman. Whisky was his elixir of life, his thick white bushy moustache providing the perfect filter for whatever he drank. He had learned to fly at the Delhi Flying School and had been employed as a pilot for the Indian Post when he was requisitioned by the British Royal Air Force as part of a twenty-four-member Indian squad that would fly Hurricanes into Germany.
On his last sortie he had suddenly found his entire dashboard missing. He hadn't noticed because of the ruckus made by the engine. Black smoke and oil had started emanating from his Hurricane's engine at eighteen thousand feet over the English Channel. At seven thousand feet he was advised by ground control to bale out over the channel. A boat would pick him up.
‘Don't send the boat,’ he had replied over the crackling radio. ‘Why?’ asked the operator. ‘Because I can't fucking swim, that's why!’ he shouted. Mohanlal had soon glided towards the white cliffs of Dover but as soon as he opened up his airplane's landing gear, the Hurricane burst into flames. He managed to crash-land and had to be dragged from the burning wreckage. He hated the hospital food but loved his nurse and the scotch. He soon realised that scotch never changed its mind the way the nurse did.
After the war ended, Mohanlal returned to India with a rather generous pension from the RAF that enabled him to start up a limited-route air charter service using an old Hawker Hart. It was to lead to the wonderfully simple and elegant solution that Agrawalji spoke of.
‘See? That's Patna city below you,’ bellowed Mohanlal as the sputtering Hawker Hart lurched once more. Gangasagar was ready to throw up his breakfast, and cursed both Agrawalji and Mad Mohanlal for placing him there at five on a bitterly cold morning. The plane seated the two men one behind the other.
‘Can you see those ruins, south of the railway lines? That's Kumhrar—the ruins of the ancient city of Pataliputra from which Patna derives its name,’ yelled Mohanlal, oblivious to the discomfort of his first-time air traveller. Both men were wearing B-8 goggles with RAF helmets, A-2 bomber jackets and 1941 RAF Mae West parachute backpacks. Gangasagar peered nervously over the side of the aircraft to see what Mohanlal was pointing out.
‘Pataliputra was the capital of Chandragupta Maurya's massive empire two thousand three hundred years ago. Difficult to imagine, given the pathetic state of Patna, eh?’ he barked as he turned the noisy machine northwards to follow the river.
‘The city is located along the south bank of the Ganges but the entire region is rich in iron ore. The trick lies in figuring out what the government hasn't yet done—identify exact locations!’
Gangasagar muttered some obscenities under his breath, thankful that the din of the engine would prevent the pilot from picking up on his utterances.
‘Around the world, there's been a phenomenal increase in the use of geophysical techniques in mineral exploration. What I've got here with me up front is a piece of technology called a magnetometer. There are only a few of them in the world. Your boss managed to get one through his American contacts. It's bloody incredible!’ exclaimed Mohanlal.
‘So how does this thing work?’ shouted Gangasagar, ignoring the sensation of his breakfast sloshing around inside his belly.
‘What this thing does is measure the relative magnetic attraction of different parts of the earth's surface. Iron oxide gives the strongest magnetic pull of any mineral. So when we fly over mineral deposits we should see a definite variation in the magnetic pull,’ explained Mohanlal, his voice partly drowned by the roar of the propellers and the ominous wobbling of the engine.
‘We're going down!’ screamed Mohanlal as the Hawker Hart lost altitude rapidly. Ganga
sagar cursed Mohanlal, then Agrawalji and then his own luck—in that order. For a moment he had thought that the crazy pilot was playing a vicious joke on him but within a few seconds he realised that it was no joke. The airborne junk heap was collapsing fast.
‘We must bale out!’ cried Mohanlal. Below them lay the ruins of Pataliputra, seemingly devoid of gawking tourists at this early hour of the morning. ‘Just my luck,’ thought Gangasagar, ‘I'm going to die surrounded by two-thousand-three-hundred-year-old bones. Even if they discover my body later they'll think I'm just another relic of an ancient civilisation! Why did my greedy boss send me up in the air to fucking search for iron ore that is hundreds of feet underground? Instead of digging for iron ore they'll be digging for my body, entombed in this rusting iron bird. Look, Agrawalji, here's the iron you wanted!’
Gangasagar felt dizzy as the plane shuddered and went into a tailspin. ‘Jump! Now!’ shrieked Mohanlal as he ejected himself and pulled the ripcord of his parachute. Gangasagar blindly followed. He was now beyond caring. He knew that he was about to die and didn't care if the damn parachute opened or not. Considering the state of Mohanlal's plane, it was very possible that there would be no parachute in the backpack at all!
Chanakya's Chant Page 3
