The Real Wealth Creators of India: A Look Beyond Corporations
The recent spat between comedian Kunal Kamra and Bhavish Aggarwal, CEO of Ola Electric, has stirred up a heated debate, dividing public opinion. Disgruntled customers took to social media to share their complaints and videos of burning Ola scooters, while others stood by Aggarwal, defending him as a ‘wealth creator’ and ‘job creator.’ Smita Prakash of ANI wrote, “Going after wealth creators in India is a movement in which Jaichands of the country are hard at work. Amplify the game of termites or back the job of creators. You make a personal choice via your social media handles. Be a responsible citizen.”
Despite the online uproar, Ola shares took a hit, plunging by 8.31% the next morning. This incident raises a crucial question: who are the real wealth creators and job providers in India, and how should they be held accountable?
Ola Electric, a company with a turnover of about Rs 5,000 crore, currently runs at a loss of Rs 1,000 crore. Last year, it employed 3,733 people, but announced plans to lay off 400 to 500 employees this year. Despite its significant presence, Ola faced over 10,000 consumer complaints last year alone, leading to a notice from the consumer rights regulator.
When the Hindenburg report accused the Adani Group of stock manipulation, similar nationalist pride emerged, with many dismissing the claims as attacks on the country. The Adani Group’s 413-page response framed the accusations as an attack on India’s economy. This reaction reflects a broader trend where pointing out flaws in corporate India is seen as unpatriotic, overshadowing the need for accountability.
Contrary to popular belief, the largest employers in India are not private corporations but public sector entities. The Ministry of Defence employs about 29 lakh people, making it the world’s largest employer by some estimates. Indian Railways employs around 12 lakh people. In contrast, Tata Consultancy Services and Reliance Industries, among the largest private employers, employ six lakh and nearly four lakh people respectively. The Adani Group, despite its massive wealth, employs just over 46,000 people globally.
The disparity between personal wealth growth and job creation is stark. Gautam Adani’s wealth grows at 123% annually, while job growth in his group lags at a mere 3%. This discrepancy highlights a critical issue: the so-called wealth creators are not necessarily job creators.
Karnataka’s entire IT and IT-enabled services sector employs about 20 lakh people, while Indian Railways employs more than half that number. Additionally, there are three lakh non-gazetted vacancies in the railways, further emphasizing the public sector’s significant role in job creation. A Financial Express article titled “Tata, Reliance, Adani: Corporate India’s top 6 go long on profit, short on jobs” illustrates this point clearly. While these top six groups saw revenue growth of 7.3% and profit growth of 22.3%, their job growth was -0.2%.
While generating revenue is crucial, paying taxes is a fundamental responsibility, not a special service. The top corporate taxpayers include Reliance Industries, which paid Rs 20,713 crore in taxes, and SBI, which paid Rs 17,649 crore. Interestingly, despite high corporate profits, the Indian government earned more from income tax than corporate tax in 2023-24, indicating that the middle class is shouldering a significant tax burden. The reduction in corporate tax rates in 2019 led to an estimated annual revenue loss of Rs 1.44 lakh crore for the government.
Despite government efforts to support corporations with subsidized land, tax reliefs, and relaxed labor laws, job creation remains insufficient. Layoffs are increasing, particularly in the IT sector, where over 1.4 lakh employees worldwide lost their jobs this year. The rise of contract jobs with minimal wages and inhumane working hours further exacerbates the issue, as steady employment declines.
Many private companies in India do not create wealth but acquire state-created wealth. Recent deals involving airports, public sector companies, and oil and gas contracts illustrate this trend. Private groups have benefited from exploiting natural and state-bred resources, raising the question of whether they should be considered wealth creators.
Public sector entities like Indian Railways and public sector banks play a crucial role in the economy. The railways not only generate significant economic activity but also connect remote and impoverished areas to the broader economy. The State Bank of India employs over 2.3 lakh people and serves 50 crore customers. LIC shares 90% of its profit with policyholders and invests in various institutions, including private companies. Yet, the public sector often receives less recognition and support.
Instead of focusing solely on wealth creation, it’s essential to consider who creates well-being in the country. Who provides jobs, good products and services, affordable healthcare, and quality education? If private corporations fail to contribute meaningfully to public well-being, their role as wealth creators must be questioned.
The debate over India’s real wealth creators should shift from blind support for corporate figures to a critical examination of their contributions to society. True wealth creation should enhance public well-being, create jobs, and ensure accountability, ultimately fostering a more equitable and prosperous nation.