India Inc. At Sea ; a Buoyant Corporate India Discovers Just How Much of a Dampener Poor Urban Infrastructure Can Be. Mumbai, Where India Inc. Lost Some Rs 20,000 Crore, Today. Chennai, Bangalore, Delhi, or Hyderabad Tomorrow.

Summary

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Mumbai, mammon's favoured child, part of Charles II's dowry when he married Catherine of Braganza in 1662, Shanghai-wannabe, is India's commercial capital. All but 13 of the 30 firms whose stocks constitute the Bombay Stock Exchange's Sensex are based in the city. In 2004-05, corporate tax takings from Mumbai accounted for 41 per cent of the total; personal income tax revenues, 33 per cent. And, according to a McKinsey report, some 5 per cent of India's gross domestic produce comes, directly or indirectly, from the city. With India Inc. on a roll-revenues and net profits have been on an upward spiral, and, for a sample of 107 companies, went up by 19.8 per cent and 10.3 per cent respectively in the April-June quarter-and the Sensex on fire, Mumbai should have been patting itself on the back, preening, dreaming, as it lately has been of a Shanghaiesque future, or flexing its financial muscle. Instead, on July 26, the city, the thousands of companies that call it home, and its 15 million citizens all ran for cover.

It rained on July 26 (and how). It rained on July 27 (by the end of Day 2 Mumbai had seen some 944 cm of rainfall). And, just when things looked like returning to normalcy, it rained again on August 1. By August 5, 431 people had lost their lives, 28 million man- days of business had been frittered away, 1,500 flights had been cancelled, exporters were totting up losses amounting to thousands of crores, and business had suffered losses, real and notional, of over Rs 20,000 crore. Some 150,000 people, some of them India's best- known executives (think K.V. Kamath of ICICI, A.M. Naik of L&T and Sanjay Nayar of Citigroup) had their schedules thrown out of kilter; some, who called Mumbai home were stuck in Delhi and Bangalore; others, from other cities, were stuck in Mumbai with no way of getting back home (KSA Technopak's Arvind Singhal, a Delhi-based CEO, spent 17 hours in a cab and he can consider himself among the lucky ones). Of the few million who went to work on July 26, believing that it was just another wet Monsoon day in Mumbai, some spent the night in the office or their cars, and most ended up walking home, often wading through water that was neck-deep. By the end of it all, the world knew Mumbai for what it was.

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India Inc. At Sea ; a Buoyant Corporate India Discovers Just How Much of a Dampener Poor Urban Infrastructure Can Be. Mumbai, Where India Inc. Lost Some Rs 20,000 Crore, Today. Chennai, Bangalore, Delhi, or Hyderabad Tomorrow.

The world? Oh, yes, the world knew what was happening in India and was concerned. Mumbai, after all, is home to the Indian arms of the 700-odd foreign institutional investors (FIIs) that have pumped in over $5 billion (Rs 22,000 crore) into the Indian stock market thus far this year. Luis Miranda, President and CEO of IDFC Private Equity, was in New York in the first week of August and faced countless questions on the Mumbai floods. "Every single meeting I go for, the first 10 minutes are spent discussing Mumbai," he says. "There are questions from (potential) investors on why the infrastructure is so bad."

The state government's reaction has been fatalist at best, with Chief Minister Vilasrao Deshmukh-he believes the damages do not go beyond Rs 501 crore-citing the volume of rainfall as an excuse. Mumbai did receive an extraordinary amount of rainfall on July 26 and 27 (944 cm in 24 hours to be exact), and not too many (actually, no) Indian...

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