India has been hampered by an economic downturn and a devastating coronavirus outbreak that, according to new research, has pushed millions of people into poverty.
However, while these Indians struggle to make ends meet on a few dollars a day, the country’s ultra-rich have grown even wealthier and more powerful in the last year, with their combined fortunes increasing by tens of billions of dollars.
According to the Bloomberg Billionaires Index, Mukesh Ambani, chairman of the sprawling conglomerate Reliance Industries, is now worth more than $80 billion, up $15 billion from a year ago. Gautam Adani, the founder of the Adani Group, is not far behind him, with a fortune that has risen from less than $13 billion this time last year to $55 billion today.
The two men, who are now Asia’s first and fourth richest men, are each worth more than some countries’ GDP. Their disparities with fellow Indians are emblematic of a widening wealth gap that has afflicted many people around the world, and which has become especially acute in Asia’s third largest economy, which accounted for more than half of the global increase in poverty in 2020.
During the pandemic, Ambani was Asia’s wealthiest person, surpassing many Chinese tycoons.
He’s remained the world’s 12th richest man for the majority of this year, surpassing Mexican mogul Carlos Slim and Dell (DELL) founder Michael Dell in terms of wealth. His company had a fantastic 2020, raising billions of dollars from Silicon Valley behemoths like Google (GOOGL) and Facebook (FB), who are betting on his vision to dominate the internet in one of the world’s most important markets.
And Ambani isn’t feeling too lonely at the top. Adani, the continent’s second richest man until recently, was also an Indian. The Adani Group’s founder is in charge of businesses ranging from ports and aerospace to thermal energy and coal. Adani Group, like Reliance, has done exceptionally well on the Indian stock market — shares of Adani Enterprises, for example, have increased by more than 800 percent on the National Stock Exchange in Mumbai since June 2020, indicating that investors are confident in Adani’s ability to bet on sectors critical to Prime Minister Narendra Modi’s economic development goals.
Both billionaires are Gujarat natives. Gujarat is Modi’s home state.
Last month, shares in Adani’s companies plummeted after The Economic Times reported that the country’s National Securities Depository had frozen foreign funds with stakes worth billions of dollars.
Despite the fact that the report was “blatantly erroneous,” the conglomerate’s founder lost nearly $20 billion in less than a month. Despite the steep drop, Adani is still one of Asia’s wealthiest men, according to Bloomberg, behind Chinese bottle water tycoon Zhong Shanshan and Tencent (TCEHY) CEO Pony Ma.
As Beijing cracks down on tech entrepreneurs, other Chinese billionaires, such as Alibaba (BABA) co-founder Jack Ma, have suffered losses.
According to Saurabh Mukherjea, founder of Marcellus Investment Managers, Ambani and Adani’s complete dominance is not surprising. He went on to say that almost every major industry in India is now dominated by one or two incredibly powerful corporate houses.
“The country has now reached a stage where the top 15 business houses account for 90% of the country’s profits,” Mukherjea told CNN Business.
“The playbook is the same as other countries,” he said, referencing some of America’s famous tycoons throughout history, including John D. Rockefeller and Andrew Carnegie.