Reliance Industries Chairman Mukesh Ambani said on Friday that telecom venture Jio is ahead of schedule in terms of generating returns.
Jio has shaken up the telecom sector with its free voice calling and cheap data tariffs since it was launched 14 months ago. Speaking at the Hindustan Times Leadership Summit, Ambani countered the perception of Jio destroying the competition by saying that what mattered most is that the consumer gains and the industry moves forward.
Ambani also said that education and healthcare will be on his radar in the future.
Below is the transcript of the interview.:
One of your rivals in the telecom business had an interview in a newspaper where he spoke about Jio actually destroying 50 billion of their value in the telecom business. There is this perception of Reliance entering into businesses and fundamentally disrupting them and destroying the competition. Do you think that would be an accurate assessment of what has happened in telecom?
Sunil is a good friend of mine, he is not a rival.
A business rival...
I do not think of businesses in that way. The second piece - what he said and what you are interpreting is different. But just to make my point of view clear, I think that for all of us within industry, profits and losses are risks that we take and I do not think that we can rely on regulators or governments to guarantee our profits or losses. To me, what is most important is do we really move the country forward and does the consumer gain? And I think the question as a journalist you should be thinking about is that even if there are profits and losses, who gains and who loses, as long as the consumer gains and the country moves forward, it is worth taking those losses. Some of us are big boys, we can afford that.
How soon do you expect Jio to turn profitable?
Jio's results are declared every quarter now and you can see the trend and watch the next few quarters, you will learn in January and you will learn in March. I do not want to predict, but I think we are ahead of our schedule in terms of the returns that we are generating.
How do you decide how to enter into a business? You spoke about all these interesting new areas that are emerging. What are the parameters a business has to meet before Reliance decides it wants to enter it?
The Reliance DNA started from my father when he founded Reliance. At that time, he has ingrained into us that as a business, you must solve problems and the economic value is more a by-product of that. So if you look at the history of Reliance, we started with clothing people, we started with textiles, we went into developing the textile industry, then built our refinery which was really energy security. We solved the problem at that time in terms of India not importing diesel and petrol.
If we look at our own entry into retail, it was linked to the need for employment creation and as our balance sheet becomes stronger, we still look to solve problems to create societal values and now, I challenge myself and our people to solve the more difficult problems and we can take some risks.
So what we did with Jio is really, we put in and not many in the world had backed us. But, as I just explained, we are strong believers that if India and 1.3 billion Indians have to participate in this new world, for us, we cannot always have the data infrastructure 20 years after the world. We would have no chance.
Today, we have along with Rajan and Kumar, with all of us as one industry, I think India, in terms of data infrastructure will be ahead of the US by 2019. So as we move forward, we think about more and more difficult issues that create value for all Indians. I think that agriculture is difficult and that is something that needs to be taken. Education is important. And healthcare is the most difficult. So, we would clearly think about what we can do in each one of these areas.More to follow...