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Quick Summary: James Crabtree’s The Billionaire Raj is an inside look at India’s rapid economic expansion and the rise of its ultra-wealthy elite.
Spanning from 2004 to 2014, the book examines how India’s economic liberalisation led to the emergence of a new class of “Bollygarchs”—business tycoons whose immense fortunes often hinged on political connections rather than innovation.
Crabtree draws parallels between India’s modern billionaires and the American robber barons of the Gilded Age, highlighting a recurring pattern of crony capitalism, corruption, and excessive wealth accumulation.
Tapan’s Verdict: Skim it 🤓
Billionaire Raj: Key Insights
Booms and Busts Are Cyclical
India’s post-liberalisation economic boom mirrors other emerging economies like Malaysia and Thailand, where unchecked credit expansion led to financial crises.
Economic growth, if not paired with robust institutions, often results in cycles of excess and collapse.
This is also referenced in the book, Bulls, Bears, and Other Beasts by Santosh Nair, which explores India’s evolving stock market from the late 1980s to the early 2000s.
Crony Capitalism Fuels Inequality
Unlike Silicon Valley, where wealth is largely tied to technological disruption, India’s billionaires amassed fortunes through state connections, government contracts, and monopolistic advantages.
Economist Raghuram Rajan called it a self-perpetuating cycle—politicians need businessmen for campaign funds, businessmen need politicians for favours, and the poor depend on politicians for welfare.
History Repeats Itself
Crabtree draws a fascinating comparison between India’s tycoons and the Vanderbilts of 19th-century America.
Dhirubhai Ambani, like Cornelius Vanderbilt, built his empire by outsmarting the system. He used price wars, legal loopholes, and clever tactics to dominate the market.
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The State Fails Where the Private Sector Thrives
India’s underfunded public services mean that tycoons and NGOs often step in where the government falls short, from healthcare to education.
This creates a paradox: the wealthy both control and compensate for state failure.
Manufacturing Remains a Bottleneck
Despite economic liberalisation, India still struggles with industrial growth, unlike China or South Korea.
India’s weak manufacturing sector means there just aren’t enough jobs for its growing workforce.
Memorable Quotes
Too many businesses were accumulating wealth because of their ability to manage the government rather than manage innovation.
So the circle is complete. The crooked politician needs the businessman to provide the funds that allow him to supply patronage to the poor and fight elections. The corrupt businessman needs the crooked politician to get public resources and contracts cheaply. And the politician needs the votes of the poor and the underprivileged. Every constituency is tied to the other in a cycle of dependence.
India’s public services were threadbare, forcing the poor to rely on politicians for patronage rather than institutions for progress.
