Alam Srinivas is a business journalist with nearly three decades behind him working for The Times of India, India Today, Outlook Financial Express and Business Today. He is the author of Cricket Czars: Two Men Who Changed the Gentleman’s Game
Cash and property. These were the two basic commercial foundations of a Godman’s spiritual and religious empire. Cash came from fame and trust – both the rich and poor followers donated whatever they could. When their numbers swelled to millions, the Baba had almost unlimited access to money. Properties came from power – social and political. First need of every Baba is to have a sprawling ashram. Every ashram in temple towns like Ayodhya, Mathura and Haridwar, has hundreds of acres of land. That explains the succession wars, mostly legal but sometimes violent, for these mutts.
The world of the Baba has changed considerably in recent times. He – although now they are a few God-women too – has turned more into a religious entrepreneur, who uses the cash that his ashrams and deras generate to earn more, much like a businessman and an investor. They have astute financial wizards, who help the gurus to multiply their money – through stocks and other financial instruments, businesses, real estate and, of course, bullion. In many senses, the Godmen have acquired financial acumen.
In fact, the Baba Businessman today follows the time-tested strategies pursued by global multinationals, and the tactics evolved by legendary international investors such as Warren Buffet and George Soros. They use outsourcing and M&As (mergers and acquisitions) to grow exponentially in an inorganic manner. They use safe, but speculative, means to make money on the bourses, and money and commodity markets. They are smart, savvy and sensible in their commercial and business pursuits.
Experiences from the recent demonetisation drive, and details of the Indian money stashed away in Swiss banks and banks in other countries, indicate that those who earn money legally or illegally don’t park it in one place, where it earns minimal or zero interest. Instead, they channelise it to multiply and grow it. In the case of demonetisation, over 99 per cent of the cash in high-denomination notes found its way back into the banks. The latest figures released by Swiss banks show that the money stashed by Indians in their various accounts is a mere Rs 4,500 crore, or less than $700 million, against an earlier estimate of over $1 trillion in black money in India.
These examples prove that black money is not kept in idle cash, but is reinvested. The baba too has learnt this art, craft and science. He too believes in rerouting his money to earn returns that can be between 10-50 per cent, or even more if he is not risk-averse, and is willing to speculate. More importantly unlike the holders of black money who have to wash and launder the money, the Baba’s earnings can be white and tax-free, if he is willing to declare it to the tax authorities.
Let’s take a peek into the new commercial empire of an Indian Godman, and compare it to those built by businessmen and big investors. The source of the money is traditional – cash and bullion through donations. To give a sense of the annual earnings, the Sacha Sauda Dera of Gurmeet Ram Rahim, who was recently jailed on two charges of rapes, was over Rs 16 lakh a day, or almost Rs 60 crore a year. This seems a reasonable estimate because the Dera, according to the income tax records, earned Rs 30 crore a year in 2012-13, which was almost 50 per cent higher than its annual income in the previous year.
One presumes that this must only account for the part-cash and cheque earnings. The Baba may not have declared the gold and silver that he received, or declared only a part of it, and did the same with the real estate that was donated, gifted or leased out permanently by rich followers. Such real estate is either not shown on the books, or shown at much below-the-market rates, i.e. the rates prevailing when the property was gifted or leased.
All the annual earnings, which are shown on the books of accounts were tax-free. This is because of the earlier laws in the country, as well as the fact that the deras or ashrams are registered as trusts and NGOs and, hence, get tax breaks. However, this has changed to a large extent under the new GST (Goods and Services Tax) regime. All the temples, mosques, churches and other religious bodies are liable to pay taxes.
In June this year, BJP MP, Dr Subramanian Swamy, wrote a letter to the revenue secretary in the finance ministry on the issue. He quoted media reports that said that the annual tax burden due to GST on the Tirupati Temple Trust would be Rs 100 crore. He added that all the exemptions that the temple bodies enjoyed from income tax, service tax and wealth tax stood withdrawn under the new tax regime. He urged the government that since these bodies were not profit-oriented, the earlier exemptions on their earnings should continue.
Swamy made another allegation. He said that GST taxes the Hindu bodies, but continues to exempt Mosques and Churches. A month after his letter, the finance ministry clarified, “There are some messages going around in the social media stating that the temple trusts have to pay the GST while the churches and mosques are exempt. This is completely untrue because no distinction is made in the GST Act or any provision based on religion. We request to people not to start circulating such wrong messages on social media.”
We know some of the ways about how a Godman spends. There is charity work that he does – schools, hospitals, clinics, relief work during disasters, and free food. In addition, s/he runs the large deras and ashrams at several locations, where thousands of people come to stay, eat, and spend days and weeks, apparently in religious mirth. This requires huge sums of money because the amenities and facilities are either free or highly subsidised. To run the ashram like Gurmeet Ram Rahim’s main one at Sirsa would cost a few lakhs of rupees a day.
A recent article in the Economic Times said, “The sect (Sacha Sauda) has under its belt several Guinness World records, including largest blood donation camps in 2003, 2004 and 2010; has rehabilitated prostitutes, transgenders, alcoholics and drug addicts; and carried out disaster relief – from the December 2004 Tsunami and Gujarat earthquake to flash floods in Uttarakhand.” This made it popular among millions.
In addition, most Godmen have ostentatious lifestyles, with mansions, expensive vehicles, and extended luxuries. They live and travel in style – although this is also financed by the rich followers. According to a few media reports, Gurmeet Ram Rahim owned a fleet of luxury cars, which included Hummer, Bugatti Veyron, BMW and several modified cars. “A few of his cars are a Bugatti Veyron replica known as ‘Chariot of God’, an Agrojetter, which is basically a modified Hero Honda Karizma, a modified Hyundai Santro and a modified Maruti Gypsy.” He liked his life to be in the fast lane.
Obviously, a Godman will own a clutch of properties. (see graphics). In 2011, when Sathya Sai Baba was ill, a large media group speculated about his wealth. “The SSSCT (Sri Sathya Sai Central Trust) supervises how the functioning of the welfare entities, including educational and health facilities, are to be run and controls the purse strings of several trusts and a team of sharp auditors. But the SSSCT is tightlipped when it comes to the fabulous wealth of the Sathya Sai Baba network, estimated to add up to a staggering Rs 40,000 crore, including movable and immovable assets in India, besides those in 165 other countries.” The empire is truly global.
Obviously, when a Baba dies, there are disputes over the properties he owns, and how they are to be divided. In some cases, the family members claim inheritance, as was the case when Sai Baba died, but the trustees of the main and other trusts wanted to dig their fingers into the wealthy pie. After the death of Bhagwaan Shri Rajneesh (Osho), there were allegations that some of the trustees tried to surreptitiously sell off properties to builders.
For example, one of the allegations was that the trustees of Osho International Foundation (OIF) sold Plot CTS No. 3, Koregaon Park, Pune, which was worth Rs 50 crore, to a Pune builder. In 2011, “this plot, measuring 5,387 sq m, was actually gifted by the OIF to Darshan trust, an unknown entity in Delhi,” said a media report. It added, “One group of followers has accused the OIF trustees of mischievously trying to hand over trust properties… to a prominent builder with close ties to a leading politician from Maharashtra.”
However, now the Baba has become more evolved, and functions like a businessman. Take a look at Gurmeet Ram Rahim’s presence in the entertainment business. He produced, directed and acted in three Bollywood movies; one of them was simultaneously released in 4,000 theatres across the country. It’s not clear if they made a profit, but each one cost several crore of rupees. In addition, millions of CDs of his songs were sold. The Baba became a rock star as he held mega musical shows in large stadiums.
It is Baba Ramdev who took his business empire to another level. In 2016-17, his Patanjali Group doubled its annual turnover to over Rs 10,500 crore. The FMCG firms said that it will again double its annual production in this year, and emerge as the largest ‘Swadeshi’ brand within 1-2 years. After success in several FMCG segments, and competing successfully against MNCs, the Baba now wants to take on McDonald’s and KFC. It hopes to open restaurants, even as it doubles the number of existing distributors. Last year, Patanjali created a sensation, when its co-founder and Baba Ramdev’s aide, Balkrishna, was ranked the 48th on the Forbes List of Richest Indians. “Forbes pegged his net worth at $2.5 billion (nearly Rs 16,000 crore)…. The magazine attributed his net worth to his 97 per cent holding in Patanjali Ayurved, which he co-founded with yoga guru Ramdev.” Patanjali Ayurved accounts for the bulk of the group’s annual turnover.
Patanjali’s business model is based on two premises – one related to management, and the other related to morals and values. The group works on the principle of outsourcing, which has been adopted by leading global MNCs in several sectors. It has handpicked small, medium and large firms that didn’t operate at full capacities, or were under problems. It leased out entire capacities so as to save time and money that’s required to set up greenfield projects. In a jiffy, it could produce enough quantities to take on the existing FMCG giants. In some cases, it bought over firms.
The morality ring around the group was to sell the ‘swadeshi’ concept. Its brand and ad campaign focused on buying Indian products, made in India by Indians, and using Indian technology and ingredients. Thus, cow’s milk and Ayurveda became the USPs, which won the hearts and minds of the people. However, its price points and its expansive presence in cities and towns helped the growth of the business. In a sense, it managed to apply the latest business techniques, and marry them with the existing social beliefs.
Clearly, the new Baba is quite different from the traditional ones, at least in the manner in which they utilise their money on businesses that can earn huge profits, rather than merely on charity and lavish lifestyles. The color and source of the money has remained the same. Where it goes and how has changed. This is the age of the Baba Businessman.
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