Embattled former liquor baron Vijay Mallya faces the prospect of debt collectors coming to his house
You know the mighty have fallen when Vijay Mallya had to fly on a plane owned by his erstwhile competitor Naresh Goyal to make his escape to london as the Indian authorities dithered in arresting him. His desperate wish to run an airline had not only effectively ruined him, it also forced him to sell his majority stakes in both United Breweries, owners of the iconic Kingfisher brand, and United Spirits, to multinationals. Mallya contends that Kingfisher Airlines’ failure was a run-of-the-mill standard business failure and that he has already paid a high price for that — no airline, no liquor company and life as an economic fugitive exiled from his country and reviled by his countrymen. Some of the hatred towards Mallya may be relatively unjustified as other businessmen have defrauded far more money. But Mallya’s high-profile lifestyle, his belief that he himself was his company’s biggest brand ambassador allied to the fact that he micro-managed every detail of his airline — he claimed to have ‘personally selected’ all the air-hostesses — was bound to end in tears. What cannot be denied, however, was that Kingfisher Airlines redefined service standards for the airline industry in India. But as a business it was a train-wreck that anyone with any knowledge of the aviation industry could see from a mile away.
So, why did banks keep sanctioning Mallya and his airline loansIJ Questions need to be asked and Mallya needs to answer them. How did Mallya manage to get his Kingfisher Airlines brand valued at thousands of crores and get loans on that basisIJ Were inducements paid, and if so were they in cash or kindIJ These are legitimate questions that investigative authorities have and Mallya must and should answer them. By remaining running away, Mallya has lost all credibility. While it is true everyone should be presumed innocent until proven guilty, being a fugitive leads the both the public and the judicial system to presume guilt. It is not difficult to understand why there is a widespread belief Mallya indeed did acquire funds illegally. Indian banks must use the opportunity given to them to take control of some of Mallya’s assets. That said, the man must have protected his personal and family wealth through a network of trusts already, but that should not preclude Indian banks from taking what they can from Mallya. At the same time, the Government must ensure that the British authorities extradite Vijay Mallya back to India where he should stand trial.