Rishi Sunak is the new British Prime Minister and the third Conservative leader to take office in less than three months.
However, the former chancellor has not had the easiest route to the top job and past scandals could yet come back to haunt him as prime minister. Earlier this year his and his wife’s tax affairs came under scrutiny after it was revealed she had claimed out-of-home status in order to save on her tax bill.
This coincided with his being fined for attending a birthday party in Downing Street during the Partygate scandal.
Mr Sunak is believed to be the wealthiest man in the House of Commonswith The Sunday Times rich list valuing his fortune and that of his wife at £730million.
His initial success at Westminster sparked a wave of enthusiasm in India, both because of his own Indian heritage and because he is married to Akshata Murthy and therefore the son-in-law of one of the most successful businessmen. India’s wealthy Narayana Murthy, often hailed as the father of India’s IT boom.
On Tuesday, Mr Murthy praised his son-in-law and said he believed he would do his best for the UK.
“Congratulations to Rishi. We are proud of him and wish him success,” Murthy said in a statement.
“We are confident he will do his best for the people of the UK.”
“India’s Steve Jobs”
Narayana Murthy’s personal story closely follows India’s journey to become a successful global IT hub.
His story of starting his own business using capital of just $250 and a team of six in Pune in 1981 is a favorite story of poverty among middle-class families across India.
As CEO and President of Infosys, Mr. Murthy led the company from 1981 to 2014 and earned a reputation among market pundits and analysts as one of the nation’s greatest entrepreneurs.
“What Steve Jobs is for the United States, Narayana Murthy is for India,” says Trip Chaudhary of Global Equity Research.
“[IT firms like] Wipro, TCS and Infosys have changed the image of India from the country of snake charmers to a place of services. They put India on the world map.
Having built Infosys, Mr. Murthy is known for emphasizing business ethics and corporate governance, at a time when nepotism was rampant among many of Infosys’ competitors.
He decided to become chairman emeritus in 2014, and the company decided to appoint new management entirely independent of its founders.
Shriram Subramaniam of InGovern says, “At that time, Infosys was the only company in India where the promoters (founders or major shareholders) did not sit on the board and walked out completely to bring in a professional CEO. But it was a failed experiment.
Every Indian remembers the extraordinary story of the Infosys crisis in 2017 when the executive appointed by Mr. Murthy sensationally resigned.
Vishal Sikka resigned after citing a ‘drumbeat of distractions’ and ‘false, baseless, malicious and increasingly personal attacks’ as his reasons for leaving – the heavy implication being background interference from Mr. Murthy, obviously unwilling to let go of the reins.
Mr. Subramaniam believes that the incident should be seen as a mere event in the company’s history.
“Narayana Murthy also has her own weaknesses… [yes] he was a micromanager, but he no longer took an active role in the company after 2014.”
When asked if the company has always adhered to the ethical business practices that Mr. Murthy himself speaks of from time to time, Mr. Chaudhary takes a pragmatic approach.
“We have to celebrate the success of a company, but no one has succeeded without breaking the rules and the status quo,” he says.
“If anyone wants to glorify [businessmen] like Harishchandra [a mythological character known for only speaking truth] so that’s their problem,” he says.
Mr Murthy, 75, is now retired and, together with his minority stake in Infosys, he has an estimated net worth of around $2.5billion (£2.1billion), according to the listing Forbes 100 Richest Indians.
Mrs. Murthy’s investments
The Murthy family were last in the news in the UK in December 2020 due to calls for the UK government’s ethics watchdog to investigate Mr Sunak after a Guardian History suggests that the chancellor failed to declare his wife’s multi-million dollar business portfolio in the official register of ministerial interests.
The newspaper also reported that a series of investments had been bought by Ms Murthy through a company called International Market Management (IMM), which runs a chain of restaurants and channels investments through Mauritius to cut taxes paid in India.
His other business interests include Catamaran Ventures, which profits from Amazon Cloudtails.
Through Catamaran, Ms Murty also has direct stakes in at least six UK companies – Digme Fitness, Jamie’s Italian, Jamie’s Pizzeria, New & Lingwood, Soroco and Wendy’s.
Questions have been raised about Mr Sunak not declaring those interests – but analysts say the way Akshata Murty handled his affairs would be seen by many as regular practice.
Speaking of his wealth, Mohandas Pai – a former director of Infosys – says: “Akshata Murthy is a resident of UK, not a taxpayer in India. She is independently wealthy. She’s been rich for a very long time.
“She had her shares in Infosys from her childhood. And I’m sure she manages her tax affairs very well following Western practices.
According The GuardianMs Murty bought a five per cent share in IMM for £500,000 in 2014.
Instead of investing directly in the two Indian subsidiaries that operate its restaurants, according to the report, IMM funneled the money raised from its shareholders through an intermediary company in Mauritius.
This decision, which is not illegal, means that the company ends up reducing taxes payable on profits in India.
It also does not have to pay the 20% capital gains tax and its dividend tax is also reduced from 10% to 5%.
The holdings were never likely to prove problematic for the Murthy family, given the strength of their reputation in India, built up over decades, but their huge wealth could continue to create problems for Mr Sunak if he does. he was running for the future leader of the Tories, aa member of a super-rich elite trying to lead Britain through a brutal cost of living crisis.
A spokesperson for the Murthy family declined to comment on the Guardian report when contacted by The Independent.
Mixed reactions in India
Although Mr Sunak’s elevation to the top job was warmly welcomed by many Indians, it has also sparked a political debate over India’s own policies.
As the first Indian-born British Hindu prime minister, several members of India’s political right as well as the ruling Hindu nationalist Bharatiya Janata Part (BJP) hailed Mr Sunak.
While the right celebrated Mr Sunak’s Indian roots, several analysts were quick to point out that Mr Sunak was a British national and had only Indian origins.
The opposition in the country, however, has lambasted the Narendra Modi-led government for praising Mr Sunak as minorities face continued persecution under his rule.
Shashi Tharoor, a Congress party MP and former UN diplomat, said that while Mr Sunak represents an important moment in British history when a member of the minority community can be elevated to the post of prime minister, he s is asked if this “can happen”. in India.