Ambani Leads $200 Billion Loss Among India's Richest

By Subramaniam Sharma and M.C. Govardhana Rangan

Nov. 13 (Bloomberg) -- Mukesh Ambani and Lakshmi Mittal led India's richest in losing $200 billion this year as the global financial crisis triggered a plunge in stocks and property values, Forbes Asia said.

The combined wealth of India's 40 wealthiest people slumped 60 percent to $139 billion, the magazine said today in an e-mailed release. Mittal, 58, lost his top position to Mukesh Ambani of Reliance Industries Ltd. Mittal lost $30.5 billion after the world's biggest steelmaker ArcelorMittal extended production cuts. The net worth of Mukesh Ambani, 51, dropped 58 percent after demand for petrochemicals made by Reliance Industries slumped and oil refining margins shrank.

There are 27 Indians with a net worth of $1 billion or more, compared with 54 last year. The key Sensitive index declined 53 percent this year and is set for its worst annual performance on record. At the same time, there are 456 million Indians who live on less than $1.25 a day, according to the World Bank.

``Indians who felt the heat of the meltdown have not exactly become paupers,'' said Anup Kumar Sinha, professor at the Indian Institute of Management Calcutta, in Kolkata. ``They will probably realize anew the importance of the real economy and reconcile to the vagaries of the financial markets.''

Wealth Erosion

Last year, 14 Indian billionaires didn't make it to the list of the 40 richest. The wealth of Anil Ambani, 49, was eroded on concern Reliance Communications Ltd., India's second-largest mobile-phone operator, may find it difficult to raise money to expand amid a credit crunch and increased competition.

Mukesh and Anil split the Reliance Group in 2005 in a deal brokered by their mother and have since expanded their businesses to include oil exploration, media and supermarkets.

Vijay Mallya, chairman of United Spirits Ltd., Gautam Thapar, chairman of papermaker Ballarpur Industries Ltd. fell off the list, the statement said.

Amongst the biggest losers of wealth are India's real-estate tycoons as a five-year rally in property prices and borrowing costs that had climbed to a seven-year high deterred home buyers.

Kushal Pal Singh, 77, is ranked fifth. That's lower than his last year's fourth position. DLF Ltd., the nation's biggest developer, declined 77 percent this year. Earlier this month, the company said its hotel venture with Hilton Hotels Corp. may be delayed by 12 to 18 months as it seeks funds for new projects.

Ramesh Chandra's Unitech Ltd., the nation's second-biggest developer, fell 90 percent this year. Last month his son Sanjay Chandra, who is the managing director of Unitech, blamed ``criminal'' speculators for the record 50 percent one-day plunge in the stock on Oct. 24.

Market Meltdown

More than $29 trillion has been erased from the value of global equity markets as credit losses and writedowns climbed to $950 billion in the worst financial crisis since the Great Depression. The Stoxx 600 declined 44 percent in 2008, headed for its worst year on record.

China's richest lost 57 percent of their wealth in the past year amid plummeting stocks, falling property values and wrong-way currency bets, Forbes Asia said on Oct. 30. The mainland's 40 wealthiest people are worth $52 billion, the magazine said.

India has taken several steps to ease a credit crunch and protect the economy from a global slowdown. The Reserve Bank of India this month cut interest rates and reduced the amount of money lenders must hold in reserve.

Slowing Growth

Prime Minister Manmohan Singh this week said the country's economy will grow between 7 percent and 7.5 percent in the next financial year starting April 1. In the current year, the central bank has forecast an expansion of 7.5 percent to 8 percent.

Asia's third-biggest economy will be able to return to a 9 percent growth trajectory as its large market and diversified industrial base will help the nation overcome the global financial crisis, Singh said on Nov. 10.

India may be the first in Asia to emerge from a downturn, helped by local consumption and a drop in commodity prices, Sharmila Whelan, senior economist at CLSA Asia-Pacific Markets said this month.

``During the pathway to recovery, the stress will be on local demand more than on a shrinking global demand,'' said Sinha of the Indian Institute of Management. ``Once the dust settles, global flows of real goods and services will be as important as before.''

Indian billionaires such as Sunil Bharti Mittal, 51, built his phone-services business Bharti Airtel Ltd. to cater to the needs of the world's second-most populous nation. The government started opening up the economy in 1991, ending its monopoly in industries ranging from telecommunications to aviation.