Leading NRI industrialist and philanthropist Lord Swraj Paul passed away in London on 21 August 2025, at the age of 94. Founder of the UK-based Caparo Group, Paul was born in Jalandhar and moved to the UK in 1966 while seeking treatment for his daughter Ambika, who later died of leukemia. Out of tragedy grew resolve: Paul went on to establish Caparo Group into a global enterprise with interests in steel, engineering and property.
The name Swaraj Paul, however, takes one instantly down memory lane. Long before Caparo entered India’s auto component space in the post-liberalisation era, Paul had already made national headlines. In the early 1980s, his quiet foray into two iconic enterprises—Escorts and DCM—set off a storm in corporate India. The trigger was a 1983 Reserve Bank of India move allowing NRIs to invest up to one per cent in listed firms. Paul, through Caparo subsidiaries, took advantage of this opening, acquiring significant stakes in Escorts and DCM, both of which had low promoter holdings. Soon after, the RBI imposed a five per cent collective ceiling. Obviously, the authorities were keen to end the misuse of the earlier one per cent investment cap on an NRI individual or entity. But that became a case of closing the stable door after the horse was bolted!, By then Paul had already crossed the threshold. Significantly enough, the investing firms in these two Indian listed companies were subsidiaries of a holding company that had majority control by a family trust. There was a rider here. Paul and his ilk were the beneficiaries of this trust.
The Paul foray into these two firms became a cocktail of a story starring decisive actors such as the LIC, PNB, RBI and the government of the day at the centre. The entire episode threw up a lot of questions. Was the process of investment in order? Should the investments have prior permission from the RBI? What followed was high corporate drama. Escorts refused to register the share transfer, prompting litigation that went all the way to the Supreme Court, which eventually ruled in Paul’s favour. Meanwhile, LIC, then a major shareholder, convened an extraordinary general meeting to oust directors, sparking an acrimonious battle. Exhausted by the long tussle, Paul eventually sold his shares, leaving Escorts with the Nandas.
What did the Escort adventure – should we say misadventure teach the Indian enterprises? Paul’s bold move had exposed the vulnerability of Indian promoters who controlled companies with minimal personal stakes. His actions served as a wake-up call, prompting promoters across India Inc. to strengthen their holdings and guard against hostile bids. Lord Swraj Paul may have walked into history, but his legacy remains twofold: a global business empire rooted in resilience, and a decisive moment in Indian corporate history that reshaped promoter behaviour for decades to come.