Why do we Indians always assume racial prejudice when a foreign company spurns a takeover bid by an Indian company? Is it because we ourselves are prejudiced or because we are still insecure about ourselves?

Think of a young professional with a well paying job. Like most of his peers, he is highly conscious of his social image and buys only those brands which supposedly enhance that carefully nurtured image.

Now, consider a scenario where this young professional is shopping around for a new vehicle – an SUV let us say. Ever since he started thinking about a new car, he had in mind this SUV from a Japanese manufacturer. It is the right size, not too big or not too small, and the design elements fit the suave image he wants to project for himself.

Just before the visit to a dealer, he hears from a friend that the Japanese SUV manufacturer is now owned by a Chinese company. He is also told about a rumour that more than half of the parts in the supposedly Japanese SUV now come from China, though the price of the vehicle remains unchanged.

The Japanese company never made any money from the business, so it is possible that the new Chinese owners are trying to cut costs and make some returns from their investment. It is only a rumour, but could be true!

Will he still go ahead and buy the SUV? He may, because the brand remains the same and there are no apparent physical changes to the vehicle. But, he is very likely to delay his final decision to convince himself that it is still the best choice. Before he makes his decision, he may also look at other SUV models which he hadn't considered before.

Is there anything remotely racist in his behaviour? Can the Chinese company accuse him of discrimination on the basis of race or nationality?

This is only rational behaviour from a brand-conscious consumer. He knows very well that the value of a brand, especially a premium brand, is based on how it is perceived in the market. It is no surprise that he delays his decision after hearing the news about the Chinese ownership of the company and rumours about Chinese parts being used in the vehicle. He will buy the vehicle only if he is convinced that the perceived brand value is not affected by the Chinese ownership and the rumour about Chinese parts.

Anyone who has ever sold a branded product or service will know that this is how a consumer behaves. When that is the case, why were most commentators and analysts so hysterical when a Jaguar dealer in the US said a takeover of the British luxury car maker by an Indian company would hurt its brand image?

He was summarily branded a white racist completely out of touch with the emerging global economic order where only India and China matters. He was reminded that the day of Indian brands had already come and that he should not try to resist the irreversible process of global Indian domination.

For God's sake, he is a car dealer and knows his customers better than a bunch of armchair commentators in this country. Jaguar's brand image has already been sullied by persistent quality problems and unimaginative designs. Is it any wonder that dealers in the US, the most competitive auto market, are worried about the brand being taken over by a company virtually unknown in that country?

It is obvious that managing the possible change in perceptions about the Jaguar and Land Rover brands, and maintaining the aura of luxury, will be the biggest challenge for any potential buyer? Ask Ratan Tata or Anand Mahindra. They would agree, without batting an eye. Then, why get hysterical when someone else says that? 

The same kind of outburst was evident when luxury hotel group Orient Express rejected the Tata Group's proposal for a business alliance with its Taj Group. (See: Indian Hotels demands apology from Orient Express) What really got the commentators' goat were the reasons given by Orient Express. The US Luxury hotels company said it was not very keen on an alliance because the Tata group's hospitality business is 'predominantly Indian'. Besides, in its opinion, an alliance may lead to erosion in the brand value of its properties.

Isn't it true that Tata's Taj group of hotels is even now a 'predominantly' India-focussed business, though the group has bought some premium properties abroad recently?

The proposal made by the Tata group was for a broad business alliance, with the two groups taking minority equity stakes in each other but retaining their individual identities. When picking a business partner, or any kind of partner for that matter, the most important factor is compatibility.

Orient Express is a focussed operator of super premium hotels in prime locations around the globe. The Taj group, on the other hand, is present in all segments – from premium to budget. How was it unbecoming for Orient Express saying it did not find the two businesses compatible enough to pursue an alliance?

Tata group made an unsolicited proposal, which Orient Express has every right to reject for its own reasons. It cannot be told that it can reject the proposal only for reasons acceptable to us but not for other reasons.

Why should we accuse it of racism if it cites concerns over the possible impact on its brand image caused by an alliance with a diversified group – which happens to be Indian? Would its statements still have been considered racist, if it had said the Taj group is 'predominantly India-focussed' instead of 'predominantly Indian'?

Why shouldn't we believe that Orient Express, with its 'predominantly Indian' remark, was referring to the geographical spread of the Taj group rather than its ownership?

Orient Express may also have a reason to feel provoked. The Tata Group bought a 10 per cent stake, later hiked to 11.5 per cent, in Orient Express before making a proposal for an alliance. It's a a bit like putting one foot in somebody else's tent – uninvited - and then saying, 'let us join our tents and share the same bed'?

Not many top managers would take kindly to the idea of losing their positions after being acquired by another company. So, why is it a surprise that the Orient Express management's reaction was a bit hostile? Would the reaction of an Indian company have been any less hostile an unbidden takeover attempt by a foreign company?

The fiercest defender of 'Indian pride' was Swaminathan Aiyar in The Times of India. In his column, he almost commanded Ratan Tata to shed his nice guy pretension and be prepared for hostile takeovers – because ''the history of business is littered with the corpses of nice guys''. Really? Who were they?

He goes on to suggest that ''to be successful as a global multinational, Tata needs to become more like Lakshmi Mittal and inspire fear, no less than respect''. Is he suggesting that all Indian businessmen with global ambitions should behave like modern day Genghis Khans, go overseas and bludgeon foreigners into submission? Is that how businesses function?

But the worst part of Aiyar's column was his description of how Ratan Tata was being treated by 'white racists' like the Orient Express management, just because he is averse to making a hostile takeover. ''It means that a takeover target can spit in your face and say that mere association with you will be demeaning, leaving you looking like an oppressed Harijan'', he roared in his column.

Doesn't the allegory of the oppressed Harijan he uses to build his case reflect our own prejudices? Is that why we get so agitated at the slightest hint of prejudice against ourselves and behave with near hysteria? Because we see the pain in the eyes of so many of our own, when we repeatedly show our prejudices against them?

Just like Toyota took many decades to grow from a brand which was widely ridiculed to a company which offers Lexus – perceived to be among the best luxury automobiles – it will take time, effort and a lot of patience for India and Indian brands to build their image in western markets. The South Koreans understand this fact of life – look at Hyundai which is copying the Toyota way – and the Chinese too to a great extent. If we still don't, it shows our immaturity and lack of faith in our own abilities.

(Also see: How does Orient stack up against Indian Hotels?)