Taj Lake Palace, Udaipur: A record hotel partnership for 50 years

By Ranjit Bhushan

Business decisions often make history. Pioneering business decisions have the power to spark economic growth, transform urban landscapes, and have an impact that lasts for generations, not just decades.

It was 1971 when Jehangir Ratanji Dadabhoy Tata, better known by his acronym JRD, as Chairman of the Tata Group, decided to sign on the proverbial dotted line to accept the Lake Palace Hotel in Udaipur on a lease term for Taj Hotels from the former royal family of Mewar.

It turned out to be a visionary move that breathed new life into the 400-year-old city of Udaipur – where the soul and spirit of the fearsome Maharana Pratap still reigns.

Write in the prestigious Quarterly on family businesses — from the Thomas Schmidheiny Center for Family Business at the Indian School of Business (ISB) in its July-September 2022 issue — Professor John Ward and Professor K Ramachandran paint a stark picture of the macro environment of 1971.” The abolition of private scholarships and special privileges granted by the Indian government in 1971 posed a major challenge to the former royal families.They lost income that was essential to maintain their lavish estates and fulfill their moral responsibilities as as guardians of their community,” notes the case study.

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“The 75th descendant of the Mewar family, Maharana Bhagwat Singh Mewar, has taken up this challenge by converting their summer residence, the Lake Palace, into a heritage hotel. This was a pioneering effort which led to the conversion of many other royal properties into hotels,” he said.

According to ichltata.com, this provided an interesting point to join: JRD’s decision to partner with Lake Palace Hotel in 1971 marked the Taj Hotels’ first foray away from Bombay, now Mumbai.

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Since 1903, the Taj Mahal Palace Hotel has defined the scenic India Gate waterfront promenade at the Radio Club and its distinctive pier. For more than 60 years, the Taj Mahal Palace became not just a luxury hotel, but a cultural center, an exclusive venue where Bombay’s elite celebrated their personal and corporate ceremonies. Now, in 1971, the Chairman of the Tata Group took the bold step of taking the first step towards Udaipur, a sleepy heritage city that didn’t even have regular air connections to Bombay or Delhi!

The ISB case study (entitled ‘India’s Mewar Dynasty: Sustaining 76 Generations of Service and Custody’) highlights the existential challenges facing Maharana Bhagwat Singh. “The economic distress due to the abolition of private purses and the voluntary responsibility as “guardians” to take care of the dependents of the properties encouraged him to undertake this conversion. However, this transformation of the royal family into hoteliers was not easy. They lacked the professional skills to run the business. Therefore, Bhagwat Singh approached the Taj Group of Tatas in 1971 to operate the hotel on a lease basis. This association celebrated its 50th anniversary in 2022. Lake Palace has become India’s most unique luxury palace hotel,” he noted.

To mark 50 years of business association, N Chandrasekaran, Chairman of Tata Sons visited Udaipur in October 2021. While thanking Shriji Arvind Singh Mewar, Chairman and Managing Director of Lake Palace Hotels & Motels Private Limited, d having entrusted the Indian hotel of the Tata Company Ltd. (IHCL) with the Palace, he recognized the architectural marvel and illustrious history of the Palace Island on Lake Pichola.

Business historians agree that IHCL’s partnership with Lake Palace Hotels & Motels, now in its sixth decade, is India’s longest running business partnership in the Indian private sector. It surpassed the famous collaboration between the Munjal family’s Hero Group and Honda Motor Company of Japan which lasted 26 years, between 1984 and 2010.

In recorded interviews, for the preparation of the ISB case study, Shriji Arvind Singh Mewar admitted that without the resources and expertise of the Taj Group, the Lake Palace Hotel would not have reached the iconic position it busy today.

“The Taj Lake Palace is a legendary icon of Udaipur. IHCL sensitively restored it to preserve its timeless elegance and unique history, while combining it with the conveniences of modern luxury. We are delighted to have this long and fruitful relationship with the Guardians of Indian Hospitality. My family and I look forward to this continued association and enhancement of the region’s tremendous tourism potential,” he said.

On the contribution of tourism and related industries to the economy of the city of Udaipur, although there is no complete validated data, industry experts in 2022 estimated the figure at 5,000 crore of rupees or about 700 million US dollars.

Nearly 30% of the population is directly affected by tourism, or 30,000 families according to informed estimates.

In January 2022, the number of daily air flights to Udaipur was 15; with air passengers almost touching the million mark in the pre-Covid era.

The same goes for the number of hotels: luxury hotels include Taj Fateh Prakash Palace, Shiv Niwas Palace, Oberoi Udai vilas, Leela Palace, Raffles Hotels and Resorts; at least 8 high-end hotels including Radisson Blu, Radisson Green, The Trident, The Lalit, Ramada, Devigarh among others.

Alumni, working at the Taj Lake Palace Hotel in the 1970s, recall charter flights from Bombay and New Delhi that brought high profile and wealthy guests to the hotel, often in a hot and sweaty state. Telephones were a battle of nerves while the power supply added to the challenges of everyday hospitality.

It is not just Udaipur, the state of Rajasthan and India that have benefited from JRD’s decision to incorporate authentic royal palaces as part of luxury hospitality. The Rambagh Palace in Jaipur was soon to become the next palace-hotel in the Taj Group’s bouquet of offerings in 1972. It made Jaipur, the capital of Rajasthan, a global destination, a status it continues to hold with more than 3 million inhabitants. passengers each year via its international airport.

“It is no truism that generations have benefited from the decision of my illustrious grandfather Maharana Bhagwat Singh and JRD Tata,” said Mr. Lakshyaraj Singh Mewar, Executive Director of HRH Group of Hotels, Udaipur.

“Besides the former royal families, who converted their palaces in Jaipur, Jodhpur, Bikaner, Jaisalmer, one must salute the great old men of the hospitality industry like JRD Tata, MS Oberoi, Capt Nair, PRS Oberoi and Ratan Tata, who ‘ built ‘chains of hotels across Rajasthan, brick by brick.They created the infrastructure and blitz marketing that gave Rajasthan’s tourism its identity, profitability and sustainability.Today, global hotel brands the most prestigious are here, rooted in our soil, thanks to the hard work of this previous generation,” he said.

In 1992, JRD Tata was awarded the Bharat Ratna, the country’s highest civilian honour; he is the only industrialist to have been honored with this prize.

(The author is a senior freelance journalist and writes about aviation and Hospitality industry.)

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