Vijay Mallya, the boisterous Indian beer and spirits tycoon, now cuts a chastened figure.
His passport has been revoked, there is a warrant out for his arrest and India’s foreign ministry has written to the UK government requesting his deportation.
But the one-time golden boy for Indian capitalism declares he is ready to settle hundreds of millions of pounds owed to banks after the collapse of his company, Kingfisher Airlines.
In a four-hour interview with the Financial Times in Mayfair, central London, Mr Mallya says he wants to close a painful chapter in his otherwise spectacular business career.
“We have always been in dialogue with banks saying: ‘We wish to settle’. But we wish to settle at a reasonable number that we can afford and banks can justify on the basis of settlements done before.”
But he adds: “By taking my passport or arresting me, they are not getting any money.”
As the Indian government considers whether to try to extradite him, Mr Mallya says he has no plans to leave the UK, where he says he is in “forced exile”.
Chain-smoking cigarillos and sipping English tea, the pony-tailed multimillionaire confirms he has offered, in a submission to India’s Supreme Court, to repay £440m on outstanding principal of £512m borrowed from state banks.
But the banks declined because — in his words — they are fearful of taking any haircut on their loans in the face of the public frenzy whipped up against him in India.
“It is important to understand the environment in India today,” he says. “The electronic media is playing a huge role not just in moulding public opinion but in inflaming the government to a very large extent.”
Mr Mallya built an Indian beer and spirits empire that accounts for half of the country’s formal alcoholic beverages market. He was once an icon for Indian youth, aspiring to escape the constraints of their conservative, traditionally frugal society.
His attendance at his United Spirits’ Indian Premier League cricket matches, his ownership of a Formula One racing team, his parties and the models from his annual Kingfisher calendar earned him the nickname “King of Good Times”.
But Mr Mallya suffered a devastating financial blow in 2012 with the collapse of his once-popular, but never profitable, Kingfisher Airlines. It left behind a mountain of debt to a consortium of 17 banks, led by the government-owned State Bank of India.
He has now become a test case for how the Indian authorities deal with heavily indebted business magnates.
India’s central bank governor, Raghuram Rajan — struggling to clean up public sector banks overburdened with bad debts — has complained about Indian entrepreneurs living luxuriously while failing to meet their obligations to public lenders.
Kingfisher’s unpaid debts are estimated at about £900m, including principal and accumulated interest.
But Mr Mallya says this sum is an “inflated amount”. He claims the actual principal borrowed was a little over £500m, while interest as of 2013, when legal skirmishes over repayment began, was £120m. “It is grossly unjust to apply compound interest and artificially inflate this figure,” he says.
Mr Mallya says his offer of a final settlement of £440m was “way, way in excess of the World Bank average for settlement of bad debts”.
He also asserts that India’s banks have sold many previous non-performing loans owed by other borrowers to asset reconstruction companies for just 30-40 per cent of their book value.
India’s enforcement directorate — a special federal agency set up to tackle financial crimes — has targeted Mr Mallya on suspicion that he diverted part of a Rs900 crore loan (£90m) from IDBI Bank overseas.
Mr Mallya vigorously denies the charge and invites the government to send in the best auditors in the world. “I am absolutely not guilty of any of these preposterous charges of diverting funds from Kingfisher, buying properties or stuff like that.”
During the interview, Mr Mallya — a serving member of the Indian parliament — steadfastly declines to criticise the Indian government led by Narendra Modi. He rejects the idea that Mr Modi, an austere figure, was behind the decision to issue his arrest warrant and revoke his passport.
“I am perfectly happy with a stable government [with a majority in the lower house]. I will be happy when there is a majority in the upper house too [for the Modi government].”
Instead, Mr Mallya blames the political climate for the failure to reach a deal with the banks, a climate that saw him described this week as a “fugitive from justice” by the country’s attorney-general.
“As professional bankers, they would like to settle and move on but, because of my image as portrayed, they are reluctant to be seen as giving me any discount,” he says. “It will attract huge media criticism and inquiries by vigilance agencies in India.”
He remains an Indian patriot, he insists, who is “proud to fly the Indian flag”, but as the outcry around him continues, he is more than happy to stay safe in the UK.
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