Rahul Bajaj on Licence-Raj Strategy

Between the 1960s and the early 1990s Rahul Bajaj did not merely run an automobile company — he made the Bajaj Chetak scooter the visual shorthand for middle-class aspiration in post-independence India. Families booked the scooter and then waited, on average, ten years and sometimes as long as fifteen, because the rigid License Raj quota system capped monthly factory output well below genuine consumer demand.

From 1950 to 1990 Indian industrial growth was throttled by government quotas and approval regimes; a factory was legally permitted to produce only a fixed number of units each month regardless of multi-year waiting lists. Bajaj repeatedly petitioned Delhi to raise Bajaj Auto's manufacturing cap, arguing on economic, moral and employment grounds, but bureaucrats kept the ceilings in place for years.

Faced with quota rigidities, Bajaj chose to deliberately exceed licensed production to meet genuine consumer demand — and was hauled before the Monopolies and Restrictive Trade Practices (MRTP) commission with the technical threat of imprisonment. When the judge asked whether he was prepared to go to jail, he reportedly invoked his grandfather Jamnalal Bajaj's nationalist jail time, and the case was ultimately dropped.

Rahul Bajaj took charge of the Bajaj Group in 1965 at the age of 27, inheriting an auto operation throttled by License-Raj capacity permits. Over the next five decades he scaled the flagship Bajaj Auto from roughly ₹7.5 crore in turnover to ₹12,000 crore, with the Chetak scooter carrying the lion's share of that growth during the 1970s and 1980s when waiting lists stretched for years.

In 1971 the Indira Gandhi government declined to extend the international collaboration agreement between Piaggio and Bajaj, abruptly severing Bajaj's access to Vespa technology and tooling. The forced decoupling pushed Bajaj Auto to design and manufacture an indigenous scooter — a geopolitical shock that unintentionally seeded the Chetak and the 'Hamara Bajaj' brand identity.

Under the License Raj regime a company was permitted to produce only up to 25 percent above its licensed capacity; Bajaj Auto hit this ceiling even as orders stacked up to a ten-year delivery backlog. Rahul Bajaj was summoned by the Monopolies and Restrictive Trade Commission for the 'crime' of producing more scooters than his industrial license allowed, a moment he later recounted in the book Business Maharajas by Gita Piramal.

At the MRTP hearing, a competing manufacturer — Automobile Products of India's chairman M.A. Chidambaram — tried to disparage the Bajaj scooter by noting that his Lambretta weighed 100 kg versus Bajaj's 94 kg. Rahul Bajaj, defending himself without counsel, reportedly replied that 'the Lambretta is 100 kg of silver but the Bajaj scooter is 94 kg of gold,' turning the comparison into a branding coup; the commission permitted the expansion.

The 'Buland Bharat, Buland Bajaj' advertising tagline — popularised as 'Hamara Bajaj' — embedded the brand into the nationalist imaginary of the License-Raj era, positioning a scooter as a symbol of self-reliant India. The campaign became one of the most durable pieces of Indian advertising, surviving even as the product portfolio pivoted from scooters to motorcycles after 2001.