Tesla and its CEO Elon Musk have been in the news lately over a remuneration package. Last week, Tesla shareholders approved CEO Elon Musk’s $56 billion remuneration package. This is not the first time something like this has happened. In fact, Elon Musk is probably one of the highest-paid CEOs in the world. For comparison, Elon Musk’s annual salary is actually more than the total revenue of several leading car manufacturers in India. If you compare it with the GDP of India, Elon Musk is getting paid more than the GDP of some of the Indian states combined.
Elon Musk’s $56 billion package is actually a very huge amount. The economy of Maharashtra is the largest in the country. Maharashtra is India’s second most industrialized state, contributing 20% of the national industrial output. The Gross State Domestic Product of Maharashtra is $417 billion.
If you look at the lower part of the list of states contributing to the GDP of the country, you realize that it is very low and Elon Musk’s annual salary is more than the GDP of all these states combined. For this story, we are referring to the GDP of the states Goa, Tripura, Chandigarh, Meghalaya, Sikkim, Manipur, Arunachal Pradesh, Nagaland, and Mizoram.
These 9 states are on the lower half of the list of states that contribute to the national Gross Domestic Product. If you take each of these states individually, their contribution is very small compared to other bigger states. However, that doesn’t mean each of these states is not performing well.
Goa’s Gross State Domestic Product (GSDP) is $11.1 billion. Tripura has a GSDP of $8.4 billion, Chandigarh’s GSDP is $6.1 billion. Meghalaya has a GSDP of $5.2 billion and Sikkim contributes a solid $5 billion. Other states like Manipur, Arunachal Pradesh, Nagaland, and Mizoram have a GSDP of $4.9 billion, $4.7 billion, $4.3 billion, and $3.7 billion respectively.
The figures seen here are old and as per 2017 data Goa is India’s richest state with the highest GDP per capita—two and a half times that of the country. Tripura is the third smallest state in India and it is an agrarian state with more than half of the population dependent on agriculture and allied activities.
If you calculate the GSDP of all the states mentioned above, it comes to a total of $53.4 billion. This is still less than the $56 billion annual package of the Tesla CEO.
Most of the CEOs around the world are paid roughly 200 times more than the pay package of their employees. However, in this case, the package established by Tesla for Elon Musk in 2018 was struck down or invalidated by the Delaware court. The chancellor ruled that the process was flawed and the amount was unfair. The court had also mentioned that no discussion was done in this regard before approving the package.
A crucial annual shareholders meeting was called last week this year and in this meeting, the same package was once again approved by the shareholders. Not just the GDP of these 9 states, but it is also more than the total revenue of Indian companies like Tata Motors, Hindustan Petroleum, State Bank of India, and TCS.
