NO CONTROL ON WEDDING BILLS

By M H Ahssan

Wish to cut down on wedding costs? Don’t have a clue from where to start. HNN tells you ways to rationalise the huge expenditure for making the event not only a memorable one but also affordable

Marriages may be made in heaven but if only they could be solemnised there too. Every bride and groom could fulfil their vision of a perfect wedding, in an idyllic setting with as many guests and fanciful embellishments as they desired, without spending a penny on it. However, it only gets this good in dreams. In real life, a wedding means weeks of nervous anxiety for all concerned, starting from the day the dates are decided to the moment when the final reception is over. Compounding this anxiety is the dip that you can see in your bank balance, every time a ceremony takes place.

As a parent, you may not give it too much thought, particularly if you’re one of those who have saved up for the day well in advance. In fact, even with the slowdown, most parents still dismiss forking out large sums of money with the thought that such an opportunity comes up only once or twice in a lifetime. Nevertheless, there are certain things you could do to rationalise the vast expenditure, without compromising on your child’s special day. If you’re wondering how this is possible, SundayET provides you with a ready reckoner.

CREATE A BUDGET
Most financial planners agree that as parents, the first step you should take is to chalk out what you can afford to spend on the wedding. Be realistic and do not allow yourself to be guided by emotions at this critical stage. This needs to be followed up with an estimation of the different areas of expenditure such as clothes, jewellery, gifts, food, décor and how much you want to allocate towards each of them. Mumbaibased financial planner Zankhana Shah feels that doing this allows you to make prioritise as well as take decisions which are realistic and practical. Meanwhile, keep your eyes open to over-spending on any particular element. Always keep the bride/groom privy to your plans at every stage to prevent misunderstandings.

However, if you find yourself worrying over where you can cut costs, then here are a few practical alternatives.

LIMIT THE NUMBERS
Step back and ask yourself just how many ceremonies you actually need before and after the wedding. Both brides and grooms have had as many as six-seven ceremonies each in the past but wedding planners say that it is possible to bring this number down to about three or four. For instance, many families are now combining ceremonies such as the wedding and the reception to save unnecessary expenses. Also if the relationship between the families is extremely good, you could decide to have joint functions and divide the expense equally.

Here’s another game you can play with numbers. Inviting 1,500-2,000 guests to your wedding may make you the talk of the town, but tapering your guest list by about 200-300 people could give you that little extra you needed to add an exotic element to the décor or dessert in the wedding buffet. If you are worried about hurting sentiments, divide your guest list such that different people are invited to different ceremonies. Also, keep your invitation card simple and classy and cut out the huge hampers and gifts accompanying the card. If you are extremely particular, then you could send a traditional item like a box of sweets with your card. Limit the number of cards printed and send online cards to as many as possible.

KEEP IT SIMPLE
Also remember that it’s not always necessary to spend huge sums to have a glamorous or a classy look. If you have a good wedding planner, he/she definitely has the skills to achieve the same look at a far lesser cost. According to Meher Sarid, a consultant to the wedding industry, “Over the last two years, wedding décor has taken a more minimalistic turn. So if you don’t want to use hand-embroidered velvet for your tents, then there are simpler and cheaper alternatives such as using velvet with prints on them or even thick satin.” Similarly, creating the basic paraphernalia for a wedding like the mandap, a small backdrop, a well-decorated entrance, using domestically available flowers and props is possible at a mere Rs 50, 000 while it could even go beyond Rs 10-15 lakh.

Jewellery is yet another segment where you are likely to see huge spends, especially for wedding. With gold prices at an all-time high hovering around Rs 15,000 (per 10 grams) mark, you could consider looking for alternatives like using jewellery that has been handed down in the family or use gold-polished jewellery or even switch to silver. In fact, this year, many brides have actually decided on fake jewellery owing to the higher prices of gold. Shah also recommends that in addition to giving children gifts in the form of money and gold, parents should also look at making investments for their children, which will compound and provide for his/her goals in a shorter time.

STICK TO YOUR HOMETOWN
Coming to wedding destinations, Sarid says that in the current scenario, it would make greater economic sense to limit your weddings to Indian soil or even to your hometown. This allows you to enlist the services of contacts that you have made in the past as well as the specialised skills of people in the family. However, with hotel rates and flight rates having dipped drastically, you have the chance to explore your options, provided you have the time and the ability to evaluate them carefully. However, many NRIs who were looking at arranging a wedding in India are now conducting marriages in their hometown as this would help them cut numbers.

The best bit is that with the slowdown many people, even those who can afford it, have become careful with their spending and have stopped the ostentatious display of wealth. In an atmosphere like this, a few less bells and whistles may not seem to be as grievous an error as it would be in normal times.

IT'S ALL ABOUT MONEY HONEY

By M H Ahssan

AFTER A DOWNWARD TREND FOR AN YEAR, THE INDIAN STOCK MARKETS ARE AT LAST SHOWING SOME SIGNS OF REVIVAL. HNN HERE TRIES TO TRACK THE UPWARD MOVEMENT AND GAUGE THE MOMENTUM

Gone is the age of buying and forgetting share portfolios. The savvy investing class is looking at making a quick buck even in the current market.

The widely held theory is that the only time to make money in shares is when the market is rising. But, several investors have worked towards dispelling this perception in the recent bear market, armed with improved products and better information that have helped them capture movements either way.

Not many dispute the fact that the scope for making profits is much higher in a bull market than in a downtrend. Still, many nimble-footed investors have chucked the ‘buy and forget’ investment style for the moment in search of some quick gains. Market participants attribute this confidence among such investors to increased possibilities to trade through futures and options.

“People are increasingly adopting specific strategies in derivatives to make money during bear market,” said Gaurav Dua, research head at retail brokerage Sharekhan. “The most common of them is to buy put options and wait for the market to fall. Avid investors also make use of covered calls to
make money,” he added.

Market participants expect a significant build-up in put options over the coming weeks in the run-up to the general election results mid-May. While players are hoping for a coalition led by Congress or BJP to come to power, changing equations in the political circles over the last few weeks have made predictions all the more difficult.

“Historically, markets have been edgy ahead of elections. We think concerns of a hung Parliament could lead to a 15% correction in markets this time,” said Bank of America Merrill Lynch, in a recent report.

“Markets are looking for a stable government that will push through incremental structural reforms after the election. But for now at least, the outcome of the election remains very much in the balance,” Nomura International said in a report. “A poor fiscal situation and a likely weak coalition government at the centre should mean that a major post-election rally is unlikely,” it said.

Amid the confusion over the outcome of elections, investors will also closely watch the March quarter results of Indian companies. Analysts said any sharp decline in earnings could undo all the optimism that has been build-up of late and trigger a sell-off in the market.

Though companies are expected to report a further dip in earnings this quarter, investors are awaiting comments from companies about the broader business outlook. While some domestic economic data has sparked hopes that the worst could be over, analysts are still cautious about concluding that India is back on the growth path.
“While there has been a visible improvement in demand in some domestic sectors, this will not translate into earnings upgrades,” CLSA said in a report.

The ABN AMRO Bank’s purchasing managers’ index (PMI), a key economic barometer based on a survey of 500 companies, rose to 49.50 in March from 47.0 in February. The index had hit a low of 44.4 in December. Nomura does not expect a speedy rebound in the economy’s growth, even though it sees the economy showing ‘nascent signs of bottoming out’ by mid-May.

“A noticeable economic recovery is unlikely until FY11 (year ending March 2011), underpinned by very loose macro policies (at home and abroad), low commodity prices and an easing of the global credit crunch,” it added.

Apart from domestic factors, developments in the global economy and financial markets, mainly the US, will play a significant role in dictating the trend in equities here. Global markets have rallied 20-25% over the last three weeks on the recent move by the US government to clean up the financial sector. The latest step to allow banks more flexibility to value toxic assets, which have forced significant write-downs, has also been cheered by markets. But, market partcipants do not seem to be convinced whether these developments are good enough indications of the worst being over and term the recent upside as a ‘bear-market rally’. “We have not witnessed a significant change in fundamentals, locally or globally to justify such a rally.

It is only a operator-driven rally and many investors would be caught on the wrong foot,” said Ambareesh Baliga, vice president, Karvy Stockbroking. Market participants said investors who managed to buy shares at the year’s low can contemplate booking profits, given that the likelihood of a decline is higher now than before.

“Investors will be able to money if they trade with a shorter time horizon. The idea is to buy at lower levels and sell at 15% to 20% gains,” said Anmol Sekhri, portfolio manager at brokerage Bonanza Portfolio. He thinks that the current level is not the best to buy for the longer them.

Centrum Broking’s senior vice-president, portfolio management services, Mehraboon Irani believes there is scope for investors to make upto 30-40% returns even in this market through short-term trading strategies, without the help of derivatives. “The idea is to buy only high-beta large caps; highrisk investors can buy high beta value - low fundmental stocks while medium risk-taking investors can buy high beta - sound fundamental stocks like ABB, L&T or Tata Steel. Riskaverse investors should only buy stocks with good fundmentals and reasonably good beta levels HDFC or SBI,” Irani said.

Stable govt will see stock rally
If a stable government is formed, the market could gain up to 30% in next six months. But weak coalitions could see roller-coasters ahead

If the stock market performance after the formation of a new government over last few elections is anything to go by, investors can be sure of one thing - if a stable government is formed, the market can gain up to 30% over the next six months. However, if it is again an unstable coalition, then they are in for some more rough rides.

Apart from the masses, the investor community too, has a keen eye on the elections. This is because, the formation of a stable government invariably provides the government more leg-room to take tougher policy decisions, which may be against the interest of some sections, but helps corporate India and in turn, the investors.

An analysis of post-election market trends over the last two decades, the period for which market data is available, provides interesting insights and reaffirms the above hypothesis. On all the three occasion out of the last five elections, when a stable government was formed, the sensex generated positive returns. On the other two occasions, after ’96 and ’98 elections, when there was a crisis of stability, markets have generated negative return of nearly 20%. Out of the three positive occasions, on two occasions, the returns were more than 25%. Interestingly, on both of these occasions, Congress or Congress-led governments were formed at the centre. On the third occasion, it was a marginally positive return of 3%.

The stock market generated a return of nearly 37.6%, after the first election under consideration here. The gain in the first election seems to have been impacted by Harshad Mehta scam. However, a closer look reveals that the real bubble started after the six-month period considered here. While the returns during the first six-month of government formation was still reasonable at 37%, the next three months, when the bubble was really formed, gave a return of nearly 120%!

The two occasions when markets generated negative returns were after ’96 and ’98 elections, when the United Front and BJP led coalition were formed respectively. The second of this was close to important international events, namely the East-Asian currency crisis of 1997-98. However, a closer look reveals that the maximum impact of this was in the second half of 1997, which is before the elections, when markets declined by nearly 25%. In fact, in the two months preceding the election, markets had gained about 20%, which was lost in the subsequent months.

The only election that led to a stable government and still did not generate returns was in ’99 when the BJP led coalition came to power. However, this was also the only election to have been impacted by external factor, namely the bursting of tech bubble in 2000. NASDAQ, the key indicator of the bubble, rallied in the months preceding March 2000 when it peaked and corrected by nearly 40% thereafter. Sensex had a nearly similar run, peaking in Feb’00 with 22% returns and then witnessing a correction.

Another interesting fact that comes out of the analysis is that out of the five occasions, the market has shown a rally/correction only once in the first two months, whereas on all other occasions, it has been a gradual movement over a six-month period. This holds an important lesson for the future - any expectation of short-term gain may be disappointing. Investors may have to hold on for a while, if there are signs of stability and will get a chance to exit if instability persists.

Ghee says ‘Jai Ho’

By M H Ahssan

You know what’s the perfect symbol of India’s bindaas gung-ho spirit, its cussed refusal to mimic the West, and its unpredictability? It’s ghee. India has always loved ghee, or pure butterfat. Ayurveda says ghee is great for increasing self-awareness and intelligence, besides getting a complexion and voice to die for. Ghee is soothing and delicious. It evokes memories of dripping rotis, drenched rice, and bowls of dal with a half-inch layer floating on top. Those innocent days before we learnt to eat alien palm oil and soya bean oil.

At a time when jobs are toast, and household budgets stretched after salary cuts (a throbbing vein of personal pain currently), our ghee consumption is rising 8%. Instead of dropping dead like flies from heart disease and strokes, Indians eat more than 32,000 t ghee annually. It’s our favourite comfort food, that beats paneer, ice cream and mithai.

Ignoring the West’s horror of saturated fats, Indians now cheerfully pay 35% more for desi ghee. A 1-kilo tin that sold for Rs 140 in Delhi’s wholesale market last year, is now at Rs 190. Prices are expected to climb further in the next two months.

Love for ghee is universal, as widespread among the urban middle-class as the rural masses. Consumers clearly know the benefits of ghee because close rival vanaspati, that comes from vegetable fat, is no longer popular in the kitchen.

What’s more important, rising demand for ghee affects all of us. Milk is the raw material for ghee. And it’s a rare Indian household that doesn’t buy at least a few cups fresh milk daily. This tug-of-war between ghee and liquid milk means one has to give. The bet is on milk. Milk is going to become much more expensive this summer. The demand-supply dynamics makes it a dead cert. Look at the numbers. India is one of the world’s top milk producers, with 70 million dairy farmers selling 280 million litres daily. Supply is rising 4% annually. But equally divided, that still means each Indian’s daily share is much less than a 330-ml Diet Coke can.

So there is a huge pent-up demand for milk, even if it originates as a few teaspoons to stir into tea and coffee. Three quarters of the total supply is sold as liquid milk. As one out of every two litres is sold in cities, where consumers are relatively better off, often price becomes no object for an essential item like milk. Demand will heat further as more of India becomes urban.

The rest of India’s milk - about 40 mn t in a year- is used for making ghee, butter, skimmed milk powder, khoya, paneer, dahi, cheese, mithai. Ghee gets the lion’s share because it is most popular and also fetches the maximum premium. So when ghee demand rises, dairymen start grabbing a larger share of liquid milk for it. That squeezes liquid milk supply and further pushes prices.

This season there is an additional complication. Every four years, Indian milch cattle hits a lean patch, which reduces overall supply of milk. 2009 is one such ‘leap’ year. To worsen matters, fodder is scarce because poor rains and parched soil means there is very little grass for grazing. So milk supply, especially in the South, Andhra, and Maharshtra, will decline.

On the other hand, both milk and ghee demand will continue to rise. Dairies will buy full cream milk more aggressively to make ghee. This means consumers will have to outbid dairies if they want creamy milk. Full cream milk is certain to become more expensive fairly soon.

Luckily for the calorie-conscious, toned milk prices won’t rise as fast because it has no fat for ghee. Toned milk is simply a mix of water and skimmed milk powder, which is in ample supply, for now. Dairies consider toned milk a poor cousin of full cream milk because it’s demand is growing by an anemic 2% annually. We may be obsessed with our metrocentric food fads. Ultimately the creamy layer will dictate terms.

The other option before ghee manufacturers is to import butter oil, a close substitute, from New Zealand. That makes sense currently because overseas prices are low. Only around 8,000 t, or 25% of total demand, is expected to get shipped in. Yet that is enough to worry milk cooperatives, who fear it may slacken the tug-of-war between consumers and ghee brands over their milk. They want higher customs duty on butteroil to ‘protect’ farmers. Ghee guys say, protect consumers by allowing duty-free import.

Saree saga: Draped for elegance and growth too

By Kajol Singh

Shantaram's eyes were weary. But he couldn’t suppress the proud smile on his face. A masterpiece all the way, he thought to himself giving the nine-yard wrap one last look. A brush of colour, a touch of tradition and an entire year of laborious craftsmanship... the meticulous weaves had finally taken shape. And it had been worth all the days of working round the clock for Shantaram’s family. After tying the knots on warp and weft threads, dyeing, colouring, weaving and finishing, the beautiful double Ikat Patola saree was ready.

It’s not just the Patola saree of Gujarat that is impressive. In fact, the saree in itself is perhaps the most innovative garment in the history of India. What’s more, it’s holding out in the era of slowdown. The brisk business speaks volumes. Sample this: Many leading retail houses in the country admit to 15-20% increase in saree sales over the last year. Even expensive designer sarees are now being bought by a whole lot of 20-somethings. A visible indication of saree sales being untouched by slowdown blues. Industry estimates peg the saree market at a massive $12 billion in India.

Experts say that the demand is steady despite the economic slump. “Sarees like the Patola command a niche market with primarily the NRIs and affluent lot buying them from us. Our sale of sarees have in fact gone up by 20% over the last year,” says S K Chaturvedi, MD of Gujarat State Handloom Handicrafts Development Corporation which was formed in ‘73 for revival of handlooms and handicrafts of Gujarat.

Various other states of India, too, can be credited for making the saree an iconic sensation. Each saree mirrors an effortless story woven around the country’s royal tradition and heritage. With their unique charm and appeal, it is little wonder that sales have still been soaring at a time when spending on other categories have seen a sharp drop.

A peek into the past also offers interesting insights into the story of the saree. It was Maharani Indira Devi of Cooch Behar who made the idea of French chiffon sarees extremely popular in the royal circle. Princess Niloufer from Hyderabad wore fashionable chiffon sarees showing off asymmetrical sequin work. Then synonymous with royalty, the saree’s glory exists even today.

States, including Gujarat, Maharashtra, Tamil Nadu, West Bengal and Orissa, narrate stories of rich heritage spun into this elegant garment. While Gujarat is known more for its reversible double Ikat Patolas, it is the fine silk Kanjeevarams that are synonymous with the South. Likewise its the Paithani which are famous in Maharashtra and Ikat sarees which are dominant in Orissa. The fine silk and opulent embroidery in Banarasi sarees from Uttar Pradesh make them highly sought after, while ‘Kantha work’ and Balucharis are prominent from Bengal. The Uppada silk saree is typically of Andhra Pradesh.

Not surprisingly, each of these sarees are quite expensive. Bright coloured Kanjeevarams are the famous reflections of the art and craft of South India. Made by craftsman in Kanchi and characterised by lively colours, the quality of silk used is extremely fine. Gold zari work can be significantly seen on them, also making for a good investment. The premium range in these is between Rs 10,000-Rs 15,000. But besides the popular Kanjeevaram, there are other sarees in Tamil Nadu too which are equally well-known.

Attracting global fashion houses
Brocades, tissue sarees, Thagadu and Sarboji sarees also form the exclusive range in silk sarees. Tissue sarees, usually worn by the bride are woven in gold thread and are priced mostly upwards of Rs 1 lakh.

Mr Jairam, MD of Rasi Radha Silk Emporium in Chennai, a 110-year old textile firm in Chennai, feels that even though fewer people may be wearing it now, a growth in demand is still being seen. "The saree is not dying as we have seen a steady growth in their demand over the years. We saw a steady growth of 17% till October. The dip in sales post October has been marginal. It is a significant part of the wedding market, hence the sales are not affected as much," he says.

Nalli Group of Companies, a leading player in the textile and retail business, has also been experiencing year-on-year growth in saree sales. "It's more of a perception that the saree is going out of fashion. They have been clocking good sales and growth every year," says Lavanya Nalli, president of the Nalli Group of Companies.

The South, in fact, is known for its wide range in saree wear besides the Kanjeevarams. Also famous is the Mysore Silk saree which is known for extensive and rich zari embroidery on the borders of the saree. From Andhra Pradesh, the pure silk Uppadas display geometric designs and intricacy, requiring a lot of skill and a few months to produce, thus pushing up the cost of these sarees.

The sarees of Gujarat are no less magnificent. The reversible double Ikat Patola, one of the most famous sarees of the state, can range anywhere between Rs 80,000-1,50,000! Woven in Patan in Gujarat, it takes over a year of painstaking effort to make one such saree. Besides the Patola, there is also the Bandhini saree which is the tie and dye saree of Gujarat.

Another popular saree mostly worn in weddings is the Gharchola saree which is woven in Khambat while the embellishment is done in Kutch and Jamnagar. Mainly worn in wedding ceremonies, the red and white combination in these sarees is a preferred choice. Adds Mr Chaturvedi, "Gujarat is famous for various types of sarees. In the Patola, the craft and motif is very intricate. The yarn is dyed in such a way that the motifs form beautifully on the saree. It is symbolic of the rich craft of India." Equally enchanting is the hand-woven Paithani saree of Maharashtra which is a distinctive style featuring bird motifs as well as stars, lotus, flowers etc. A Paithani could range anywhere between Rs 3,000-Rs 1 lakh or above depending on the way it is designed. Made of pure silk, these use gold embroidery extensively. However, in recent times even silver threads topped with gold are a common feature, thus bringing down the overall cost of the saree.

But if you thought the saree's popularity was only restricted on home turf, think again. International fashion houses such as the French fashion house Balenciaga included the saree in their creations as early as 1937. And in 2007, Nicolas Ghesquiere, creative director of the fashion house reintroduced the saree in a glamourous avatar showing innovative drapes in his collections. He even had an entire line dedicated in Fall 2009 for the Paris Fashion Week called the Sari Silhouette Collection!

Experts, however, feel that continuous steps need to be taken to ensure a steady sales growth for the saree. Rta Kapoor, author and researcher, for 'Saris of India' volumes & 'Handcrafted Indian Textiles,' has been involved in several initiatives to revive the evergreen wonder. "The saree has to be re-introduced as a contemporary garment that can be woven in many new ways as it is so flexible and can be constantly refashioned. Only then can the looms that are facing a threat from cheap imports be given a new lease of life," says Kapoor.

In fact when it comes to innovation, the varied drape styles of designer sarees has increasingly been attracting the younger generation. Fashion designer Ritu Kumar, whose collection comprises a large variety of sarees in metallic work, says that a lot of innovations are taking place by designers to attract the younger buyers.

"The drapes are very versatile now. The blouses are also more innovative in cholis, halters, strings and backless styles. One can drape the saree depending on the blouse being worn. For evening wear, it is now fast becoming a preferred option by women in their mid 20s," she says. While styles may come and go, this is one clothing item that continues to have its loyal base of customers. An ageless wonder all the way.

PUNTERS VOTE FOR MANMOHAN AS PM

By HNN Election Team

Less than two weeks away from general elections, the race for power is reaching a crescendo. Perhaps the most clued in on the ground realities is the satta market. HNN finds out how the odds stack up

The five-day process to find out who will rule the world’s largest democracy will cost the Election Commission of India roughly Rs 1,400 crore. However, around five times that sum is at stake in the dingy bylines of urban India where punters are calling cards, taking bets and hedging risks on the outcome of General Elections 2009.

Welcome to the world of India’s booking syndicates, or the Satta Market. HNN eaves dropped on the chatter emanating from the Satta dens of Mumbai, Delhi, Jaipur, Agra, Kolkata and Bangalore, where an estimated Rs 7,000 crore is riding on Elections 2009, up significantly from the Rs 2000-4,000 crore that the last polls commanded.

All these cities have seen hectic activity going on in their satta dens for the months. Bets are being placed on almost everything to do with the elections — winners and losers in key constituencies, margins of victory and defeat and anything else that can be speculated upon.

Who will be the next Prime Minister of India? A question that’s on over a billion minds today is boiled down to five options at the betting table — Incumbent Manmohan Singh, followed by Rahul Gandhi, L K Advani, Mayawati & Sharad Pawar. Mr Singh is a clear favorite here, meaning this option commands the least amount of risk, and hence the least margin. The odds on him are pegged at just Rs 10 to every Rs 100 you bet on. In other words, a bet on the incumbent PM returning to power will earn you just Rs 110 for Rs 100.

After Mr Singh, it’s a tight race between BSP supremo Mayawati and NCP leader Sharad Pawar. On Mayawati, if you bet Rs 100, if she becomes PM you win Rs 145 while on Sharad Pawar you get more than Rs 150. At the fourth position is BJP’s PM candidate LK Advani followed by AICC general secretary Rahul Gandhi. While punters are booking Rs 155 for LK Advani, if Rahul Gandhi was to become the PM, the profits would be the highest at Rs 160.

A leading bookie in Delhi told Sunday ET that the exit polls during earlier elections had fuelled a lot of activity in the satta markets. “In the last general elections, exit polls after every phase played a crucial role for us. Now, with no exit polls there has been a wait and watch policy by many punters. In fact, the same rates seem to be prevailing in all the operating markets, while earlier markets had different rates. There is a general feeling that the UPA campaign so far has been aggressive as compared to the Opposition and its allies.”

With many political analyst predicting the 15th Lok Sabha to be a hung parliament the satta market is still not giving any rates on which political party will win and with how many seats. In fact betting rates of every political party is expected to be out only three to four days prior to every phase of voting. The first phase of voting starts on April 16 and the last one would be on May 13, which is the fifth phase of voting.

Interestingly, Varun Gandhi has not only become the poster boy of the BJP but also of the betting word in the last one week. In fact, he is among the few individual politicians on whom the satta market is giving rates of winning the elections. Besides Varun Gandhi, the punters are also fixing rates for individuals such as Sonia Gandhi, Rahul Gandhi, LK Advani and Laloo Prasad Yadav but the profit margins on these leaders are very low. Interestingly, for the satta market any sports hold more mileage and importance than the general elections, even if it comes once in five years.

THE SIEGE WITHIN - When political friends become opponents

By M J Akbar

The first pattern of this general election has emerged: the really fierce contest is not between traditional foes, but between yesterday’s friends, particularly where they shared power. The BJP’s sense of betrayal in Orissa is palpable. The more decisive story is within the UPA, where shifting mindsets have ignited a splinter-explosion.

In 2004, the Congress had a single aim: to defeat the BJP. This time, its objectives have doubled. Its parallel purpose in 2009 is to expand its base. Where this expansion is sought at the cost of the BJP there is only minor confusion, created by large-scale intrusions by Mayawati or more modest forays by Mulayam Singh Yadav. The contradiction within the UPA lies in the fact that the Congress space in the Gangetic belt and Maharashtra has been usurped by its allies. The Congress clarified its intentions when it decided that it would not fight the 2009 elections as part of an UPA alliance, but seek partial adjustments as suited its purpose. It has prioritised its opponents from the list of allies.

At the top of the Congress hitlist is the Left, which opposed its heavy strategic tilt towards America. The Congress accepted a humiliating seat-sharing arrangement with Mamata Banerjee in order to maximise the damage to the principal Left citadel. In practical terms, this alliance will not help the Congress very much: it would have retained its six seats even without Trinamool. But the Congress vote could help Mamata Banerjee to poll vault from one seat to 10 or even more.

Curiously, the Congress walked away from similar electoral terms in Bihar, giving a lifeline to the BJP and the NDA. Lalu Yadav and Ram Vilas Paswan offered the Congress what it had, three seats. The Congress could even lose all three seats, because it is contesting alone. It accepted a double jeopardy in Bihar in order to begin the process of revival.

Ditto in Uttar Pradesh. Mulayam was more generous than Lalu. The Congress had nine seats; it was being offered 17. A Mulayam-Congress deal would have pressurised Mayawati, squeezed the BJP and taken Congress from nine seats into double digits. Double jeopardy again: BSP and BJP will increase their tally now. The collapse of the Jharkhand pact with JMM will be even more beneficial to the BJP. Is there an explanation?

The Congress stuck with Sharad Pawar only because it did not want its chief minister to resign before the Assembly elections in autumn. But Sharad Pawar is also dispensable in the large scheme of things; he blocks Congress growth in the second largest state, just as Mulayam and Mayawati choke it in the largest. In Tamil Nadu, Karunanidhi retained his alliance with the Congress only by increasing the latter’s seat share to 14 out of 39.

Congress has calculated that when the tears dry and the numbers are counted, the cost will not amount to loss of power in Delhi. It believes it will still emerge as the largest single party, and then be able to cajole or bully the very allies it has damaged by whipping up a ‘Stop BJP At Any Cost’ campaign.

They would not be politicians if Pawar, the Yadavs and Ram Vilas did not instinctively recognise the dangers of this squeeze. They have responded by squeezing back. Pawar has pre-empted the post-election bullying with a question of his own: if the Congress is so anxious to stop the BJP, why doesn’t the Congress support a Third Front government from outside, or even inside, instead of demanding primacy of power in any coalition? In 2004, he and the others were caught flat-footed. This time they have begun a dance to a tune of their composition. Pawar has made it clear that he considers himself a better future prime minister than Dr Manmohan Singh or Rahul Gandhi.

Prakash Karat, who has no debts to pay the Congress and feels betrayed, is categorical that the Left will not support a Congressled government in 2009. If UPA is the modern coalition in Indian politics, the Marxists are saying that they are all post-modernists now.

Conflicts of regional interest have added a Fourth Front to the Third, but these parties will rearrange themselves after the results. Where conflicts are incompatible, parties like BSP and SP will be in different camps, depending on who has reached where first. Do not imagine that all ‘Front’ parties have closed the backdoor to the NDA. Indian politicians love the freedom of a two-way street, and some of them are dexterous enough to negotiate any roundabout.

But both the walk and the talk will start only on the afternoon of May 16. Professional politicians pay for opinion polls, and then dismiss those they don’t like. This may occasionally reflect an inability to face the unpleasant; but they also know that polls are not necessarily the truth. An opinion poll is what it says it is: an opinion. The fact of the matter is that only facts matter. Till then, ignore the spin, enjoy a rest, but do wake up to vote.

Global powerhouses made in India

By M H Ahssan

The transformation of Indian companies from domestic to global players occurred in three phases. Pre-reform, prior 1991, Indian business was in shackles. The post-1991 economic reform necessitated decade-long corporate restructuring to make companies globally competitive. Now, in the third phase, Indian companies are increasingly going global.

Pre-1991, large Indian business houses were prone to stay at home in the sheltered domestic market. The institutional environment of licensing and limited competition led to domestic success without developing the unique competencies, the resources, or the viable scale necessary for competitive advantage in international markets.

Post-1991, Indian companies realised that the traditional Indian business model appropriate for ‘‘sheltered firms’’ had to be abandoned. The decade-long Indian corporate restructuring programme had four essential elements: cleaning the balance sheet, improving competitiveness, focusing on core businesses, and strengthening management. To a great extent, the promoter determined the degree to which the painful restructuring medicine was adopted. Some business groups and companies were rather aggressive in changing the old ways. Other business groups suffered from poor leadership and the family splitting of assets. As a result, some renowned family business houses witnessed unprecedented decline in the 1990s.

In that decade, dominant domestic leaders increasingly looked to become global but they had to overcome the mindset barrier. ‘‘We asked ourselves: Why don’t we become one of India’s MNCs in manufacturing? By doing so we will have better access to the market, better access to knowledge, better access to new developments,’’ explained Baba Kalyani of Bharat Forge. Nevertheless, it took Bharat Forge seven years to find its first customer because coming from a so-called underdeveloped, low-cost country, the company had to battle all kinds of doubts regarding its capability. The Bharat Forge experience raised three issues about overcoming the mindset barrier that comes up repeatedly in Indian companies’ global quest: making a leap of faith, persistence in the face of initial setbacks and overcoming the liabilities of the ‘Made in India’ origin.

For an Indian company to go global requires, at some level, a leap of faith into the unknown. In the face of scepticism, the entrepreneur or owner made the decision to go for it despite, what to unbiased observers, may have seemed like long odds. Anand Mahindra mentioned that while pursuing his MBA at Harvard Business School, he was disappointed that there were no case studies or examples of Indian global brands. It fired his ambition and led him to decide that when he took over the family business, Mahindra would be a global brand.

Becoming global is a learning game. There are initial setbacks and in light of a growing and profitable domestic business, it would have been easy to retreat from global markets. Yet, they persevered and learned from their mistakes. The initial hotels acquired in the 1980s by the Taj Group in cities such as Chicago, New York, and London were B-level properties. But they were what the Taj Group could afford given the foreign exchange limitations the government placed. Taj realised that its competence was in the running of five-star hotels. Later, when it became serious about its international operations in developed markets, it shed all the initial acquisitions and acquired prestigious hotels such as the Ritz Carlton in Boston and Blue Sydney in Australia. What made Taj persevere? R K Krishna Kumar, vice-chairman of Taj Hotels, said: ‘‘The Tata Group has always recognised that the world marketplace is not divisible ... There’s a strategic compulsion to go outside India for many of our businesses because we believe the global market is one marketplace.’’

Until the late 1990s before the IT outsourcing boom, the image of India was detrimental to Indian business. At its worst, India was identified with abject poverty. It was extremely difficult to convince global customers that an Indian supplier could be a reliable source of good-quality products made by a technologically sophisticated company. Imagine an Indian executive a decade ago trying to persuade Procter & Gamble that Essel Propack should be its supplier in the United States.

Indian entrepreneurs learned that in competitive global markets there was always another supplier willing to match the Indian firm’s low prices. To obtain the order required more than that: demonstrating they had the world-class capabilities (assets, processes and knowledge) to compete in international markets.

Going global also requires a dominant lever. Companies such as Infosys and i-Flex Solutions were born global because they understood that India’s huge human capital advantage needed global fulfillment. The IT sectors were instrumental in sparking the imagination of Indian entrepreneurs to seek ‘born global’ business models that exploit India’s large pools of reasonably priced skilled workers.

A transformational merger is a frequently employed strategy to become a global firm. Hindalco did exactly that with its 2007 acquisition of Novelis, a world leader in aluminum rolling and can recycling. Several other Indian firms, such as Arcelor Mittal, Tata Tea and United Breweries, have also used acquisitions as a path to globalisation.

Other companies, such as Tata Motors, Godrej, and Marico, have utilised the specific product competencies developed for India to enter other emerging markets. Given India’s size, domestic leadership often confers global scale, as seen at both Mahindra & Mahindra and VIP. As Anand Mahindra observed, ‘‘India is the largest tractor market in the world, and if you are the largest tractor maker in India, it is a disservice to India if you are not a global force.’’

Grave crisis hits cemeteries

By NEWSCOP

Everything is shrinking in the time of recession — even space for the dead. In the last few years, graveyards in India have been facing an acute shortage of land.

According to Penzy Morgan of New Delhi’s Indian Christian Cemetery, fresh spaces are available in just two of the Capital’s seven Christian cemeteries. “The only burials taking place in these cemeteries are of family members of those whose graves are already there, and even they are being buried in layers on top of existing graves,” she says.

The problem is believed to cut across religious lines. Mehfooz Mohammad, caretaker of the Delhi Wakf Board’s mosques and graveyards, says the Capital’s Muslims need at least 10 more graveyards. “As per a 1970 gazette notification, 488 Muslim graveyards exist in Delhi. Of these, only 25-30 are in actual operation today. Many graveyards have been illegally occupied and litigation is on to get the land back,” he says.

Wadood Sajid, a Muslim cleric, attributes the space shortage to too many permanent graves. “As per Islamic law, graves should be kuchha (temporary), so as to facilitate more burials on top. However, people have not only made permanent graves, but also erected tombstones, making it difficult to bury in layers.”

This has meant for some innovative solutions. The Sewri Christian cemetery in Mumbai exhumes bodies after 18 months and places the remains in small niches that line the cemetry’ walkways. Relatives of the deceased can erect plaques or put up pictures on the niches. “We have been grappling with space shortage for a long time. The issue, in fact, became so acute that since September 2005, we have withdrawn the facility of people buying space within the cemetery. However, since the introduction of niches, a little more space is available,” says Reverend John Silas of Mumbai Diocese.

The Madras Cemeteries Board (MCB), which looks after three cemeteries in Chennai, recently started the system of multi-tier vault burial. This, after its largest cemetery at Kilpauk was partially closed for new burials in April 2005 because there was little available space. “We also introduced the practice of ash burial, where the body is cremated and the ash buried. However, that hasn’t found many takers,” says MCB secretary Bosco Alangar Raj.

The multi-tier vault system places bodies in vaults that look like bank lockers. They can be reused after 2-3 years with the remains pushed into a pit below. “We have utilized 115 vaults till date,” says MCB president Father M. Rayappa.

Even so, the problem with shrinking space for burials looks set to assume grave proportions.