Showing posts sorted by relevance for query special report. Sort by date Show all posts
Showing posts sorted by relevance for query special report. Sort by date Show all posts

Monday, August 24, 2015

Access To Health: Nowhere Near To Being A Healthy Nation

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SPECIAL REPORT
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The out-of-pocket health expenditure by the poor is spiraling and the government spending on public health care is reducing. The existing public health programes and insurance schemes are failing; private health care sector is not properly regulated; INNLIVE finds the health of our nation worrisome.

Despite our efforts and best wishes, our modus vivendi, work atmosphere and environment often lead to situations where we have to consult medics and get treatment. The Country Cooperation Strategy brief of the World Health Organization (WHO) informs that India accounts for 21 percent of the world’s global burden of disease.

Thursday, July 18, 2013

Sardar Sarovar Project: NaMo Narmada, Who Gains, What?

By Himanshu Upadhyaya (Guest Writer)

As elections draw closer, state rhetoric over the Sardar Sarovar dam heightening project is slowly reaching a crescendo as evident from various media reports, but who will finally benefit from the moves on the ground?

Even as The Indian Express reports on the steadily rising water storage in the Sardar Sarovar Dam over the river near Kevadiya in Gujarat, farmers who have been waiting for the last three decades for Narmada waters to irrigate their farms intensify the stir.

Monday, March 09, 2015

Special Report: Why Blame Mufti On 'Masarat Alam', When BJP Wooed 'Separatists'?

The saffron party allegedly reached out to NDFB insurgents in Assam during the Lok Sabha elections.

It is very easy to adopt a hardline national interest view and hurl fire and brimstone at Mufti Mohammad Sayeed for ordering the release of Masarat Alam, supposedly the architect of the 2010 protests.

The BJP, being part of the ruling coalition in Jammu and Kashmir, is party to the government's decision to release Alam.

Saturday, January 24, 2015

Special Report: Why Chhattisgarh State Ration Shops Are Turning Away People Without 'JDY Bank Account'?

This is probably part of the national push to replace food rations with cash transfers. In the first week of January in Chhattisgarh, many people who went to government ration shops to collect their month supply of food grains were turned away because they did not have bank accounts.

It is usually the poor who do not have bank accounts. So, for a couple of weeks, it was those in the greatest need of subsidised grains who went without them.

Tuesday, December 02, 2014

Special Report: Who Among India’s Young Are Likely To Become Modern Slaves?

India has the largest youth population as well as the highest number of people trapped in forced labour and trafficking.

Last month, the United Nations Population Fund released its State of the World’s population report. At the same time, an international activist group, the Walk Free Foundation, released its Global Slavery Index 2014, which estimates the global extent of forced labour, human trafficking and other forms of slavery. In both reports, India gets the highest rankings.

Thursday, November 27, 2014

Special Report: Cows Are Dying Mysteriously In India And A New Vaccine Might Be To Blame

The Ministry of Agriculture has ordered an investigation into the three companies manufacturing foot and mouth disease vaccine.

The major outbreak of foot and mouth disease last year, that killed thousands of cattle in India’s five southern states, may have been caused by the use of substandard vaccines, says a new report.

A team of scientists from the Chaudhary Charan Singh National Institute of Animal Health in Baghpat, Uttar Pradesh, tested samples from 52 batches of vaccine provided to the Foot and Mouth Disease Control Programme by three companies.

Friday, June 14, 2013

Special Report: Rotting Food Grains In Hungry India

By Astha Prakash (Guest Writer)
   
It is hard to believe that India is the same country that transformed from a “begging bowl” to a “bread basket”. After high-yielding varieties of seeds were first introduced in India in 1968, the wheat production rocketed from 6.4 million tonnes in 1948 to 20 million tonnes. The Green Revolution converted India into a shining new nation brimming with success and sufficient wheat stalks. But 45 years after the hopes of converting a country that was once on the brink of mass famine to a self-contained nation, the situation continues to be shaky.

Sunday, April 12, 2015

Special Report: How The 'Rajya Sabha TV' Is Looting Public Money And Floating Norms In Recruitment & Operations?

Is Rajya Sabha TV (RSTV) degenerating into a white elephant that is being fed and maintained with little or no use, and that too at the tax-payer’s expense.

Supposed to represent the voice of the Upper House and corresponding maturity, RSTV raised a lot of hopes when it was launched four years back. However, much of the promise stands belied as amateurism seems to have had an upper hand over professionalism as far as the privileged channel is concerned.

Saturday, September 06, 2014

Why Intel Agencies Are Wary Of Hiring Muslims And Sikhs?

SPECIAL REPORT: In the third year of UPA-2, the then prime minister Manmohan Singh called a meeting of top officials of the Special Protection Group (SPG), the Research and Analysis Wing (RAW) and the Intelligence Bureau (IB) to seek advice on whether the representation of Muslims in the intelligence agencies could be increased, whether they should be allowed to join RAW and whether to end the ban on the entry of Sikhs and Muslims into SPG. The officers reportedly pointed out that any such move would be risky. They asked who would take the blame if something went wrong after the established system was tinkered with. Nothing came out of that meeting and the issue was never raised again.
Intelligence agencies in India have long followed an unwritten ‘no entry’ policy for Muslims (though there have been a few Muslim officers in the IB), while Sikhs are banned from SPG, formed in 1984 to provide security to the prime minister, and the National Security Guard (NSG), the elite anti-terror force functioning under the Union Ministry of Home Affairs. “This is not a new policy. There have been no Muslim officers in RAW since its formation in 1969,” says a former RAW officer. “It has its own reasons for following this policy.”

Wednesday, June 03, 2009

SEZs: It's really a damp squibs?

By M H Ahssan

A study by the Hazards Centre shows that only 19 of an approved 366 SEZs are functional. And within many of these, the number of manufacturing units actually set up and the number of people employed is much lower than expected

A village elder, evicted from the village of Akalmegh in West Bengal in order to facilitate the creation of the Falta Special Economic Zone (FSEZ) located on the banks of the river Hoogly at Diamond Harbour, is still trying to pick up the threads of his life.

“Before moving here, I do not remember a single villager having to go to bed on a hungry stomach. We had paddy, fish from the pond in front of our house, palm, coconuts and different types of citrus fruits. There were few quarrels and if one took place, an elder helped resolve it,” he said.

“Moving to High Land (the name of the resettlement colony) has seen a change of lifestyle. Everyone is worried about his livelihood and there are frequent disputes,” he added.

Around 420 families were resettled in High Land 25 years ago. Today, 12,000 people live in the colony and they echo the regret and pain expressed by all those who have been displaced by the Special Economic Zones (SEZs) being created by governments across the country ostensibly to boost development and increase revenue.

In 1992-93, villagers belonging to eight villages outside Jaipur in Rajasthan were forcibly evicted so that the Sitapura Industrial Area could be created. Land began being bought from farmers in 1992 at the rate of Rs 1 lakh per bigha (though some claim they were paid just Re 1), much below the market rate.

The displaced villagers regret that the peace and harmony that marked their earlier lifestyle has been replaced by what could at best be described as a slum life.

“We were assured we would be given employment in the factories that came up here and that RIICO would provide us with water, electricity and good roads, but all these promises have been belied,” said Ram Singh, a villager from Khusdar village.

The Jaipur Special Economic Zone (JSEZ) was set up primarily to decongest Jaipur by removing the gems and jewellery industry from the heart of the city. But the jewellers chose to move the workers along with the units, so that although 4,200 workers are working here, only 2% of them are local villagers, employed mainly in menial positions as sweepers or daily wagers.

These are some of the findings of the first systematic study on the functioning of SEZs financed by Action Aid and undertaken by the Delhi-based Hazards Centre.

‘Special Economic Zones: How Special and how Economic’ highlights how SEZs, which are 30-40 years old (they were earlier known as Free Trade Zones), suffer from several major drawbacks, the main one being that they have not attracted the kind of foreign direct investment (FDI) that the government had anticipated.

The study quotes extensively from an American study of FDI flows in China (Lee and Fritz Foley’s study ‘Facts and Fallacies about US FDI in China’, 2007), which shows that FDI flows into China have been grossly overestimated. Moreover, 90% of the production from these SEZs caters to the local market and is not export-oriented.

Although the Indian government has approved 366 SEZS, only 19 are functional. They have attracted FDI worth Rs 525.70 crore against private investment of Rs 4,649.94 crore. Investment by the central and state governments till 2007 was Rs 1052.25 crore.

Of the 19 functioning SEZs, the Hazards Centre monitored the performance of Kandla in Gujarat, Falta in West Bengal, Vishakhapatnam in Andhra Pradesh, Jaipur in Rajasthan and Manesar in Haryana.during 2007-08.

According to the study, four of these SEZs were not manufacturing the goods they had originally set out to manufacture. Kandla was developed as a textile and garment hub but had switched over to manufacturing chemicals and fertilisers. Falta, set up to export plastic and rubber, was presently doing business in textiles and garments. Vishakhapatnam, set up to manufacture fine chemicals and engineering goods had switched over to export of high value gems and jewellery. Jaipur alone continued to fulfil its original objective, which was to work in gems and jewellery.

Says Dunu Roy, director of the Hazards Centre, “It is obvious that there was poor assessment of market demand at the time these SEZs were created because today they are making something completely different.”

The older SEZs with the lowest per unit investment (Jaipur and Kandla) were found to have the best export figures.

The survey also found that not enough market research had been done before setting up these zones. The result is that in most SEZs, the number of manufacturing units has come down drastically.

In Kandla, only half of the original 362 units that were set up are functioning. Prestigious units belonging to the Mafatlal and Milton groups have shut down. And while the SEZ claimed to employ 16,581 people, a field visit to the district commissioner’s office in Kandla showed the exact figure was 14,299.

In the same way, the Falta SEZ has 127 functioning units although more than 200 units had been approved originally. Local workers pointed out that only 90 units run on a daily basis. The factory inspector admitted that only ten industries in this SEZ have been registered under the Factories Act.

Vishakhapatnam has generated direct employment for 4,200 people, though the state government had promised employment in a ratio of 60 persons for every acre of land that was acquired. This, the report points out, would have meant the creation of 21,600 jobs.

The Sitapura Industrial Area near Jaipur has been developed on 1,646 acres of land. Villagers from eight villages were evicted to create this SEZ. Lack of employment and gross underpayment of those who do manage to find jobs continues to be a major problem.

In Falta, casual labourers were being paid as little as Rs 30 per day and if a worker took two days of leave, he was fired. “Six months ago, workers launched an agitation and blocked the roads preventing goods carriers from entering FSEZ. Under pressure, the SEZ authorities increased the daily wages to Rs 68 per day and provident fund of Rs 10 per day would be deducted from the salary of the more experienced workers. No industrial unit is willing to take responsibility for on-site accidents,” says Dunu Roy.

In no SEZ is labour hired on a permanent basis, nor is any healthcare provided, the report found. Children are known to be employed in several industries in contravention of labour laws. They are being smuggled in early in the morning and smuggled out late in the evening. Since labour inspectors are not allowed to inspect SEZs, increasing numbers of children are being sucked into the labour pool at lower wages.

Another big source of concern according to the report is that these SEZs are producing huge amounts of toxic waste that is being dumped indiscriminately in the agricultural fields of villagers living outside these zones. The official stance is that only ‘non-polluting’ units have been permitted in SEZs, but this is belied by the complaints of villagers who find a huge reduction in agricultural productivity in their fields which have been inundated by industrial effluents.

The Development Commissioner of West Bengal admitted that no treatment plants have been built to treat solid or liquid waste, and that effluents were flowing out “anywhere outside the boundary wall”, draining into agricultural land and ponds where fishing was practised. Fisherfolk in this area complain that the fishing stock has been hugely depleted in the past one decade.

Villagers complain about the deterioration of their natural environment and the sharp increase in diseases. They also point out that while the state authorities have developed some infrastructure within the economic zones, they have failed to provide any facilities for the surrounding areas.

The Manesar SEZ has been allotted to a private developer -- the Uppal group -- and is not yet functional. The Uppal group had proposed an investment of an estimated Rs 6,500 crore but given the way the market has crashed, it is difficult to see how the group will raise the money to start the numerous knowledge-based industries visualised earlier.

Roy points out that “SEZs begin with high public investment and only when they stabilise does the private entrepreneur step up his investment. Foreign investment comes in at a much later stage when the risks have been covered. It is for this reason that most developers want to use these zones for the purposes of land transaction so they can cover their investment.”

He adds, “Export growth has been slow except in the case of dedicated single-product SEZs that have remained true to their objectives. It can therefore be said that they have fallen far short of their stated objectives.”

The report concludes that SEZs prove categorically that private profits cannot be married to public benefit. The government is using a fallacious argument when it believes that public benefit will come out of private enterprise because this has not been the case.

Friday, February 22, 2013

Did Home Ministry Sit On Crucial Info That Could Have Prevented Hyderabad Twin Blasts?

Every time terror strikes the country, questions over failure of intelligence and information sharing crop up. Thursday's twin blasts in Hyderabad may well be yet another such instance. Did the Home Ministry sit on crucial information? CNN-IBN accessed a key interrogation report of an Indian Mujahideen (IM) suspect where he confessed to doing a recce of Dilsukh Nagar in 2012.

Four months ago, Delhi police had arrested a suspected IM operative Maqbool who informed the interrogators about a possible blast in Hyderabad. Maqbool and his associates conducted a recce in three areas of Hyderabad on a motorcycle. The areas included Dilsukh Nagar, Begum Bazaar and Abids in Hyderabad. He also provided details of who all he was in contact with locally and how he trained many in assembling bombs using urea, diesel and cracker powder.

The suspect even told interrogators that they wanted to prepare IEDs so that blasts can be triggered near theatres. Maqbool and his associates were involved in explosions in Hyderabad and Nanded.

Significantly, Thursday's twin blasts took place near two old city theatres - Konark and Venkatadri. The police's interrogation report also states that Maqbool was an associate of the Riyaz Bhatkal and his targets included Bodh Gaya in Bihar. The report states his involvements in blasts in Lamba theatre in Secunderabad in 2000. Sharda theatre in Maharashtra's Nanded in the year 2000 and blast in Lal Darwaza area of Hyderabad in the same year.

This interrogation report now raises a big question mark - was all this was shared with Hyderabad Police and whether the fresh inputs Home Minister Sushil Kumar Shinde spoke of were different from what was already known four months ago. Or, was this an intelligence failure again?

Here's the full text of the Delhi Police Special Cell interrogation report:
  • The Special Cell, Delhi Police had busted an Indian Mujahideen Module with the arrest of four persons, namely, Asad Khan (aged 33 years) r/o Tawakkal Nagar, Naigaon, Distt. Aurangabad, Maharashtra, Imran Khan (aged 31 years) r/o Peer, Bhurahan Nagar near Masjid-e-Saalehind, Nanded, Maharashtra, Sayed Feroz @ Hamza (aged 38 years) r/o Shukarwarpath, Pune, Maharashtra and Landge Irfan Mustafa (aged 30 years) s/o Landge Mustafa Usman r/o Raj Nagar Dargah, Darya Road, Mukund Nagar, Ahmed Nagar, Maharashtra and explosives, detonators and other incriminating material had been recovered. With their arrest the serial blasts of 1stAugust, 2012 were worked out.
  • Sustained interrogation of the accused arrested by us revealed that a person, namely, Sayed Maqbool @ Zuber, S/o Syed Haji, R/o Samtam Nagar, Near Madina Masjid, Dharmabad, Nanded, Maharashtra was in close association with them and together they planned to commit fiyadeen attacks on the Buddhist shrines in Bodh Gaya in Bihar as retaliation to the alleged atrocities being committed upon Muslims in Myanmar. Their plan had the approval and support of the Bhatkal brothers. Sayed Maqbool was arrested after great deal of efforts on 23rd October 2012 from Hyderabad where he had been hiding to evade his arrest.
  • Maqbool came in contact with Imran through a common friend. The latter introduced Maqbool to Asad and Irfan. Maqbool taught them how to make a bomb by using urea, diesel and fire cracker powder at Asad's farmhouse in Aurangabad. In April 2012, Imran introduced Maqbool to the Bhatkal brothers. Before the Pune serial blasts of 1st August, Maqbool, Irfan, Imran and Asad had discussed their plan of carrying out a fidayeen attack on Buddhist shrines at Bodh Gaya, Bihar. Since Bhatkals wanted to avenge the death of Qateel Siddiqui, they decided to carry out bomb blasts at Pune first.
  • About a month before Ramzan in 2012, Maqbool helped Imran in doing a recce of Dilkhush Nagar, Begum Bazar and Abids in Hyderabad on a motorcycle. This was done on the instruction of Riyaz Bhatkal.
  • Maqbool began his criminal career along with one Azam Gauri @ Aleem r/o Warangal, Andra Pradesh (killed in a police encounter in 2000). His first criminal act was the murder of Krishna Moorthy (FIR No. 220/1999, u/ss. 302/120-B/34 IPC read with sec. 25/27 Arms Act, PS Bodhan, District Nizamabad in which he has been convicted for life. However, he was released from jail in October 2009 after commutation of his sentence.
  • His next criminal act was the murder of one Devender (Case FIR No. 195/1999, u/ss. 302/120-B/34 IPC read with ss. 25/27 Arms Act, PS CID, Andhra Pradesh), who had allegedly encroached on a Masjid land in Uppal, A.P.
  • Maqbool was also involved in the murder of Mahaveer Prasad (Case FIR No. 172/2000, u/ss. 302/34 read with s. 6 Explosive Substances Act, PS Afzal Ganj, Hyderabad City), a jeweller. Here the motive was robbery.

Maqbool was instrumental in the formation of IMMM (Indian Muslim Mohammadin Mujahidin; a terrorist organization) at village Mancharia in 1999 alongwith Azam Gauri and Roshan Baig. They worked under the garb of social reformists by showing that their objectives were -

(1) To stop dowry system in society.
(2) To fight against corruption and
(3) To stop pornographic films.

Azam Gauri had taught Maqbool how to prepare IEDs so that they can cause blasts in those theatres where blue films were being shown.

Maqbool alongwith others were involved in the following bomb blast cases:
  • Bomb blast at Kaketiya Hotel, Lal Darwaza (FIR No. 01/2000, u/ss. 4/5 Explosive Substances Act, PS Moghalpura, District Hyderabad City)
  • Blast at Sharda theatre (FIR No. 28/2000, u/ss. 307/120-B IPC read with ss. 3/4/5 Explosive Substances Act, PS Itwara, District Nanded.
  • Blast in Lamba Theatre, Secunderabad (FIR No. 31/2000, u/s. 120-B IPC read with ss. 4/5/6 Explosive Substances Act, PS Begumpet, Secunderabad, Hyderabad City,
  • Blast in the House of Azam Ghori while preparing IEDs. (FIR No.28/1998 u/s 307 IPC read with Sec. 3/4/5 Explosive Substances Act, PS Dharmabad, District Nanded.
  • Other cases in which he is involved are as below:-
  • FIR No. 39/2000, u/ss. 120-B/153-A IPC, PS CID, Andhra Pradesh (a case of conspiracy).
  • FIR No. 28/2000, u/s. 25 Arms Act, PS Dharmabad, District Nanded (recovery of fire arms only).
  • Maqbool is also close to Abdul Rauf, r/o Shahidabad (leader of AIMIM - All Indian Majlis Itehad-ul Muslimi, a political party) and one Nashruddin. Both Abdul Rauf and Nashruddin have been involved in Hiren Pandya murder case of the year 2003. Maqbool was appointed as the Dharmabad District President of AIMIM by Abdul Rauf.
  • Further investigation is going on.

Sunday, November 02, 2014

Indian Urdu Media: Fanning Minority Fears In Tears

Of all categories of people in our societies, journalists understand meanings of words instinctively and the societal context in which they are understood by common readers. Shahid Siddiqui is the chief editor and owner of Nai Duniya, an Urdu newspaper that has been read by Indian Muslims for over 41 years. 

Siddiqui controls the weekly newspaper and decides images, headlines and articles that are published. Since it is generally accepted that Muslims have low literacy levels and cannot evolve enlightened responses to emerging issues, it is reasonable to expect Siddiqui’s newspaper to show a positive path for Indian Muslims.

As a school-going youth in the 1980s, this writer watched Siddiqui’s newspaper arrive regularly in bookstalls at railway stations with cover pages that would leap to our eyes with messages such as: Islam is in danger; Muslims are under siege; the West is hunting Muslims; Jews are evil. It hasn’t changed. 

Saturday, July 18, 2015

Special Report: Worshiped Inside Temples, But Mistreated Outside: The Fate Of Captive Elephants In India

WEEKEND KA TADKA: I recently visited a popular south Indian Lord Ganesha temple, Kottarakara Sree Maha Ganapathy Temple. What struck me besides the scorching summer heat, was the horde of devotees thronging the sanctum sanctorum with fervour. Murmured chants and prayers lent an other worldly feel to the atmosphere. Having sought my share of the Lord’s blessings, I ventured outside to explore the premises of the temple.

Outside the main entrance stood an elephant tethered to a tree, flapping its ears serenely, munching palm leaves and bananas. It was a majestic creature, easily the largest I had ever encountered, with its long trunk and gleaming tusks. A small crowd of excited onlookers watched with awe and took pictures from all possible angles.

Wednesday, September 04, 2013

Did Asaram’s Arrest Turn Vanzara Against ‘God’ Modi?

By Kajol Singh / INN Bureau

While it was his despair at the lack of support from his ‘god’ Gujarat Chief Minister Narendra Modi that ostensibly led suspended IPS officer D G Vanzara to write his explosive resignation letter, reports suggest that the arrest of his ‘guru’ Asaram Bapu in a case of sexual assault may have had something to do with that letter being formally dispatched. 

A complex triangle A known supporter of the self-proclaimed godman just like Modi himself was until some time back, Vanzara is believed to revere Asaram intensely.

Friday, August 02, 2013

Special Report: Jammu Is A Barometer Of Modi’s Fortunes

By Ashraf Jani / Srinagar

To gauge the success of Hindutva politics across India, this is the region to watch. Jammu & Kashmir may be India’s only Muslim-majority state but Jammu, the state’s winter capital, was one of the fountainheads of Hindu nationalist politics in the country. It was here that Balraj Madhok formed the Praja Parishad Party in 1949 and later merged it with the Bharatiya Jana Sangh, founded by Syama Prasad Mookerjee in 1951 and the forerunner of the BJP. Mookerjee died in a Kashmir jail while protesting the special status given to the state under Article 370 of the Constitution. In fact, the Jana Sangh’s slogan of Ek Vidhan, Ek Nishan, Ek Pradhan (One Law, One Symbol, One Leader) emerged from its opposition to J&K’s special status.

Saturday, February 28, 2009

By M H Ahssan



Subhiksha is India's largest retail chain -- or some would prefer to say "it was." Over the past few months, the network of neighborhood discount shops has been coming apart at the seams. Most of the outlets are now closed. The company -- Subhiksha Trading Services -- has been unable to pay salaries and statutory dues for the past few months. With the unpaid security agency staff also not reporting for work, many of the stores have been vandalized. "The properties have become vulnerable targets," founder and managing director R. Subramanian told The Financial Express. The vandals, he said, could include "disgruntled vendors, employees, anti-social elements taking advantage of the situation, and even owners of the real estate" rented by the retail chain.



Subhiksha -- which means "prosperity" in Sanskrit -- is coming apart in other ways, too. In fast-moving developments, one of the investors -- private equity company ICICI Ventures -- has asked the government to step in and order an independent audit of the company's accounts. Another investor -- the high-profile Wipro chairman Azim Premji's personal investment firm, PremjiInvest -- has approached the Madras High Court to stop the proposed reverse merger between Subhiksha and Blue Green Constructions & Investments, a listed company Subramanian had acquired last year. Subramanian's objective was to get listed through the back door after the plan for an initial public offering fell through because of adverse market conditions. ICICI Ventures holds a 23% stake in Subhiksha and PremjiInvest another 10%, which was sold to it by ICICI Ventures last year for around US$50 million. In addition, the Employees Provident Fund Office recently said that Subramanian will be held personally responsible for non-payment of statutory dues to the staff.



Previously, Subramanian was the poster child of India's retail revolution. Others, like the Future Group's Kishore Biyani (who started Big Bazaar, Food Bazaar and Pantaloon) may have made a bigger splash. But Biyani had a business background; Subramanian's father was a Reserve Bank of India official and Subramanian was a first-generation entrepreneur, a product of liberalization and India's answer to Wal-Mart's Sam Walton. "Subhiksha was a value-focused retailer born at a time when organized retailing was only for the elite," said Subramanian in an email to India Knowledge@Wharton. "From 150 stores in September 2006, all of which were in Tamil Nadu [a state in South India], the company grew rapidly to over 1,600 stores [across the country] by September 2008."



The big question: Is Subhiksha shutting down? "We are in pain but we are not shutting down," Subramanian wrote. "We had expanded rapidly; most of the growth was debt-led. The company had planned to raise equity during 2008 and was close to doing so in September when calamity hit the global markets. The company's lenders, while supportive, were also unable to extend further lines unless the equity was raised. The banks were not lending to each other, forget about lending to us.... It became a chicken-and-egg story with the company running out of cash by October. We were making money up to September, so the business is viable; it's just that the balance sheet was not.... Money is like blood. If the blood flow stops, the entire brain stops working."



Subramanian acknowledges that employees, landlords and vendors have not been paid. "It's not because we do not want to pay; it's because we can't pay." Is the Indian retail story over for now? "In a market like this, there will be pain," Subramanian wrote. "However, people with long-term interest in retail and a sane cost structure will survive and thrive. Subhiksha will be there, too."



Lack of Demand

Subhiksha, of course, is not alone in facing a recent reverse. The woes of India's organized retail sector -- or "modern trade," as it is called -- have many causes and casualties. Even well-financed companies or those that have wealthy backers are feeling the heat.



"Lack of demand is the major problem," says Mathew Joseph, senior consultant with Delhi-based think-tank the Indian Council for Research on International Economic Relations (ICRIER). "Real estate prices are falling, and organized retail would like to wait until the bottom is reached. Finance is also difficult to come by in the context of falling demand and low profitability as banks are becoming risk averse." Gibson Vedamani, director of the Retailers Association of India (RAI), adds: "Like everyone else, the business groups in modern retail have been hit by the global recession by way of a credit squeeze [and a lack of] funding and working capital. The slump in real estate has been a big issue. Those who had big expansion plans had [acquired] real estate earlier at much higher prices. They are now re-looking at their expansion plans and renegotiating the rates."



One example is Reliance Fresh, backed by Mukesh Ambani, the world's wealthiest Indian and chairman of Reliance Industries. Ambani considers retail the next big thing both for his group and the country. Reliance Retail, a subsidiary of Reliance Industries, launched its first store in November 2006 through its convenience store format, Reliance Fresh. At the end of the last fiscal year (March 2008), the group had 590 stores across 13 states. (It is close to 1,000 now.) This includes other formats such as Reliance Digital, Reliance Mart (hypermarkets), Reliance Trends (apparel), Reliance Footprints (footwear), Reliance Jewels (jewelry), Reliance Timeout (books, music and other lifestyle products), Reliance Autozone (auto accessories and service) and Reliance Wellness (health and wellness).



There were problems from day one. Vegetable sellers stoned Reliance shops in Ranchi, Jharkhand, claiming their businesses would be killed. There was a dawn-to-dusk shutdown of all major markets in Bhubaneswar, Orissa. In West Bengal, Reliance Retail ceased operations after widespread protests. In Uttar Pradesh, the government ordered the closure of the chain following eruptions of violence and the ransacking of some outlets. In Mumbai, traders, farmers and shopkeepers moved into the streets, bringing the city to a near standstill. They were protesting not just against Reliance, but organized retail as a whole. "This is a do-or-die battle for us. Either they go, or the small traders and farmers perish," says Dharmendra Kumar, director of India FDI Watch, an organization that seeks to prevent Foreign Direct Investment (FDI) in the retail sector in India. Kumar says his mandate is to prevent multinationals like Wal-Mart, Tesco and Carrefour from entering the Indian market. As they are not yet in India -- or are present in very restrictive formats -- companies like Reliance Retail have become the substitute targets.



Much of this battle took place in 2007. Today, organized retail is downsizing by itself. Reliance has reassessed its plans and closed some stores; it is in consolidation mode. According to the Future Group's Biyani, growth has moderated. "While urban consumers have the ability to spend, we believe their confidence level has been low leading to disproportionate savings levels," says a report by equity research firm Enam Securities. "Weak same-store sales have cast doubts on the retail consumption story." According to The Economic Times: "Almost all retailers, listed and unlisted, are putting off or curtailing large-scale expansion plans announced earlier."



Yet just a short while ago, the kirana (mom-and-pop) stores seemed to be fighting a losing battle. Groups like FDI Watch, along with the media and politicians, rose to the defense of the huge farmer-trader-shopkeeper segment.



The Future of Kiranas

But there are many who believe that both large and small retailers can thrive. According to Arvind K. Singhal, chairman of retail consulting firm Technopak Advisors: "The battle, if any, was being fought only by politicians and the media. In India, the kiranas will coexist with modern retail for many decades to come." Adds S. Ramesh Kumar, professor of marketing at the Indian Institute of Management Bangalore (IIMB), who has recently done a study on the retailing sector: "Kirana shops, which number around 15 million to 20 million, are part of Indian shopping culture. They are spread throughout the length and breadth of the country and cannot be completely displaced by modern retail formats in the foreseeable future."



The future of the kiranas caused so much concern that the Union Commerce Ministry appointed ICRIER to do a special study to find out the impact of modern trade on these small outlets. The ICRIER report, released in the middle of last year, found that it was "a positive sum game in which both unorganized and organized retail [could] not only coexist but also grow substantially in size." The study found that:



The total retail business in India would grow at 13% annually, from US$322 billion in 2006-07 to US$590 billion in 2011-12.



The unorganized retail sector would grow at about 10% per year, with sales rising from US$309 billion in 2006-07 to US$496 billion in 2011-12.



Organized retail, which now constitutes a small 4% of the total retail sector, is likely to grow at a much faster pace of 45% to 50% per year and quadruple its share in total retail trade to 16% by 2011-12.




Joseph, who led the ICRIER research team, says that some numbers have had to be whittled down since the report was published. "There is a general slowdown in the economy due to the global crisis and that is expected to affect the growth of organized retail in the country," he says. "We had assumed a GDP growth of 8% to 10% during 2007-12 in the report. This is now impossible, at least for the current year 2008-09 and the coming year. Organized retail cannot therefore grow at 45% to 50% as we envisaged."



ICRIER was not alone in painting a rosy picture for organized retail. A November 2005 PricewaterhouseCoopers (PwC) study in tandem with the Confederation of Indian Industry (CII) said that one of the largest marketplaces for modern trade -- India -- was about to open up. "To reach its potential, the Indian retail sector requires significant capital, technology and best practices to bridge the existing productivity gap and achieve scale in operations, which are critical to the sector's success. One of the key steps towards facilitating the development of the retail sector and in accelerating its growth would be to allow foreign direct investment." Titled "The Rising Elephant," the report concluded that the organized sector share would account for 9% to 10% by 2010. Increased employment, efficiency in agriculture and increased exports through sourcing from India were the three most significant benefits of modern trade, the study said.



Another PwC-CII report, released in December 2008, said that the real beneficiaries of organized retail will be "the government, consumers, unorganized trade participants and producer-farmers." Mom-and-pop stores could become part of the system, benefiting everybody. Only about 100,000 "mid-category" stores would take a hit in the medium term.



Yet another report in September 2008 was titled, "The Great Indian Bazaar: Organized Retail Comes of Age in India." The study, by consulting firm McKinsey, said that by 2015 India was likely to be a US$450 billion retail market. Organized retail would grow from 5% to 14%-18% by 2015. The report made two other important points. First, "mom-and-pop stores will continue to remain relevant across large and small towns." Second, "retail in India can be profitable, but not with cut-and-paste global formats." The four mantras for success included innovative "local" formats; customer-backed merchandise platforms; an efficient supply chain; and an empowered front-end sales team, said McKinsey.



A Welcome Shift

Are these strategies and projections destined for the dustbin as India joins the global slowdown? The experts say no. "This is a passing phase but it could last for another year," Singhal of Technopak says. Adds Vedamani of RAI: "This is a temporary phase when many adverse forces are working together and organizations are therefore becoming very cautious. The boom in retail will surely return."



Many see this as a welcome shift to neutral gear, because Indian retail had been growing so quickly. "This calendar year will see companies consolidating their operations rather than looking at expansion," says Vedamani of RAI. "In the earlier retail rush, they were too busy to get their act together. They are now looking at putting their processes in place and getting their houses in order for when the market picks up."



Joseph of ICRIER notes that the slowdown has given the mom-and-pop shops some breathing space, too. "They now have more time to adjust and compete with organized retail," he says. "There are several cases of traditional retailers modernizing and successfully competing with organized retailing. We believe in the co-existence of both big and small retailers in the country, as each one has its own comparative advantages vis-à-vis consumers."



"The situation here is very different from the one in the U.S.," says Kishan Bhat, engagement manager at Zinnov Consulting, a Bangalore-based management consulting firm. "India is a market where everyone can coexist. The culture of kirana stores in a country like ours can never become obsolete. It is deeply rooted in the system and definitely has an edge over the organized sector in terms of convenience and personalized customer experience. The kirana stores today are also adapting to the growing competition from the organized sector. We do foresee them eventually organizing their way of business."



Bhat sees a mutual learning process which will benefit both eventually. "The organized retailers are also learning from the kirana stores and trying to provide a better customer connection," he says. "Besides this, both formats are implementing the best practices of each other. Hence, the two formats will definitely coexist as long as customers are the winners."



"Small retailers in India have inherent advantages," says the PwC-CII "Rising Elephant" report. "They are located next to the consumer, making it convenient for top-up purchase. They know them well, some even by name. They give credit too -- which no large retailer does. Their fixed costs are so low that their breakeven point is as low as 46% of sales."



Finding a Model

Kumar of IIMB says there are opportunities now that may look more attractive for organized retailers. "Segmenting consumers on price sensitivity and lifestyles along with multiple retail formats holds the key for a retail chain in the Indian context," he says. "Organized retail, instead of competing with the unorganized sector using price cuts on branded offerings and short-term sales promotions, should get into private labels that provide good quality at relatively lower prices as compared to established brands. The economic slowdown is probably the ideal time for such retailers to launch these private labels. Private labels with limited merchandise will be an effective approach to target the middle-class consumers who shop almost every day as a part of their culture. Besides, since most residential areas have kirana shops, it is unlikely that consumers will drive long distances for their regular shopping cycles."



"Modern retail is a less-than-20-years-old phenomenon in India," says Singhal of Technopak. "It has attracted a diverse set of entrepreneurs and business organizations, and each one is trying to find out and develop its own unique business model. Some of these models are fundamentally flawed; in some cases the execution is flawed. However, overall, the growth of modern retail in India has been very steady and there is increasing width and depth [in terms of product categories, formats, etc.]. Modern retail trade in India is still in an evolutionary phase and will be in this phase for at least three-five more years before the winning formats and the winners stand out. Then, there will a consolidation and growth phase led by these winners."



Will the winners be Indian companies or MNC majors? There are no easy answers. "India's landscape is fundamentally unique," says Singhal of Technopak. One can't transport Western models and expect them to automatically succeed, he notes. For instance, infrastructure is in very bad shape. During the initial euphoria of the retail boom, several companies imported retail professionals from the West, who came armed with just-in-time and other cost-saving techniques. They realized, to their dismay, that none of this would work in a country where it could take days for a truck to traverse a few hundred miles, he adds.



"The large players usually try to gain on economies of scale and lure customers by reducing the margins," says Bhat of Zinnov. "This would [require] elimination of middlemen and brokers along with established logistics and infrastructure support. However, in the current scenario, lack of infrastructure and inefficient logistics services have dampened the growth of organized retail while providing continued shelter to the middlemen. As a result, organized retailers have not been able to provide higher value. On the contrary, unorganized retailers leverage the inefficiencies of the system and encourage consumers to drive a hard bargain, which enables a win-win situation for both."



One example of the potential pitfalls is the Piramal Group, which opened an upmarket outlet in downtown Mumbai, the first of a planned chain. It proved to be a tourist attraction for visitors to a nearby religious shrine. Most visitors came to look, but not to buy. The company tried to insist that all who came to the mall should possess a mobile phone or a credit card to gain entry, but the idea was quickly withdrawn after a public outcry against discrimination. (The mall closed down shortly thereafter.)



These are problems that no amount of multinational expertise or FDI can likely address. "FDI is not so relevant in the current context, but technology can certainly help retailers understand their customers better," says Vedamani of RAI. Bhat of Zinnov disagrees. "The entry of foreign multinationals would make the market more competitive," he says. "Indian consumers will definitely benefit." But money or new technology will not help, he adds, "unless customers become the utmost priority."



"FDI in retail is extremely relevant," says Singhal of Technopak. "As India's consumption basket changes, new retail businesses have to be started to take care of emerging consumer needs. For this, both capital and know-how [in sourcing, distribution, etc.] is needed. From a consumers' perspective, they also need more choice in terms of retail options, and FDI can give them access to more choice of formats and value propositions." Adds Joseph of ICRIER: "Inexplicable restrictions on FDI investments in the sector are preventing even Indian retailers from raising global capital."



Early in February, the government announced major changes in its FDI policy through two "Press Notes." The ban on FDI in multi-brand retailing such as supermarkets seems about to expire, but "the 10 pages of unintelligible officialese" leave many unanswered questions, according to The Financial Times. There have been no clarifications as political parties prepare themselves for the coming general elections. Subramanian of Subhiksha is certain he will be there when the MNCs arrive. The problems for both organized Indian retail and his own venture will pass. "After all, challenges make boys into men," he says.
By M H Ahssan



Subhiksha is India's largest retail chain -- or some would prefer to say "it was." Over the past few months, the network of neighborhood discount shops has been coming apart at the seams. Most of the outlets are now closed. The company -- Subhiksha Trading Services -- has been unable to pay salaries and statutory dues for the past few months. With the unpaid security agency staff also not reporting for work, many of the stores have been vandalized. "The properties have become vulnerable targets," founder and managing director R. Subramanian told The Financial Express. The vandals, he said, could include "disgruntled vendors, employees, anti-social elements taking advantage of the situation, and even owners of the real estate" rented by the retail chain.



Subhiksha -- which means "prosperity" in Sanskrit -- is coming apart in other ways, too. In fast-moving developments, one of the investors -- private equity company ICICI Ventures -- has asked the government to step in and order an independent audit of the company's accounts. Another investor -- the high-profile Wipro chairman Azim Premji's personal investment firm, PremjiInvest -- has approached the Madras High Court to stop the proposed reverse merger between Subhiksha and Blue Green Constructions & Investments, a listed company Subramanian had acquired last year. Subramanian's objective was to get listed through the back door after the plan for an initial public offering fell through because of adverse market conditions. ICICI Ventures holds a 23% stake in Subhiksha and PremjiInvest another 10%, which was sold to it by ICICI Ventures last year for around US$50 million. In addition, the Employees Provident Fund Office recently said that Subramanian will be held personally responsible for non-payment of statutory dues to the staff.



Previously, Subramanian was the poster child of India's retail revolution. Others, like the Future Group's Kishore Biyani (who started Big Bazaar, Food Bazaar and Pantaloon) may have made a bigger splash. But Biyani had a business background; Subramanian's father was a Reserve Bank of India official and Subramanian was a first-generation entrepreneur, a product of liberalization and India's answer to Wal-Mart's Sam Walton. "Subhiksha was a value-focused retailer born at a time when organized retailing was only for the elite," said Subramanian in an email to India Knowledge@Wharton. "From 150 stores in September 2006, all of which were in Tamil Nadu [a state in South India], the company grew rapidly to over 1,600 stores [across the country] by September 2008."



The big question: Is Subhiksha shutting down? "We are in pain but we are not shutting down," Subramanian wrote. "We had expanded rapidly; most of the growth was debt-led. The company had planned to raise equity during 2008 and was close to doing so in September when calamity hit the global markets. The company's lenders, while supportive, were also unable to extend further lines unless the equity was raised. The banks were not lending to each other, forget about lending to us.... It became a chicken-and-egg story with the company running out of cash by October. We were making money up to September, so the business is viable; it's just that the balance sheet was not.... Money is like blood. If the blood flow stops, the entire brain stops working."



Subramanian acknowledges that employees, landlords and vendors have not been paid. "It's not because we do not want to pay; it's because we can't pay." Is the Indian retail story over for now? "In a market like this, there will be pain," Subramanian wrote. "However, people with long-term interest in retail and a sane cost structure will survive and thrive. Subhiksha will be there, too."



Lack of Demand

Subhiksha, of course, is not alone in facing a recent reverse. The woes of India's organized retail sector -- or "modern trade," as it is called -- have many causes and casualties. Even well-financed companies or those that have wealthy backers are feeling the heat.



"Lack of demand is the major problem," says Mathew Joseph, senior consultant with Delhi-based think-tank the Indian Council for Research on International Economic Relations (ICRIER). "Real estate prices are falling, and organized retail would like to wait until the bottom is reached. Finance is also difficult to come by in the context of falling demand and low profitability as banks are becoming risk averse." Gibson Vedamani, director of the Retailers Association of India (RAI), adds: "Like everyone else, the business groups in modern retail have been hit by the global recession by way of a credit squeeze [and a lack of] funding and working capital. The slump in real estate has been a big issue. Those who had big expansion plans had [acquired] real estate earlier at much higher prices. They are now re-looking at their expansion plans and renegotiating the rates."



One example is Reliance Fresh, backed by Mukesh Ambani, the world's wealthiest Indian and chairman of Reliance Industries. Ambani considers retail the next big thing both for his group and the country. Reliance Retail, a subsidiary of Reliance Industries, launched its first store in November 2006 through its convenience store format, Reliance Fresh. At the end of the last fiscal year (March 2008), the group had 590 stores across 13 states. (It is close to 1,000 now.) This includes other formats such as Reliance Digital, Reliance Mart (hypermarkets), Reliance Trends (apparel), Reliance Footprints (footwear), Reliance Jewels (jewelry), Reliance Timeout (books, music and other lifestyle products), Reliance Autozone (auto accessories and service) and Reliance Wellness (health and wellness).



There were problems from day one. Vegetable sellers stoned Reliance shops in Ranchi, Jharkhand, claiming their businesses would be killed. There was a dawn-to-dusk shutdown of all major markets in Bhubaneswar, Orissa. In West Bengal, Reliance Retail ceased operations after widespread protests. In Uttar Pradesh, the government ordered the closure of the chain following eruptions of violence and the ransacking of some outlets. In Mumbai, traders, farmers and shopkeepers moved into the streets, bringing the city to a near standstill. They were protesting not just against Reliance, but organized retail as a whole. "This is a do-or-die battle for us. Either they go, or the small traders and farmers perish," says Dharmendra Kumar, director of India FDI Watch, an organization that seeks to prevent Foreign Direct Investment (FDI) in the retail sector in India. Kumar says his mandate is to prevent multinationals like Wal-Mart, Tesco and Carrefour from entering the Indian market. As they are not yet in India -- or are present in very restrictive formats -- companies like Reliance Retail have become the substitute targets.



Much of this battle took place in 2007. Today, organized retail is downsizing by itself. Reliance has reassessed its plans and closed some stores; it is in consolidation mode. According to the Future Group's Biyani, growth has moderated. "While urban consumers have the ability to spend, we believe their confidence level has been low leading to disproportionate savings levels," says a report by equity research firm Enam Securities. "Weak same-store sales have cast doubts on the retail consumption story." According to The Economic Times: "Almost all retailers, listed and unlisted, are putting off or curtailing large-scale expansion plans announced earlier."



Yet just a short while ago, the kirana (mom-and-pop) stores seemed to be fighting a losing battle. Groups like FDI Watch, along with the media and politicians, rose to the defense of the huge farmer-trader-shopkeeper segment.



The Future of Kiranas

But there are many who believe that both large and small retailers can thrive. According to Arvind K. Singhal, chairman of retail consulting firm Technopak Advisors: "The battle, if any, was being fought only by politicians and the media. In India, the kiranas will coexist with modern retail for many decades to come." Adds S. Ramesh Kumar, professor of marketing at the Indian Institute of Management Bangalore (IIMB), who has recently done a study on the retailing sector: "Kirana shops, which number around 15 million to 20 million, are part of Indian shopping culture. They are spread throughout the length and breadth of the country and cannot be completely displaced by modern retail formats in the foreseeable future."



The future of the kiranas caused so much concern that the Union Commerce Ministry appointed ICRIER to do a special study to find out the impact of modern trade on these small outlets. The ICRIER report, released in the middle of last year, found that it was "a positive sum game in which both unorganized and organized retail [could] not only coexist but also grow substantially in size." The study found that:



The total retail business in India would grow at 13% annually, from US$322 billion in 2006-07 to US$590 billion in 2011-12.



The unorganized retail sector would grow at about 10% per year, with sales rising from US$309 billion in 2006-07 to US$496 billion in 2011-12.



Organized retail, which now constitutes a small 4% of the total retail sector, is likely to grow at a much faster pace of 45% to 50% per year and quadruple its share in total retail trade to 16% by 2011-12.




Joseph, who led the ICRIER research team, says that some numbers have had to be whittled down since the report was published. "There is a general slowdown in the economy due to the global crisis and that is expected to affect the growth of organized retail in the country," he says. "We had assumed a GDP growth of 8% to 10% during 2007-12 in the report. This is now impossible, at least for the current year 2008-09 and the coming year. Organized retail cannot therefore grow at 45% to 50% as we envisaged."



ICRIER was not alone in painting a rosy picture for organized retail. A November 2005 PricewaterhouseCoopers (PwC) study in tandem with the Confederation of Indian Industry (CII) said that one of the largest marketplaces for modern trade -- India -- was about to open up. "To reach its potential, the Indian retail sector requires significant capital, technology and best practices to bridge the existing productivity gap and achieve scale in operations, which are critical to the sector's success. One of the key steps towards facilitating the development of the retail sector and in accelerating its growth would be to allow foreign direct investment." Titled "The Rising Elephant," the report concluded that the organized sector share would account for 9% to 10% by 2010. Increased employment, efficiency in agriculture and increased exports through sourcing from India were the three most significant benefits of modern trade, the study said.



Another PwC-CII report, released in December 2008, said that the real beneficiaries of organized retail will be "the government, consumers, unorganized trade participants and producer-farmers." Mom-and-pop stores could become part of the system, benefiting everybody. Only about 100,000 "mid-category" stores would take a hit in the medium term.



Yet another report in September 2008 was titled, "The Great Indian Bazaar: Organized Retail Comes of Age in India." The study, by consulting firm McKinsey, said that by 2015 India was likely to be a US$450 billion retail market. Organized retail would grow from 5% to 14%-18% by 2015. The report made two other important points. First, "mom-and-pop stores will continue to remain relevant across large and small towns." Second, "retail in India can be profitable, but not with cut-and-paste global formats." The four mantras for success included innovative "local" formats; customer-backed merchandise platforms; an efficient supply chain; and an empowered front-end sales team, said McKinsey.



A Welcome Shift

Are these strategies and projections destined for the dustbin as India joins the global slowdown? The experts say no. "This is a passing phase but it could last for another year," Singhal of Technopak says. Adds Vedamani of RAI: "This is a temporary phase when many adverse forces are working together and organizations are therefore becoming very cautious. The boom in retail will surely return."



Many see this as a welcome shift to neutral gear, because Indian retail had been growing so quickly. "This calendar year will see companies consolidating their operations rather than looking at expansion," says Vedamani of RAI. "In the earlier retail rush, they were too busy to get their act together. They are now looking at putting their processes in place and getting their houses in order for when the market picks up."



Joseph of ICRIER notes that the slowdown has given the mom-and-pop shops some breathing space, too. "They now have more time to adjust and compete with organized retail," he says. "There are several cases of traditional retailers modernizing and successfully competing with organized retailing. We believe in the co-existence of both big and small retailers in the country, as each one has its own comparative advantages vis-à-vis consumers."



"The situation here is very different from the one in the U.S.," says Kishan Bhat, engagement manager at Zinnov Consulting, a Bangalore-based management consulting firm. "India is a market where everyone can coexist. The culture of kirana stores in a country like ours can never become obsolete. It is deeply rooted in the system and definitely has an edge over the organized sector in terms of convenience and personalized customer experience. The kirana stores today are also adapting to the growing competition from the organized sector. We do foresee them eventually organizing their way of business."



Bhat sees a mutual learning process which will benefit both eventually. "The organized retailers are also learning from the kirana stores and trying to provide a better customer connection," he says. "Besides this, both formats are implementing the best practices of each other. Hence, the two formats will definitely coexist as long as customers are the winners."



"Small retailers in India have inherent advantages," says the PwC-CII "Rising Elephant" report. "They are located next to the consumer, making it convenient for top-up purchase. They know them well, some even by name. They give credit too -- which no large retailer does. Their fixed costs are so low that their breakeven point is as low as 46% of sales."



Finding a Model

Kumar of IIMB says there are opportunities now that may look more attractive for organized retailers. "Segmenting consumers on price sensitivity and lifestyles along with multiple retail formats holds the key for a retail chain in the Indian context," he says. "Organized retail, instead of competing with the unorganized sector using price cuts on branded offerings and short-term sales promotions, should get into private labels that provide good quality at relatively lower prices as compared to established brands. The economic slowdown is probably the ideal time for such retailers to launch these private labels. Private labels with limited merchandise will be an effective approach to target the middle-class consumers who shop almost every day as a part of their culture. Besides, since most residential areas have kirana shops, it is unlikely that consumers will drive long distances for their regular shopping cycles."



"Modern retail is a less-than-20-years-old phenomenon in India," says Singhal of Technopak. "It has attracted a diverse set of entrepreneurs and business organizations, and each one is trying to find out and develop its own unique business model. Some of these models are fundamentally flawed; in some cases the execution is flawed. However, overall, the growth of modern retail in India has been very steady and there is increasing width and depth [in terms of product categories, formats, etc.]. Modern retail trade in India is still in an evolutionary phase and will be in this phase for at least three-five more years before the winning formats and the winners stand out. Then, there will a consolidation and growth phase led by these winners."



Will the winners be Indian companies or MNC majors? There are no easy answers. "India's landscape is fundamentally unique," says Singhal of Technopak. One can't transport Western models and expect them to automatically succeed, he notes. For instance, infrastructure is in very bad shape. During the initial euphoria of the retail boom, several companies imported retail professionals from the West, who came armed with just-in-time and other cost-saving techniques. They realized, to their dismay, that none of this would work in a country where it could take days for a truck to traverse a few hundred miles, he adds.



"The large players usually try to gain on economies of scale and lure customers by reducing the margins," says Bhat of Zinnov. "This would [require] elimination of middlemen and brokers along with established logistics and infrastructure support. However, in the current scenario, lack of infrastructure and inefficient logistics services have dampened the growth of organized retail while providing continued shelter to the middlemen. As a result, organized retailers have not been able to provide higher value. On the contrary, unorganized retailers leverage the inefficiencies of the system and encourage consumers to drive a hard bargain, which enables a win-win situation for both."



One example of the potential pitfalls is the Piramal Group, which opened an upmarket outlet in downtown Mumbai, the first of a planned chain. It proved to be a tourist attraction for visitors to a nearby religious shrine. Most visitors came to look, but not to buy. The company tried to insist that all who came to the mall should possess a mobile phone or a credit card to gain entry, but the idea was quickly withdrawn after a public outcry against discrimination. (The mall closed down shortly thereafter.)



These are problems that no amount of multinational expertise or FDI can likely address. "FDI is not so relevant in the current context, but technology can certainly help retailers understand their customers better," says Vedamani of RAI. Bhat of Zinnov disagrees. "The entry of foreign multinationals would make the market more competitive," he says. "Indian consumers will definitely benefit." But money or new technology will not help, he adds, "unless customers become the utmost priority."



"FDI in retail is extremely relevant," says Singhal of Technopak. "As India's consumption basket changes, new retail businesses have to be started to take care of emerging consumer needs. For this, both capital and know-how [in sourcing, distribution, etc.] is needed. From a consumers' perspective, they also need more choice in terms of retail options, and FDI can give them access to more choice of formats and value propositions." Adds Joseph of ICRIER: "Inexplicable restrictions on FDI investments in the sector are preventing even Indian retailers from raising global capital."



Early in February, the government announced major changes in its FDI policy through two "Press Notes." The ban on FDI in multi-brand retailing such as supermarkets seems about to expire, but "the 10 pages of unintelligible officialese" leave many unanswered questions, according to The Financial Times. There have been no clarifications as political parties prepare themselves for the coming general elections. Subramanian of Subhiksha is certain he will be there when the MNCs arrive. The problems for both organized Indian retail and his own venture will pass. "After all, challenges make boys into men," he says.

Friday, September 18, 2015

Special Report: Another Meat Debate - Poor Pakistani's Are being Sold 'Horse And Donkey' Flesh?

By RABIA BASRI | INNLIVE

In a country where class mobility is inaccessible to most, questionable approximations of all sorts burgeon. The Pakistani love affair with meat has been a long and enduring one. In decades past, every neighbourhood, rich or poor, featured a butcher shop, whose front prominently featured a fresh carcass swinging from a hook. Housewives would debate quality with the butcher or argue over the price or the freshness or the cut.

Sunday, December 07, 2014

Special Report: 'The Invisible Baby Makers Of India'

For the women who donate eggs, the lure of easy money often turns into a death trap.

When Yuma Sherpa visited New Life India Fertility Clinic in New Delhi with the intention of donating her eggs, her concern regarding donation was more or less around its returns. After all, the 23-year-old was desperately in need of  Rs 25,000. The procedure that began on 8 January made her unwell. After the final round, she fell unconscious. Soon complications erupted and within a few hours she was declared dead.

Wednesday, July 17, 2013

Special Report: India-Bhutan Ties At A Start Or An End?

By Medha Bisht (Guest Writer)

Since Bhutan opposition People's Democratic Party (PDP) led by Tsering Tobgay won last week's National Assembly elections, speculation has grown over the influence that India's decision threats to withdraw certain subsidies had on the vote. Many analysts say India's withdrawal of subsidies on cooking gas, kerosene oil, excise duty refund and hydro-electric projects could have lost the vote for the formerly ruling Druk Phuensum Tshogpa (DPT).