London to Ahmedabad in 11 years

In October, 2012, the UK announced that it was ending the no-touch policy with Indian state Gujarat after 11 long years. Since the religious riots in Gujarat in 2001, the UK had not had any diplomatic relations with the government of Gujarat, until Oct 2012, when James Bevan, the British high Commissioner met Narendra Modi. While this immediately changed political equations in India making Modi less communal and thrilled all Modi supporters, nobody paid any attention to the boycott itself, or the need for the boycott. And why, if the boycott was really needed, did it take a decade to recall it?

Without going into the political significance (if any) of this entire event, let us just talk about the two core issues here: One, the legality of the boycott and 2, the ethics behind the recall. 

1.    The boycott was basically of the CM Modi for his alleged role in the religious violence in 2001. However, immediately after, in 2002, Modi won the state elections in a democratic election process, an election process that was organized by the Election Commission, which is impartial and has defined rules and procedures. The very fact that the Indian Constitution allowed Modi to contest elections and the fact that the people of the Indian state democratically elected Modi is significant proof that neither the Indian state nor the Indian people deemed Modi to be directly involved in the riots, in anyway. Therefore, any external nation has no authority to take a decision on Modi and label him to be involved in the riots. In other words, the boycott was illegal and without any basis. If the UK did decide to go ahead with the boycott, it was sheer disregard for the Indian government and the Indian democracy.

2.    Let us for a minute, assume that the boycott by UK was legal, then why did the UK decide to call it off? The nature of the sins in 2001 and 2012 still remain the same. If Modi was really involved, as alleged, then he should have met the same fate as other perpetrators of crime, have in the world elsewhere. This change of heart was obviously because of the loss to UK business in a place as vibrant as Gujarat. You see, business interests stand above any type of sin, however, horrifying they might be. The recall of the ban, if it was legal, in the first place was completely unethical.    

On both counts, the UK has lost. Rather than acting as a mature country, the UK has demonstrated that foreign policies related to India are made in haste and pure business interests drive decisions rather than humanity and ethics.

 

Anna and Kejriwal: Gandhi and Bose of a different era

Anna and Kejriwal: Gandhi and Bose of a different era

Subhash Chandra Bose used to be Mahatma Gandhi's favorite. The Mahatma adored Bose, who was upright, straighforward and had the same exact goal as that of the Mahatma - India's independence from British rule. Gandhi supported Bose when he was first nominated as Congress President in 1938. However, Bose's vision of an independence struggle included speaking in the language the British understood, the language of armed forces, which the Mahatma opposed. Consequently, the following year, 1939, Bose left the Congress and formed his own outfit, the Forward Block.

Fast forward to 2011-2012, it will feel like you are reading the story of Anna Hazare and Arvind Kejriwal. The objectives of these two gentlemen are exactly the same - an India without corruption. However, like Bose, Kejriwal realized the a crusade against corruption has to be conducted in a language the politicians understand - that of politics. Anna and Kejriwal's combined struggle lasted for over a year, until Nov 2012, when Kejriwal launched his own outfit - AAP (Aam Admi Party).

The question to be asked is who will emerge as the ultimate revolutionary - Anna or Kejriwal. In the case of Gandhi and Bose, the latter is now a forgotten hero, while Gandhi is the most celebrated name in India today. Will Kejriwal turn into another Bose, another forgotten hero in the annals of Indian history, or will he really change history? While, it is hard to predict, I will attempt to do so in this blog.

Bose's war against the British was heavily dependent on external parties - the German, the Russians, who had no interest whatsoever, in Indian independence, but rather wanted only an English defeat. One did not really mean the other - an English defeat was in no means India's Independence. Bose's approach, while sincere, was not as impactful as he would have wanted it to be and his version of the revolution failed.

On the other hand, Kejriwal's tryst with the political system hinges on the very people who make the political system. Their are no external entities involved. His movement is about the people who vote, the issues that bother the very people, and the politicians who are hated by the same people. In other words, his movement has all the ingredients that can create impact.

Of course, the messaging still as to evolve - he still needs to communicate powerfully, his economic vision, since that is what what will help India emerge as the next superpower. Unlike Bose, the fundamentals are strong, the passions strong; just that the messaging has to evolve and resonate well with the masses.

Kejriwal will be the new Gandhi.   

Organized Retail vs. Chaotic Retail

The question is not whether FDI in Retail is good or bad, rather, is "Organized" Retail itself has any value in the economy. Organized retail is defined as a big corporate opening up multiple stores in whatever format. Chaotic Retail is retail as it exists today, with mom and pop shops mushrooming all over.

This blog analysis the question posed above thru the prism of the neutral eye, across 7 different stakeholders.

Let us first look at all the stakeholders involved in the Retail industry.

Retail Stakeholders

1.   Farmer

Farmers have the following 2 challenges:

(i)            Ensure maximum return on investment

(ii)           Ensure output (perishable product) is not destroyed i.e. ability to preserve food produce before they finally get sold off

Neither of these challenges are addressed by any retail model. The welfare state has to ensure he following three things:

(i)            there is no wastage of food produce by building and supporting adequate infrastructure (e.g. cold storage).

(ii)           Also, the welfare state must establish a fair value (price) for the all types of produce.

(iii)          More importantly, the welfare state must ensure that the farmer is equipped to sell their produce when they are harvested

Bottom-line: No impact to farmers in any retail model

2.   Manufacturer

This stakeholder group includes all types of manufacturers - from the Unilevers of the world to the small/medium entrepreneur next door. The larger manufacturers may not care who they deal with- a large retailer or a small retailer through  a distribution network. They probably may care, since the power of organized retail can grow to an extent where they can coerce the manufacturer to reduce their margins.A small to medium manufacturer, in theory, could gain, since they can sell directly to the organized retail, bypassing the middlemen and possibly increasing their margin. 

The reality is that organized retail would force any manufacturer to reduce their margins. In addition, organized retail would typically go back in the supply chain, to start manufacturing themselves. Retailer owned labels would be flooded in the stores, which could eat into market share of the other manufactures. Apart from retailer -owned labels, there is always a question of importing low cost foreign owned brands, which has a significant negative impact on domestic manufacturing and close-outs of manufacturers. However, the government can step in and control how much import or retailer-owned labels can be allowed.   

In case of Chaotic Retail, standard market dynamics kick in and there is space for everyone.

Bottom-line: Manufacturers, both big and small, will be impacted be Organized Retail, especially small to medium manufacturers. Heavy government interventions needed to establish trade imports and for retailers to go back in the supply chain and manufacture themselves via a subsidiary.        

3.   Investors (Domestic or Foreign aka FDI)

For an investor (talking about large investors, not the smaller ones) like Banks, FIs (Financial Institutions) or HNIs (High Networth Individuals), Organized Retail opens up a massive market where they can invest and mint money. An investor will always favour Organized Retail, Chaotic Retail is certainly not to their liking.

Bottom-line: Investors (Banks, FIs, HNIs) will always root for Organized retail as it offers them significant opportunities to mint more money.

4.   Consumers

Let us, for a minute, not talk about Consumers at all. Remember, the Consumer does not play the role of only  a Consumer. An average Consumer is basically a farmer, a manufacturer, an employee in an industry. I promise to talk about this stakeholder group later in this blog.

5.   Government

Apart from a host of other issues, a government must ensure people welfare (not necessarily Investor welfare, though investors are also people :-) ), keeping in mind larger interests of people and at the same time, ensure government gets its adequate due in terms of tax money. Any of the retail models offers, provided there is right control, offer fair amount of tax money to the government. However, the government has to go beyond, to make Chaotic Retail be effective - it has to invest in the infrastructure and technology, which would generate employment, and therefore, tax money.  

Bottom-line: Government tax money (revenue) is not significantly impacted in any retail model. However, Government needs to provide right support to make Chaotic Retail work, which can be a source of good employment.  

6.   Employees

In Organized Retail, there are lots of employees. In Chaotic Retail, there are relatively fewer employees; there are more entrepreneurs and employers (let us call it the E-spectrum). Let us look at the e-spectrum of the Chaotic Retail world

(i)            At the lower end of the E-spectrum in the Chaotic Retail, are less-educated folks, basically the guys who sell vegetables on the street. I don’t see how they will stay employed in the Organized Retail world. Essentially, Organized Retail pushes them to poverty and crime.

(ii)           At the medium piece of the E-spectrum are the small and medium mom and pop shop owners who are making OK money. These guys have some education. In organized Retail, they will be forced to shut shop or operate on a much lesser income. You could argue, they must innovate - but it is easier said than done. Such folks will be the sales persons or the clerks in the Organized Retail stores and backoffices.   

(iii)          At the higher end of the E-spectrum, the folks are dreaming big. Their will be severe consolidations in this segment as the market matures, some will really do well and some will be out of business. Many of their employees will be fired and some would join the Organized Retail as sales persons or clerks

Bottom-line: Many of the moderately educated employees will get re-employed in the Organized Retail. There will be no net new employment; rather re-alignment of jobs would occur

7.   Other Impacted Industries    

This category includes impacted industries like shipping, transportation, logistics, warehouses, etc. The Organized Retail model would provide a boost to the real estate/ construction business, their would be multiple stores and warehouses coming up. However, we do not necessarily need Organized Retail for this, and a welfare government should be able to launch infrastructure projects in PPP model.

Bottom-line: Shipping, Transportation, Logistics may see a boost in Organized Retail, but this cannot be the sole reason for allowing Organized Retail

8.   Consumers

As promised, we are back to talking about Consumers (4 above). A consumer wants the best possible product at the cheapest price. Organized retail does not guarantee the cheapest price, however, it does not provide a wide variety of products to consumers at all price points. Consumers would end up spending more - it increases consumerism. This blog however, will not discuss the merits or demerits of consumerism. At low end organized retail chains (think the dollar stores in the US), which will be a hit in smaller Indian towns, there would be significant health issues -  a lot of people would readily procure less expensive food products. This is terrible for the average consumers.

In a nutshell, analysing all the stakeholders, Organized Retail is not a must for pushing reforms. Rather, a welfare state, with a small amount of willingness, can usher in significant benefits without compromises any of the stakeholder group, except, of course, the investors. 

It is a myth that farmers will be benefited, net new jobs created, or infrastructure will get a boost.    

The government must implement effective governance, infrastructure and technology and guarantee     fair prices to farmers. There are lot more benefits in Chaotic Retail with some government support.

A decision is simple - depending on who the government is working for - the investors or towards becoming a better welfare state.

Soldiers of a different kind

I am yet to come across a person who does not respect the heroic "Soldier". The soldier serves their assigned territory from known or unknown elements, protects citizens from enemies, helps citizens in unpleasant or life threatening situations like floods, famines, etc, and yet never asks for any favours from those that they protect. A selfless, do-good persona - that is the kind of imagery that lights up in our mind when we think of "soldiers". And, this is so true, to a great extent!

Yet, it makes me completely nervous and angry when society does not accord similar respect to another kind of soldiers- the woman home-makers. They are mothers for some, wives for some others, daughter-in-laws for others. Their very existence, in many cases, is of low to zero significance, in the minds of the people who surround them - husbands, parents or children. And I wonder why.

The average woman is the soldier of her house - her territory. She tirelessly and selflessly, protects her territory against known and unknown enemies (fever, mosquitoes, etc), serves the entire family, takes care of daily chores, and ensures hygiene factors (to the best of her knowledge) are met. And, asks for no favour in return from any of the citizens (her family members). 

Unfortunately, the society takes this for granted and largely ignores the women who sacrifice their self interests for the family. It is important to recognize the contributions of these soldiers so that they remain inspired. Remember, a society that does not honor its soldiers is doomed to fail.            

Equipping our women to better home-makers

Equipping our women to better home-makers

You are probably already choking or cursing me as you read the title of this blog. Trust me, I am no woman hater, I have a lovely wife and 2 daughters, both of who are girls :-)

What behooves me write about this unique enablement is the apathy demonstrated by our society towards women, who are home-makers and of such women, who think it is their "ill-fortune" that they have to be confined to the kitchen or home all their life - what the society likes to label as "simply a house-wife".

How many times have you heard the expression - "oh, I am only a house-wife" or, "my life is wretched, I am only a house-wife". It is high time, we as  a society, give our home-makers the respect they truly deserve and actively promote home making as a profession. 

Profession? Now, you are wondering, where is the "profession" in home making? Where is the money? But remember, all professions are not meant to be money making. Like our companies and corporates - some are "for profit" and many others are "Not For Profit" (NFP) companies. You can't do a a great job in both simultaneously, nevertheless, both are important for a society. Ditto for home-making. Like the Not for Profit companies, they are equally important as the society, and need the right training to fully equip themselves to be good wives, good mothers, good home makers and good in several other roles (daughter-in-law, etc.)

Here is an inventory of what people need to be adept in, in order to become a successful home-maker. You will notice, I use the word people and not woman, since, once, people realize the importance of home making, their would be no gender-tagging.

1.    Basic medicine, health, first aids

2.    Human psychology (child psychology, in particular, if planning to raise a family

3.    The art of Communication, specially articulation - remember, the home-maker in an expanded role has to speak for the tiny tots as well, not just for the self

4.    Cooking sciences - this does not mean cooking great food, but rather cooking healthy food, knowing food value requirements and nutrients

5.    Basic language and math skills - local language skills and math to impart basic education to the tiny tots

I do not intend to make this a laundry list and don’t claim that this is in an order of importance. To me, they are the top 5 important skills home makers must have to be successful.

Our society must come up with NGOs and Not For Profit companies that work towards the success of home-makers. Remember, love and success begin at home!