FDI in Organized Retail: Is it worth the hooplah?

barkha dutt @BDUTT replied to you:

BDUTT barkha dutt
@change_thinker thats my problem with it
Nov 28, 5:12 PM via web
In reply to…

change_thinker Manishankar Prasad
@BDUTT Kiranawala wil always b around, organized retail will always cater to UrbanIndia n not Bharat, Walmart promotes monoculturalization
Nov 28, 5:11 PM via web

The above exchange of views with Barkha Dutt, sets the stage for the burning rage over something deeply effecting all in India. There has been massive hype, over the FDI decision taken by the Indian Cabinet to clear the long standing proposal. Foreign Direct Investment has been a bone of contention as overseas players in organized retail have the monetary muscle, the technology and the know-how for a trade, the Brits and Americans have mastered, with the french not too far behind (Tesco, Wal-Mart and Carrefour for the uninitiated). I had encountered supermarket organized retail in Oman, the first time i traveled ‘phoren’ about 15 years back, they were clean, organised with smiling faces, although fake at supermarket counter in contrast to the kirana-wala next to our building, who used to over-charge us every time we went, with his faulty weighing gauge.  Well, the ‘udhari’ system might not work at a big bazaar, but  the friendly neighborhood ‘Guptaji’ , may lend temporary credit for a packet of milk, when you are out on a morning walk without the wallet.  The discourse in the Media, clearly seems to polarized over the issue, which has clearly diverted attention from the more pressing JanLokPal bill (a masterstroke by the Congress). This what an opposition leader said today as I read in a tweet a while back-

Sharad Yadav: “The East Indian Company came as cloth merchants but the Congress party is giving away the entire retail market ”

There has been Indian players in the organized retail space in India since the past decade. They all started with a bang, but only a few remain as the Indian consumer is very price conscious, impulse buying is not really Indian, we come with detailed budgeting with check-lists at the supermarket. The Indian retail players have constantly bled, and I guess the move for 51% FDI in organized retail is a way of bailing out the existing players, rather than big players making a dent. The technology transfer in cold storage supply chain management is something Indian players can learn from a Wal-Mart, as it offers the lowest prices due to the sheer volume game it prefers to engage in.  Farmers are at an advantage as they hope to get better prices than at APMC Mandi’s. I do not think any more players in the market will create that much of an impact as the local mom n pop store will cater to a demand that a big hyper-market cannot. They both have their own spaces to fill in. Jobs will get created in the Organized retail space as more smaller shops will close as they really cannot compete on prices and services with the Big Guys. Urban consumers are set to have more options and better prices.

A regulator needs to put in place to monitor cartelizaton for food prices, as hording on a institutional level may take shape. People need to made aware of the pitfalls of excessive consumerism. Choice is good, but addictive retail therapy ruins families. In my opinion, India is a unique market, every region in India with its special cultural and demographic needs, will be a challenge for the MNC Player. Getting into the market is easy with 100 million USD, but surviving and thriving is an altogether different battle. Welcome to India, i would say to Wal-Mart, bring it on!

Why Legislations dont work in delivering services

The easiest and the most commonplace instrument of governance is to draft, pass and enact laws. That is the principle act of legislators at the provincial and federal level.  They are called legislators for a certain reason. India has been in the process of bringing in to force entitlement legislation’s like the right to acts: education, food, work. These are indeed commendable civil society-government joint initiatives  to bring in social security for the poor. the Rural Jobs Law- NREGA; is a well intention-ed act that offers poor rural folk employment based pay for upto 200 days per year. Huge sums are allocated without any check and balance built in hence leave a massive opportunity for earning money illicitly in the bureaucratic supply chain. The NREGA Act has worked in bits and patches such as in Andhra Pradesh, but the same cannot be said of Uttar Pradesh. Entitlement legislation needs to backed with the actual social infrastructure to efficiently deliver services to those who matter the most; the rural poor.  These are indeed the developmental front of National Security: for example in the Red Corridor. It is indeed a conflict with a tremendous human, social dimension. Implementing multi billion dollar schemes require systemic engineering, foundation need to be robust to take the load of such large scale initiatives. All stakeholders need to have convergence to a function-able degree. The objective should be the betterment of a few million people and not only their egos and pockets sadly. They need real time data, forensic analysis for fraud and professionals dedicated to program implementation. Dumping all additional workload on the District Collector, does not help the poor chap, already overburdened with work. Legislations need muscle in form of structural support to make an impact.

Another Legislation which is on the horizon due to popular demand, and civil society-media mobilization is the ombudsman legislation in India in the working; The Jan Lok Pal.  The popular uproar in favor of the Anna Hazare movement is admirable as it was Delhi’s Tahrir Square moment. It awakened national consciousness after the Kargil War. People got involved in thinking about change. Those are the positive externalities of the movement. I believe India’s Occupy Movement is yet to come although Mr. Friedman of the New York Times understands otherwise.  The Jan Lok Pal agitation is a public spectacle, real changes are brought on the ground and not on New Hour with Arnab Goswami. The Ombudsman wishes to create a parallel architectural framework on top of the present vigilance apparatus. Additional bureaucracy adds power to the civil servants to extract more ‘rents’ and not to the common man as they will have another layer to negotiate, instead of a single window clearance. Governance paralysis will be another pitfall, as civil servants will be unwilling to stick their neck out to make real changes.

Legislations  are cosmetic changes, what is needed is a surgery. Corruption is a cultural malaise in South Asia, with the Bakshish tradition since the Mughal era. What is needed is strong institution building and not adding other layer of bureaucratic mess. By the way, no one has said of who will monitor the Lok Pal itself, a super Lok Pal in 20 years? Will it take the shape and ethos of the Supreme Gaurdian Council of Iran with our own Ayatollah in the form of a self righteous civil society actor, we must not let people hijack the efficacy of institutions.

The Gulf of Life: Realities and Expectations

Recently I have watched two films that i wanted to watch as they had soulful stories to offer, with a dash of mainstream glamour . I watched Zindagi Na Milegi Dobara- a Bachelor trip flick starring a very powerful starcast including Hrithik Roshan, Katrina Kaif and the multi talented Farhan Akhtar. The film is wonderfully shot in Spain; which is phenomenal advertorial for tourism in that part of the World. The film deals with issues of a trio of college friends who are facing different issues; one is a rich Investment Banker does not have time for anything apart from making money, had a failed relationship with his girlfriend, and who rediscovers the spirit of life when he overcomes his fear of water by scuba diving and in the process rediscovering love with their diving instructor. Another friend, a part of the trio;is dealing with the fears of having a over-possessive  would be wife. The third one, deals with the fear of meeting his biological father for the first time, who is an artist and he seems to have taken up on his genes as he is a poet himself. The film is unique in treatment and has many pointers to offer if some one is facing a quarter life crisis. Very emotional indeed.

Today, i watched Rockstar; a classy and energetic musical starring Ranbir Kapoor and the charming Nargis Fakhri. Passion seems to be dripping from the movie. It is a film loosely characteristically on Jim Morrison, but with a distinct Delhi identity. The destructive creative potential of passion and love is exemplified in the movie. Music stems from a broken, pained heart as the punchline in the film lucidly communicates.  Genius seems to have its own frailties and idiosyncratic nuances.  The differential between the real and the aspirational often causes all the genesis of miseries which our mundane existence. Expectation management is at the crux of peak performance. Procrastination happens when the paralysis of non performance results in fear.It is a viscous circle at its peak.

 

 

Time for businesses to walk the talk on human rights

There has been a huge bit of hype over corporate citizenship and its onus to protect the rights of workers in the past few years. Corporate Social Responsibility and its corresponding voluntary ISO 26000 standard, includes human rights as one of the metrics for good corporate citizenship. This vocalic buzz is indeed positive for workers’ rights in general as the spotlight and accountability increases in these cases.

But the reports from the media regarding the rights of workers are not really all positive. We have had the Foxconn episode, with poor worker conditions in the factories which manufacture Apple products such as the iconic iPhone. ‘Sweatshop’ labor has been the norm in the textile industry for some time, while the sports goods industry is not a stranger as well in this discourse on worker protection. From workshops in Pakistan to Bangladesh to factories on the Chinese East Coast to Indonesia, workers’ rights are flouted without any batting of an eye lid as many a documentary has demonstrated.

The reason for the reduction in workers’ rights and protection has been due to the commodification of labor into ‘a particular exchange value’ or a cog in the ‘value chain’. Classical Marxism again makes a comeback as an analytic instrument of theoretical analysis. The whole paradigm of outsourcing compounds the matter of responsibility of implementation of rights protection and adds layers of complexity in regulatory affairs.

In this hyper-charged age of globalization, trade barriers are broken down and manufacturing is globally distributed. Some firms like the sportswear major Nike does not manufacture anything of their own. They outsource everything, and different parts of their products are made by different suppliers, and someone else finally assembles the product. How do transnational brands ensure worker safety and fairness? Suppliers competitively bid for contracts often on the lowest value offering – the minimum bid. The problem is the minimum is not simply the best for the worker.

Due to globalization, transnational corporations move to unchartered territories in search for resources and new markets. For example, Chinese mining firms in Zambia are facing labor unrest for human rights violations recently. The question which arises here is: Are standards for transnational corporations the same across various jurisdictions – developing and the developed world? Is legal compliance the same in Zambia and London? The answer is sadly no, the institutional power of the nation state differs from the global south to the industrialized west. Nation states in developing countries are simply powerless in front of multinational corporations because of the sheer wealth and ability of the corporate behemoths.

In light of the limitations mentioned above, it is time to move beyond the rhetoric and walk the talk regarding human rights and to implement the tenets, in order to truly treat the human for what the human actually is, beyond the ‘user value’ determined by the corporation.


This article was published in the Green Business Times, on the 7th of November, 2011 (http://www.greenbusinesstimes.com/2011/11/07/time-for-businesses-to-walk-the-talk-on-human-rights/)

Time for Human Rights to come under business responsibility?

In this hyper-charged age of globalization, where trade barriers are broken down and manufacturing is globally distributed; both in the intellectual sense and in its physical avataar. There has been a huge bit of hype over corporate citizenship and its onus to protect the rights of its workers.  Corporate Social Responsibility and its ISO 26000 standard, includes Human Rights as a metric for good corporate citizenship.  Well, this vocalic buzz, is indeed positive for workers rights in general as the spotlight and accountability increases in these cases. But the signals we get from the media regarding workers rights is not really all hunky dory. We have had the Foxconn episode, with poor workers conditions in the factories which manufacture Apple products such as the iconic iPhone. ‘Sweatshop’ labor has been the norm in the textile industry since a while, the sports goods industry is not a stranger as well in this discourse on workers protection. From Pakistan to Bangladesh to factories on the Chinese East Coast to Indonesia, workers rights are flouted without any batting of an eye lid.

The reason for the reduction in workers rights and protection has been due to the commodification of labor into  ‘a particular exchange value’, a cog in the ‘value chain’, classic Marx again makes a comeback as an analytic instrument of analysis. The whole paradigm of outsourcing compounds the matter of responsibility of implementation of rights protection and adds layers of complexity in regulatory affairs. Some firms like Nike do not manufacture anything of their own; they outsource everything, different parts of their products are made by different suppliers, and someone else finally assembles the product. How do transnational brands ensure worker safety and fairness? Suppliers competitively bid for contracts often on the lowest value offering; the minimum bid.  The problem,  is the issue of the minimum bid- the minimum is not simply the best for the worker.

Due to globalization, as transnational corporations move to un-chartered territories in search for resources and new markets. Chinese mining firms in Zambia, are facing labor unrest for human rights violations recently according to a Time Magazine online post – http://globalspin.blogs.time.com/2011/11/04/human-rights-watch-reports-abuses-in-chinese-run-mines-in-zambia/?xid=tweetbut

The question which arises here is: Are standards for transnational corporations the same across various jurisdictions- developing and the developed world. Is legal compliance the same in Zambia and London?  The answer is sadly no, the institutional power of the nation state differs from the global south to the industrialized west. Nation States in developing countries are simply powerless in front of multinational corporations because of the sheer wealth and ability of the corporate behemoths. In the light of the limitations presented above in my analysis, it is in fact time, to move beyond the rhetoric and walk the talk regarding Human Rights and to implement the tenants of them, in order to truly treat the human for what the human actually is, beyond the the ‘user value’ determined by the corporation.

 

 

 

Why Globalization has under-delivered

Globalization was the dominant ingredient in the discourse throughout the 1990’s after the fall of the USSR, as people were tasting freedom from decades of repression of the secret services. They opened their arms towards Globalization, as the magic pill; the panacea that the world needed. Then came the wrath of the Chicago School economist led multi-lateral institutions like IMF and World Bank whose reforms drove people into poverty, hunger and deprivation through wild west economic restructuring that brought Russia, the former USSR nations to their knees.  It was the kind of economic shock doctrine which Naomi Klein calls in her book of the same name.  Liberalization of economies has indeed brought in a lot of good but crony capitalism and capital accumulation has also intensified in economies in the developing world such as India. Globalization championed by the spokesman of the Business Media-Tom Friedman, wrote a good PR tool can flattened a very biased discourse, only showing the rosier rhetoric of the paradigm. Economic Globalization has been catastrophic, it has only forwarded the imperialist design of the wealthier west by extending their business might; crushing the weak guy who is now protesting at Occupy movements throughout  to be without a voice and helpless.

Cultural Globalization is the advocacy of a mono-culture. It is annihilating, local cultural ethos in the developing world. Every one knows Friends and Two and a Half Men in Singapore, but how many Americans or Swiss know of Phua Chu Kang or the Heartlands?. Globalization is Orientalism 2.0, and its quasi Americanization at Best. It is the Mc Donalization of Culture.  Glocalization is an oxy moron at best. Apart from Anime which inspired the Matrix, we have RA ONE in India coping Iron Man; dont we have our own culture to commercialize and popularize?

Globalization has its pluses, but its minuses are far more, Globalization has its evangelists but counter culture is hitting back with a vengeance as well.