FDI in Retail: As I see it

No sooner than the noise over foreign direct investment (FDI) in airlines sank, India is talking about FDI again.  This time it’s in retail. This time, however, the political noise is of higher decibel than that of FDI in airlines. And it’s not surprising because FDI in retail affects a larger base of people than FDI in airlines.

The issue has already united opposition parties cutting across political beliefs.   

And in this ideologically untenable coalition of opposition parties, there is enough to laugh over for someone looking for it. The Left parties are congratulating the Right for putting up a stout opposition to the government introducing FDI.However, the FDI decision has found endorsement from various business leaders and some major English dailies. 

But what the opponents of FDI in retail really have to say?  They say it will bring in foreign giants who will wipe out the middle man engaged in taking goods and food from the producer to the consumer. (The middle man can be a neighborhood grocer or somebody (or a group) who takes produce from the farmer to the shopkeeper.)

The anti-FDI guys also allege that the multinationals will lower their prices so much that small shopkeepers, unable to meet the price onslaught due to poor cost and infrastructure capabilities, will be eventually driven out from the retail ecosystem. 

Telegraph cited a case study to address various concerns regarding FDI in retail. The study said that a sizable group of farmers in Bengal is producing potatoes for Pepsi (Pepsi Lays) potato chips. The potatoes they grow reach Pepsi via a network of middle men. Pepsi also uses these middle men as a conduit to pay the farmers. 

And it’s working. Some farmers interviewed by the paper said the rates paid to them are much more than the usual market rates and the payments are also made in a timely manner.  

So this addresses two concerns (a) the middle man, instead of getting wiped out, is a well-established part of the business cycle; (b) the farmers are not only getting better rates than they would through the conventional supply-chain model, but they are also getting their payments in a timely manner.   

Now comes the shopkeeper. I will share my personal experience in this regard. I am currently holidaying in Calcutta. And yesterday my mother handed me a list of goods to be bought from the market. I went to a shop and did my purchase. 

But just when I was walking out, it struck me that on the other side of the road lay big departmental stores where I could have gone. But I didn’t. Not because I owe anything to the shopkeeper but because it’s a habit to visit neighborhood shops to make such purchases. And this common habit has survived the entry of big players like Reliance and Mahindra into the Indian retail space.  

And anyone who is familiar with these shopkeepers knows that they are not particularly having a great time in the current scenario: in the absence of global retail giants. 

These shopkeepers cater to two kinds of customers; those who just walk in once in a while and those who make bulk purchases from them on a weekly or monthly basis. While their business can’t subsist on the casual walk-ins, the shopkeepers retain the bulk-buying customer base by employing soft-old-world customer-retention measures like social courtesies instead of better service or pricing. Because even among small shopkeepers there is enough competition and the quality of their goods hardly varies leaving the customer almost nothing to choose from.

But as I make my case for FDI in retail, I hear the government has put the decision to introduce FDI in retail in suspension due to political opposition.

Of Films, Literature, Social Media and Cancer

Tahelka recently conducted Think, an initiative to get together prominent personalities from various fields – literature, films, science etc - and across the globe to discuss and exchange ideas on topics as varied as their professions - literature, films, social media, etc. The venue was Goa.

I had read about Think in newspaper when it had run into a controversy over Tarun Tejpal’ s (the founding editor of Tahelka and the man behind Think) comment:“Eat, drink and sleep with whoever you want tonight but come tomorrow as it’s full house.”

They covered the program in the Tahelka magazine and I flipped through its pages to get a feel of things. I decided to Youtube, but as the list of guests was both impressive and long, the choice of whose views I would like to hear was difficult to make. But I finally chalked out a small list for me. Shashi Tharoor, VS Naipaul, Sidharth Mukherjee (biography of cancer fame) etc, were there. Later I made an addition to my list - Ammir Khan.

All of them were interesting. Sashi Tharoor spoke on the role of new media in the modern world, sharing the stage with Hari Kuzru. Shashi said how new media are not just helping connect people but also making meaningful contribution to disaster management and handling humanitarian issues. “But what about its downside – the fact that the direct access Twitter and Facebook give to public figures (like Tharoor himself) can be misused by abusive fans?” the host asked. Over time you develop a thick skin Shashi responded. Hari said that’s why you have the blocking button.

Tarun started his conversation with Naipaul after a long introduction of the author about his prominence in the world of literature. Naipaul is great and controversial in equal measure. So Tarun finished his introduction by saying, “Try to know Naipaul through his books, that’s where he lies, not through Google posts and media reports.”

Some years ago Naipaul had rued the ‘death of the novel’ and he substantiated his prophesy. He said any art form has its own life cycle. The novel was born hundred or so years ago with Charles Dickens and hundred years on it has changed so much that Dickensian novels are not written any more. He said probably cinema will replace the long form of writing.

Tahelka runs a ‘how to write’ course and Tarun mainly asked questions keeping in mind the benefit of his students, I felt. Talking about his writing process , Naipaul said he used to go to a place and put up in a hotel and spend the hotel life for sometime. Before going he would make sure he knew some people in the place who would put him in touch with more people.

Naipaul would casually talk to them while wining and dining. But the casual setting of wining and dining didn’t mean Naipaul was relaxed; instead he was constantly on the prowl for ‘anything interesting or profound’. Naipaul said every writer has his own methods and you will find out your own as well. On certain things, however, you have to depend on your instinct or whatever.

Tarun Tejpal and Naipaul go back fifteen years (Naipaul blurbs for Tarun’s books) and their intimacy was quite evident during the discussion.

I was particularly curious about Siddartha Mukherjee. Siddartha probably has been a prominent figure in the world of oncology for a long time, but he entered general consciousness this year by winning the Pulitzer Prize for his Emperor of Maladies: A Biography of Cancer.

With some-days old stubble and an untrimmed French beard, Siddartha has a grubby and intense look. The unkempt appearance helps him look his part: a cancer scientist. He is based in the US.

He was interviewed by Barkha Dutt. To give the discussion a dose of immediacy Barkha framed some of her questions based on the theme - that by failing to save Jobs from being claimed by cancer, science or technology has failed to return Jobs the favour he did to the humankind by giving us so many powerful technologies. (Never mind the exagerration; that has become our habit when it comes to Steve Jobs.) Siddartha said it’s a failure of imagination for the medical world.

He informed that women who eat fatty foods are more prone to breast cancer and this fact, a survey revealed, led some breast-cancer afflicted women to conclude that the bag of potato chips they ate in remote past was responsible for their affliction. A bag of potato chips can’t lead to cancer. It’s plain guilty consciousness.

He revealed many more important facts about the disease.

For all our medical advancements, our attitude towards cancer hasn’t changed since the time Cleopatra, in ancient Egypt, had discovered that she had cancer.

The discussion was certainly grim, but I heard it very intently. This is a disease we all want to know about for curiosity as well as dread.

What impresses me the most about Ammir is the sincerity he brings to everything he does. When he spoke about his films, that sincerity was evident. He talked about the shock that the first cut of Lagan, which was seven-hour long, induced on them. They felt the movie that took one year and a lot of money to be made would probably be a dud given its length. Aamir edited the film for six months. And it wasn’t easy because he couldn’t indiscriminately chop scenes as that would make the film too fast; and a too-fast narrative would go against the basic nature of the film which was classic.

Aamir said he believes in making ‘good’ films without ignoring their commercial interests as film-making is a team work and many people, starting from the producer to the distributor, remain dependent on a film and are affected to various extents by its success or failure. Being from a film family, he understands this.

He said he doesn’t take fat advances; instead he waits for the film to play out and then takes his fee depending on its performance. He follows the philosophy of madaris (roughly translates into minstrels) who are surrounded by viewers when they perform on streets and when the show is over one of them takes off his hat and goes to the viewers for their fee. Those who liked the show drop a fee in the hollow of the hat; those who didn’t are free to go without a payment.

The list of guests I Youtubed on excluded many. Probably I would catch up with them later.

Indian Low Cost Airlines and FDI

Not too many years ago air travel was a luxury of the rich. But for last five years or so, low cost air carriers (LCCs) have changed the way the middle class India travels. However, if you look at how few of them are there and how they struggle to survive due to the volatility of the airlines industry and high infrastructure and maintenance costs, you will think whether this luxury will be short-lived.

There are only two to three operators in LCC sector and among them only one - IndiGO - is profit-making. And the current crisis the Indian airlines industry is going through where even the high cost players are struggling to survive due to ever burgeoning maintenance costs makes the situation of the LCCs more precarious.

Even from a customer’s standpoint, the LCCs are hard up. There is not much to choose between their fares and the quality of their services is uniformly mediocre. But that mediocrity is justified as perils of being ‘no frills’ service. It means you have to pay for everything onboard, starting from meal to water. (They sometimes serve toffees free.) Some LCCs even refuse to refund your ticket fare when you insist on cancellation and instead ask you to keep the money with them to use it for any future travel by the same carrier.

Alas, this ‘pay for a service if you want’ is not unique to Indian LCCs. In the US, on LCC flights, you are expected to pay additional spot costs for additional leg space and similar things.

If you fly low-cost, you have invariably faced these or any one of these situations. But surprisingly, after sulking for a while, you moved on. And when you flew next time, you flew low-cost again.

Because LCCs solve certain fundamental travel problems for you: They phenomenally shorten your travel time if compared with trains (and they say their target customers are those who travel by train) and they ensure general comfort of air travel, again not if compared with their high-cost variants but train. And they, of course, charge you almost half as much as costlier service providers.

But will this breed with their existential problems doubled by the aviation crisis survive or will they die a quick, natural and uncontested death?

I did some net research to find out how the lone profiting-making LCC carrier IndiGO is managing to remain profitable amidst general gloom. These facts will explain.

IndiGo has a record on-time arrival. An article says, “The average Indian mayn’t be punctual in his day-to-day life, but he values being taken to his destination on time by a service which he is paying for.” (I can identify with it.)

The LCC carrier also acts quickly on customer complaints. While onboard, a flier wanted to change his seat for a front row seat and he had been asked for extra money and denied a receipt for the same by the staff. Next time, while travelling by IndiGo, the same flier saw the air attendants give receipts to those asking for a change of seat.

IndiGo uses lighter aircrafts that guzzle less fuel and it buys more aircrafts than it requires and earns money later by leasing or selling out the additional aircrafts.

If anlyzed by a technical expert, these methods will reveal their weak points. For example, do light aircrafts undermine safety in inclement weather? Keeping a fleet bigger than your needs so that you can sell or lease out the additional fleet is speculative in nature and if there is a hike in fuel prices leading to an increase in airfares and thereby a fall in demand, the additional fleet mayn’t find buyers or leasees.

But, given that IndiGo has been posting profits following these methods, they can be considered safe practices to follow.

Talking about LCCs and not talking about the airlines industry and its ailments is limiting the discussion. And even for LCCs to function properly and profitably, there needs to be a healthy airlines industry, and that will require policies that can maintain and improve the health. The Indian government is
considering FDI (foreign direct investment) in airlines. There are views both against and in favour of it.

I again did some net research to understand the vox populi on FDIs.

Let me share the general concerns against FDI. The foreign players with deeper pockets will maul the domestic operators. They will offer artificially low fares and make the domestic players uncompetitive. They will pose security problems. And some countries like the US and Canada have been denying foreign players entry into their aviation space.

While these views can’t be outrightly dismissed, if you see these views carefully, you will notice that any competitive market poses these problems. If you also put these views together, they will reveal two patterns that are generally found in a competitive market: supremacy of deeper pockets and presence of ulterior motives in very few cases (security in this case).

The first can be combated by creating a level playing field through regulations and the second, by creating transparency. Of course, both are difficult to achieve, but a beginning can be made or at least a direction taken. And that would lead to something much better than what is present today where, some allege, the foreign players are at greater advantage than the domestic ones.

FDI will ensure influx of funds which is required for an ailing industry and competition will mean the consumer will have greater choice. Additionally, it will also create jobs and ensure lesser danger of job losses.

If you look at the IT industry, the admission of foreign investment, instead of killing the domestic players, has helped them carve out their distinct position in the market space. So you have tier ones, tier twos as also small startups.

And in a healthier industry, LCCs will be at greater advantage than the high-cost carriers because they can
attract a greater consumer base.

Literary Magazines and their Survival

I have been reading literary magazines for some years now. The first literary magazine I read was Asia Literary Review. I stuck to it until I stopped finding it one day at the bookstore I visit. I searched for it at other bookstores, but without any luck. Probably it met with the same fate many literary magazines meet eventually; either the store stops stocking them due to lack of sale or the magazine shuts down. This is the tragedy of literary magazines (LMs).


LMs are vastly different from the glossy newsstand magazines. LMs generally carry short fiction works by known and unknown authors, book reviews, photo essays and articles on current affairs and culture; they are literary in nature. Not for them the snazzy film reviews, one-page idiosyncratically written biased pieces etc.

I have nothing against newsstand magazines and I enjoy reading them, but LMs distinguish themselves by content and approach.

If a popular magazine informs you of an issue in a short and quick manner, a literary magazine gives you the complete perspective. Only when you read a topic in a literary magazine, you understand how many sides can exist to a subject. (If read over a period of time, you develop an analytical and all-sided approach to dealing with a subject.)

LMs showcase culture, give a platform to new writers and photo enthusiasts by giving them an opportunity to publish their work, alas not many are lucky enough to publish their works with them as you have to meet their criteria and they greatly vary from magazine to magazine and are mostly not clearly explained in their submission guidelines. Also, unlike in popular magazines, articles in literary magazines are tilt-free, if a little leftist, which is understandable given their arty nature.

Then why literary magazines struggle to survive while their newsstand siblings do well? I have worked out some theories. The strength of LMs – their content - is also their weakness. People want to be informed but in an entertaining and quick way. They may want to know an issue but only enough to talk about it in office and not necessarily to get a student’s perspective.

Another problem is lack of exposure. While ordinary magazines enjoy a round-the-clock exposure to customers at pun shops and newspaper stands, LMs stay tucked in a solitary corner of serious bookstores. So unless you visit these bookstores – and there are light readers who don’t – and are curious enough to visit the neglected corners of the stores, you are unlikely to get a view of these magazines.

Unlike books, magazines are generally identified with quick reading, and the fact that LMs generally have a solemn look and feel about them (covers are generally very serious) doesn’t help.

But these problems are not without solutions. I think LMs’ content approach (length, nature etc) should not be tinkered with to get a wider audience. LMs would never have the following of their newsstand counterparts, but they would always have their dedicated readership. What can be worked on is their publicity. They have to enjoy more visibility through proper placements at bookstores and newspaper stands.

Probably this sort of network is difficult to build by small groups that mostly run LMs; but here is where big newspapers and publishing houses have a role to play. An increased reader base with a polished reading taste will only help them in turn.

If nothing is done, this species will meet with extinction.

Sadistic Part of Diwali

Today I reacted to a Deccan Herald (an English daily) news item such that you react to a needless tragedy brought by a futile pursuit. The article reported that on Wednesday some people injured their eyes by Diwali fireworks. What was worse is that some of them were not even using fireworks themselves but just passing by others using them. The piece was accompanied by a photo of the poor chaps with their eyes bandaged. The article said passersby are most likely to be hurt by Diwali fireworks because they are least prepared.


It further informed that this despite ‘how to celebrate Dewali safely’ educational campaigns the government has been running. I thought how many of the children playing with fireworks even know about those campaigns and even if their parents know and have cautioned them, how many of them are likely to dampen their Diwali spirit by being mindful of boring government cautions. In fact, why blame kids; even their parents put fire to bomb wicks with the innocence and unconcern that will put their children to shame.

I have nothing against fireworks in general. Some of them form extraordinary spectacle and almost all of them add to the festivity of the occasion. Except one: crackers. There is nothing beautiful or festive about them, only eardrum-shattering noise. And sadly, in the squib community, they are the most used ones. For each rocket that whistles up and bursts forming patterns against the dark sky, there are at least ten crackers that go off giving the festival evening the sound and feel of a warzone.

There is a cryptic mentality behind bursting noisy crackers. Unlike rockets and their ilk which are about delicacy and beauty, noisy crackers are aggressive and assertive. They help you announce your arrival and let others know that you couldn’t care less that the noise was bothering them. In fact, the fact that the noise could bother others makes crackers more preferable to their silent beauty-oriented cousins. There is something sadistic and macho about bursting them. As a kid, when I used to burst them together with my cousins, holding them in your hand, instead of keeping them at a safe distance, to light their wick and then throwing them with an air of nonchalance, as if unconcerned about the risk of the act, was a mark of bravery.

The older you were in the group, the closer to you and the longer you would like to keep the combustible. One of my cousins even used to go to his school and stealthily throw a bomb in a solitary corner and then see it go off from a distance and then brag about it to his friends the next day. It was his protestation against a bullying system. Can you tell me what fun the new-money types derive from bursting long rolls of slender red reed-like patakas sinking an entire neighborhood into nerve-wrecking sound?

But let me not blame crackers alone. All forms of squibs are bad in varying degrees. And their use, however warranted by the occasion of Diwali, puts others at risk. After taking off, if a rocket assumes a crooked trajectory instead of a straight one, it’s anyone’s guess what can happen. Similarly, a rangmashal or phuljhari or fire whirl can be equally dangerous to the user as also a person walking by (as the article suggested). And all this or at least a substantial bit of the risk posed to others can be avoided if only one can avoid using fireworks in neighborhoods and go to an open maidan.

But then the anonymous nature of a vast maidan would hardly help you make a point. If the government is really serious about reducing hysteria-induced injuries, it should consign its educational modules on safe Diwali to flames and simply ban the use of fireworks in public place. My celebration shouldn’t become your agony.

Musings on Russia

Lately, I have been having an affair with Russia. I am reading Anton Chekhov (I have written a bit about it below) and accidentally the other day I heard a program on radio: From Russia with love. I can’t remember the channel I heard it on, but I found it quite interesting. It was a long program where the host interminably read out tit bits on Russia in Hindi, in news-reading style, with very occasional interruptions coming in form of Hindi songs. I couldn’t follow whether it was an Indian-government-backed initiative to promote our relations with Russia. Since then I have heard the program a few more times.


The program covers a wide range of topics – science and technology, literature, healthcare etc -and paints Russia with a very lofty brush. I found some of the stuff amusing. Let me share some of them. Somewhere in Russia, child psychiatrists are conducting an experiment where they are having friendly dogs play with mentally retarded children and after weeks of play and mingling with the canines, the children are showing the signs of improvement in their social behavior.

Now potatoes are an inseparable part of Russian diet, but they were not always so. Many centuries back, when a Russian czar went to Europe, he was introduced to the vegetable and he sent a sack of a particular variety of potatoes to a feudal lord back in Russia and asked him to grow the variety of potatoes in his field. After some years although the consumption of potatoes slightly spread in Russia, it remained restricted to elite circles, being served only at parties where boiled potatoes were served with sugar sprinkled on them.

Then, when famine came to Russia and the country slid into an excessive scarcity of food, the Russian monarchy forced peasants to grow potatoes. Forced to grow a vegetable they were not used to, the peasants revolted. The host couldn’t say what happened to the revolt, but the rise in potato consumption in Russia can be, the host informed, traced back to a few years after the breakout of the revolt.

What surprised me most about the bits of information the host shared is that everything sounded surprisingly novel despite the fact that Russia has been a long-standing foreign-policy buddy of India and the Indian-government has sponsored many TV and radio programs (especially on Doordarsan) as part of its relationship-building measures with the Soviet Russia. (The radio program, in fact, sounded like one of those initiatives which have outlasted their purpose and time.)

Had it been America or say Germany, would things still feel so unheard of? Many of the things would still sound novel but as a whole they wouldn’t sound as foreign and unfamiliar as Russia’s. And remember, the US, Germany nor any other country has been India’s friend for as long as Russia.

Our hobnobbing with Russia started in the post-independent Nehru era, although it was informal due to Nehru’s non-alignment policy. The relationship was formalized under subsequent governments as the cold war intensified with the passage of time and it became difficult to stay neutral. And it got an impetus when Russia sided with India against Pakistan during the Bangladesh war. In the early 90s, after the fall of the Soviet Russia and the start of market liberalization in India, we started getting close to the US and moving away from Russia.

But strangely, this long friendship never led to people to people relationship. Russia remained an obscure place where few people, not good enough to get admission in Indian colleges, went to study medical, engineering and other technical courses. We didn’t know enough about its people and society nor were we really interested in them. For us, Russia was a country behind a veil. Sadly, even after the fall of the Soviet Union, not much has changed about Russia. (Last week I read an article which said Russia is still not well understood by Europe.)

I think to us what glamorized American culture deglamorized Russia: Hollywood. If you see Hollywood movies of the cold war era, Russia was their favorite punching bag. Either it was Rambo outfighting the Russians in Afghanistan or James Bond (who is actually a British character but Bond movies and Hollywood are inseparable) outwitting a Russian spy.

In the cold war days, America fought Russia not just through the CIA but also through popular culture, demonizing everything Russian and lionizing anything American. And it worked, because the Soviet Russia didn’t have an equivalent of Hollywood which could combat US popular attack and sell its point to the world. Or being a communist country, did Russia prefer secrecy to transparency, never creating a Hollywood deliberately?

Perhaps that’s the reason why we still know so less about Russia.

Anton Chekhov's Short Stories

I have been reading a collection of short stories by Anton Chekhov, one of the Russian literary greats, regarded as master of modern short stories. What triggered my interest in Chekov is that many short story authors I have read are said to model their style after Chekhov’s.

The most famous of them all are Hemingway and Faulkner; I have reader neither of them. But I have read RK Narayan’s and recently Daniyal Mueenuddin’s and many more well and little known writers’ short works (in books and magazines) who, knowingly or unknowingly, follow the Chekhov style, which bases itself not on an airtight plot but a slow narrative without too many excitements and mostly ends on a sad note. It’s very close to how real life is.

Chekhov lived until 1904 and so the stories show the pre-revolution Russia. The stories are about Russian elite and peasant life (and its miserability). But they don’t make any political comment on the human conditions prevalent before the coming of the revolution.