Friday, August 31, 2007

India's quest towards modernity

JRD Tata was always optimistic about India’s future. Jack Welsch too had been upbeat on India’s progress. He felt infrastructure in India is the only bottleneck hindering India’s progress but this can be tackled by Indian bureaucrats. Richard Gere in his recent interview said ‘India is on roll and if the momentum is maintained, India could well be a world power within 200 years’. 200 years ?? I thought it is far too long. Japan had shown country can be transformed in a span of 30 years. China went even further; they changed the economic scenario within 15 years but they are still far away from uniform wealth distribution across the country. For me, India is placed in precarious position that is very unique. At 8% plus p.a. economic growth, India offers attractive market for many commodities but I feel its being pulled by two opposite forces– one by quest for modernity by educated and vibrant youth and other by deep rooted concepts of antiquated socialist ideas. Chances are that it may not pull either way conclusively. And my Japanese boss’s prediction may come true ‘India will progress but not as spectacularly as Japan did’. So far he seemed to have guessed it correctly; India remained far too complicated for any machination to yield quick results.

During my last week’s visit to Mumbai, New Delhi I was keen to observe the perceptible change that media has reported about India’s progress towards modernity. Over last few years, I was impressed by the Immigration efficiency at Mumbai airport. The manner in which they manage boisterous Indians by making them stand in a single queue is commendable. This time, travel from Mumbai to Delhi by Kingfisher Airlines brought another example of India’s youthful face. They have surpassed the benchmark of youthfulness and vivaciousness set by Jet Airlines. New Delhi’s metro rail and string of flyovers along the ring road make capital city look sleek and modern. But as my trip ended, subjects like Retailing and Real estate pricing heavily weighed on my mind; they kept on questioning me if India’s is really on correct and righteous path of modernity.

In a hurry to transform Mumbai into imaginary Shanghai, there is a mad rush by real estate developers to build high storied buildings and Government is overeager to sale plots, open areas and allow demolition of smaller buildings to create ‘high rise towers’. I shudder to think how Mumbai’s narrow roads would cope with additional cars that would come out of homes at peak hours. I am also not sure if there would be enough water supplies to all residents. India seems overzealous with private automobiles and flyovers, a concept that can’t be sustained with rising cost of imported fuel and large distances between cities. Japan despite powerful domestic automobile industry opted for railway network. When the other developing countries were busy with flyovers, Mumbai was building ‘round about’ with green islands. When world moved to freeways, we started building flyovers over every traffic island. We now are busy developing road network and metro railway when we need long distance efficient railways.

That brings to me another subject of real estate prices in metro. I was intrigued by the news that illegal hutments in Bandra Kurla Complex( Bharat Nagar) that occupied land over last two decades are being offered by real estate developers in the excess US$200K to vacate a small plot. Its illogical to digest that intruders from other states that illegally occupied vacant land are offered a fortune on a platter that would never have been dreamt by ordinary middle class citizens who worked all their life just for one bedroom flat at far away places like Dombivli, Thane. And while doing that, they diligently paid their taxes that helped and sustained India economy. In Japan, number of rich is miniscule and so are poor homeless, bulk of the population is middle class. In any country, size of the middle class is a reflection of socialist pattern. Perhaps, India too is eager converting hutment dwellers into robust middle class.

I visited Atria mall in Mumbai and Sahara in Gurgaon. Atria is a glass facade, sleek mall built right along the major road that leads to downtown but it has no independent access. So is the case with Sahara and other malls in Gurgaon. On weekend, when the bulk of middle class in Delhi descends on Gurgaon, with no quick access, one can spend hours just getting an entry in the mall. I wonder why Govt didn’t force the mall owner to build a flyover or pay for separate access. In Dubai, every mall has adjacent parking building with a separate access. I fear Atria may follow the same way as Pyramid – Mumbai‘s first mall that soon became defunct due to parking and traffic chaos.

Retailing in developed countries progressed in gradual progressive manner. Small shops gave way to convenience stores. They in turn led to chain of supermarkets and malls were the latest entry. And this happened, while country’s economic might became stronger. In India, we moved from small grocery shops to swanky mails with very little of supermarkets or convenience stores. Now Reliance is opening a chain of mega malls that would sell fresh vegetables. Its no surprise that ordinary seller of fruits and vegetable would be crushed under the might of Reliance. Spencer group a decade ago, launched Foodland’s – chain of supermarket and I feel we need these in every suburb than malls. Shops in Atria Mall, displayed those familiar European brands that are popular in Dubai. I wonder why any rich Indian would buy these when he could take pride in making trips abroad and buying them in Dubai or Singapore. There is another area that I am sceptical about the success of malls is air conditioning. Electricity cost is high and Air conditioning must be a big burden on sellers. How it is possible for shop owner to sell commonly available Indian brands with high rent and high electricity costs? They have no option but to go for Eldo, Charles & Keith, Mango, Giordano, Nine West, Maxx, Benetton and charge fancy premium prices. But how long this can go? Till such time, average visitor would bring his family to enjoy air cooled environ and eat McDonalds or Indian equivalent after taking few strolls on escalators. Sahara Mall in Gurgaon has turned into scene straight from railway station. But here, mall management was smart to house Haldiram eating joint with Big Bazaar grocery supermarket. Rest of the shops sold anything from Indian costumes to bangles. It was interesting to see Indian woman in tight T shirt and Jeans but with mangal-sutra, bangles and red bindi Modernity and tradition co existed at every part of the mall.
Does India really need huge malls? I feel positive despite its economic non-viability. Times of India displayed a picture of cricket stadium in Thane (close to Mumbai) packed with 60,000 spectators. But there was neither Cricket match being played nor any Bollywood gyrating dance being performed. All these 60,000 people were sitting in disciplined manner. After all, they had come to qualify for 2,000 new recruits that Police department had advertised. That picture alone summed up India’s un employment situation. Burgeoning mega malls at least would provide enough jobs to youngsters and in the process will improve skills and rekindle entrepreneurial spirit.

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1 Comments:

Anonymous alok srivastva said...

Your article was an apt one for it provided a perspective that sounded both as someone amongst us at the same time that of an outsider.

Sahara Mall, despite being one amongst many in Gurgaon, is different from others for the reasons very well identified by you. Haldiram and more importantly Biz Bazaar. With no offense intended to any one, you will see a huge difference between crowd that you see in Sahara and say in Metropolitan Mall.

Now that is India for you, there is a section which want to take their family/guest out but are not comfortable walking in to Metropolitan but are at ease to go to Sahara for, if nothing else, they can buy something from Big Bazaar. On the other hand there is a section who need exactly what is being sold it Biz Bazaar but would make it a point that they DO NOT go there, they prefer to buy it from much costlier Shoppers Stop.

But in a country like our’s where first category outnumber the latter by a huge margin, it is sad that our focus is to come out with Malls instead of convenience stores. No wonder more than 60% of the people who visit these malls are there to stroll on escalators and spend time in the comfort of AC which has always been a paid luxury till now in India.

Alok

1:43 PM  

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