Sunday, January 22, 2012

The Indian Entrepreneur is Alive!

On a chilly winter morning I took the train to one of the most historical of places in Bengal - Murshidabad.The way led through places like Plassey,where Lord Robert Clive defeated Nawab Siraj-ul-Daula in the 1700s and laid the foundation of British Rule in India.

The neglect of such historic sites is monumental to say the least and I imagine Lord Clive would not feel out of place was he to wander back today to the site of his triumph!goats loitering on the platform,mudbrick houses and green farms,ducks swimming in muddy ponds,a typical scene from rural bengal and nothing to denote thate this place once was responsible for changing the face of modern India and indirectly leading to the formation of a great nation from a conglomoration of princely states.

On the positive side,having travelled cattle class for this short 5 hour trip I saw a surfeit of home grown entrepreneurs selling books,incense,boiled eggs,home made sweets,a flute player and a magician as well as a stand up comedian.The energy shown by them was amazing.

Its a lot easier for the IIT-IIM-Harvard educated citizen to get PE funding or other sources to start a business.But here were people from the 'have-not' side,how did they capitalize their business?Funding?What profitability?

Especially when there is no safety net(other than family support I suppose) and their dependents mean that they cannot afford to fail.

It was a vibrant thriving community that has demarcated areas of operation as well as the product to be sold.It is such as these that bring their village craft to those who live in suburban areas and provide a minute glance at the indegeneous industry.Wonder how many craftsmen and craft we have already lost?

But as long as this vitality thrives,no amount of redtape and bureaucrasy can styme the development of India.I hope things will only get better from here...

Thursday, January 5, 2012

Cars and All Those Things...

The Auto Show in Delhi shows that automobile manufacturer's are finally going with their gut.For many decades India had either very big,flashy and expensive cars or tiny tinboxes that did service on the roads.The need for an SUV or crossover that was affordable,drivable on India's mad roads and scrambled parking and did not cost a bomb...was simply a dream.

2012 is changing that with Renault,Ford,Ssangyong etc bringing in smaller city based SUV,RUVs and hopefully buyers would be spoilt for choice soon.It underlines a distinct maturity in the economic sense with more clients leaving the 'low cost'model and having higher aspirational values and more disposable incomes.

I am shocked to see the number of Audis,BMWs on Kolkata roads as its never been a city that believed in 'flash'.A lot of it is due to the lease method used by these companies to hire their cars rather than sell them outright,but it does underline a major change in tastes or is it the demoghraphic change in age and aspiration?

Despite the looming slowdown in growth I believe Tatamotors and M&M are poised to grow fast as they have the niche products to sell in Indo-China where most of the demand is coming from.

The Fords,Chryslers,GMs got taken out by the Japanese when the shift to small car segment happened in the late 80s and now I believe these US companies have dumped their gas guzzling SUVs and taken to the lower end they have made another mistake.The brand built by Jaguar,Landrover has been revived in Asia by Tata motors and that has been a master stroke.

The shift to high cost and a higher margin product will make a difference to the annual Balance Sheet next year as demand has not shown a major negative blip yet.Honda toward has declared a price war and when these Japanese get something in their craw they keep at it till the end so would be interesting to see how Hero Motors reacts to their former business partner in India...