Walmart in India!
So Walmart is officially in India now. The Indian Left has predictably started making noise. I suspect a lot of article must have already come out about the imminent death of the small Indian shopkeeper. They will write about how Walmart got a “backdoor entry” into India.
But is this tie-up between Walmart and Bharti a convenient arrangement to scale the policy barriers? Or is it something more?
We have seen Walmart has been the reason for many papa and mama businesses to close in US. Is that possible in India? I am sure they will offer very competitive prices thereby forcing other traders to reduce their margins just like they do here.
Is that a good thing for India? Will Indian government slowly turn into a government run by corporation and lobbyists?
or am I over reacting just like others?
3 comments:
RB,
Your concern is well intentioned. But there is NO WAY, ACTUALLY, ABSOLUTELY NO WAY the entry of Walmart in to India will result in the Indian government turning in to a govt run by corporation and lobbyists. Not in the next 25 years.
Wanna know how I am so sure? It is because the Indian govt, no matter of what stripe, left or right, is ALREADY run by corporation and lobbyists - dynasties that indirectly control the corporations and lobbyists, except they are not transparent as they are in the west.
Also don’t forget that the historical dynasties of Tata, Birla and Ambanis have had massive and behind the scene influence on the Indian body politic. They have for the most part improved the standard of life in India.
In addition, it is well documented that the MNCs in India in 2002 – GE, MSFT and others are the ones that prevented a potential India-Pakistan war in 2002 after the Indian parliament attack. That was probably a VERY good thing, because as a much weaker conventional military force with an aggressive attitude, Pakistan would probably have attacked India with nuclear weapons first, which nobody in their right mind would have wanted.
So, as a well wisher of India, I would actually welcome a government more influenced by true capitalists (not controlled – only influenced). It might actually give the small corner “potti kadai” to grow and make more money and create more jobs.
Finally, I understand you are talking about “retail on the cheap” when it comes to Walmart. The KEY to Walmart’s success in the west is it’s incredible supply chain system which depends on an incredibly efficient transportation system. In fact, the first relief supplies to New Orleans after Katrina was Walmart trucks! So it will take a VERY efficient transportation infrastructure for Walmart to usurp the advantage of small local businesses across India – something not likely to happen in the next 25 years!
Oh, ouch! Thats a little harsh! India is working at providing a better infrastructure to its people. If not for the people, then atleast for the BIG companies that are coming to India to increase production for less overhead expenses.
Its just that we, NRI's, probably notice it more than others as we only visit India after a long absence (> 1 year).
I have witnessed Chennai highways and they are far better than they were 5 years ago. Delhi's highways are also very impressive. The Malad Mall in Mumbai is also pretty lavish. They have a whole floor full of food courts...including big restaurants like "Ruby Tuesday", etc.
Getting back to the topic of Walmarts. I personally feel its a good thing. What the Indian government sometimes lack, the BIG companies (like Toyota, Mercedes) can provide. So its getting there, its just not yet there. Besides, its not who provides the roads sometimes, its how its being used.
I am all for big chains enter India for many reasons:
1. I am always treated badly by my corner shop.
2. He decides what I can use for my essentials.
3. I want to eat an apple every night from Kashmir which fell off the tree the same morning.
4. I am fed up with what I can feed on, soon I am going to feed on my furniture to find an alternative for rice.
a. The corner shop people are only a percentage of Indian population and why is government protecting them?
b. When International company enters the market, they have to hire local people. Local people get trained, knowledge improves.
c. I want to get to a point where the logistics in India improves.
Indian government should make my life easier, so I can make money elsewhere. So Let Tesco and Walmart in.
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