What are these retail chains all about?

'Retail Chains, Reliance Retail, WalMart ..' we have been hearing of these names but never thought more about them. Most of us just know that all it is to do is setting up big air-conditioned shops and selling goods which amy also be sold by our nukkad shop (mom and pop stores). The next thing coming to mind may be that it is going to ruin the small-time traders and benefit on the big corporates like Mukesh Ambani.

I have been following the retail scene in India very closely since 2004, mainly because of personal interest. In this post I would like to present the real picture of this retail thing and what it means to India in layman's terms. The article tries to show a glimpse of what all goes on in the back-end of these retail chains (mainly hyper markets) in very simple terms.

Types of Retail Chains
These retail chains setup big, flashy, air-conditioned shops where you can touch, feel and then buy items. Now, there are several formats to it. Different formats are created mainly to cater to different segments. For example

• you can find stores which sell expensive items targeted mainly at not-so-price-sensitive shoppers such as westside, shopper's stop etc
• on the other hand there are stores whose USP is the price they offer, the lowest in the market, such as Reliance Fresh, Big Bazaar etc. The latter ones which fight price-wars are also knowns as hyper markets or hyper-marts.

Hyper Marts
The hyper marts stories interest me more than anything else. Hyper marts are the only thing today which have the capability to improve the conditions of Indian farmers and the whole agricultural scenario. Sounds too preposterous !! Read ahead to understand how.

A retail-chain in general can be broken into two tiers

1. Front-end: The interface which interacts directly with the end-customers e.g. the store, the employees handling the counters at the stores etc
2. Back-end: Back-end has to do everything from sourcing the stuff, storing them in inventory to delivering them to the stores and alot more. In short, this is where the whole game is played while front-end is just the face.

Front-End: These usually consist of big shops where a customers can buy everything from his/her list. Also, these hypermarts try to price their items below everyone else in the market. This way they plan to grab a big share in the price-sensitive segments. The obvious effect is on the small traders who cannot come up with competitive air-conditioned shops and price their items low as well. To understand how are these big retail-chains able to do this we need to take a look at their back-ends and understand how they work/plan to work.

Back-End: This is where the real game is. The struggle here is to improve the supply chain and make them more and more efficient. Let's first understand what a supply chain is and why is it this important.

Let's take a hypothetical example of a small shop keeper in say a small town somewhere in Karnataka who wants to sell wheat. The wheat is being produced by a small farmer in a small village in Kanpur, Uttar Pradesh. Now, let us try to trace a probable path of the wheat sack starting from the village in Kanpur to the shop-keeper. The farmer had taken a debt from some village money-lender to raise the crops so he is in a hurry to sell-off his produce and pay back. He cannot wait for the right price. He sells all his produce to a middlemen in village at a price which is way below the government fixed Minimum Support Price (MSP). This middleman then takes the wheat produce to the mandi in Kanpur and sells it. A trader then procures wheat from this Kanpur mandi and tries to sell it in other places throughout India. Say, now he sells it to a trader in Mysore. Now, our small shop-keeper may purchase the wheat from this trader in Mysore. The chain can even be longer than this. This supply chain has various inefficiencies. Everyone, at each step will ask for his share. There is a possibility that the supply and demand of wheat in mandi don't match, thereby creating a dead-loss.

Let us now see how a big retail chain (say reliance retail) is expected to work. They have all the data about the sales at their outlets and can accurately estimate the demand for whole year. The are two ways to procure.

1. They go out in the usual mandi's and offer the best prices and they may directly goto farmer and buy out his produce. Check out this year's mad rush and how farmers are reaping gold.
2. They sign-up with farmers everywhere in India (say also with our poor farmer in Kanpur). The agreement is that they will help the farmer use the latest farming techniques, seeds and all. At the end of the season the retail firm will buy the produce at a price fixed initially

Using either of the above mentioned techniques, the retail chain can procure the required amount of wheat and will store that in it's own godowns spread all across the country. As the inventory levels in a particular store starts dropping the items can be delivered the store using their own transport department. This way the long supply chain has been cut-short making it more efficient than our existing supply chain where the product changes god-knows-how-many hands before reaching the end customer.

We discussed two procurement techniques above in brief. Let us now discuss them in detail.

Buying directly from the mandi: The pros are that you can go ahead and buy as much as you want and don't need to plan right from when the seeds are sown. The cons is that it still has some inefficient links (from village to mandi). Also, the price of procurement is not known accurately before-hand.

Contract Farming: Here, large business houses can enter into contracts with small farmers. The farmers will be provided help in terms of loans and technical know-how. The price is fixed at the time of signing the contract. So, the farmer knows the price his produce is going to fetch right from the start. This reduces the possibility of situations where we have seen that one year we don't have onions in the market and the prices shoot up, then expecting huge profits farmers next year sow acres of onions and the market witnesses a bumper crop and lowest prices. Such, situations have drawn many marginal farmers to commit suicide. Entering into a contract ensures them a price and therefore they can plan accordingly. Through contract farming farmers can also dare to produce crop which require high investments and more technical know-how (such exotic vegetables and flowers etc). These would otherwise be a very risky game for small farmers. The only cons with contract farming is that the procurer has to estimate his requirements well ahead of the harvesting season.

Exports:
Setting up of good quality and efficient supply chains will also result in a mani-fold increase in exports. It will enable the products from small farmers, milk producers, handicrafts and various others to compete globally. At the end of the day, ours is an agriculture based economy and to flourish we should be feeding the world and not importing from them.

Overall long term effect of hypermarts on Indian agriculture.

1. Helps farmers in getting better price for their produce


2. Reduces the difference in price at what the farmer sells and at what the end consumer buys at.


3. End consumers also get better prices.


4. Farmers can easily enter into crops which promise them to fetch better returns (such as cash crops, exotics and flowers).


5. The biggest difference maker is expected to be the increase in the competitiveness on Indian products in global market thereby fueling the exports.


6. We get to see some Indian companies making in big at the global level and an opportunity to be a share-holder in it.

What will the mom and pop store-owners do?
There is no doubt that some of them are going to go out of business. But, this is for the good of the farmers, for the good of consumers and ultimately for the good of nation. Most of them don't add any value to the economy and just make the chain inefficient. My advice is that they should start looking for a different business opportunity where they add some value. The Indian economy is expected to grow tremendously and we need many entrepreneurs to make that happen. And I know that this community has it in them to make this happen. So, there is nothing to fear about. Change is the name of the game and we should be ready for it.

I expect it to take another four-five years before we actually start feeling the positive results of these changes. The biggest risk is from our political community. The biggest reason for India IT industry making it big was that no one in the political community cared about it. Retail revolution promises to a far bigger thing than that just if politicians leave it aside.

Bharti, Wal-Mart announce deal

Bharti, Wal-Mart announce deal
It's going to be quite an interesting story. The entry of wal mart in India is going to pull the retail revolution to full throttle right from the start.

But, I would had been happier to see the bharti-tesco deal coming through. Though, i don't think that tesco is going to leave the market. It must be looking for other viable options.. may be tatas (they too planning a foray into retail). My li'l biasness towards tesco is because of it's extensive experience and superiority in agricultural supply chain management and it's just the retail revolution's promise of delivering it to farmers is what is keeping me glued to all these activities. It's their turn now after the IT/BPO pros to benefit from the booming, growing and developing India.

I am hopeful : III

In the last decade India has made big strides in the global economy especially IT and BPO sectors. There have been numurous stories about the jobs moving from everywhere to India. Optimism is probably at its highest level among the urban Indian youth. Most of them are either earning more than their parents ever did or are sure of doing so after finishing their college.

But, I have always been skeptical if all this can really elevate India, the real India, the rural India. All these stories are mainly of nri's and urban indians. All this has barely made any dent in the rural regions of the country. The only sign of modernity you will find is television sets and mobile. Green Revolution was the only thing which had some real impact on the life of rural Indians, but that too was limited to just punjab, haryana and to some extent western UP. Also, It is now a age old story (the time-period of green revolution was 1967-1978). It is close to three decades since any serious step has been taken in that direction. Infact, rural India is still where it was decades ago.

I have always been of the view that agriculture will have to move-up a step to bring out Indians from the clutches of poverty. It requires fewer people to be involved and be made more profits. Talking about profits, it will enormously help if middlemen can somehow be removed and reduced by a large extent. the crux of the problem is lack of proper supply chain management. With Mukesh Ambani deciding to enter the retail market (read Bigger, Faster, Better), with his bigger than the biggest dreams it seems that the retail business in India is on the verge of a revolution as had been the case with telecom with reliance infcomm entering the foray three years back. In the field of petrochemicals/refinery Mukesh has shown the world that he has the capacity and tenacity to turaround a country like India's position to a 'net energy exporter'. When Mukesh entered the telecom sector, the mobile market was restricted mainly to the upper and upper-middle class and that too exclusively in urban areas. The current scenario needs no story-telling, everyone knows about the booming telecom sector.

Mukesh plans to invest $5 billion by 2011. The investment will be distributed across the whole chain, the farms, the stores and the distribution system guided by the latest logistics technology. He aims to create enough of a surplus to generate $20 billion in agricultural exports annually. His trials are already complete in partnership with the Sahakari Bhandar chain of 19 supermarkets in Mumbai. The stores were modernized and new system put in place resulting in trippling of revenues in a matter of two months. During the second phase, he plans to enter the small towns with a population of over 50,000 and build stores/partner with already existing stores before entering the metros.

But the biggesy risk is from the lack of infrastructure and modern technologies in the farm sector. "To transform Indian farmers into quality suppliers for his new retail chain, Ambani plans to create 1,600 farm-supply hubs across India, providing technical know-how and credit, selling seeds, fertilizer and fuel, and buying produce. He also plans to build some 85 logistics centers to move food to retail outlets and to ports and airports for export. Reliance is gearing up to train tens of thousands of new employees in the next six to eight months to do everything from erecting prefab warehouses to transporting fresh produce."

If all this goes well and according to plans, rural India will find itself catapulted into a era of self-perpetutating growth. It has the potential to do the same for the farmers what IT/BPO has done for the college grads.

I am hopeful : II : Bigger, Faster, Better

Bigger, Faster, Better

India's top tycoon hopes to kick the country's nascent boom into hyperdrive by remaking its stores, farms and even its biggest cities.

By Ron Moreau and Sudip Mazumdar
Newsweek International

July 17, 2006 issue - Mukesh Ambani has been India's Mr. Big for a long time. By all accounts, he is the country's most influential private citizen, and the businessman who thinks bigger than the rest in this rising economic superpower. He was all that even before a bitter internal feud led to a split in his family conglomerate. The breakup, finalized in January, left Mukesh in control of the larger (and largely petrochemical) share, Reliance Industries, and that behemoth has seen its fortunes soar ever since. It is now India's largest private-sector enterprise by any measure: revenue ($20 billion in 2005), profit ($2 billion), or share of Indian GDP (3.5 percent). Last week its stock closed up 15 percent since January, making Reliance India's biggest company by market cap (about $35 billion). Mukesh, who was already the world's 38th richest person before the split, according to Forbes, is now considerably richer. He says that while most family empires destroy wealth when they divide, the parting of the Ambanis was a "win-win" proposition.

Now, Mr. Big's ambitions are bigger than ever. Since the breakup, Ambani, 49, has finalized plans to invest more than $11 billion over the next decade to build two new satellite cities outside creaking, overcrowded Mumbai and Delhi. He foresees these metropolises emerging within just four years, each with a population of 5 million people making $5,000 a year, on average (or seven times India's norm), and hosting top multinational companies. And that is all pretty simple—a development on steroids—compared with the idea that really gets Ambani going.

Ambani's favorite scheme aims to revolutionize in one swoop two of India's largest but most backward sectors: farming and retail. Despite boom times, India is still a nation where 100 million mostly small farmers work with ox and plow, where 96 percent of retail stores are mom-and-pop shops and most of the roads between farm and store are mud tracks. Ambani plans to invest $5 billion by 2011 to put both the farms and the stores on the road to modernity, connect them through a distribution system guided by the latest logistics technology, and create enough of a surplus to generate $20 billion in agricultural exports annually.

In China, these plans would be hatched by the Communist Party. In India, the government is neither visionary nor efficient enough. But Mukesh Ambani is both. "This new business model excites me the most," said Ambani, wearing a white polyester-blend, safari-style shirt and dark blue slacks, in an exclusive interview in his Mumbai office recently.

Ambani is in many ways the enthusiastic extreme in a booming India, which has seen an explosion of entrepreneurial energy every time it opens a new industry to competition. The Reliance conglomerate got its start as a family textile business in 1966, and has grown in spurts, often triggered when the government released its grip on one sector or another. Mukesh Ambani's new cities were born, for example, from a recent reversal in the attitude of both state and federal governments, which are now willing to give private businessmen control over huge projects. "Can you imagine the change in mind-set?" he says. "The government is ceding its powers."

Reliance has always had a complex relationship with the government. In a sea of family monopolies, it was a genuine start-up. Yet it quickly acquired deep and sometimes murky connections with politicians, who have often helped Reliance along the way. Mukesh retains the extraordinary clout of his late father, Dhirubhai, the company's founder. But many who have dealt with him say he has also created a company that succeeds based on merit, not political good will. In that sense India's complex and controlled reform process has been perfect for market-savvy insiders like Ambani.

Ambani is not the only major Indian entrepreneur who sees India's farmers as an army of opportunity, either. Others are investing heavily in fruit and vegetable exports to Europe, information services for farmers, and consumer credit in the countryside. What unites them is both pursuit of profit, and a perhaps uniquely Indian mission to spread the wealth, which is arguably becoming a business necessity in a democracy whose growing income gap could prove explosive, particularly for the superrich. What distinguishes Ambani is the sweep of his plans, and a track record for making big projects happen. "His genius, his strength, is that he's enormously good at executing large projects," says Nandan Nilekani, the CEO of Infosys, India's huge IT company. "He is able to assemble large numbers of people, the project-management skills, the capital and then execute."

Ambani wants to build a chain of both small and supersize stores across India, creating 1 million jobs and reaching $25 billion in annual sales, all by 2011. If his plan succeeds, he says, consumers will get fresher food at lower prices, rural incomes will soar, farmers will become active consumers, and Reliance will become "a WalMart in India." The agricultural export boom will bring India's farmers into the global economy, as IT has done for its college grads. "We are rebalancing the world," says Ambani. "We are in fact lucky to be at the right place at the right time, contributing to our self-confidence as Indians. That's what energizes me." It's a vision in which everyone wins, which helps explain the silence of any doubters.

They were not so silent earlier. Mukesh Ambani got his start implementing his father's dreams. In 1980 Dhirubhai summoned Mukesh back from his M.B.A. studies at Stanford to begin a risky attempt at "backward integration" of its textile mills. The plan was to move from sewing clothes to creating the fabric, and eventually refining and pumping the oil from which synthetic fabrics are made.

At almost every step, naysayers would dismiss Ambani's plans as too grand for the Indian market. Mukesh first took charge of building a polyester plant at Patalganga, with an annual capacity of 10,000 tons at a time when India's demand was only 6,000 tons, and got it done in just 18 months. After Dhirubhai was hobbled by a stroke in 1986, Mukesh became a more nearly equal partner and was once again manager-in-chief when Reliance built a petrochemical plant to feed the Patalganga complex. "The son learned at his father's feet how to think big," says Vallabh Bhanshali, a Mumbai investment banker.

By 1996, the Ambanis were launching the next step in their grand plan: an oil refinery. Mukesh lived in a shipping container at the arid site in Jamnagar, 850 kilometers northwest of Mumbai on the Gulf of Kutch, while managing a work force of 80,000 and shuttling back to Mumbai in a small plane to consult with his invalid father and answer the critics, who kept asking: "What does Reliance know about refining?"

The Jamnagar project would set the pattern of sharp attention to detail, executed at breakneck speed, for which Ambani is now famous. He and his experts looked at 2,400 configurations for the refinery, sweated over every detail, yet finished in just three years. Jamnagar is now the world's third-largest refinery, and can turn crude into gas for cars or aviation fuel for $2 or $3 less per barrel than its closest Asian rival, a plant in Singapore. "We wanted and got an elephant that could dance to the tune of any market," says Hital Meswani, a long-time family friend who heads the refining operation.

Soon after the plant came online in 2000, India not only stopped importing refined oil products, it started exporting enough to more than pay for its crude-oil imports, becoming a net energy exporter for the first time. While other nations like Angola and Turkmenistan have achieved a similar turnaround, they did it by simply exploiting existing oil reserves—not by creating an industry from nothing, as Ambani did for India.

Soon, Ambani plans to break ground on a $6 billion expansion that will make Jamnagar the world's largest refinery, capable of processing more than 60 million tons of crude oil annually. Meanwhile, he has completed the "backward integration" of Reliance through an oil and gas exploration company that has hit a potentially huge natural gas reserve off the east coast of India, and is now spending $1 billion annually to pursue sites too remote for major oil companies, including three in Iraqi Kurdistan. "Mukesh wants to take risks," says P.M.S. Prasad, president of the search company, Reliance Petroleum.

Dhirubhai did not live to see this moment. He died in 2002, setting off a power struggle between Mukesh and his younger, more flamboyant brother, Anil, 47, that became a tabloid sensation and prompted speculation that Reliance itself might not survive. Mukesh pushed ahead during this period, taking advantage of the deregulation of the telecom sector to launch Reliance Infocomm in 2003, which quickly became the third-largest telecom in India. Mukesh felt a special attachment to Infocomm because it realized another dream of his father's—cutting the price of a phone call down to a penny a minute in India.

A year ago, with Reliance stock faltering, the matriarch of the Ambani clan stepped in to resolve the feud by dividing the conglomerate in two: the majority share ended up in Mukesh's hands, but Anil got Reliance Infocomm as well as Reliance Energy (electric power) and Reliance Capital (finance). "We are not crying about the three sectors we lost," says Anand Jain, Ambani's friend from their grammar-school days and head of Reliance's new cities project. Jain points out that within one month of the settlement Mukesh was rolling out three new projects, including the new cities, the farm-to-retail plan, and a related plan to foment "a second green revolution" in biofuels.

The Indian market is smiling on all of Mukesh's schemes. The three companies under his control have more than $22 billion in annual revenue, but 90 percent of that comes from Reliance Industries, which is entirely in petrochemicals. No doubt high oil prices have helped push up Reliance's stock price in recent months, says Ambarish Baliga, a vice president at Karvy Stock Broking in Mumbai. "But Reliance's strength is Mukesh" and the consensus view is that Reliance Industries will thrive even if oil prices fall because retail is "the main story going forward."

The question that some Indian businessmen ask, in private, is whether Ambani can really translate the model he used to build refineries so successfully to all his new projects. While Reliance touts its new business teams as top-flight, many old family friends remain in the upper ranks.

They are, however, as meticulous as ever. The farm-to-retail team is researching every step of the plan, from vegetable growing to hypermarket versus mom-and-pop retailing. The good news is that the backwardness of Indian farming conceals competitive advantages—for example, India has more arable land than any other country, and spans climate zones ranging from alpine to tropical that can grow any cash crop. The bad news, says Ambani, is that "the whole supply chain is totally disorganized." Because of a lack of storage, refrigeration and transportation, some 40 percent of India's fruit and vegetables spoils before reaching market.

To transform Indian farmers into quality suppliers for his new retail chain, Ambani plans to create 1,600 farm-supply hubs across India, providing technical know-how and credit, selling seeds, fertilizer and fuel, and buying produce. He also plans to build some 85 logistics centers to move food to retail outlets and to ports and airports for export. Reliance is gearing up to train tens of thousands of new employees in the next six to eight months to do everything from erecting prefab warehouses to transporting fresh produce. Even Reliance's admirers note that with little experience in farming or retail, Ambani is taking his biggest risks yet. "There will be mistakes," Ambani admits. "But we are not scared. We will correct our mistakes fast and move on."

In a sense, Ambani's basic bet is on the future of the Indian market and its 1 billion consumers. This is virgin territory, in which the 96 percent share held by 12 million family-run shops is high even compared with China (80 percent) or Thailand (60 percent). That makes it a relatively easy market to conquer. In the past two years Reliance has built 1,250 modern service stations, and already has 15 percent of the retail gas market, with plans to double the number of Reliance stations by December. Mukesh predicts consumer sales will surpass refining as Reliance Industries' main source of revenue within seven years.

Ambani thinks he can beat the likes of Wal-Mart on his home turf based in part on local knowledge: for example, Reliance executives understand that small retailers are a powerful lobby, particularly on the local level, and could easily trip up a giant. So Ambani is moving first to incorporate small stores into his chain, starting with a trial partnership with the Sahakari Bhandar chain of 19 supermarkets in Mumbai. In just two months, Reliance has renovated, computerized and stocked these stores, with dramatic results: average store revenue and customer traffic have tripled. In a second stage, Ambani plans to build new superstores, starting on the outskirts of the 784 Indian towns with populations greater than 50,000 before expanding into the ten largest cities, where property prices and congestion make superstores problematic.

Ambani's farm, retail and energy visions merge at his Life Sciences Center in Mumbai, which is pursuing his "second green revolution." Founded in 2002, its research includes experiments in growing biofuels from the jatropha plant and cellulose on a commercial scale. "If you can crack the cellulose code just like the Da Vinci code, cellulose and jatropha could give us two agro-routes to a world without gasoline," he says. About half of Indian homes have no electricity, and Ambani says big companies have no workable plan to bring it to them (an indirect slap at Anil's Reliance Energy). His answer is to go "wireless." He now has teams setting up experimental biomass generators in remote villages, and envisions a day when thousands of villages have these generators—sold and serviced by Reliance's rural retail network.

It could happen, as many obstacles seem to be melting in Ambani's path. Last year Parliament passed a law creating Special Economic Zones, which grant developers authority to plan new projects with more freedom than even China allows in its own bustling SEZs, on which Ambani's new cities are modeled. Reliance has all but secured 150 square kilometers of largely farm land east of Mumbai, at prices Jain estimates at 1/1000th those in downtown Mumbai. The government holds some equity in the projects, but as a largely "silent" partner, and has already approved Reliance's detailed plans for both new cities, says Ambani. "If you would have asked me five years ago if a project like this was possible I would have said no."

Reliance's first move will be to set up roads, rapid transit, power and water supply, telecom and rail links. In cooperation with the government it plans to build a 20-kilometer bridge across the bay linking old and new Mumbai, and a new seaport. Another private firm is building a new airport nearby. There will be a one-stop licensing agency, jointly run by Reliance and the government, to cut through India's infamous red tape. "Every serious investor in the world is approaching us to get in," boasts Jain, and Reliance has already secured $2 billion. Ambani expects that the cities will each pump $25 billion into the national economy every year. With groundbreaking due to begin later this year, Reliance aims to finish New Mumbai and Delhi by 2010 or sooner. "If anyone can do it Reliance can," says Sanjay Nayar, the CEO of Citigroup in India. After all, the bigger and faster, the better.

I am hopeful : I :Centre-right? That’s all right

Alot of changes have been going on in the country on the economic front over the last decade, but I was never so much hopeful as I am today. It is all because of the way events have been unfolding and the upbeat mood. Will first quote some of the articles that convey most of my views and information. First of the series is a shekhar gupta's, one of my favorites among the current league of journos.

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Source: http://www.indianexpress.com/story/7112._.html
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Centre-right? That’s all right

Shekhar Gupta
Posted online: Saturday, June 24, 2006 at 0000 hrs

CMs from north, south, east and west of the country are embracing markets and corporate investment. They have sensed the new mood

Who needs checks & balances? Up & down in down southNow, don’t lose the plotLong live our dead ghosts

Two events on the same day this week, in the two most distant metros in the country, each involving an adversarial brother and a fraternal adversary, raised the same, intriguing, vital and delicious question. Was it pro-rich, or pro-aam admi?

In Mumbai Prime Minister Manmohan Singh laid the foundation stone of the new metro, its builder-to-be, Anil Ambani, proudly by his side. Forget the politico-corporate significance of the event for a moment. Just ask yourself this simple question: when India’s most respected and successful economic reformer goes ahead to bless a mega commuting infrastructure project to be built by one of its biggest corporates and tells his own party’s government in Mumbai to get its act together, is he batting for the rich, or the poor? For corporate greed, or for the aam admi’s needs? Is he pulling his moral and prime ministerial weight in favour of the long-suffering poor and middle classes in a decaying city, or is he merely blessing another corporate money-making adventure and underlining his alleged neo-liberal obsession?

Now switch to Kolkata, nearly 2,000 km to the east. Here West Bengal Chief Minister Budhadeb Bhattacharjee stands beaming beside a beaming Mukesh Ambani on the 30th anniversary of the Left Front government, publicly thanks him for “taking the trouble” of coming to Kolkata and warmly welcomes his plans to invest Rs 2,000 crore each in agri-retailing and gas pipeline infrastructure. Is not only India’s, but possibly the world’s most popular Communist leader junking his beliefs and succumbing to the charms of the moneybags, or is he taking one more giant step for the welfare of the poorest of poor, the agrarian class of mostly very small land-owners with no marketing clout? Is this the rise of a new commie-corporate cronyism, or is it learning the truth from facts and doing the right thing by his own aam admi? The question becomes even more interesting as he followed this up immediately by amending his state’s Agricultrural Produce Marketing Committee (APMC) Act to allow the private sector to buy produce directly from the farmer.

If the answer is the former, that these were both pro-rich, neo-liberal sort of infractions, then it would seem the virus is catching on with the political class. In the same week, Tamil Nadu patriarch Karnunanidhi visited the Infosys and Wipro campuses in neighbouring Tamil Nadu, inspired by his party’s young IT minister at the Centre, Dayanidhi Maran, and in the company of Karnataka Chief Minister H.D. Kumaraswamy in spite of the fact that politically he is part of a rival formation, and there are serious, current issues between their respective states. Again, in the same week, Manmohan Singh was in Bangalore too, laying the foundation stone of the metro there and an elevated highway in the company of the same Kumaraswamy who stabbed his party’s government in the back and now leads a coalition with the BJP.

And forget Manmohan Singh for the moment. He is, after all, no more than a ‘neo-liberal’, pro-American, pro-Zionist dilettante, anti-poor, and so anti-third world he even wants to take India out of that holy grouping by talking of high growth rates. What about the messiah of the poor Dravidian Karunanidhi, who would give his voter everything free, from rice to television sets to, who knows, an air-conditioner each next? And what about the Gowdas, the self-appointed, ‘humble’ champions of the poor farmer? Have they lost their way so completely as to be crowing about building infrastructure in Bangalore while rural Karnataka, particularly its farm sector, is in such ‘distress’?

Run your eye across the map of India and you cannot get away from the contagion. In Orissa BJP’s ally, Navin Patnaik, who also happens to be one of the cleanest and most popular chief ministers in the country, is rolling the red carpet to attract corporate investments from Tata to Jindal, from Iffco to Posco. Has he lost touch with the reality of his state, one of the poorest in India? Once again the same question, is he batting for the moneybags, or his aam admi?

Go north, south, east or west, the same question confronts you. One of the first ideas of the new Left Front government in Kerala, led by the most committed Stalinist since Stalin, is to exclude IT and tourism industries from strikes. India’s most prominent and politically successful Lohiaite, Mulayam Singh Yadav, has allowed a spectacular privatisation of sugar industry in his Uttar Pradesh that is working to the benefit of all, from the farmer, to the industrialist, to his exchequer. The number two Lohiaite, in Bihar, is so keen to attract investment he has appointed N.K. Singh of the NDA’s once-dreaded neo-liberal ‘mafia’ to head his development board. The BJP governments in Rajasthan and Madhya Pradesh are building intra-state road networks in public-private partnerships or on BOT basis at break-neck speed. The chief ministers of Chhattisgarh, Rajasthan, Punjab and Haryana are all bending over backwards to attract corporate investment, to build infrastructure, to corporatise agriculture, towards contract farming. Have they all gone mad? Have they all forgotten their politics? Just what the hell is going on?

Well, if they have indeed gone mad, at least the ideologues of the Left, the self-styled champions of the aam admi, assorted povertarians — who love poverty (different from the poor) so much their leitmotif is, “poverty is my birthright, and you shall have it” — should take heart. Because then India must be ripe for an immediate revolution. But no such thing is going to happen. In fact, in spite of all this dark talk of the have-nots versus have-mores, the farmer versus the broker, the corporate versus the destitute, the overall mood in our country is so wonderfully upbeat we are moving on nevertheless. In fact, as one case in point, in none of the states other than Bengal and Kerala, where elections have taken place lately, has the Left’s vote share added even one more percentage point.

So, here is my take on what is going on. A different sort of revolution is sweeping our country. It is sometimes said Manmohan Singh and his key ministers are erring gravely in running a centre-right government while the mood in their coalition, and even their party, is strongly centre-left. But if you forget the ‘mood’ for a moment and survey the entire country, and indeed the rest of the world as well, it is now evident that, whatever your ideology, there is only one way of economic governance. It is to embrace the global markets, be creative and competitive, fight for a larger share of the flowing capital, build better infrastructure, wealth, enterprise, and thereby more jobs and money for welfare schemes. You can call it centre-right if you wish. But if people, from Manmohan Singh to Buddhadeb, to Karunanidhi to Gowda, from Patnaik to Mulayam, from Nitish to Vasundhara and so on, are in their own ways following the same mantra of governance, there must be something right with it. This is the way India has been changing over the past 15 years. Events of this week just seem to have brought so much of the evidence together in such a remarkable manner.