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Development: Meaning, Measurement and Strategies - Part Four of ten
AIDS : Realistic Overview of Prevention Strategies in Tamil Nadu
An Overview of the Energizer Market in India
Decentralised Powerloom Industry : The Incidence of Semi-Feaudalism
TIDEL Park Ltd. : In Need of a Strong Marketing Strategy
MMA to organise workshop on Brand building
| Development: Meaning, Measurement
and Strategies - Part Four of ten By Dr Y Subba Reddy, Faculty, Institute for Financial Management and Research (IFMR), Chennai. |
In the following, we examine in depth the policy shifts that have taken place in different countries and the circumstances that led to the shift and finally the consequences.
Ascent of Mixed Economy in Western Europe
Several broad forces shaped the mixed economy policy in the Western Europe. The appalling destruction, misery, and disruption created by the war meant that something had to be done urgently to thwart the capture of the entire continent by communism. Further, industrial machinery was obsolete and worn-out, the labor force in Europe was exhausted, malnourished, and in disarray, and technical skill had been dissipated. Extreme climate, culminating in the Siberian winter of 1947, unleashed a grave crisis. There was no functioning private sector to which to turn to in order to mobilize the investment, capital goods, and skills necessary for reconstruction and recovery. International trade and payments had been disrupted. Under the circumstances, Government would have to fill the vacuum and organize and champion the recovery. The Great Depression of the 1930s and the mass unemployment problem discredited the market system. At the end of the war, in Europe and throughout much of the world, capitalism seemed infirm, inept, and incapable. It could not be counted upon to delivery economic growth and a decent life. It was considered morally objectionable, appealed to greed instead of idealism, promoted inequality. It had failed the people and to many it had been responsible for the war.
The Labour Party, which came into power in the UK in 1945, nationalized the coal, iron and steel, railroads, utilities, and international telecommunications. The premise of nationalization was that as private businesses, these industries had under invested, been inefficient, and lacked scale. As nationalized firms, they are expected to mobilize resources and adapt new technologies and there would be far more efficient and ensure the achievement of national objectives of economic development and growth, full employment, and justice and equality. They would be the engines of the overall economy, drawing it toward modernization and greater redistribution of income.
Through the nationalization acts of 1945 and 1946, the French state decisively asserted its domain over the commanding heights, taking control of banking, electricity, gas, and coal, among other industries. However, due to opposition from the French Communists the nationalization drive was quickly halted in 1947. Communists perceived the nationalization as a weapon to prop up capitalist state and to resist the communist tide. At the end when it was all added up, the state had acquired a major stake in some of the most critical sectors of the economy, in what was a very decisive break with the prewar tradition.
Nowhere else in Europe was capitalism so discredited as in the four occupied zones of postwar Germany, owing to the complicity of a large part of business with the Nazi. The Nazis had preserved private property but controlled and subordinated it to their own purposes. The appalling conditions of postwar life seemed to provide the circumstances for implementing a socialist vision. Controls and rationing contributed to a barter economy, with dejected people trooping, by dilapidated trains, to the countryside to exchange whatever household goods they might still possess for a couple of eggs or a bag of potatoes. The seminal events took place in June 1948. The American and British executed a massive overnight currency reform, replacing worthless reichsmarks with new deutsche marks, which created a sound economic foundation. Subsequently it also abolished most of the price controls. All these steps, despite the Soviet blockade revived the economy in Germany. The black and gray markets disappeared and goods reappeared in the shop windows. After the establishment of Federal Republic (as West Germany was officially known) gradually the social market economy was built and by 1969, the Federal Government owned one fourth or more of the shares of some 650 companies. Public ownership extended to transportation systems, telephone, telegraph, postal communications, radio and television networks, and utilities. Partial public ownership extended to coal, iron, steel, shipbuilding, and other manufacturing activities.
There were crucial differences between the German model and the French and British models. In Germany, the state created a network of enterprises and left the market mechanism where the tripartite management of government, business, and labor play active role in operating the economy. This unique formulation took Germany from its economic nadir to the heart of European economic order in under a decade and established as the locomotive of European economic growth.
Postwar Italy inherited a mixed economy from the Fascist government of Benito Mussolini. However, the decisive break came with the state established Ene Nazionale Idrocarburi (ENI), which was a sprawling conglomerate with business ranged from crude oil and gasoline stations to hotels, toll highways and soaps. ENI facilitated reconstruction and promised to deliver natural resources to a resource-poor country. Only a few years after the war, ENI was already building new gasoline stations along Italy's roads that were larger, more attractive, and more commodious than those of its international competitors. It became a model for what state owned companies could do and for the very rationale of state ownership.
Along with this mixed economy consensus, all the Western European countries made efforts to solve the German question and face the threat from Soviet Bloc. All these endeavors led to a path of integrating the European economy.
The economic record of the Western Europe countries in the postwar years was extraordinary. The mixed economy delivered a standard of living and a way of life that could not have been anticipated, or even imagined, at the end of the World War II. The 1950s and 1960s became known as the golden age of the welfare state in Britain. By 1955, all the Western European countries had exceeded their prewar levels of production. The scourge of unemployment, which discredited the prewar order throughout the industrial world and which had been the number one stimulus to action was banished. This record of success in the industrial countries of Europe vindicated the idea that government must take an active role in overseeing or directing the economy in order to provide prosperity for all.
[To be continued]
| AIDS : Realistic Overview of
Prevention Strategies in Tamil Nadu By Allaudin K, Project Director, TN State AIDS Control Society, Chennai. |
"Awareness is the key to prevention" declared by the PM of India. Realizing the importance of awareness, Tamil Nadu launched intensive campaign using mass media folk medium etc. from 1994-95. The awareness among various sub-population groups has increased to nearly 98%. The awareness level even in rural areas of Tamil Nadu is better as compared to even urban areas of some other states.
As part of prevention effects, intervention programmes have been taken up through NGOs. They are working among CSWs, Truckers, MSMS, Migrant workers and other vulnerable groups. This has helped to promote safe sex, treatment seeking for STDs, reduction in non-regular sexual partners etc. which have in turn helped prevent infections.
The facilities for treatment of STD have been improved and out reach services extended to villages. Free supply of condoms along with unique social marketing programme implemented with the help of condom manufacturers has helped improve distribution, sale and use of condom. The strengthening of Blood Banks through licensing and mandatory testing of blood before transfusion have helped prevent transfusion related infection. The voluntary Blood Donors clubs in the colleges and rural areas have been useful in making use blood available easily.
The training and orientation of field staff in prevention and control of HIV/AIDS has been useful in equipping them with necessary knowledge and skills and disseminate the same ot the public. The advocacy workshops for the panchayat leaders, option makers and introduction of HIV/AIDS education in colleges and schools have gone a long way in involving the entire community in prevention and control of HIV/AIDS.
Tamil Nadu's experience in implementing prevention activities through the society is unique has evolved as a model for rest of the country. the prevalence of HIV/AIDS among STD Clinic attenders is pla teaming and stands at 16.27% in September 99 while the prevalence among TB patients fluctuates between 4.39% & 9.6%. Among the AnteNatal mothers, the prevalence is fluctuating between .69% and 1.63%. The available data indicates that the preventive efforts in Tamil Nadu are becoming a success and the rate of infection will come down sooner that later.
| An Overview of the Energizer
Market in India By Dimple Serawiwa |
The products available in India under the product category of energizers can be broadly classified according to their medical origin as modern or alternative medicinal (ayurveda, sidha, herbal, etc.) products. In the Indian environment we find more number of players in the alternate medicinal energizers compared to modern medicinal energizers.
The patent of Viagra was registered in 1993. However, according to WTO agreements, India has to follow patent regulations registered after 1995, not before. Therefore, Viagra has a product can be pirated. Around a dozen of Indian pharma companies are already in the race to pirate Viagra. The following are leading the race : Orchid, Cipla, Dr Reddy's, Kopran, Ranbaxy, Cadilla, Uni Chem, Hetro and Torrent. Some have already started manufacturing sildenafil citrate - the active ingredient in Viagra - in bulk and exporting. They are also planning in a big way to launch a desi version of the wonder drug, implying heavy-weight competition in future in the Indian market.
Further, there is an argument that Viagra is exported from India - Viagra is a videshi version of our desi medications, which have been around for many centuries (but have never really been hyped like Viagra). In fact, the advocates of alternative medicines claim another theory : that is, one important Indian ingredient used for sexual enhancement is called "Amukkura". Viagra is from Amukkura. Therefore, via Amukkura. Thus, the name Viagra. This is an indication that modern energizers will fight with desi energizers in the Indian market.
From the customers point of view, the consumer need for energizers in India seems to be a happy news for the players in the industry. According to a Opinion Poll by Outlook-Sofres MODE : percentage of Indians who say they are willing to pay RS 100 for a Viagra pill to enhance their sexual performances is 53; and percentage of Indians who say they are willing to pay Rs 500 for a Viagra pill to enhance their sexual performance is 17. The survey also revealed that 25 per cent of the respondents have used some performance enhancing pills in the past. (The poll was conducted in seven Indian cities covering 885 respondents. All were married and are aware of Viagra.)
Marketing pharmaceuticals in India is far more difficult than one imagines. It relies less on technology and more on understanding the market. The TA's perceptions count a lot, especially in a segment like energizers. Because, in a country like india where masked-sex prevails, even if one wants to purchase any sex related product, making the desired consumer to come to the OTC itself calls for special efforts. This has been vindicated in the Indian marketing history with reference to related brands such as condoms and sanitary napkins.
The above argument is vindicated by the marketing strategy adopted by Nirvana, a product from the table of manufacturers of KS condoms. According to JK Chemicals, "the promise of more enjoyable sex is common to both the condom and Nirvana.
Further, consumer goods are purchased by preference. But, drugs are not purchased by preference, but on doctor's recommendations. However, in India, energizers are purchased by preference as any other consumer goods.
In India, of late we find several companies entering into food supplement business. Though, strictly speaking, supplementary foods are not in direct competition to energizers, they are positioned in between. Thus, these products may eat into the market share of energizer segment. Because, on a perception level, a consumer who wants to buy an energizer may go and buy a food supplement product. Therefore, any marketing efforts with respect to any energizer product has to create a segment identity first, prior to creating a brand identity.
| Fashion Shows : Skin Talents?
By B Kanishwarya |
“Oh my India! And its traditions!”
This is a cry by many Indian women, thanks to the Indian fashion shows.
India is a country, where women is worshiped. And India has to her credit many women personalities. And in the same land, we find greatest insult to women taking place in the form of fashion shows. Today’s fashion shows show skins of Indian women rather than their talents. But, fashion show organisers claim that fashion shows brings out the best women talents, their skills and mental strengths. However, in practice, we find only skin talents being depicted in many fashion shows. This is an insult to Indian women.
Indian fashion designers design women cloths (or no cloths) which can not be worn off stage (There are instances where even models have refused to wear these skin-revealling cloths). They lack social responsibilities. If only they can imagine their mothers or sisters wearing these dresses, I am sure that their designing concepts will vary. Thus, the fashion designing institutes are the primary culprits. God only knows why this country needs institutes to tell the world how to design cloths which can not be worn. These fashion designing institutes are doing totally oposite to what they are suppose to do. It is crazy.
Indian fashion designers have seem to forgot the fact that style is a constant and the only variable is fashion. And the readers of this column will agree with me, I am sure, that any women’s beauty does not lie only on skin-skills. Some women do look more pretty when their skin is better covered, rather than revealed. Measuring women only on the basis of skin-skill is dangerous to the future of this country, which is exposed to several forms of media. I wonder where the next generation will land? May be at a dress-free boat.
Another comedy of fashion shows in India is that of season-based (winter collection, for example) shows, since India does not have either a fall or even a definite spring. India has a mix of all seasons all over the nation, due to her geographical diversity. Thus, a show titled ‘Spring Collection’ or ‘Winter Collection’ does not make sense.
Media too are starving for such half-naked skin photographs. This has been well utilised by fashion show organisers. The lesser the cloths they wear, brighter the chances that they will appear in next day’s media. Media should also function with its social responsibilities. They should avoid giving undue importance to these kind of cultural-distorting factors.
Fashion shows are exploiting women. But who cares? Even the participating models do not care, why should someone care? Models are suppose to be paid to display designer cloths. But not for wearing less cloths (or no cloths).
Fashion shows do show very little on trend or style. They depict more of skin to attract audiences. There can be found no legal frame work to control this kind of skin exhibitionism. The cultural ministry should take serious action against these activities which degrade Indian women. It is unfortunate that the Indian feminist organisations have not taken up the matter seriously. They need to join hands and attack this issue.
Read the first line of this article once again.
| Decentralised Powerloom Industry
: The Incidence of Semi-Feaudalism By G Shunmugam, Ph.D. Scholar, Department of Economics, University of Madras. |
Introduction
Textile industry is the oldest among industrial sector of India. It is linked to major agricultural crop, namely, cotton. While the decentralised handloom industry has been the embryo of Indian textile industry, the Post Second World War period demand gave the great fillip for the emergence of powerloom industry as the decentralised segment of the Indian textile industry. By definition the decentralised sector powerloom units are units having less than or equal to four looms.
Problem faced by the Powerloom Sector
Even though the powerloom sector has been included as a member of modern small-scale industry from the Sixth Plan period, the sector has been continuously deprived from the opportunities of availing concessional short-term and long-term loans from the agencies of institutional finances.
Sample Study
The primary objective of the present paper is to investigate the sources of finance for investment in fixed/working capital and the extent of debt with special reference to the differential organisational pattern. To this end, a sample study has been conducted at Komarapalayam of Salem District which occupies a prominent position in the weaving industrial map of Tamil Nadu.
Entry of Handloom - Weavers
In the economy of ancient India, every occupation was connected with a caste. The percentage distribution of the owner of the sample units in terms of the hereditary occupation clearly demonstrates that still the handloom weaving communities, namely Devangars and Sengunda Mudaliars have their supremacy in holding the powerloom units. Infact, nearly two-third of the powerloom owners are from the hand weaving communities. weaving communities, namely Devangars and Sengunda Mudaliars have their supremacy in holding the powerless units. Infact, nearly two-third of the powerloom owners are from the hand weaving communities.
Caste-wise Distribution of the Powerloom Units
In order to ascertain the facts revealed and to derive improved information from the collected data, occupational status prior to power loom weaving has been prepared in this study.
It is the handloom weavers who have entered in a big way into powerloom industry. However, the contribution by the non-weaving communities describes a different note, namely, it is the traders and other allied occupational group that is responsible for the entry rather than the agriculturists.
Occupational Status Prior to Powerloom Weaving
Out of 18 non-weaving community units, owners of 13 units come from trade and other occupations.
Since powerloom owners hail from the handloom industry, they are unable to mobilise resources even to purchase the main capital equipment, namely, the loom. Hence, they resort to borrowing from the master weavers and traders/private financiers to their livelihood.
Cost of Yarn
In the powerloom industry, the cost of yarn constitutes a major portion - 86 per cent - of the total variable costs or working capital. The micro firms alone are the purchasers of the yarn. Most of these entrepreneurs who availed institutional finance for the purchase of yarn have pledged their properties with banks. it is found that only two micro firms out of eight are able to manage yarn purchases out of their own savings. A few micro firms are getting short-term credit purchase facilities (for yarn purchase) from yarn dealers at pre-determined price and in many cases the credit facilities are extended without any interest but only for a stipulated period.
These yarn dealers are none other than the private financiers and hence the terms of trade are always in favour of the private financiers only. The usual practice, as observed by the researcher, is that the private financiers sell the necessary quantities of yarn on credit facilities only when there is a decreasing tendency in the prices of the yarn. The private financiers usually stock yarn and release only partial requirement of the micro firms. This way many financiers are able to reap large chunk of profits which are disadvantageous to the micro firms. This is similar to the system envisaged by Karl Marx, “where high profits were the prerequisite of accumulation while at the same time accumulation was carried on in order to maintain high profits” (W J Bawmol, 1951).
Lack of Knowledge on Output Market
It has been found that most of the powerloom owners suffer from lack of knowledge on the output market. Most of the micro firms are forced to sell their products through the financiers who also act as commission agents.
The master weavers and traders have greater role to play. They provide the yarn in sized beams to these unabled owners and get back woven cloth for selling. By the terms of unwritten contract, these private financiers pay wage for the service done by the weavers at pre-determined piece rates. At the time of payment, some portion of the total wage earned by the job seeking weaver is deducted towards amortisation and interest. Usually, the interest rate is almost twice that of the lending rate of nationalised banks by the job seeking weaver is deducted towards amortisation and interest. Usually, the interest rate is almost twice that of the lending rate of nationalised banks.
When an attempt was made to know the source of finance for fixed capital and indebtedness of powerloom owners, it was found that nearly two-third of loom operators borrowed money from the master weavers, private financiers or from both the sources for fixed capital needs. The most important fact is that nearly 90 per cent of borrowers belong to ‘job-seeking powerloom operators’.
Historically speaking, master weavers and traders (merchant class) entered into the field of handloom production at the time when handloom sector came to depend on mill spun yarn. When powerloom units came into existence, these middlemen visualised greener pastures in the emerging powerloom sector. They exploited the capital-starved hand weavers by seizing the opportunities created by the non-availability of institutional funds providing necessary working capital.
Concluding Remarks
The following prominent
features of the decentralised powerloom industry in Komarapalayam
are considered:
The economic analysis of the powerloom sector of Indian textile industry tend to confirm with the writings of Karl Marx, “as a matter of history, capital, as opposed to landed property, invariably takes the form at first as money; it appears as moneyed wealth, as the capital of the merchant and of the usurer” (Karl Marx).
| TIDEL Park Ltd. : In Need of a
Strong Marketing Strategy By WhiteArrow News Service, Chennai, April, Y2K. |
With the growth in Indian software exports, Indian Governments - both states as well as central - have started realising the importance of this goldmine. Governments, especially state governments, such as, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu are competing with each other to pull software houses to their states. While doing so, the offer competitive investment environment and concessions to corporates to set up software centres at their states.
Two major hurdles for Indian software clinics within India are continuous power supply and swift connectivity for data transfer. In order to overcome these issues state governments are promoting software parks where these problems are not suppose to exist, thus pulling software firms ( Indian as well as global) to these parks. One such success story is Hi-Tech City of Andhra Pradesh.
TIDEL Park is one such major initiative of Government of Tamil Nadu towards development of world class infrastructure exclusively for software and related activities. The project by TIDCO and ELCOT (industrial financial institutions of Tamil Nadu Government) is under active implementation, with a capital outlay of Rs 338 crore. The Park is located at Chennai, capital city of Tamil Nadu.
The project is coming up in 8 acres of the land with a build up area of 1.28 million sq. ft. The project consists of two basements, ground floor and 12 upper floors. The flexibility of design of the building is such that one can have the option of talking anything from 4500 sq. ft. to 90000 sq. ft. in one single floor.
Strengths of Tamil Nadu
with respect to IT Industry
Advantage Chennai
Though the TIDEL Park claims
superiority over other similar projects across the nation, it is
still aiming to achieve an occupancy level of only 50 per cent by
the end of May 2000, when it will be ready for inauguration.
Comparatively, when the Hi-Tech city was inaugurated by Mr Bill
Clinton, President of United States of America, the entire space
of Hi-Tech city was marketed before inauguration. Infact, big
global names in the industry inclusive of Microsoft have occupied
space in Hi-Tech city. However, with respect to TIDEL Park, two
months left for inauguration, it has signed up only with 14
companies, which are relatively unknown.
Marketing of Industrial Parks require high level of strategy formulation, rather than money power or local advertisements. A well carved out PR strategy as in the case of HI-Tech City may be of great use in marketing. Hi-Tech City, even after marketing the entire space, is still managing its brand equity, thanks to the strong long-term strategy of the State of Andhra Pradesh or rather the IT savvy Chief Minister Mr Chandra Babu Naidu.
Either TIDEL Park is struggling with creation of over capacity or lack of an intelligent strategy or both. Unless and otherwise the problem is shortlisted soon, a marketing solution can not be arrived at.
For more information on TIDEL Park click here.
| MMA
to organise workshop on Brand Building By White Arrow News Service, Chennai, April 2000. |
The Madras Management Association is organising a one-day interactive workshop on Brand Building. Aptly named " It's a Brand New World", the workshop will seek to explore the sustaining power of Indian Brands in the light of global competition and arrive at strategies to be adapted for sustaining mindshare. The work shop will take a look at some Indian and International brands that are making it big, with real life case studies and would also address issues like the Power of Public Relations in brand building, viability of brand extension, Celebrity endorsements, etc. It would also cover contemporary issues like branding of Hi-Tech ventures and the shift from product centric to promise centric business model. MMA is organising the work shop with the objective of providing a platform for brand managers, Mar-com managers & Technocrats to study the trends sweeping the consumer markets and adopt some of the strategies discussed in the session at their workplace. To conduct this workshop, MMA has roped in Mr. Sridhar Ramanujam, CEO, Integrated Brand.Comm, whose company specializes in integrated brand solutions. Prior to founding this company, Mr.Sridhar has had a successful career in Advertising & Communication spanning 15 years with hands on experience of managing brands like BPL, Digital, Van Heusen, Weekender, United Breweries, Birla AT&T, Videocon, Wrigleys, Kurl-on, and Dalmia Cements.
Day /Date : Saturday, April 8, 2000
Time : 9.30 am to 5.00 p.m.
Venue : GRT Grand Days
For Further Details Contact: Mr.Balasubramanian Madras Management Association 110, Nelson Manikam Road, Chennai 600 029 Ph : 374 0446, 374 0950 Fax: 37404776 email: mma@vsnl.com