Monday, December 17, 2007

Tearfully yours, bania-ji, Dec 2, 2007

India is a land of ironies. Even so, the prospect of the Left shedding crocodile tears for the petty trader is truly bizarre. For sixty years the Left bashed the bania--every time food was short, it wanted to nationalize the grain trade and send the ‘profiteer’ to jail. In the early 1970’s it almost succeeded. Now, when the nation has begun a historic transition from small, unorganized retailing to supermarkets, the Left wants to stop it in the name of the bania

There is a legitimate concern, however--what will happen to the millions of jobs in the neighbourhood grocery stores as supermarkets like Reliance Fresh open across the country? The answer to that question has just come in. Thomas Reardon, a world authority in retailing, and Ashok Gulati, India’s premier agricultural economist, conclude in a recent study that the number of employees per square metre in organized and unorganized retail is almost the same. The difference is that employees of supermarkets are better paid, have pension benefits, are trained on computers, and have the opportunity to rise economically and socially. Hence, millions of youngsters are all set to benefit. With franchising, thousands of traders will also gain simultaneously.

This is not the first time that the Left has tried to stop history. When Rajiv Gandhi wanted to introduce computers in banks and railways, the unions went on massive strikes. This delayed our computer revolution by 15 years. A union leader confessed later that computers had actually increased jobs, not reduced them. The same virtuous circle will repeat itself in a bigger way in retailing as the benefits will touch the entire society. The farmer will get a higher price for his produce when he sells directly to supermarkets and is freed from the clutches of our corrupt mandi system. The housewife in the city will also pay a lower price at Reliance Fresh stores because the middlemen have been removed.

Yes, wholesalers and artiyas will lose, and they are the ones behind the current agitation in Uttar Pradesh, Bengal and Kerala. As often happens, the young, idealistic Leftist ‘jhola-walla’ has been captured by these vested interests and has ended on the wrong side. Politicians have also got into the act. If Mukesh Ambani hired and trained 10,000 Dalits for his Reliance Fresh outlets, he would get Mayavati on his side.

The epic, Mahabharata, seems to have been aware of our Indian ironies. It tells the story of Jajali, an arrogant Brahmin, and Tuladhara, a trader of spices in Varanasi. Jajali observes the shopkeeper as he weighs his spices disinterestedly, treats his customers alike, and lives “like a piece of wood flowing in a stream”. Ian Proudfoot, the Sanskrit scholar, explains in Ahimsa and a Mahabharata Story that the trader, with multiple suppliers and buyers, doesn’t depend upon anyone’s favour. His gains and losses are the result of impersonal market forces. He pursues his own interest (like the stick) and this leads to the common good through the “invisible hand” of the market (the stream, in this case). Tuladhara’s life is in contrast to those who doggedly strive for social advancement and influence.

There is an ironic twist in a trader teaching a (Leftist?) Brahmin on how to live. The Mahabharata holds up a worldly merchant as model of detachment before an egoistic, forest dwelling ascetic. Is it the epic’s way of telling the Leftist and RSS Brahmins that sometimes it is better to go with the flow, like a stick in the river, rather than impose your will on history? Think of an India without computers.



s4ur4bh said...

Goes a long way to show that a paltry few can rule over the uninitiated many !!!!

murali said...

I am fully aware and do support free trade and free hand. But i am wary about supermarkets, because the supermarkets can throw smaller retailers out of Business because of pricing pressures.After some time, there will be little competition for the supermarkets other than other big supermarkets. They will start co-operating and share data and pay lower prices to suppliers and farmers.
- This is what i came to know how it worked in UK and how Tesco suppresses suppliers because of its monopoly in retailing. Not sure if this is the case in India.