Building an organization…

Having founded an organization inspired by the teachings of Swami Vivekananda more than 28 years ago, a question often asked of me is “How has your organization managed to grow into a large one managed by a team of highly committed people today?” People often ask me if there is a deliberate, purposive management or leadership strategy that the organization has deployed to achieve the seemingly difficult challenge of a group of young like-minded persons working together for nearly three decades. After all, Swami Vivekananda had mentioned in one his talks that it was a challenge for two Indians to work together. He had said, “If 2 Indians get together, then they will fight over the 3 ideas that they get and fall apart in 4 minutes”.

The answer lies in another simplistic, yet profound and practical saying of Swami Vivekananda. He wrote that three things were needed to make an organization and a Nation great – (1) absence of jealousy and suspicion, (2) conviction in the power of goodness and (3) doing good and helping all those who want to do good.

Team work is truly possible only when the team members not only have respect and love for each other but also learn to operate with a high level of trust, reciprocity and interdependence. This is possible only when there is absence of jealousy and suspicion. The situation of the world around us may look despondent, but needs a lot of positive and constructive action. The environment today can appear bleak and discouraging to young people who set out with noble ideas. Self doubt can be dreadful at times and one is constantly challenged by a seemingly hopeless situation. One needs tremendous strength and faith in oneself to persevere at such times. The belief that good will always triumph is not only a truthful reality but can serve as a very good motivator and keep the spirit alive in times of such extreme crisis. The change that we hope to bring about can seem small, insignificant and hopeless when one looks at the larger picture. While this need not be necessarily true, it can wear us down and push us to inertia. It is only then does the statement of doing good and helping all those who are doing good truly has a profound and practical meaning.

Swamiji was always a very practical man and knew the difficulties that ordinary men would face. It is for us to internalize what he said and raise above the ordinary and take ourselves, our organizations and our Nation towards greatness.

- Balu

Qualities of a social worker

What qualification should one possess to involve oneself in the world of social work? This is a common question asked in the many interactions that I have with young people. Many of them feel that they need to be either a doctor or a teacher or a professional social worker before they can get involved in the service of others. While formal qualifications and training do add to the competence of people engaged in this kind of work, I would like to mention the qualities that Swami Vivekananda saw as a basic requirement of people wanting to work for others.

Swami Vivekananda felt that unless one knew how to swim, one should not attempt to jump into the ocean. I have seen many people begin to engage in social service activities with a lot of enthusiasm, only to crumble at the first sign of a problem. Swamiji has said “Purity, Patience and Perseverance are three qualities that every social worker needs to have”. This is not only extremely relevant but a very practical mantra. In a world filled with corruption and negativism, purity in thought, word and deed helps build strength of character and one can stand out like an oasis.

Social service is also a very stressful activity and it is easy for one to give up in frustration. It is during these circumstances that the virtue of patience pays off. The tendency of most people is to keep searching for motives and they tend to look at those doing selfless service with a lot of suspicion. One needs enormous patience to accept people as they are and continue to do what one is doing with no desire for name, fame or any other tangible return. Gandhi also talks about the need for enormous patience. In his remarks on ‘Social Service and Reform’, he mentions that since it is the social worker who goes in search of people to serve, he needs to cultivate enormous patience to not get demotivated by the non-responsiveness of society towards the acts of service that he does.

Finally one needs to understand that any social change is a gradual process. In these days of instant gratification, one should have enormous perseverance to sustain the attempts and energy at bringing about this change. Surmounting a societal problem requires enormous will power and Vivekananda maintained that perseverance will always conquer.

Having these qualities of purity, patience and perseverance not only helps a social worker serve society better, but also enables him to mature spiritually. Swami Vivekananda always saw selfless service to mankind as an opportunity for self-purification and a means to attain salvation.

- Balu

Hosa Kanasu – 26

Here’s the 26th installment of ‘Hosa Kanasu’, my fortnightly column in Prajavani: 21 Feb 2012

- Balu

Our Youth and our Emerging Nation

This is the recording of my talk at the Youth Convention organized by Sri Bhavatarini Ashrama in Bangalore on 18-Sep-2011.

- Balu

FDI in retail…sounding the death knell for Rathnamma

Every morning, Rathnamma sits on the footpath outside where I live in Mysore, selling greens and vegetables. I would watch her come at around 8 am and go about her business on most days. One day, I decided to talk to her and try and understand how much she could possibly earn each day. From my conversation with her, I understood that she would borrow Rs 500 each day from a money lender and go and buy the greens and vegetables every morning directly from farmers from the ‘unofficial’ market close to the exhibition grounds in Mysore. She would then spend about Rs 50 on an auto and bring the vegetables to this spot of hers. Her business would take around 2-3 hours to transact and she would end up with around Rs 750 each day. She would have to return Rs 550 to the money lender in the evening and the cycle would continue each day. I was fascinated by her story and the economics associated with it. Her family, the money lender, the farmers involved and the auto driver were all involved directly in this economy apart from the many others who could also be indirectly impacted. The Rs 150 that she made each day added to the family income. The vegetables she sold was possibly the freshest that one could get. As I chatted with Rathnamma, I thought about the recent controversy that India witnessed over allowing Foreign Direct Investment (FDI) in retail. There was so much of heat but very less light in the discussions that took place subsequently in Parliament before the Government decided to put the decision on hold. While there are arguments for and against FDI in retail, I tried to see the issue from ‘ground zero’, where people like Rathnamma live and transact their business.

We need to understand what retail business is, why foreign players are interested in doing this business in India and what the experience of other countries like China, Indonesia and Vietnam are. Would our country and the economy benefit from FDI in retail? How are the average small traders and Indian farmers going to be protected? Will the economy grow at the aggregate level but swallow up the poor in the process?

In 2004, the Delhi High Court defined the term ‘retail’ as a sale for final consumption in contrast to a sale for further sale or processing (i.e. wholesale). The retail industry is mainly divided into Organised and Unorganised retailing. Organised retailing refers to trading activities undertaken by licensed retailers i.e., those who are registered for sales tax, income tax, etc. These include the corporate-backed hypermarkets and retail chains, and also the privately-owned large retail businesses like the stores run by Reliance, Birla and Tata group. Unorganised retailing, on the other hand, refers to the traditional formats of low-cost retailing – the local kirana shops, owner-manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc. With a contribution of 14% to the national GDP and employing 7% of the total workforce (only agriculture employs more) in the country, the retail industry is definitely one of the pillars of the Indian economy. Unorganized retailing is by far the most prevalent form of trade in India constituting 98% of total trade, while organised trade accounts only for the remaining 2%. Estimates vary widely about the true size of the retail business in India. Some have estimated that it is around Rs 8,00,000 crores and is growing at a rate of 40% per annum. Organised trade employs roughly 5 lakh people, whereas the unorganized retail trade employs nearly 3.95 crore people. One of the principal reasons behind the explosion of retail and its fragmented nature in India is the fact that retailing is probably the primary form of disguised unemployment/underemployment in the country.

Given the already over-crowded agriculture sector and the stagnating manufacturing sector, and the hard nature and relatively low wages of jobs in both, many million Indians are virtually forced into the services sector. Here, given the lack of opportunities, it is almost a natural decision for an individual to set up a small shop or store, depending on his or her means and capital. And thus, a retailer is born, seemingly out of circumstance rather than choice. This phenomenon quite aptly explains the millions of petty shops and small stores. The explosion of retail outlets in the streets of Indian towns and villages is a visible testimony of this. The presence of more than one retailer for every hundred persons is indicative of the lack of economic opportunities that is forcing people into this form of self-employment. Because of this fragmentation, the Indian retail sector typically suffers from limited access to capital, labour and real-estate options. The typical traditional retailer follows the low-cost-and-size format, functioning at a small-scale level, rarely eligible for tax and following a cheap model of operations.

The Indian Government had conceived allowing large multi-national companies to set up multi-brand retail outlets in Indian towns with populations of more than 1 million. The Government’s logic seems to be that such cities can not only absorb and support these large stores, but will also ensure that the smaller shops and kirana stores will continue to flourish. Imagine if Wal-Mart, the world’s biggest retailer, sets up operations in India at prime locations in the 35 large cities and towns that house more than 1 million people. The supermarket will typically sell everything – from vegetables to the latest electronic gadgets – at extremely low prices that will most likely undercut those in nearby stores selling similar goods. Wal-Mart would be more likely to source its raw materials from abroad, and procure goods like vegetables and fruits directly from farmers at preordained quantities and specifications. This means that a foreign company will buy big from India and abroad and be able to sell low – severely undercutting the small retailers. Once a monopoly situation is created, this will then turn into buying low and selling high. Such reorientation of sourcing of materials will completely disintegrate the already established supply chain. In time, the traditional outlets are also likely to fold and perish, given the ‘predatory’ pricing power that a foreign player is able to exert. The producers and traders at the lowest level of operations will never find place in this sector, which would now have demand mostly for fluent English-speaking helpers. Having been uprooted from their traditional form of business, people like Rathnamma will unlikely be suitable for other areas of work. It is easy to visualise from the discussion above how the entry of just one big retailer is capable of destroying the whole local economy and send it hurtling down.

Supporters of FDI in retail argue that the advantages of allowing unrestrained FDI outweigh the disadvantages. They quote the example of Thailand, Malaysia and China where too the issue of allowing FDI in the retail sector was first met with incessant protests, but later turned out to be one of the most promising political and economical decisions of their Governments and led not only to the commendable rise in the level of employment but also led to the enormous development of their GDPs. One must also not forget how these countries, who opened their retail sector to FDI in the recent past, have been forced to enact new laws to check the prolific expansion of the new foreign malls and hypermarkets. The record of our politicians and bureaucrats in successfully enforcing regulatory laws is not very encouraging and the experiences of the above countries may not be a good example to refer to.

While there are arguments about the advantages of allowing FDI, one must try and look at this issue from the eyes of Rathnamma and traders like her. Her small pavement shop may not seem to be adding to the growing economy, but it ensures food on her table. What the Government in power needs to do is go beyond advocating the cause of these large corporations and start creating an enabling environment that will allow her access to more reasonable credit and a formal market system.

- Balu