Rural Connect is boon for Indian MNCs

Seven countries in Asia (India, China, Indonesia, Pakistan, Vietnam, Bangladesh and Philippines) and three in Africa (Nigeria, Egypt and Ethiopia) collectively include about 2.2 Billion rural consumers out of more than 3.4 Billion rural consumers in the world and 3 Billion rural consumers in Asia and Africa. In India, more than 800 Million consumers live in rural markets and more than 150 Million rural migrants living in urban centres maintain links with their families, visiting them during festivals, weekends, and other occasions.

Rural Migrants living outside India are connected with their families through Skype and mobile phones. In BRIC countries Brazil and Russia are most urbanized with less than 15% and 26% of their population living in rural areas. Brazil is more urbanized than USA. USA urban population size is more than 80%. India and China are far away from USA. Now, it becomes very difficult for a company to grow in these markets. In India, progressive company grows by having an inclusive strategy that focuses on both on Urban and Rural consumers. It is in their DNA.

Consider HUL, although it is a European MNC but its DNA in India is rural along with Pakistan and Bangladesh. HUL caters need of more than 1 Billion rural consumers. Reaching Rural Consumer by “Missed Call” is the new thing adapted by companies in India. Even the Indian TV Industry is using Rural or semi-rural settings and stories to create successful TV serials. Many NGOs are helping rural people to connect them with urban areas and inclined them towards technology.

In my Opinion, the rural DNA of Indian MNCs is their biggest strategic asset that will be hard for any other country to match. They understand how to appeal to the aspirations of rural consumers amidst lack of infrastructure, economic and language diversity, and unorganized retail markets. Technology will drive Indian MNCs and rural consumers to connect with each other and make India a better country in the world.

New Government vision of 100 smart cities will turn out to be positive factor and Indian MNCs will grow more. Their strategy of connecting with people will shift more towards consumer aspirations and service, not to build awareness. To make a better future and country Round Robin work has to be done, and then only we will be counted as citizen of developed nation.

World in September

In the history of the world, September seems to be an important month. From developing nations to developed nations, most of the changes in the past and present occurred in the month of September. In 2014, many events took place in the emerging countries of the world. India, Europe, and USA all three countries saw major changes. Let us look in the past events and changes in this year.

It was September 2001, when Islamic Terrorist group attacked upon the United States in New York and Washington. Two towers of World Trade Centers were attacked and US Pentagon was attacked. Many people died in the attacks. Few years later, on September 15, 2008, Lehman Brothers Holdings Inc. was filed under Bankruptcy. As the fourth largest investment bank of US, this crime led to 2007-08 financial crises in the world. Last year in 2013, India GDP fell down to a lower rate and currency exchange rate touched the highest point-making rupee weakest in history.

Year 2014 brought out many other changes in Indian History. After completing 100 days in office, Prime Minister Narendra Modi visits Japan for five days. Both the countries build Special Strategic Global Partnerships. Modi statement of “No red tape, but red carpet” was signs of investment from foreign countries. After that, Australian Prime Minister visits India for Nuclear deal. In mid of the month, Chinese President visit India for trade relations between both countries. MoU was signed for building Smart cities, SEZs, Chinese Development Bank, and manufacturing goods in India. Soon after some days, PM launches “Make in India” campaign to attract businesses from around the world to invest and manufacture in India.

In the end of the month, PM visit US to attend UN General Assembly council, to address Indians in USA, and to meet US President Barack Obama. Modi speech in Madison Square made him most searched person on Google and Tweets on Twitter. Both countries agreed to help each other in Defence and India to import technology from USA. These were some changes in India in September, which will drive India’s growth largely.  

On 24 September 2014, India became the first country in the world to reach the Mars orbit in its first attempt. The Mars Orbiter Mission was launched by ISRO. The total cost of the mission was approximately $70 Million and it is the cheapest inter-planetary mission ever to be undertaken since Martian exploration began. In corporate world, Alibaba IPO breaks the record of becoming the largest company in e-commerce sector by market share. Its value reaches $230 Billion after IPO in month of September.

After some peace talks between Israel and Palestine, Russia and Ukraine, tensions start between UK and Scotland. Scottish Independence referendum on Scottish Independence in September was another important day in history. The decision of Scotland to remain in Great Britain not only saved UK but some other countries like Tibet, India, China, and Pakistan. If the results turned out to be opposite then there might be chances of voting in for Kashmir and Tibet.

In September 2014, ISIS members began attacks on journalists from different countries, forcing US and EU forces to launch air strikes. These strikes are still in process. The 2014 Hong Kong protests also known as Umbrella movement, began in the same month. The cause behind the protest is that Chinese Central government decision on electoral reform regarding future Hong Kong chief executive and Legislative Council elections. The protests are still going and there are no negotiations between the protestors and the government. In Business news, all light was on Apple new iPhone and watch. However, there may be more things going around or took place in between years in same month but these are some, which remains in light and make it a big month in the history of the world.

 

Breakout Nations

Ruchir Sharma is a head of Emerging Markets and Global Macro at Morgan Stanley Investment Management. He generally spends one week per month in a developing country. He has been a contributing editor with Newsweek and has penned essays for publications such as Wall Street Journal, Financial Times, New York Times, Foreign Affairs, and Economic Times. He is the writer of Best International Economic Book “Breakout Nations.” Recently, I finished reading this book and it is the most interesting book on economic landscape.

The book takes on a life of its own as it delves in depth into each country and its economic drivers. China, India, Brazil, Russia, Mexico, Europe, Turkey, South Korea, Japan, Taiwan, USA etc all find a mention and an analysis. This book tells the in depth economic conditions of every country. It also covers past crisis of Asia, USA, Europe, and ASEAN countries. This book is also a revelation as well as treasure trove of information and ideas. In this book, Country Specific notions, are challenged and disproved such as in the section of consumer demand in China. Country specific problems that can hold it back are analysed in short and power pack sections like welfare, investments of Indian Businesses abroad in a time when the home country is in urgent need of capital.

It also contains graphs and numerical which tells comparisons and analytic view of each country. Each nation’s problems as well as enablers find adequate mentions giving a nice balance and flow to the analysis, as well depth and convincing power. Economic, political, crimes, as well as other problems find adequate coverage. Some problems like crony capitalism in India, welfare state in Brazil, political situation in Russia, olipolistic nature of Mexico, and rising inflationary trends in India are covered in depth. Each factor that can affects growth are looked at.

The objective of this book is to identify Breakout Nations- the nations most likely to succeed. Both conventional factors and unconventional factors approach in this book is right. For example, the analysis of number of Billionaires in a nation is a revelation. Overall, this book first, teaches one how to properly analyse a market or a nation. Second, it is a handbook of emerging markets. It gives a perspective of entire emerging market in a short.

A word on writing style, it is simple and easy to understand. One does not need to be a professional economist to understand the book. This is perhaps the most powerful plus point of this book. It makes the entire pitch in very simple, easy to understand and comprehend prose. It avoids needless details and voluminous analysis. The analysis is short and up to the point. This makes for a fast read and it makes for easy absorption of the material presented in the book.

As the Breakout Nations identified, be prepared for a surprise. Read the book to learn more, and open your mind to new ideas and thoughts.