Today's news that the Central Cabinet has at last decided to open the Indian retail market to global supermarket chains brings a two year saga to a close. India's bania traders and other small family-owned corner 'ration shops' have traditionally monopolized India's and the city of Bombay's food and consumer goods retail trade. While giving a pittance to farmers and producers through an age-old system of seasonal contract buying, these petty traders through their wholesaler cousins have taken advantage of every surplus and every shortage through a near-monopoly of purchase credit.
Every street corner of Bombay had or perhaps still has its bania shop. It was a family enterprise with husband, wife and children engaged in stocking, cleaning, sorting and selling to the community it served. Every customer who came was known by name and when they cursed the quality and high prices, the bania smiled and gave credit in reply. In fact in the 60s and 70s, almost all families had a cash flow problem although Goans would shy away from that habit, except when paying for their liquor consumption in Aunties' joints. Most of these traders are BJP supporters and the party has nominally protested the cabinet decision though they like the ruling party, will have their own agenda in the matter. Rarely does any decision get taken with the interest of the citizens in mind. Only time will tell how this major change on India's landscape will pan out. It's a 450 billion dollar retail market and the giant Walmarts and Tescos, together with a host of smaller players from Canada, Australia and Europe will rush in to get a piece of that big pie. That could mean a leaner and more efficient supply chain and distribution system that is bound to benefit the price at the buyers end. That is the impetus under which the cabinet acted to deal with the rising food inflation in India. On the other hand, negative things can be surely expected. Small and marginal farmers will be driven to be additional statistics to the already high suicide farmer rates. No one will buy from them as they cannot cheaply produce at critical mass that will attract big buying. Poor producers will be driven to sell their holdings to bigger farmers and co-operatives at fire sales. The whole social imbalance will be skewed even further in rural India. The poor farmer will now be landless and jobless due to farm mechanization and the rich ones will become richer with more efficient farming. That may not be a bad thing for the country until one realizes that unemployed farmers generally have few other skills and even less education. Not to talk about the whole of the petty trader class who will be wiped out of an occupation outside of which they have had little exposure. All this can be managed well if one is governed by legislators and administrators with foresight and pro-active thinking. Of late India has not been well known for this. On the contrary all their attentions will be drawn to the corrupt misuse of huge subsidies and re-employment plans that will be put in place ostensibly to help the people displaced by the huge retail industry shift. Shades of the Cobbler Scam except that the Food Scam will make the former look like a walk in the park. The quantity of available food will increase for the population as the huge chains drive increased output per acre but this will be through the cost of increased chemical and genetically modified grain use, causing long term health problems in an already poorly nourished population. But prices will slowly increase in tandem as overheads and corporate profit compulsions overcome the previous inefficiencies and petty profiteering of the neighborhood bania. Gandhi's enduring wish for the prosperity of his country's villages will vanish with that of self sufficiency and prosperity for India's small farmer. But sentimentality and emotion aside, India by becoming part of the global food chain would have put behind forever the return to the basket case that it was until the 1980s, when it sent its Agriculture and Food Minster with a begging bowl every year to the US for PL480 funds or to seek the charity of big-brother Russia. Pessimists will always worry that a global famine will hurt India huge population first, in the new circumstances, but I prefer to think that if the country manages the change with a strong commonsense regulatory regime, it could be the coming of age of India's agricultural heritage making for itself another successful transition to the modern world. Roland Francis Toronto. --------------------------------------------------------------------------- Protect Goa's natural beauty Support Goa's first Tiger Reserve Sign the petition at: http://www.goanet.org/petition/petition.php ---------------------------------------------------------------------------