Can RSS be selective in opposing a foreign investor?

ROHIT CHANDAVARKAR
Saturday, 12 May 2018

Rashtriya Swayamsevak Sangh’s (RSS) economic 
affairs wing Swadeshi Jagran Manch has taken strong objection to global retailing giant Walmart’s entry into India. A day after the historic announcement by Walmart and Flipkart, this RSS affiliated organisation launched protests in Delhi and told the media that they will not allow Walmart to enter India.

The question to be asked over this is ‘can any pressure group such as the Swadeshi Jagran Manch be selective in opposing a foreign investor wanting to come to India?’

Rashtriya Swayamsevak Sangh’s (RSS) economic 
affairs wing Swadeshi Jagran Manch has taken strong objection to global retailing giant Walmart’s entry into India. A day after the historic announcement by Walmart and Flipkart, this RSS affiliated organisation launched protests in Delhi and told the media that they will not allow Walmart to enter India.

The question to be asked over this is ‘can any pressure group such as the Swadeshi Jagran Manch be selective in opposing a foreign investor wanting to come to India?’

At all global summits, Prime Minister Narendra Modi has been appealing to the investors to come and invest in India. Some have responded. But the general trend is that the big manufacturing plants are being set up mainly in countries like China by them but, not in India. The global investors look at India more as a marketplace and not as a manufacturing hub.

So, they want to enter India for their retailing activity or similar operations. Should India welcome them or say no to them is the question the Government of India has to answer, but the policy cannot be ‘say yes to some and say no to some’!

Today, we already have a global e-commerce giant like Amazon 
present in India. In the media sphere, we already have players like Google and Facebook dominating the scenario. In the food and beverages space, we have many multinationals like Coke, Pepsi and McDonalds operating freely and building brick and mortar structures and physically expanding in the country. If all these are allowed to operate in India without much restrictions, what is the logic behind blocking only Walmart?

Speaking about the deal,  Bloomberg says, “Walmart’s entry into India in earnest is going to be another shot in the arm for made-on-the-internet brands. Horizontal and vertical E-commerce platforms will try to woo these brands to tie them into exclusive 
partnerships and with Walmart’s entry, there exists a buyer who isn’t afraid to put their money where their mouth is and acquire brands they believe in. However, brands will have to be able to innovate around one of product design, distribution or customer acquisition to stand out from the noise.”

Walmart’s founder Sam Walton famously said, “Opportunity lies in the opposite direction.” There are plenty of young categories in India that are there for the taking including but not limited to FMCG, jewellery, beauty, health, etc. While competition has begun to gain a toehold, there is still a long way to go to establishing clear leadership.

Historically, Walmart has been famous for frugality and being able to drive down procurement costs by squeezing its suppliers, most of who were dependent on Walmart for 
building their brand. 

In the pre-internet era, advertising and distribution were the two areas of focus mainli so as to to build a successful brand. This is not evident anywhere else more so than on their redesigned website. The new walmart.com is an E-commerce website 
masquerading as a lifestyle website with highly localised and 
personalised product recommendations. This transformation has so far been driven by an acquisitive strategy.

In 2016, they acquired Jet.com for $3.3 billion not as much for their product and customers as it was for the leadership team. The goal was to bring a cultural shift. 

Post-acquisition, Walmart encouraged Marc Lore, founder of Jet, to maintain the entrepreneurial spirit at Jet and transport that ethos to Walmart. This was also the key to Marc Lore selling his company to Walmart. Having founded and sold two companies in the past, one to Amazon for $500 million, Marc was clear on wanting to continue to be involved with Jet post the sale and hence Walmart made for the perfect partner, according to Bloomberg.

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