The Congress has cast away the largest minority community in order to support MNCs.
The general belief is that Muslims came into India with their invasion of the sub-continent and the formation of the Mughal Empire from the early 16th century.
However, historical facts show that Arab traders visited the Malabar coast of Kerala as early as the 7th century, brought Islam with them, and engaged the local population in a robust and profitable trade in pepper and other spices. They intermarried with the local people and this resulted in the evolution of the large Muslim Maplah community of Kerala.
The Muslims of India thus have a rich tradition of engaging in trading activities for over 1,300 years. Trading is a major source of sustenance for them all across the country.
Will history repeat itself?
However, their trading activities in Kerala were rudely interrupted by the arrival of the Portuguese, in the early 16th century. As often happened in those times, the Portuguese attacked, looted and set fire to the town of Calicut. The Mappila community lost the spice trade — and a whole lot more — that they had carefully built over centuries to the invaders.
Can a 21st century version of this scenario unfold with the UPA Government opening the gates to Foreign Direct Investment (FDI) in multi-brand retail? When a historical parallel like this is suggested, the reaction of most people is to reject it under the loose argument that such things cannot happen in current times. While I do hope they are right, it would still be worthwhile to see how vulnerable the minority community is to the new FDI policy and its implications.
We can review this with the help of the Government’s study of the status of the minority community conducted by the Sachar Committee.
Sachar panel findings
Appointed in 2005 by the Prime Minister, the Sachar Committee was commissioned to prepare a report on the social, economic and educational condition of the Muslim community of India. The committee’s extensive report was presented to Parliament on November 30, 2006.
Table 1 drawn from the report shows the distribution of workers in socio-religious category by industry groups. The classification of Wholesale and Retail trade employs 17 per cent of the working Muslim population, compared with 8 per cent for Hindus and 10 per cent for other minorities. The Muslim community is twice as likely as the majority community to be engaged in trading and retail, the source of their livelihood that the UPA Government is handing over to multinational companies.
A category of employment related to Wholesale and Retail Trade is Transport, Storage and Communication. This category employs 6 per cent of all Muslim workers, compared with 4 per cent of all Hindus. At an all-India level, there are an estimated 16 million people in this category who are under threat by retail FDI. The likely impact on this group is not even under any consideration from any quarter.
By looking at the worker participation rate and applying it to the population, we can estimate the actual number of workers by socio-religious category and by employment category. Table 2 provides this summary. It shows that 20 per cent of the people engaged in Wholesale and Retail trade are Muslims, although they represent only 13 per cent of the total population, and just 11 per cent of total worker population.
There is thus a disproportionate dependence of the Muslim community on Wholesale and Retail Trade. Of course in sheer size, the majority Hindu community has nearly four times the number of people as Muslims engaged in wholesale and retail trade.
Muslims by States
If one looks at Table 3, it will be no surprise that the top three States in terms of Muslim population — UP, West Bengal and Bihar — have promptly said they will not entertain FDI in retail in their States. The leaders of these States know their voters and the state of this community. The Congress-run government of Kerala, where one-fourth of the population is from this community, has also refused to agree to FDI in retail. The problem arises in States such as Maharashtra, Assam, Andhra, J&K, Rajasthan, Delhi and Haryana that have agreed to FDI in retail.
The Government claims to have put in safeguards in the policy. Unfortunately, such claims ring hollow since the rules are easily changed by administrative notifications and everyone is aware of how lobbies are adept at getting this done. The silver lining is that since this Government has shown the way, it is equally simple for the next Government to amend these rules and protect the millions of Indians engaged in the trade.
Employment for displaced?
Whenever it is pointed out that huge numbers of people will be displaced by the multinationals for whom the doors have been thrown open in retail, even educated and responsible people blithely argue that such people will have to be retrained and redeployed. What are the possibilities of this happening for the Muslim community? Look at Table 4, which highlights education level of different communities. With nearly two-third of the literate Muslims just at the Upper Primary School level — the highest proportion at this level among all communities — it will be well near impossible for those displaced to find any other employment.
Communities will come together
FDI in retail is an issue that will have a major impact on all communities. This is going to be one case where everyone will have to come together to send a clear message to the Government on what is acceptable and what is not. This is already evident in the united opposition of all political parties to this development.
The Congress has spent decades cultivating its self-styled role of taking care of the minority groups in the country. With this one act of opening FDI in retail, the Congress has cast away the largest minority community in order to support the multinationals. As the popular saying goes, action speaks louder than words. In this instance, it is blaring from loudspeakers.
(The author is Group CEO, R K Swamy Hansa, and Visiting Faculty, Northwestern University, US. Views are personal.)
Keywords: FDI in retail, Muslims, minority community, Mappila community, spice trade, Foreign Direct Investment
Comments:
This is a totally wrong-headed argument. The author is asking for national policy to be governed for a single community...policy-making is for India and all Indians. If you want to argue against FDI, make an economic argument, not a religious one.
Shall we now hijack even basic economics to caste and creed? If FDI helps or hurts, it will do so for all Indians....and if FDI in retail can reduce food prices for the long-suffering Indian consumer, then everyone will benefit...Hindus, Muslims, Buddhists etc.
In my view, the arguments for and against FDI in Retail Trade are blown out of proportions. Also FDI in Retail cannot take away the existing Retail Trade. There would be requirements for both of them to co-exist in this vast rural oriented economy. There is a provision for the states to accept or reject and hence I assume enough safeguards are already built in. By raising this FDI in retail trade issue,we may be playing to the 'gallery' and that too at this time, when the elections are near the corner.
I agree with the author about the spice trade. The English established the gun factory in 1615 only. Our Indian kings wisely refused to follow the English. Had they followed the English, thousands of swordsmen (and related occupations)throughout India would have been become unemployed. And in 1761 (150 years later) the patriotic Indians fought the third battle of Panipat with swords.
(1) FDI in retail is attracting various views and comments and this article expresses the most outlandish of all such views. (2) Basic issue is inefficiencies in the country’s retail sector and citizens’ feeling is that these will be partly addressed by foreign capital which will considerably improve distribution. (3) The wide gap between price paid by farmers and consumers is always ignored. Leaders of political parties need to be told again and again that citizens (consumers and farmers at large) want their interests to be taken care of, with or without FDI. (4) Are consumers, who far outnumber the traders, not more important for these parties? (5) If instead of FDI, our own companies are able to manage the supply chain and are allowed to market farmers’ produce without interference from Agriculture Produce Marketing Committees, consumers would welcome such arrangement as foreign capital is only an enabling factor for making retail sector more efficient.
This is a perverted assessment with too many unproven assumptions done along
totally unnecessary segmentation. 9% of population are into retail trade, but 100% of
the population are consumers and FDI in retail would benefit the consumers. 51% FDI
in retail should be made 74% FDI and 26% as IPO to Indian citizens. Limitation to 51%
benefits the 49% Indian owner who essentially a rent seeker. Telecom FDI is a fine
case for that.
Well shouldn't we be happy that decisions are being taken without
"minority appeasement". the write up is assuming that FDI will kill the
market and affect everybody. the trader in commodity X is a consumer of
commodity Y
I used to have some respect for the author, looking at his credentials. With the utterly untenable arguements presented in the article, I intend to give a pass to any article written by the author.
What is next? A caste/region/sub-caste based analyis of policy implications?
We need to think as a country of Indians and implement what is beneficial for the country.
The author has provided 'enough' economic reasons in his earlier articles. This time, he gives a religious arguement, a crucial perspective in a socio-economic standpoint. Argue against the facts given, instead of rejecting outright saying the arguement is based on religion/caste etc.
@ C. Nandkishore : Hats off to you !!!! Great !
This argument is outlandish and untenable. The statistics put forth are
also incomplete and misleading. Indian market is so huge there is enough
space for everybody. In the present scenario of retail malls in cities
it was feared that street corner groceries would suffer . But nothing of
that sort had happened. Even after the advent of multinational retail
malls no harm would be caused to present retailers. Moreover consumers
would have choice to choose from.
Lies, damn lies and statistics. Any set of numbers can be twisted to
make a point or a counterpoint. This topic purportedly to discuss the
demerits of FDI in retail has walked in an area which is a potential
mine field - communal divide. The author is a visiting faculty....on
what, how to propagate pernicious theories under the garb of market
research? It is disgusting to say the least. If an attempt was made how
different economic strata would be impacted there would have been some
merit.
An utterly digusting communal assessment in the garb of minority appeasement. It is appalling that the writer has not heard of the Delhi Sultanate. The sudden referenec to the Sachar Committee report lets the cat out of the bag. If the condition of Muslims is all that precarious, his own figures contradict the findings - a bigger proportion of muslims are involved in retail trade. Belongs to the water paper basket.
dear author,
please use you brain if you have one in place. For God's sake, pls do not ignite other people's feelings. you, being a column writer in The Hindu, should know better and should start thinking beyond the 4 walls of your pathetic small village. There are extremists out there waiting for a spark to start violence.
It is with a sense of regret that I read this article by a learned
scholar at a prestigious University in the US. First the argument is
deeply flawed what policies are going to affect which groups. We
Indians are all in it togather. if the policy is good for the country
it will help the national economy by introducing modern methods of
retail trade and thereby benefiting the consumers the most. Why is the
author silent on this point. Furthermore this policy will inject
innovation & product development in most industries which are still
being run on centuries old patterns leading to large scale wastage of
raw materials.This policy will help energise the SME sector and help
boost the Indian high value exports realizing better value for Indian
made products. This is a shameful way to protect the centuries old
vested interests having this snake like grip on the economic system.
We shall welcome the foreign capital to come to India with an open
door policy to create high number of jobs.
What a stupid analysis! Do businesses survive only on protection? He surely wants
India to live in the dark ages. In the era of demand dictating prices and capital
efficiency being the norm why should India decides its policies based on what
minorities do? Also, what about the thousands who will get jobs?
I got shocked when I read this article. Not because of the content.
But, this was so similar to an article written by friend Uppili R. He
sent the final draft of the article (with same central theme & stats -
in fact bit more detailed & intelligent) on 25-Oct to my gmail (which
I can prove). I know he sent it to Hindu Business Line and has been
following it up. He was informed there will be a decision today - but
we see the idea being stolen by another writer, who boasts impressive
credentials (!!!)
How is this possible that 2 authors think about similar idea/issue -
defend their idea with same data (Sachar committee report) and same
table from that report?
I am shocked by the lowest standards adapted by The Hindu! Will the
editorial answer for this - or will they delete this post and continue
their practice?
I think this is the most ridiculous argument. Maybe the writer has a
hidden agenda in expressing this way. Any Economic decision will have an
economic impact on certain sections of society. Getting religious
segments is the worst kind of expression that should be banned from our
collective memory... netbaniya.com
I think the author is trying to make a point in a language which the political class will understand. The short point is that FDI in retail is a sell out and pandering to the interests of a few MNCs. And while executing the sell out, the UPA has conveniently ignored its vote bank. The fact that states like WB, UP and Bihar are not for it, atleast openly, suggests that the author's assesment is pretty accurate. In the long run, FDI in retail will impact all Indians but I guess it really doesn't really matter to the government. They seem to have lost complete touch with ground realities and are just intent on filling their coffers and seemed to be worried only about their leaders international image.
i am totally surprised to see the comments which my friends had made
in connection to this article....I would like to say that what the
author tried to show is a social issue in relation to FDI in MBR.
It s a kind of research paper which deserves special appreciation
because it reveals some facts and possible outcomes which nobody has
discussed so far( as per my little knowledge).
My request s that it s better to criticize for what he discussed in
this article ( on a specific issue) and not bring each and every
issues related to FDI in MBR.
Highly irresponsible and skewed article by Shekhar Swamy. Rather than just saying FDI will hurt Indians (I am not even asking you to mention Hindus, Sikhs, Buddhists, Jains, Parsis etc.), Swamy singles out a community. And if Muslims came to India in the 7th Cent. rather than 16th., so what has that to do with FDI?? Kindly desist from writing articles that distintegrate the community...
This is a stupid article based on some really strange data and interpretations. Look at the table. Consider the limited number of categories. The growing services sector employs only 8% population? Really? And even if one considers this data to be reliable, the opening up of retail will benefit the farmers, right? That's 60% Hindus and 40% Muslims! Let's welcome it!
This is the most outrageous, communal and separatist article I have read in Business Line. First of all, looking at an economic issue from religious perspective beats the purpose of economics - an inclusive research. Second of all, if any, who is affected because of FDI in retail majorly includes Baniyas of North, Nadars of South etc, who are non-Muslims. Focussing on only Muslims seems outregeously ridiculous.
If one goes through the series of articles written by Mr. Swamy and published in the Business Line over the last year on the FDI in retail issue, they provide a powerful critique of the consequences of this decision from one primary standpoint - the disruption it would create in the large community of self employed people in a country where job creation in the organised sector is woefully inadequate.
The author has traversed the economic, social, management and technological dimensions of this issue in great detail. What this article does is address the politics of this issue. It is hardly the fulcrum of his argument - only a facet of his primary premise.
Despite being a supporter of FDI in retail, I find this analysis very unique and insightful. Never thought on these lines. The issue of displacement, employment & employability is a deep one. The issue can have far reaching effects on future crime rates. And, there can be little debate on the fact that crimes committed in India are linked more to the community the author is referring to. Not that the minority issue should make or break the FDI deal, but the government should give some serious thought to mechanisms to redeploy the displaced trader workforce.
It is the most ludicrous argument put forth by Hindu. To bring in religion into a large scale policy decision is not only a feeble attempt at communializing the decision but also shows the utter ignorance of the author in matters of economics. Simply put a kirana store employs 2 helpers at best and that too from family. A mid sized store employs at least 15 people across all classes of society. The safe guards on local procurement are also clearly stated in the policy decision. The influx of international majors in India in the much fabled IT sectors has proven that competion does not kill local players but actually adds value to the industry, supplier and employment. The growth to a 100 Billion dollar industry employing millions of people across the country. This has also given great imputus to support industries to thrive on the success. To claim that such success excludes people based on religion is just plain STUPID. Hindu is expected to have better journolistic standards than this
This article is an eyeopener for me and has made me aware as to how this
is going to hurt the Muslim community. I don't think this argument is
about majority versus minority community. All this article has put
forward is a fact that the Muslim community traders are going to be more
affected that the Hindu community basis the numbers available. Fact of
the matter is FDI in multi-brand retail is going to hurt the trader
community whether Hindu or Muslim. Its going to hurt the Indian traders.
The article has brought up a reality to light. And even as facts scream
aloud, it's surprising to see, people tend to ignore the signs. While
the debate states that FDI in retail affects every section of society,
its impact on the major minority could have far-reaching effect, which
is a threat to all consumers. I think the fact highlighted here only
states that with believable evidence. Its high time the policy makers
take note of this and re-look at their decision to allow FDI in retail.
Amazed at some of the responses here accusing the author of caste
based analysis etc. Any Indian who is in a position of hiring will
have to acknowledge that there is huge employment discrimination
against Muslims in private sector. It is not by accident that Muslim
community engage in trading as livelihood. So it is fair to point out
that one avenue that is open for a large number of Muslim youth will
be shut now with FDI. RE all other standard (read 'stupid') arguments
(eg farmer's income, greedy middlemen, inefficiency in sector),
everyone of them has been refuted with data by the author in 8+ other
articles that have appeared in these columns. Even conceding Retail
needs "reform" can anyone explain why FDI is the "solution"? Why
Indian tycoons that can buy Corus/Arcelor cannot invest $60b that we
expect from FDI on retail. The answer is: there is money to be made by
giving away our markets to multinationals. Wake up guys, and see what
Walmart et al have done to rest of the world.
another drawback of FDI in far future would be the monopoly of the foreign company. once a foreign company is granted entry into india, it may offer very low prices and kick out its competitors (may be in the case of walmart. and after gaining its monpoly, it may increase the prices affecting the customers at large. before allowing FDI, Govt should protect the interests of the existing companies.
This is an eyeopener. And simply don't understand the outrage that some readers
have expressed. Indian business are by and large community and region driven.
Second the argument is based on the Govt. own numbers. It stands to reason that
the largest displacement will happen amongst the community that has the largest
representation in retail. This is something that UPA and indeed all parties have to
seriously consider. FDI in retail will light the fuse on what could be a social atom
bomb.
We have been brainwashed into believing that FDI in retail is a holy Grail. Why on earth should Walmart or Carrefour or Tesco be concerned
that the Indian Farmer should get a fair price for his produce. Or with
that the Indian consumer should get food at lower prices. They are here
to make money and repatriate profits. Please show me any proof available
that FDI will bring down prices for the end consumer.
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