Articles
Guest Column 
Art-up your triple bottom line
by Manali Jagtap Nyheim
It is time again when businesses are out of the winter slumber and state visits are back on the calendar. For the India-UK space there is indeed oodles of excitement after British PM David Cameron's latest visit to India in February. Whether this excitement will lead to any visible change or not is yet to be seen but what is certain after this visit is the use of some potent jargons in the latest trade talks between India and the UK.
Corridors, business parks, special economic zones (SEZs) and manufacturing parks are soon becoming common lingo in the communication, almost like a new vocabulary to the bilateral discourse; but it may be not so new to India.
It has been almost five years since India collaborated with Japan to start work on an industrial corridor between the political and the financial capital of India – Delhi and Mumbai. It is a mega infrastructure project worth around $90 billion with financial and technical aid from Japan and covers an overall length of 1483-km between the two cities. The emphasis is on expanding the manufacturing and services base and develop the Delhi-Mumbai Industrial Corridor (DMIC) as a 'global manufacturing and trading hub'.
Although Japan is a partner in developing the corridor, the Koreans and Germans have also managed to get a foot in the door to this mega project. Korean companies expressed an interest in constructing the upcoming Dighi port in Maharashtra. Besides, India has sought Germany's cooperation in taking up a pilot project on skills development in the Delhi-Mumbai Industrial Corridor project.
With such enthusiasm around the first corridor, Britain didn't want to be left behind and so came the offer to collaborate on a new corridor connecting the financial and technology capitals of India – Mumbai and Bangalore. Mr Cameron didn't miss the opportunity to make this announcement the highlight of his India visit. No surprise that finance and technology are the two sectors where Britain can compete easily with others, so the choice of the corridor was indeed well thought out.
But what opportunities can the two cosmopolitan cities of India offer in return?
In Bangalore, it is relatively easy to spot the obvious ones with a moderate eco system for R&D and IT services that lure not only the enterprising Indian youth to migrate to the city but also attracts a lot of multinationals to set up base.
Likewise in Mumbai, the obvious attractions are in the field of financial services and creative industry. Although the financial services in India are at a nascent stage of development in comparison to the UK, the entertainment industry and potential business link-ups between London and Mumbai in the entertainment world can be a game changer in boosting the trade figures between the two economies.
However, in comparison to Mumbai, Bangalore has a much active civil society and initiated platforms like the BATF (Bangalore Agenda Task Force), B-PAC (Bangalore Political Action Committee) and IIHS (Indian institute of human settlement) funded by Nandan Nilekani. The corporate honchos have exhibited a sense of responsibility rested in the private sector towards the overall development of the city and the state in general. These might not have a direct influence in attracting foreign investments to the city or the state but surely in the long run Bangalore might have an edge over Mumbai and may turn out to be a much better governed and managed city – watch this space!
This corridor is expected to house a major power and gas pipeline infrastructure between the two states and given that the UK climate change minister, Greg Barker, is also the 'minister for business engagement with India', we might expect the UK's low-carbon technology to underpin these power projects if it takes off the ground. We might just see this corridor develop as an example of a low-carbon emitting zone too.
Having said the above, the question is not of a lack of opportunity but that of financing the opportunities that lay blatant to everyone involved. Then why can't the technologically sophisticated finance minds of the City of London come up with some prudent investment plan for such an opportunity?
As we know, India is finance starved so maybe an initial seed capital offered by the British government to British companies (on the lines of the Japanese model) to commence their BMEC dream could prove the kick-start needed and many others could follow suit. It would be naïve of me to think that I am the only one pondering over this idea; in fact some of them may actually be working on such a plan as I write.
But before the UK analyses whether the BMEC is a good opportunity or not, chances are that the Japanese would have already started work on a comprehensive plan for their next mega corridor –Chennai-Bangalore, accelerating the pace of manufacturing activity, which tends to lag behind the IT and services industry.
Ridhika Batra is the London-based Director of the Federation of Indian Chambers of Commerce and Industry (FICCI) for the UK and France.
*The views reflected in this column are personal.
Lord Raj Loomba, entrepreneur, philanthropist and now Member of the House of Lords, talks to Shiv Morjaria on his work in the field of empowerment of widows via the Loomba Foundation and building a business from scratch.
What was the trigger behind your work on the treatment of widowhood in the sub-continent?
It was something I noticed as a young boy, of around 10. My father had just died of tuberculosis. His body was still in the house, not yet cremated when I found my grandmother, also a widow, telling my mother to remove her bindi, her bangles, and wear only white clothes from that day on. I was too young to comprehend, I couldn’t do anything at the time. It made me sad because she had done no wrong.
A defining moment came when I got married. The priest who was conducting the wedding ceremony asked my mother to move away from the altar because, being a widow, she could bring bad luck to the newly-weds. I was shocked and very angry. How could a mother who gave birth to me, a mother who educated me, a mother who always wished me well, how could she bring me bad luck? Why are widows being treated in this inhuman way?
Why is this such an important cause?
Most people are unaware that there are an estimated 115 million widows currently living in poverty, and that 1.5 million widow’s children will not live to see their fifth birthday. Nearly 81 million widows have been physically or mentally abused and millions have been ostracised and abandoned, simply because they are widows and therefore considered to be in some way cursed, involved in witchcraft or responsible for their husband’s death. A widow may no longer be able to afford to send her children to school nor find a job. Many widows will be forced to send their children out to work, putting them at risk of child abuse and exploitation.
Some widows are not allowed to remarry; others will be forced to marry a relative of their deceased husband against their will. It is shocking. What’s more shocking is how few people are aware of this gross violation of human rights.
How does the Loomba Foundation set about addressing some of these issues?
The foundation seeks to provide education opportunities. It has funded this for 8,500 children of poor widows, supporting 27,000 family members in India and Africa since 1999. Fortunately for us, my father was a successful businessman and had left enough money for our education, but our future would have been very different otherwise. Educating the children of poor widows not only ensures that they will grow up with enough qualifications to be able to earn their own living and not face poverty, but also provides hope to the widows.
We also aim to raise awareness of the issue and empower widows. In 2010, our campaign led to the United Nations formally recognising June 23rd as International Widows Day, the anniversary of my mother’s widowhood. Today, International Widows Day sees awareness events every year in several countries and has been attended by presidents and prime ministers. Step by step we are being heard.
Tell us about the specific initiatives in place designed to empower widows.
Last summer, we launched a new project, to empower 10,000 impoverished widows in India by giving them each a sewing machine and the necessary training to make garments. The cost of this is just £50 per person, but this goes a very long way towards improving their lives, and giving them back their self-respect. This project will give them independence, and the opportunity to make garments, which they can sell to friends and within their broader community. They can become self-reliant, educate their children, and feed and clothe their families.
We are working in a number of states across India, and have received match funding from a number of different sources, including the state government of Punjab, which is allowing us to empower 5,000 widows in that state alone.
In Rwanda, the Loomba Foundation supported 118 women from the widows cooperative Kotaboru in the Rukomo district of Nyagatere. This project is aimed at introducing underprivileged women into the supply chain for pineapples. Our funding covered the cost of seeds, tools, training and access to finance to grow and supply pineapple seedlings.
What are the plans for International Widows Day this year?
This year we have organised a 5-km charity walk or run in Hyde Park, London. We are expecting over 1,000 participants and would encourage everyone to get involved and register. It will be fun, and the funds raised will really make a difference.
[http://regonline.activeeurope.com/loombafoundation5k]
Aside from charity work, tell us more about the fashion business you built from scratch?
I went to the US for my education and arrived in London from there in 1962. I had just turned 20 and got a basic factory job, although I didn’t last long as my uncle from Wigan invited me up there and bought me an ice cream van. My uncle was a wholesaler in the clothing business himself and helped me set up a market stall in Widnes. I quickly managed to set up others and by 1967, I had my own high street shop.
Today, the Rinku Group (named after my son) has offices in London, China and Delhi. We supply to major stores across the UK, including BHS and House of Fraser, and also have over 250 concessions in stores such as John Lewis. It was the fact that in the 1960s, Britain offered equal opportunities to anyone, whether immigrants or local people, that enabled me to start this business.
What advice would you have for would-be entrepreneurs?
Have a vision, maintain your focus, and work very, very hard.
You became a member of the House of Lords in 2011. Tell us about your work in fostering UK-India business relations.
I’m Indian by root, British by allegiance, and therefore my interest lies in both countries. I am passionate about the development of both nations and have been involved in assisting numerous initiatives, including the friendship agreement between the chief minister of Delhi and the mayor of London.
Which book/film would you encourage everyone to read/watch and why?
The film Water, directed by Deepa Mehta and written by Anurag Kashyap, as it offers a must-watch perspective on the plight of widows in the developing world.
Shiv Morjaria is based in London and works in OTC derivatives for one of the world's leading investment banks. He is also co-founder of the Makhan Chor Foundation. Email:
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
*This regular column focuses on a variety of fields to capture facets of the life and work of personalities who the writer comes Face To Face with.
As a barrister one of the first things you learn is the meaning of 'false innuendo' in the law of libel. You know what it is – it's when someone says, 'XYZ has a company in a tax haven – found in "leaked secret" list'. 'Leaked' and 'Secret' . The innuendo is that it's some secret. What they won't tell you is that it's an online Google searchable incorporation company and their emails they refer to are as much leaked and secret as my Facebook messages are.
The innuendo is you are a tax dodging international criminal hiding wealth robbed from widows. And if they mention 'Indian' in the title, that's even better because we all of course know every single Indian on the planet, especially in business, is a corrupt SOB with secret overseas bank accounts. As a lawyer and a journalist I know how the game is played.
The papers think that by writing, 'no allegation of wrong-doing is alleged' they are protected. Like when a stock broker says 'markets may rise and fall' – you know the ass-covering small print.
A grand inquisition which exists not just because of Google and Starbucks are not paying their fair share in the countries in which they make money and so rightly hauled before Parliament, but also because corrupt politicians in the subcontinent tar all of us with the same brush. So my advice to Indian businesspersons is this – don't be put off doing business in Britain despite the inquisitions.
As a barrister and asset manager it was common in the industry to have BVI (British Virgin Islands) or Cayman based fund or investment companies. First, of course, don't have any hidden assets, bank accounts – that's the easy one – that's just plain illegal. And it goes without saying even in financial services that is not acceptable. (Of course, the innuendo that you have a BVI or Cayman or other offshore company – and so must by definition be a tax-dodging billionaire will stay with you).
Second, make your overseas company UK tax resident by having its management and control in the UK (as I have always done). This keeps you morally correct in the new era of tax morality.
Third, so why have an overseas company – well if you set it up pre-credit crunch when it was the normal business practice in investments and asset management – then you have to switch to UK tax residence – as mine has been from day one anyway.
Fourth, avoid jurisdictions which whilst in the legal and financial world have always been acceptable, have suddenly become unacceptable (eg. BVI, Cayman, Jersey, Isle of Man). This will avoid you falling foul of false innuendo. This is going to be difficult if you are in financial services.
Fifth, always keep the relevant government bodies informed.
Sixth, gain no tax advantage from tax mitigation, efficiency, reduction (I never have had tax advantage from overseas company shareholdings).
Seventh, be UK tax resident, receiving all income in the UK, and none offshore, or if it is necessarily offshore, volunteer to pay tax in the UK even if you don't have to.
Finally, never complain. But remember, because you represent your community, you must always not only do the right thing, but be seen to do the right thing, even at personal expense.
In summary, you have done nothing morally wrong if you have gained no tax benefit from an overseas holding by always keeping it UK tax resident. Then, you are 'whiter than white' and remove ammunition from your adversaries.
But, of course, the spin is 'Indian on overseas secret list' – the false innuendo is very disturbing emotionally as you can imagine – and what hurts is an innuendo. Throw in the word 'tax haven' and it all starts sounding very sexy. Don't be put off Britain – Facebook, Starbucks, Google have not.
Alpesh Patel read Modern Greats at Oxford University (now better known as Philosophy, Politics and Economics). He is a former Visiting Fellow in Business at Corpus Christi College, Oxford, and alumnus of Boston University, and lectured in China, Hong Kong, Singapore, Guatemala and India on global economics. He has a degree in Law from King’s College, London, and is the author of 13 books. He is the founder of private equity and hedge fund firm, Praefinium Partners.
The Home loan pre-emi scheme, also known as the 20:80 scheme, has been in existence for a few years but never so widely used before.
Under the scheme, the developer of an under-construction residential unit offers the buyer an option by which he covers the interest on a home loan until the unit is delivered or for a fixed period of 12-24 months in return for the buyer accessing the loan from a provider recommended by him.
The entire loan amount, which is nearly 80 per cent of the contracted value of the sale, is paid out to the developer even if only 20 per cent of the construction is completed. All is then well for the seller and buyer if construction were to go on as per schedule, with the developer gaining from a lower interest rate on this borrowing (given that home loan rates are a third lower than construction finance rates) and the buyer gaining from an interest holiday with an option to continue paying instalments that will go towards reducing the tenure of the loan.
Given the current tight liquidity situation in the real estate sector, combined with a slow off take in sales, buyers availing of this scheme must also consider the possibility that construction could be delayed. The interest holiday period, if time-bound, could lead to the bank demanding instalments be paid without the home being delivered.
An even more serious scenario would be that the developer, having drawn down on the full limit of the pre-emi scheme with the bank – which normally is capped to the extent of construction finance – using it to repay the loan and stalling construction.
Long delays in completion of projects, which happened in the 1997/2000 period across the country and then again in Mumbai between 2004 and 2007 due to legal matterssurrounding mill land sale, would mean that the buyer-borrower would have to continue paying monthly instalments without a sign of getting the home delivered.
While financially stronger developers are a bit more resilient to economic conditions, retail buyers look to banks and home loan companies having a strong due diligence process in choosing developers for the pre-emi scheme. In their mind, it is an endorsement which will be strongly disagreed by the lenders.
This scheme is now gaining currency across the major markets and across all tiers of developers – I saw a local developer advertising this scheme at Karjat, 40 kms away from New Mumbai. But are the retail home buyers going to face the burden of the home loan institutions transferring their risks to the end user in case of the developer defaulting?
Deepak Sam Varghese, founder-director of Moonbeam Advisory, is a career banker with nearly two decades of experience in retail and private banking. He is a specialist in banking services and wealth advisory and has been advising domestic and non-resident Indians (NRI) in Mumbai, Delhi, Dubai, Singapore and London, where he was based. Now Bangalore-based, his special emphasis is on financial advisory in real estate transactions, advising investors and developers in key Indian metros.
This week, two unconnected events reminded me of the political slogan "We are the 99 per cent", widely used by the Occupy movement.
One was an intense lobbying campaign in Parliament in Britain where one side of the argument won, basically because they succeeded in summing up their entire campaign in one emotional Tweet-length statement.
The second was at lunch with Chetna Sinha, Founder and Chair of Mann Deshi Mahila Bank in India. Here's a bank that was created entirely on the basis of doggedness and perseverance by rural, illiterate women in Maharastra. They did it by making the Reserve Bank of India (RBI) sit up and take notice of one compelling statement: "We want to save - let us".
Sinha, an Ashoka Fellow, was in London last week, and had kindly agreed to speak at a small lunch on her experiences with rural development and microfinance in India. Founded in 1997, Mann Deshi was India's first rural financial institution to receive a cooperative license from the RBI. Today Mann Deshi is the largest microfinance bank in Maharashtra with over 140,000 clients.
The story is a fascinating one. Sinha taught Economics at Mumbai University, and met her husband as part of their common interest in social activism. She found women in rural India desperately wanted to save money in a formal manner, but were denied the opportunity – the banks said they had no identity and no literacy.
One day, she decided, along with 1,000 other women, to raise basic share capital from friends and family and apply for a banking license. The RBI rejected their application because the 1,000 women were illiterate. The women, not disheartened and led by Sinha, set up their own classes and went about educating themselves in the basics of literacy, and made a date with the RBI Governor once more.
Yes, we are illiterate. But we can calculate interest on a principal amount better than any of your bureacrats, they said to the Governor. No, we don't have time to go to the bank during the day. Yes, we're going to create mobile banking for women. No, we can't meet the reserve ratios you set out for traditional banks. No, it doesn't matter – we just want to save, no credit. Yes, many of us are just teenagers and want to save, because we aren't sure our parents will be able to provide for our education when we're older. Yes, we know that's not possible under your current rules without a nominated guardian, but we want you to change them.
Then numbers are staggering. Within a week, 7,000 teenage girls had opened a bank account. Mann Deshi now serves over 140,000 clients in Maharastra. At least 8,527 women have graduated from their business school in Karnataka, which teaches financial literacy.
Mann Deshi now has a Chambers of Commerce just for women, with a toll-free number to ask about any business problem they may have. And because rural areas in India are very fragmented, products are designed locally according to the cash flow needs of local vendors. For example, a weekly market may be a confluence for vendors in 15 or so surrounding villages and often presents the best opportunity to them to scale up their business.
For metropolitan women in India, empowered with education and rising incomes, credit is king. For rural women, empowered with basic financial literacy and the opportunity to escape a cycle of poverty, saving is king. In an economic boom that has largely passed rural women by, Mann Deshi represents a model for the future. To borrow a phrase from another bank, Mann Deshi is really "the Indian world's local bank".
Pratik Dattani is managing director of EPG Economic and Strategy Consulting and also runs a large not-for-profit organisation with strong links to India. He is an economist whose work focuses on helping organisations and investors understand social returns and impact investments.
More info: www.economicpolicygroup.com
How does an Indian SME, starting out with one man, become a 350-man outfit with an HQ in the UK, in only a few years? How does it grow? Why does it come to the UK when it is Indian and India is growing? What are the strategies for growth? And how do you replicate it for your own business?
The company I am talking of is Aranca and my case study is based on direct experience; I was the non-exec chairman and met the founder when he was also the sole employee. I mean I helped to even select the logo - we're talking seriously ground up.
The founder, Hemendra Aran, started the financial outsourcing company whilst at LBS. The best and brightest out of India still come to Britain for British business education to make global companies. Okay, but why UK?
Well, it's not the outstanding education alone. A British company allows access to the EU, a brand, credibility to customers that remote selling from India does not. I see this time and again in my role as UKTI Global Entrepreneur Programme Dealmaker - companies which choose Britain for all these reasons of brand and reach.
What other strategies? Well, despite UK GDP still flat-lining don't let that fool you. Companies doing well are doing very well. Sure retailers can bring down GDP - but not for global businesses. The strategy for overseas investors in Britain is to tap our most growing companies with cost-saving case. That sells. British companies want to save costs in the services these Indian companies offer.
But these Indian companies of course will do the back-end often in India. Their cost base remains largely Indian. We might not talk about 'outsourcing' but it is still growing strongly.
The Indian SME going global from Britain is an overlooked saviour of British economic growth. We certainly need more in Britain. Why does it matter whether the entrepreneur or the company is home grown, or an immigrant company investing in the UK? How do we measure success? Well, a series of issues, everything from the amount of money they bring to the UK, to the tax they pay, people they employ, and skills they bring.
As someone pointed out to me this week, from a protocol perspective it is very unusual for a Head of Government to visit a country a second time without a reciprocal visit by the host after the first visit. The British PM went to India twice without a reciprocal visit from India. David Cameron wants more Arancas. With 0.3 per cent UK GDP - we all do in Britain.
Alpesh Patel read Modern Greats at Oxford University (now better known as Philosophy, Politics and Economics). He is a former Visiting Fellow in Business at Corpus Christi College, Oxford, and alumnus of Boston University, and lectured in China, Hong Kong, Singapore, Guatemala and India on global economics. He has a degree in Law from King’s College, London, and is the author of 13 books. He is the founder of private equity and hedge fund firm, Praefinium Partners.
While the headline news in telecoms last week was about the Ambani brothers sharing their network resources through a landmark reciprocal deal,India's real grassroots story is about the expansion of the fibre-optic network to connect villages. It will give almost 100Mbps access to villages across India under the NOFN (National Optical Fibre Network) project as part of the National Telecom Policy (NTP) 2012.
Several states, including Gujarat and Maharashtra, signed MoUs last week with the Department of Telecommunications (DoT), Government of India, and Bharat Broadband Network Limited (BBNL) to establish fibre-optic connectivity for all gram panchayats for universal access. To date, some 25 states and union territories have signed MoUs to this effect.
Indian press reports quote communications and IT minister Kapil Sibal saying, "Agreement signing is a formal exercise of intent and that intent needs to be translated into reality. These are paradigm shifts which would change the way public services are provided, change the way of subsidy system... it will change everything."
The vision of the broader NTP policy is to provide affordable and reliable 'broadband on demand' by the year 2015, and to achieve 175 million broadband connections by the year 2017 and 600 million by the year 2020. It also aims to provide high speed and high quality broadband access to all village panchayats by 2014 and progressively to all villages and habitations by 2020.
The NOFN project is part of the NTP 2012 vision, to connect all the 250,000 'gram panchayats' or local village-level government in the country at a total cost of around £2.5 billion funded by the Universal Service Obligation Fund (USOF). It will utilise existing fibre networks of public companies like BSNL, Railtel and Power Grid, and lay incremental fibre to connect to gram panchayats wherever necessary.
As part of the plan, non-discriminatory access to the network to deliver rural services will be provided to telecom service providers, internet service providers (ISPs), cable TV operators and content providers. They will be able to deliver a range of e-health, e-education and e-governance services.
The provision of modern communications infrastructure to rural areas and villages is an important step towards bridging the digital divide in India, and should address a big part of the inclusion agenda for the government.
It follows the bill passed last month for 'Electronic Delivery of Services' whereby all central and state government services, like application for passports, ration cards and driving licenses, would have to be available via the internet within eight years. All public authorities will have to publish a list of services that they will deliver electronically within 180 days of clearance of the bill.
Interestingly, the bill has stipulated that the chief commissioner and commissioners of the central commission should have a minimum of 25 years of professional experience in IT, management, public administration or governance. It also says that they should not be a member of the Parliament, legislature, or hold office with a political party.
These commissioners are responsible for monitoring the publication of services to be delivered electronically and ensure a time schedule is adhered to, and also monitoring the quality of service.
Like governments around the world, the Indian government is pinning a lot of hope on the improvement of communications infrastructure and delivery of broadband services and e-services to the public – whether they are in rural areas or urban areas. The aim is to include everyone and to overcome the digital divide. The move towards empowerment of the citizen will require access to low cost computers, or other devices upon which they can access government services, as well as low cost broadband services. In the process, the government is hoping that this greater transparency enabled by technology will also minimise corruption.
The moves towards a national fibre-optic network accessible to all and e-services available for most common services will certainly bring India rapidly into 21st century communications and government. As in many developing countries, in the same way that telephone density was improved in India in the 1990s by leapfrogging the need for a full coverage public fixed line network (utilising the ubiquity enabled by mobile coverage), it's possible that India's e-villages may have a more advanced communications infrastructure than some rural areas of England and other developed countries!
Nitin Dahad is a consultant and adviser in the electronics, semiconductors and wireless industry, with over 25 years experience in various roles in working with large corporations as well as start-ups globally – particularly the UK, US and India. He is also the brain behind a number of successful technology and B2B publications.
Contrary to most of what has been written about the Indian Supreme Court's ruling against Novartis, the judgment on April 1 was not really about novelty — it was about efficacy.
Big Pharma, international media and the US Trade Representative, among others, were swift to criticise the decision to deny Novartis a patent for a new version of its cancer drug Glivec. But the crux of the matter is that the Supreme Court's judgment prioritised patient value over conventional Western standards of intellectual-property protection.
The court's ruling did acknowledge that the new form of imatinib mesylate possesses certain advantages, including higher solubility — which in turn permits a greater proportion of the drug to be absorbed. However, the court was emphatic that "A demonstration of increase in bioavailability is not a demonstration of enhanced efficacy" — making a distinction between improvement and utility that is often ignored in developed markets.
This distinction highlights the stark difference between developed and developing world attitudes to innovation and improvement — a tension which will pose challenges to Western firms across a broad range of sectors as they seek to operate profitably in emerging markets like India. In the developed world, relative affluence ensures that, by and large, "newest" is considered "best" — and, by extension, is worth a premium. This assumption extends far beyond the world of pharmaceuticals, or even of physical goods: think of the premium commanded by each iteration of the iPhone, or the pride with which consumers often demand "the best" healthcare, seeking out treatment by expensive specialists using the latest technology even for routine, relatively minor complaints. In contrast, the Supreme Court judgment rests on the view that incremental improvements are not always worth the often exorbitant cost attached to them. As such, it has made a value judgment that some will argue it is ill-equipped, or at least ill-advised, to make.
But context is important when determining whether "good enough" is really good enough. Some emerging markets-driven "frugal innovation", such as the pioneering, assembly-line-style eye operations performed by India's Aravind Eye Care System, has been criticised on the grounds that (in this example) such care is impersonal and inevitably of low quality. Even if these allegations were true — and there is ample evidence that they are not — the point is that Aravind's target market is not people who have a choice between supposedly sub-optimal care and better care — their choice is between supposedly sub-optimal care and no care at all.
The principle that a good or a service might in some cases be "good enough" poses a severe challenge to Western firms hoping to operate profitably in India and other emerging markets by offering "best-in-class" technology and expertise. In India, the examples are numerous; to cite just one, property developers often opt for Singaporean architecture and engineering firms, which prevail because relative cost savings are a higher priority than the world-beating experience offered by their Western competitors. In short, the Supreme Court ruling against Novartis served as a reminder of how radically different the understanding of "value" can be in emerging markets and developed western economies.
Anjalika Bardalai is a Senior Analyst at political risk consultancy Eurasia Group – www.eurasiagroup.net