The Rupee Fall

The RBI is in a soup. For the past few months it has been trying to tame Inflation by increasing the repo rates (The rates at which Banks borrow from RBI) and CRR (The amount of money banks have to keep with RBI). It hoped to reduce the amount of money flowing in the economy, thus reducing demand and dousing out inflationary fires. It is well on its way to achieving this but the past few weeks have given them a new headache. The never ending troubles in the Euro Zone, and India’s insatiable demand for Oil has led to this mess. Let us simplify the situation.

Causes:

(1) Troubles in Europe: Economies in Europe are toppling one after the other. The famed European Lifestyle, extravagant spending and low taxes have led to a situation wherein the government is not able to pay its dues. It started with Greece and has moved on to Spain, Italy, Portugal etc… The acronym PIGS does suit them. As an investor in global currencies, when I see that the Euro is not doing too well, I am forced to shift to other currencies. The first name that comes is the Dollar. This mad hunger for dollars has caused a shortage of dollars in the world and India, being a majorly importing country is suffering from it.

(2) Imports of Gold and Crude Oil: India being a developing country, has a huge energy bill. Since we don’t have enough to feed ourselves, we are forced to borrow. We borrowed lots of Crude at high prices which has increased the country’s debt. We have a huge dollar bill but not enough dollars to pay them. So we need more rupees to borrow dollars.

(3) High Inflation: Say there is X amount of Rupees in the economy. At times of Inflation, we are paying more for a particular product. Indians will demand for cheaper products. These products will come for other countries therefore demand for rupee falls.

Possible Solutions:

(1) We cannot really do much Europe but what we can do is make sure our Economy is performing well. For that we need to make investments in Infrastructure, Public Spending has to increase and this will attract foreign investors to India rather than other countries. To increase public spending, the public should have money to spend. The public gets money from banks who get it from RBI. If RBI keeps its rates high, then people won’t be able to borrow; so an appropriate rate cut is required without releasing too much money into the economy. Rate cuts are double edged swords, lower rates mean higher Inflation and Higher rates mean low demand.

(2) We need to attract more capital into the country from our own brethren. Increasing deposit rates of NRO, NRE accounts will make Indians earning in dollars to invest in India rather than anywhere else. This allows an injection of much needed dollars into the economy.

(3) Open up FDI in various sectors. Everyone loves to invest in a booming business and India’s growth story is well known. Putting FDI in Retail on the backburner was a bad move and in hindsight, we might just regret it.

(4) Another possible move is to put a cap on Imports. The rate at which China is sucking Gold out of the economy, there may not be much left for others. A cap on Gold imports for time being might be a good idea. Increasing our debt bills will cause an unpleasant Europe like situation. The Investments have to match up with the revenues else India could face the Payment crisis of 1991.

(5) The current policy paralysis which has hit the UPA government doesn’t augur well for the economy. Investor’s confidence depends on how well the Government performs and this could be the wakeup call for Congress to push key reforms.

I am no economist but what I have suggested are basic and logical solutions to a problem which is fairly well documented and well known. It’s not an unknown virus with strange symptoms but a disease more akin to a common cold. I believe India is in safe hands as we have the World’s best bankers (probably not the best politicians) and they know what they are doing.

India Down Under

It’s that time of the year again, when all things move south and what better place than Australia. The Christmas period is upon us and the traditional Boxing Day test awaits us. Watching cricket in Australia is a different experience all together; massive grounds, large crowds, sporting wickets all make viewing a pleasurable experience. I sometimes wonder how strange it must be for Australians to celebrate Christmas during Summer time. I guess Santa in Australia doesn’t come on a Sleigh, a Ferrari perhaps to beat the heat.

After the bitter disappointment of the England Series, the Indian fans are expecting a much better show down under. I believe that they have the right team to do the job. The WI series has given the key players some good batting practice and this should help in their performance. The team which I think India should put out for the Melbourne Test is,

(1) Virender Sehwag

(2) Gautam Gambhir

(3) Rahul Dravid

(4) Sachin Tendulkar

(5) VVS Laxman

(6) Rohit Sharma

(7) MS Dhoni

(8) R Ashwin

(9) Zaheer Khan

(10) Ishant Sharma

(11) Umesh Yadav

Looking at the top 6, except Gambhir, everyone else has been among the runs. The true wickets at Australia will help Gambhir get his touch back, all he needs is a little time at the centre. The whole world is expecting Sachin to complete his centum here and what better place than the MCG and what better occasion than the Boxing Day Test.

I guess India has two big decisions to make in their selection of the final eleven. One of them is Rohit vs. Virat and the second is the choice of the third seamer, a tossup between Umesh, Mithun and Vinay. I think the 2nd dilemma is an easy one with Umesh clearly the leading choice. His performance against the Windies in the two tests has amply demonstrated his caliber. His ability to clean up the tail would come in handy and his extra yards of pace could make a lot of difference to the final outcome.

The question of Rohit and Virat is one for the ages. You can’t ask for two players more similar, matched in temperament, skills and all round abilities. One factor which differentiates them could be Rohit’s ability to play with the tail. His experience in getting India out of difficult situations will be useful in case the top order fails to click. He has also played in Australia before and his technique of playing short balls is better than that of Kohli’s, although both have a lot to learn in that area. If Sharma does get a chance to play, then it would be his maiden test. He also has a triple hundred in first class cricket, so he has the capability to construct a long innings. He is definitely Indian Cricket’s investment for the future, someone who has promised a lot but has always been on the threshold of greatness.

If you were to check both the teams Man to Man, India would probably win hands down. Clarke seems to be the only batsman in form but Ponting, Hussey and Watson are not people to take lightly. Bowling wise, Australia is definitely weakened with the absence of both Mitchell Johnson and Cummins. Johnson always had the ability to take wickets in groups something which Australia would sorely miss. James Pattinson would probably be the person who will support Siddle in the fast bowling department. He performed admirably against NZ, moving the ball both ways in helpful conditions. In the spinning department, I doubt if Lyon has the credentials to trouble the Indian Batsmen. He does give the ball a good tweak but turning it a long way won’t get him too many wickets. He has got to develop variations to sow doubts in the minds of the Indians.

Overall, you do get the feel that this could be India’s series to lose but you can never underestimate the Aussies. A good start by India at Melbourne would set the stage for a wonderful series. The key factor in the series would be India’s bowling which needs to take 20 wickets. We have the required firepower but planning and execution could be the difference between a win and loss. My prediction, India to win 2-1 and Sachin to get his elusive hundred at the Sydney Test.

Why this Kolaveri (F)DI?

“1 kilo onions do” (Give me a Kilo of Onions). The neighbourhood sabjiwala from Kerala was busy gathering vegetables when he asked me, “Bhaiyya, ye FDI kya hota hai?” (Brother, What is this FDI?). Surprised I turned towards him; Not that I was astonished at the question but why me? Does he know I am an “yum-bee-ay”? Anyways I started explaining to him what FDI means and how it works. After I finished my rumbling, as if I was pitching to a client, he nodded with a smile in an assuring manner. He asked “Mere dost bolte hain ki agar bahar ke log aayenge tho humara nuksaan hoga. Who log bade bade dukaan kholenge aur yahan ke IT log sab wahi challenge. Phir humara kya hoga. Aapko kya lagta hai?” (My friends tell me that FDI would mean that foreigners would open up big outlets and drive away us small retailers. All the IT people would start going there, then what would happen to us?) This piece of conversation got my brain cells in overdrive as I started to think about how an ordinary Indian will convince one of his own as to the benefits of this move. Now I know why they say sitting in power is tough. Even a good deed needs convincing. Sometimes even educated people don’t see the benefits. It’s the change philosophy. No one likes it even if it means life becomes easier and better.

Let us first understand what Retail really is. It’s a medium of distribution which reaches right to the customer’s doorstep. Thanks to small time Kirana shops, you don’t really have to walk more than 100m to reach the nearest shop. So convenient and easy. The major point of opposition to the FDI bill is that they would send the mom and pop stores to oblivion. Let us not complicate the answer to this by saying FDI would improve Supply Chains, Reduce food wastage etc…The most important thing to understand is the psyche of the Indian customer. We are simple, lazy people. We love the options of home delivery. Isn’t this why Domino’s is so successful in India. Even if Walmart were to sell things 20% cheaper, we would still prefer the nearby Kirana which will offer us a home delivery. The neighbourhood shop would also treat you with respect and remind you if you forget to buy something. He probably knows your home needs better than you do. We are not the type of people who will make a list and plan our shopping. We are impulsive buyers; we buy things as and when we remember or see them. When was the last time your family bought your monthly groceries all at once. It is so easy for mothers to just step put of the house and find the nearest sabjiwala. Sometimes he might come in front of your house with his rhythmic screams, “Tamatar, Aloo, Bhindi..” Who wouldn’t buy from him?

Taking the case of a city like Bangalore, Walmart would open at the most 2 or 3 shops, somewhere in the outskirts where real estate is cheap and in plenty. In MBA they always talk about value added to the customer. The value you get from a Walmart is basically cheaper goods. Quality is something which I believe would be the same throughout. The pains which you would take to commute to the shop, then carry all those bags back might just equal the return you get. Once you come back, you realize you have forgotten something. Nothing worse than that.

The point is there is nothing wrong in giving more options to the consumer. Its always better for us to have everything under one roof. Its easier to find stuff and plan. Since the big chains source directly from the botton of the supply chain, the prices you get would be better and in order to maintain the quality there would be improvement in the logistics aspect. WSJ once reported that nearly 30% of the country's fruits and vegetables perish due to a lack of cold-storage facilities, while thousands of tons of food-grain spoil in ill-equipped warehouses. A collosal waste for a developing country like ours. Foreign players would definitely solve this problem leading to lesser wastages and better prices for farmers. The elimination of middlemen would reduce jobs is another argument against FDI. Although this is true, but these people can venture into other areas which would open up due to FDI. There would be a large scale requirement of Warehouses, Material Handling Equipment, Transportation vehicles etc… Each store would employ by the thousands as they would be needed for billing, guiding customers, movement of goods, back end operations, accounting etc… All in all this is a win win situation for the country. If anyone has any doubts then they need to remember the effect which Retail chain like Food World, Reliance Fresh etc… had on the Indian Retail scenario. No one lost their jobs or no kiranas closed due to this.

Like we enjoy the benefits of KFC, Pizza Hut, etc… in India, let us also open up in retail. This is a move in the right direction and the benefits far accrue the losses. As for my sabjiwala, he says, “Bhaiyya, aap tho mere paas hi aayenge na” with a smile.

A Trip to ISKCON

I happened to go to the ISKCON temple at Bangalore on Sunday. For the uninitiated, ISKCON stands for International Society for Krishna Consciousness; They are the proponents of Gaudya Vaishnavites form of worship.

This is the 5th time I have been to this place and I have been itching to write this article ever since. Located in Rajajinagar close to the Mysore Sandal Factory, the temple complex is huge and well planned. South Indian temples by design are large and occupy huge tracts of land, sometimes forcing me to ask the question if the land could have been better used. I am sure Lord Krishna wouldn’t mind a small temple. Anyways once you enter the temple complex, you pass through small temples before reaching the Sanctum of Lord Krishna. I love the steps at the beginning of the temple where a devotee has to chant “Hare Rama Hare Rama, Hare Krishna Hare Krishna” 108 times before visiting any of the shrines. This creates a very vibrant atmosphere and fills you with a sense of sanctitude.

The main Gopuram containing the deities of Krishna, Balram and Radha is as large as an auditorium. The roof of the sanctum sanctorum resembles a collage of paintings which depict various situations in the life of Krishna. I wonder at times how people actually paint the roof of a building; reminds me of a certain sardar joke. A story better left for another occasion. The idols are seated majestically on a golden platform. It’s interesting how all the idols whether male or female are always adorned with a sari type of cloth. It’s beautiful nevertheless.

Once you have had your darshan and leave the main temple , you then come to know for what ISKCON is famous. I consider it the Amway of Spirituality. You encounter a book stall first where you would find posters depicting the offers on Bhagavad Gita. I doubt if any pious Hindu would look at an offer for a Bhagavad Gita before buying one. You would be fooled into thinking that the people who sell these might have originally worked for an FMCG company. They seem to know what they are doing. Maybe Yum-Bee-Eh is compulsory in ISKCON !! To be honest selling religious books in India is not that tough as the scriptures are very close to our hearts.

I believe that after having the darshan of Lord we should all be treated to Prasadam. It’s a birthright of every devotee. Strangely in ISKCON, the prasadam is served right at the end, close to the exit, much after the shops which sell Samosas, Kachoris, Rasnas, etc… Never seen a temple where people roam around with Kulfis and Sodas. Any devotee would be fooled into thinking this is the Prasad. They even serve Gobi Manchuria !! Talk about catering to all segments. They must have Yum-Bee-Eh’s in ISKCON. Much before the food mela you see stalls selling shirts, coffee powders, stuffed toys etc… all bearing Hindu Gods. Being an MBA myself, I would suggest ISKCON diversify into the following products,

(1) Toothpaste. What better way than to start a day with a Lord Krishna Toothpaste.
(2) Toothbrush. Unbreakable bristles. I would recommend Hanuman as the brand ambassador.
(3) Mouse Pads. The large IT crowd of Bangalore would definitely love this.
(4) Tissue Papers. This would be for the foreigners.

We can start with the above and based on customer feedback we can launch other products or more variants of the above. Did someone say Commercialization?

You guys would be glad to know that ISKCON is constructing a Krishna Lila park on Kanakpura Road in Bangalore. Sort of Wonderla. Who are we kidding, It’s a wonderla basically with a temple inside. There are roof side and pool side temples complete with water slides for kids. I never thought I would associate those words with a temple. Who says spirituality ain’t fun. No kid would ever say no to a trip to ISKCON from now. Temples for the oldies and Slides for the kids and for the parents; well the parents can choose between the two. Kudos to ISKCON, they are changing with the customer needs and demands. I think this novel concept of theirs would be a crowd puller.



At the end of our journey, and as we come near the car parking, we see two people handing out Prasad. After all the shopping, you do find the Prasad refreshing and very tasty if your stomach is not already filled with puffs and mirchi bhajji’s.

Whatever means ISKCON might be using to make money, I personally feel they make some of the most beautiful temples in the world. After the age of Cholas and Pandyas, rarely have Indian temples lived upto our heritage. I salute ISKCON in that aspect. I hope and wish that they continue to make more such grandiose temples and start selling stuff outside the temple premises.

Thoughts on Traffic

India should seriously think about stopping vehicle registrations. It has worked in a few places in the world. Our country might be doing well in terms of growth and all but the infrastructure is way behind. So give the Infrastructure time to catch up and then allow the vehicle population to expand again.

Charge high registration fees. This will prevent people from buying vehicles and would make more people use public transport. The high fees can also provide the required money for improving public infrastructure.

Stop selling 2 wheelers in India. They are the biggest traffic nuisance as they squeeze in and out from no where and rarely adher to traffic rules. They are also the reason for many accidents and for large scale underage driving.

Charge High parking fees in the city. This will prevent people from taking their cars out for every small thing. I have seen people going in a car to the nearby kirana shop or supermarket. It’s a colossal waste of resources especially petrol.

Tryst with my Manager

It was just another day at work. The usual routine, check mails, spend some time chatting on Gtalk and Communicator, check mail again, visit all the food courts through the course of the day, etc…The routine was interrupted by a call from my manager, someone who was a non entity for the past two months. He said lets discuss the ppts you made. My initial reaction was ppt?? what ppt, I never did anything for you. I replied in a cool way, “Sure Sir, when do you want to discuss?”. “We will talk at 4 PM”.

I switched to overdrive mode. Where did I keep those damn ppts. After a few minutes of outlooking, I found the ppt. I had made these presentations with screenshots which my boss sent of some random excel sheets. I remember making these ppts in around 1 hour as my team mate had said “make what you feel like”. 5 words with profound meaning; this would haunt me later.

I entered the room confidently turned on the projector and loaded the ppt on the system. I looked at my boss and he gestured me to get started. I entered my MBA mode of ppt presentation where you speak nonsense with total confidence as if you have done a PhD on them. No sooner had I started that my boss interrupted saying “What is this that you have done”.

“PPT Sir” I said tongue-in-cheek. (Wrong time for sarcasm huh!!)

“See Sriram, (Don’t know why he calls me that. Its pretty clear that my name is Srikanth assuming that you are literate of course.) Don’t get me wrong. You haven’t understood anything. I am not sure if I wasn’t clear in my expectations or you have some problem understanding but do you know what you are talking about?”

“You asked me to make a business case on BVA for two Banks. I made as much as I could understand from the screenshots you sent me.”

“Don’t give me excuses, you could have googled it up. (The project I was working on is known only to the three of us and this guy expects google to have the answer. It has become a fashion to ask people to google up anything which they don’t know. ) See Srikanth Sriramagiri, (I hate it when people use my full name. It reminds me of how long it is.) when the company pays you 1 rupee they expect 3 rupees from you. Am I right or not?”

I nodded obediently like a dog expecting a pedigree in return.

“You have 9 hours and 15 minutes everyday at Infosys. Atleast spend sometime working. See how much me and Maveli (Name of my team mate. Name altered due to obvious reasons) work everyday. We come at 9 AM and leave at 10 PM sometimes. I don’t even get time to go the loo. (I started feeling sorry for him now.) Atleast I get time to have Tea ( The guy has no time for Loo but for tea he has. Taking more liquids and not releasing them is not such a good idea Sir) but Maveli here doesn’t even have that luxury. See Srikanth Sriramagiri, I am not asking much from you. It took me 12 months to come up with this, I have given you 2 weeks and still you are not able to follow up. (What the !!! 12 months of your shit I have to understand in 2weeks. I am not Einstein, dude) Anyways Let me tell you my expectations again.”

He rumbled non stop for what felt like eternity while I could see the colourful Friday evening crowd rushing away towards the exits.

“……Have I made myself clear?” I woke up from my dream just when it was getting to the good parts. We should have an option to pause our dreams and restart them. I don’t know how many good dreams I have lost due to the lack of this feature.

“Yes, I understood”.

“What about the other excel sheet I sent you?”

Again brain goes into search mode, which excel is he talking about…”It was related to change from version 7 to version 10.”

“That excel, I have just gone through it once but I didn’t understand anything”

“See Sriram, It has been 3 months since you have joined and you know enough Finacle to understand it. That excel was made by an Intern. Don’t misunderstand me, She was from Duke University, Fuqua School of Business pursuing her MBA. I am not comparing or anything, she just had 14 years of banking experience and some basic understanding of Finacle and she could understand it. I think you should be able to do better than this.”

“Anyways I haven’t approved one single swipe of yours. You can’t forget like this. I havent forgotten once in 4 years (Not even once !!! I think he carries the swipe machine also in his pocket.) and you have already done it once.”

“I was in a hurry to catch my train to Hyderabad and I forgot. Its an honest mistake and can happen to anyone.”

“Ok. I will let it go this time. You are coming to work tomorrow (It was a Saturday. Some Client commitment crap and they make us work on Saturdays) right?”

“No Sir. I will be going for my convocation. I have applied for leave.”

“You didn’t tell me you are going.”

“You approved the leave.”

“Is it, Then its fine. If I approved it means I have seen it.” (Duh !! He has a memory of an Elephant and this he forgets.)

Another manager walks by into the cabin and they start talking in Tamil. Probably my manager was giving gaalis to me. Anyways he suddenly turns to me and says,

“Srikanth, you know I sit from 8 AM to 8 PM. Reply to all the mails and go. Do you think I need a Blackberry?”

I had a blank face. How should I respond to this? The other manager was busy on his BB. I decided to play safe and smile make it look like he was passing a snide remark on his colleague. (Evil Grin !!)

“See Sir, I am not telling you to not buy Blackberry. I am saying I am happy with this phone. I don’t need anything else.”

He was telling me all this as he didn’t want to say this to his colleagues. Smart fellow. I doubt if he knows what a Blackberry does.

“Ok Sir, You can go now. Come back with a detailed plan on how to move forward.”

“Yes Sir”

I walked away as quickly as I could from the cabin and the building. Clearly he was trying to show who is the boss. Koi nahi. Mera time bhi aayega. Phir dekhte hain kaun bada hero hai.

Chaos over nothing?

Why all this fuss about a JanLokpal Bill? We already have enough bills and laws to protect us. The problem isnt the system completely, its us. Cmon people smell the coffee. If you are so against corruption then don’t show it by wearing T shirts or badges which say “India against corruption” or for that matter “I love Anna Hazare”. Start by doing small things. For example, next time don’t bribe the police guy, or learn stand in a line to submit forms in a government office. These small but effective changes if implemented by the citizens would be more effective than another bill. In India it’s the middle class that has to rise to the occasion. They are the ones who suffer the most and have the ability to change the system. The poor will continue to be oppressed and its easy for the political class to convince them by showering them with money. The rich don’t care about the government and who runs it as they are friends with everyone. This leaves the middle class with powers which are unknown to them. This power is enough to cause a change in the way India thinks and the way it runs. If every middle class Indian did simple things right, there would be no corruption in this country, no dishonest officials and no more fasts. Let this decade be the rise of the middle class, an honest uprising where we stick to the ideals which make this country great and a nation that we are proud of.