Swami Vivekananda can teach us about cultural differences between India and the west

My Swami Vivekananda blog continues to gain reactions – he shows us how rich, diverse and deep is Indian culture and thought. He was the multitalented, multifaceted teacher, Hindu monk and spiritual guru, born in 1863. With his extremely popular and respected speeches of all times starting with “Brothers and sisters of America”, he introduced Hinduism at the parliament of world religions in Chicago way back in 1893.

Through study of his quotes, we can gain special insight into the cultural (thinking) differences between India and the west.

This learning comes with no judgement, no sense of one culture being better than another – it is offered in the spirit of understanding.

SV – “Truth can be stated in a thousand different ways, yet each one can be true.” 

This goes to the heart of cultural difference – the west treats truth as an “absolute”, meaning there is no room for difference or “relative” truth as stated in India.

This can show up in business activity, where the westerner sees the plan as fixed and set in concret(absolute), while the Indian sees it as just a plan, capable of change (relative).

SV – “All knowledge that the world has ever received comes from the mind; the infinite library of the universe is in our own mind.”

Here the west takes a materialist and scientific view of knowledge, seeing the role of the mind to gain knowledge from the external world.

SV – “Bless people when they revile you. Think how much good they are doing by helping to stamp out the false ego.” 

In the individualistic culture of the west, from a young age we are trained to “stand up for ourselves” so the likely response from a westerner when reviled is to defend or even to attack. “The best form of defence is attack” is a common western phrase.

SV – “Things do not grow better; they remain as they are. It is we who grow better, by the changes we make in ourselves.” 

This internal view is very different from the west, where growing better is generally reflected in possessions, honours and achievements – in external things.

SV – “The world is the great gymnasium where we come to make ourselves strong.” 

The big picture view of the world from the west is that it was put here for our benefit – so use it. At its worst, this has led to pollution and climate change. At its best, it is the basis of many innovations that benefit us all.

SV – “Do one thing at a Time, and while doing it put your whole soul into it to the exclusion of all else.” 

Multi-tasking has been highly fashionable in the west for decades and technology is the great enabler of it. But when you see a person totally focused on one task, you see how effective we humans can be.

SV – “All differences in this world are of degree, and not of kind, because oneness is the secret of everything.”

The concept of “oneness” is very foreign and strange to many westerners. They see differences as being of kind, and view the world through the lens of the individual, which is the opposite of “oneness”.

SV – “We are what our thoughts have made us. So, take care about what you think. Words are secondary, thoughts live and travel far.”

Thoughts are seen in the west as a totally private thing and secondary to what we do and say. Without words, a westerner could view thoughts as a waste of time.

SV –“Neither seek nor avoid, take what comes.”

This is a remarkably different view of life from how the west sees it. A westerner will strongly seek to either possess the attractive that comes or repel the negative that comes. In other words, far from “acceptance”, westerners take an activist approach to whatever life presents. It’s like a constant struggle.

SV – “In a conflict between the heart and the brain, follow your heart.”

“Think it through” is a much repeated piece of western advice, where the brain is given vast superiority over the heart.

SV – “The great secret of true success, of true happiness, is this: the man or woman who asks for no return, the perfectly unselfish person, is the most successful.”

For many westerners this is a strange concept. Happiness is seen as something the individual must find and keep for themselves. Many would see virtue in sharing and being unselfish, but they would see it as folly to be “perfectly unselfish”.

The above are just my interpretations – offered in the hope that they give useful understanding of cultural differences. We can learn from each other. What do you think?

India’s millennials drive a shift to consumer demand

India’s millennials – what a shock – are borrowing for consumables.

This is a massive generational shift in India where previous generations believed in first saving and then buying – even if it took years or ultimately going without.

Consumer credit companies such as TVS Credit and Bajaj Finserv have been increasing the share of their offerings to these niche segments not covered by conventional lenders and NBFCs.

The loans are known as EMI’s (equated monthly instalments) and are used to buy various goods, including mobile phones, consumer durables and small-ticket items on easy, no-cost EMIs via loans or credit cards.

It is the segment of youthful, low-income but tech-savvy consumers that fintech lenders are targeting – half the small loans are of Rs5,000 or less.

The country’s largest AI-enabled consumer lending platform, ZestMoney, noted in a report that it had seen more than 125% growth in EMI funding.

E-commerce majors such as Amazon, Myntra, Flipkart, MakeMyTrip, Decathlon and Paytm, among others, have seen a substantial surge in online sales in the past year due to EMI financing schemes – and digital payments mean no cash.

The New India is not afraid of debt – signalling a major uplift in consumer demand for decades to come.

Adani takes giant steps towards becoming the world’s leading renewables company

Adani Group taking giant steps towards becoming the world’s largest solar power player by 2025.

Adani is taking a massive lead in India into green energy renewables.

But in Australia it is still seen as “the Indian coal company” because of its activities in Queensland – in this market the Adani reputation has taken a hit as a result.

The reality is Adani is a leader in green energy and just got a lot bigger!

Adani Green Energy Limited (AGEL), this week signed share purchase agreements for the acquisition of 100% interest in SB Energy India from SBG (80%) and Bharti Group (20%). 

SB Energy India has a total renewable portfolio of 4,954 MW spread across four states in India.

Adani is super serious about renewables – the transaction marks the largest acquisition in the renewable energy sector in India. The transaction values SB Energy India at an enterprise valuation of approximately USD 3.5 billion.

The target portfolio consists large scale utility assets with 84% solar capacity (4,180 MW), 9% wind-solar hybrid capacity (450 MW) and 7% wind capacity (324 MW).

With this acquisition, AGEL will achieve total renewable capacity of 24.3 GW (1) and operating renewable capacity of 4.9 GW.

You’ve got to hand it to Gautam Adani who has the vision to be the leader in sustainable energy transition globally and makes it one of the largest renewable energy platforms in the world.

Mr Adani created a vision in January 2020, wherein he laid out our plans to become the world’s largest solar player by 2025 and thereafter the world’s largest renewable company by 2030.

India Avenue 36.6% return for Australian investors in India

INTO INDIA has written before about Aussie fund managers India Avenue Investment Management. Their India Avenue Equity Fund is a standout.

It’s fact sheet for the month ending April 2021 is now available. Contact the CEO Mugunthan.Siva@indiaavenueinvest.com

The fund has delivered 36.6% over the last 12 months outperforming the index by 9.1%. 

The Fact Sheet explores how India is progressing through the 2nd wave and what sectors will benefit

The India Avenue story shows why active management through local connectivity in India is of critical importance and why it will continue to win, especially during uncertain times such as the pandemic 

The India Avenue Equity Fund is available on the following investment platforms: Macquarie Wrap, Netwealth, Hub24, Mason Stevens, Powerwrap and Praemium. In New Zealand, it is available on FNZ / One Answer, Aegis and InvestNow.

You’ll see many familiar names in their portfolio – Bajaj, Infosys, HDFC Bank, Kotak Mahindra and Tata Consulting Services.

But many have not heard of others such as – Kaveri Seed, Info Edge, Redington, Aurobindo Pharma, Divis Laboratories, Avenue Supermarts and Brigade Enterprises.

India Avenue has a local India team and the ability to drill down beyond the majors favoured by most global funds.

UK and India pragmatic negotiators achieve a trade and investment deal

INTO INDIA has been advocating for Australia to do what deals can be done with India, and “park” a Free Trade Agreement for later on.

The UK-India Virtual Summit has done just that.

Their newly created Enhanced Trade Partnership (bureaucratic speak for “these are the things we can agree on now) will create immediate opportunities for British businesses in India across industries including food and drink, life sciences and the service sector.

Non-tariff barriers on fruit and medical devices will be lowered, allowing British businesses to export more of their products to India and boosting UK growth and jobs. It also commits both sides to addressing immediate market access barriers as well as continuing to seek further opportunities on the road to an FTA. That is, “parking” the FTA for later on – it is just too hard to achieve.

Prime ministers Narendra Modi and Boris Johnson held their Virtual Summit this week and agreed on a “Comprehensive Strategic Partnership” – the first European country to gain this status.

Australian PM Morrison achieved a CSP with India in 2020 and set out collaboration across science and technology, maritime issues, defence and more.

CSP deals are a sign that India is become more outward looking and – like everyone else – concerned about the behaviour of China.

The trade and investment package unveiled by the British government contains over £533 million of new Indian investment into the UK, covering areas such as healthcare and technology.

British businesses have also secured new export deals with India worth more than £446 million, which is expected to create more than 400 British jobs.

I hope our Australian trade officials are going through all the detail to see if any deals Australia has with India can now be updated on a deal-by-deal basis.

Indian startups – the real story

For decades Ashith Kampani has been in the Mumbai financial markets, giving him a front and centre seat to the Indian start-up environment. Here is his review – the real story.

Globally start-up names have become common in our lives – twenty years ago, today’s top names such as Apple, Google, Microsoft, Amazon, Facebook, Alibaba, WeChat, Baidu, Uber, Ola, Instagram, Slack, PayPal, Tesla, SpaceX, Flipkart etc. did not exist or barely made a mark in the mind of consumers. These brands have made it to the top of the valuation charts over the last two decades.

Each firm named above has been funded by the elite global VC and Private Equity firms. This trend continues.

India is still in the catch-upstage of having an organised and monitored ecosystem for its indigenous start-ups. In the Indian start-up ecosystem local ideas and local capital pools locally are mismatched.

Although Indian Angel and Seed investors have been on the rise, risk appetite has not increased.

What is needed to encourage investment? Local investors need a curator who will qualify founders, whet business models and create capacity building. This will allow deep tech to grow locally.

The areas that Indian needs to develop more efficiency in are BFSI (Banking, financial services and insurance), CPG(Consumer Packaged Goods), Smart Infrastructure, Health Care, Real Estate, Defence & Aerospace.

BFSI and Health Care have many start-up names where optimisation and efficiency levels have shown some improvement but many existing large players in Banking and Health Care are dependent on legacy systems which will require a large capex to upgrade.

In CPG & Smart Infrastructure there are fragmented players. Real Estate has many platforms, but they are part of a broken ecosystem as they are mainly matching and advertising platforms. Defence and Aerospace are a restricted sector due to government controls. However, India needs local start-ups to provide the “make & made in India” technology. This is urgently needed.

India based or born start-ups include PayTm, FlipKart, Ola, Oyo, Baiju, Swiggy, Zometo, Grofers, Nyakaa etc. They are all 10-12 years old. None of them have a dominant market share and are burning funds to acquire customers.

With a few exceptions, founders’ stakes are diluted below 15% ownership. I am OK with equity dilution as founders may have faced challenges initially to raise capital. However, if these early-stage capital pools were raised within India and in INR (Indian rupee) that would be preferable to an infusion of USD denominated funds.

Today hardly any start-ups are indigenously funded onshore in India. This is changing. Select names such as Lets Venture, angel groups which are city centric and micro-VC firms have started to commit between $100K to $1 Million in pre-seed or seed rounds.

India needs few hundred start-up names to work along with platforms like Lets Venture and a few more to provide risk capital.

Accelerators are scarce and should be encouraged to scale rapidly as well.

India also needs a centralised monitoring system on how start-ups are faring and what kind of ecosystem support is needed. These platforms can keep an eye on the progress of start-ups and create visibility and business opportunities for start­ups by bringing synergistic players on.

For example, start-ups can raise initial capital and receive visibility on the platform. They are then discovered by larger enterprises that need their services. Such platforms can be initially funded by enterprises (mid to Large) who shall have first access to the innovations of the nurtured start-ups.

Sector Analysis for India

CPG and Retail

There are four big players: Amazon, Flipkart, BigBasket, Reliance. The first three are attacking the market from an e-commerce angle with an internet front end paired with a warehouse back end. They negotiate hard with CPG players and offer attractive lower prices to consumers to as well as home delivery. The fourth, Reliance Retail has tied up with Kirana stores for last mile delivery and storage. However, Kirana may lose its business to Reliance Retail in the distant future.

Both the models pose challenges to existing small stores. Today 85% of FMCG & CPG sales are in single or small stores while Ecom and organised retail have a combined market share around 15% (other names like Delhivery, ShopX, Udaan, RingRing are still growing while some have given up).

BFSI

This is the most active and largest sector where digital offerings have taken the front row. Frontend players like Digital Lending / Neo Banks/ Payments/ Foreign Exchange offer services which compete with large banks and lenders. There are many players who digitise middle and back-ops for fintechs, lenders and banks.

Competition is fierce and it is a dog-eat-dog market where service levels and delivery are key as pricing is dictated via negotiated deals. Barriers to entry are also high. Large entrants such as Amazon Pay, Google Pay, Phone Pe Bharat Pe have been more visible than silent players like Razor Pay, Pine Labs, Pay U etc. New Neo Banks have been creating a buzz as well (Epify, Jupiter, Niyo, Ocare etc). I have not factored in Jio, but they have big plans in BFSI.

Smart Infrastructure

One of the biggest markets with select international players in this market as local start-ups do not have enough funding yet. Personally, I would watch this segment carefully as new Indian players enter.

Health Care

This is now a most vibrant sector thanks to the recent pandemic Covid19. Vaccine creation to efficient delivery is a large and needed segment. Connecting the health of each individual (with assessment) into a seamless hospital, insurance and finance model will make a positive impact on many lives. Today we have cashless health insurance, but it is a fragmented system. Start-ups are better positioned to offer a solution to repair such an awkward process.

Real Estate

Real Estate is also a broken system in India. Renting or purchasing needs to be repaired as the experience is not seamless. Only some parts are digitised, and none offers an end-to-end service. This is a totally broken experience and must be repaired end to end.

Conclusion

The Indian market of 1.4 Billion people needs many start-ups to create products and services which suits the needs of Indian people. The road ahead in India and South Asia is extremely optimistic as start-ups can simplify, digitise and link together transactions.

The market opportunity is vast but initial funding needs to be localised and customised to the India based entrepreneur. More platforms that can offer funding, visibility, sales and exit needs to be encouraged.

About the Author

Ashith Kampani has spent 38 years in capital market. Journey began with family stock broking firm on Dalal Street open outcry system to all digital online trading systems. During this journey he spent time with retail, wealth management, institutional equities, private equities, Investment Banking M&A and now in Venture Capital and early-stage Investment and advisory. Worked with JV partner Morgan Stanley and before stepping down he was MD at JM Financial. Currently Chairman at CosmicMandala15 Group & Member of Managing Committee Bombay Chamber.

Pat Cummins role model for how all of us can help India

Many of us in business relations with India are wondering what is the right thing to do in the midst of India suffering so much from the pandemic.

Pat Cummins has showed us what to do.

He is staying because IPL creates some joy for lockdown people – and he has made a big donation.

For business and trade the message is striking – keep in touch, build business relations and where you can, donate to support India.

Cummins has starred for the Kolkata Knight Riders so far this season.

The Australian superstar wrote on Twitter on Monday night to announce a donation in the fight against the virus, and to urge fellow cricketers to donate.

I am reproducing his entire Tweet because it is moving and inspirational:

“India is a country I’ve come to love dearly over the years and the people here are some of the warmest and kindest I’ve ever met.

“To know so many are suffering so much at this time saddens me greatly.

“There has been quite a bit of discussion over here as to whether it is appropriate for the IPL to continue while Covid-19 infection rates remain high. I’m advised that the Indian government is of the view that playing the IPL while the population is in lockdown provides a few hours of joy and respite each day at an otherwise difficult time for the country.

“As players, we are privileged to have a platform that allows us to reach millions of people that we can use for good. With that in mind, I have made a contribution to the “PM Cares Fund”, specifically to purchase oxygen supplies for India’s hospitals.

“I encourage my fellow IPL players – and anyone around else the world who has been touched by India’s passion and generosity – to contribute. I will kick it off with $50,000.

“At times like this it is easy to feel helpless. I’ve certainly felt that of late. But I hope by making this public appeal we can all channel our emotions into action that will bring light into people’s lives.

“I know my donation isn’t much in the grand scheme of things, but I hope it will make a difference to someone.”

Winning in India – less about sales and more about culture and relationships

When a company sends a salesperson into the Indian market, the goal is to fill the order book as quickly as possible – there is no time for that person to build ongoing relationships.

The result at best is a quick transaction based on price. It rarely lasts.

India is a country where relationships drive and impact all aspects of business. That is “how they do things there” and expect us to be the same.

Some tips for relationship building in these tough times:

  • You can build good relationships during Covid by hosting a zoom or similar catchup to see how things are going – no big agenda, just share experiences and listen.
  • You can join groups and chambers and be seen as a player.
  • You can accept the intangibility of relationships and give your key executives time and resources to build them.
  • You can look up Indian culture, architecture and history so you can have informal conversations about things close to their heart.
  • You will need strong curiosity and listening skills.

Really, decisions about future business with India need to be C-Suite and Boardroom driven, based around a minimum three-year strategy. And giving your people the right to spend time on the intangible of relationships is the best first step.

Come on India and Australia – time for an FTA to be number 1 priority

It is high time the close friendship between the PM’s Modi and Morrison led to an FTA.

It is great to see so much friendship and collaboration between India and Australia – but it is time to go to another level and have a serious shot at getting a free-trade agreement between the two countries.

Here’s 3 reasons why an FTA is now urgent:

India wants greater access to Australia’s resources.

Australia wants alternatives to China for resources and wine.

India wants investment and Australia has huge funds under management.

Patience around the FTA has been a good approach but now we have to step up the pace and get on with it.

We need some form of harvest agreements to take the heat out of agriculture – which is always a super-hot political topic in India.

Also, India seriously wants investment flows and Australia has not been forthcoming. Time for the Australian Government to lead our huge investment funds into India.

The reality is – close relations in trade mostly follow investment, and Australia has not invested heavily in India.

Wine barriers to India are huge – there is a 150% tariff – and yet wines like Orlando Jacob’s Creek have done well there.

One problem for India is they are encouraging their own wine industry, typically at the low end of the market. Perhaps they can free up tariffs on high end wine imports?

The relationship between Prime Ministers Modi and Morrison is close and could be a building block for an FTA.

Let’s put it top of the agenda!

India’s top ten business cities and what they are known for

Mumbai – beautiful, never sleeps, the financial and commercial capital of India

Mumbai

Mumbai is the ultimate commercial and financial city of India – a true 24/7 powerhouse that never sleeps. It houses the headquarters of a large number of major Indian companies like Tata Group, Reliance Industries, Aditya Birla Group, Larsen & Toubro, Godrej Group, and Hindustan Petroleum among others. The city is also the headquarters of the Reserve Bank of India, National Stock Exchange, Bombay Stock Exchange, and – yes – Bollywood.

GDP (PPP) – 310.0 billion

Delhi

Delhi is the National Capital of India – and on a global scale, it is one of the great capitals of the world. It is also the most populous city of the country. Being the political center, Delhi is home to all the prominent political personalities and officeholders including the President, the Prime Minister, and distinguished ministries. Delhi is a metropolitan city and attracts a large part of the population from all the states. With the ever-growing rates of urbanisation, the city accommodates everyone and has a diversified economy.

GDP (PPP) – 293.6 billion

Kolkata

Kolkata – oh yes, I know it has a reputation as relaxed or even sleepy – but it was the capital of British India and houses India’s oldest stock exchange. Most people are not aware that more than 83 percent of the city’s population is employed in the tertiary sector. Kolkata is the third richest city in South Asia after Mumbai and Delhi. Kolkata is a house of many Indian corporations like Coal India Limited, ITC Limited, Britannia Industries, Allahabad Bank, National Insurance Company, and United Bank of India among others.

GDP (PPP) – 150.1 billion

Chennai

Chennai is one of India’s great southern cities with all the manners, politeness and conservatism that goes with it. It is the capital city of Tamil Nadu and sits by the Bay of Bengal. Given its glorious history and its significance as Madras Presidency during the British rule, Chennai is historically and culturally rich and diverse, attracting tourism in turn. Besides being a pioneer in art, culture, and music.

GDP (PPP) – 110.0 billion

Bengaluru

Bengaluru used to be called the “garden city” but today is better known for massive traffic jams. It has a “young” feel and houses some of India’s most trendy eating and drinking establishments. It contributes more than 35 percent of India’s IT exports. The city also houses some major manufacturing industries like Bharat Heavy Electricals Limited, Bharat Electronics Limited, and Bharat Earth Movers Limited among others. Infosys and Wipro have their headquarters in Bengaluru. The city is home to 8 billionaires.

GDP (PPP) – 86.0 billion

Hyderabad

Hyderabad comes across first as located in a dry and rocky area – but the city is known for its rich history, food, and its multi-lingual culture, both geographically and culturally. The city has an estimated population of around 8 million, making it 4th largest city in India, while the population of the metropolitan area was estimated above 9 million. Religiously and culturally, the city is united with Hindus, Muslims, and Christians.

GDP (PPP) – 75.2 billion

Pune

Pune, a place for learning, thinking and doing. Pune is a city located in the western Indian state of Maharashtra and now closely linked with Mumbai. It is the 8th largest city in India and the second largest in Maharashtra. India’s first Prime Minister called Pune “The Oxford of the East” because Pune attracts students from all over the world. There are a large number of good schools in Pune affiliated either with the Maharashtra State SSC Board or the All-India Indian Certificate of Secondary Education (ICSE) and CBSE boards.

GDP (PPP) – 69.0 billion

Ahmedabad

Ahmedabad was the historic home of Gandhi’s famous ashram and is now a dynamic commercial hub – it is one of the fastest-growing cities and is one of the best cities to live in. Ahmedabad is an economic and industrial hub of India and is the largest city in Gujarat. There are several significant companies located in the city and the place is known for the textile industry. This city attracts a large number of tourists every year as there are several amazing monuments along with numerous modern buildings. Have fun – go there during the amazing kite festival.

GDP (PPP) – 68.0 billion

Surat

Surat is known by several names – the silk city, the diamond city and the clean city – it is one of the cleanest cities in India and is the best developing urban community. Surat has the largest stone cutting and cleaning centers and is especially known for diamonds. Surat has a large textile industry and there are more than 380 dyeing and printing mills with 41,000 power looms.

GDP (PPP) – 59.8 billion

Visakhapatnam

Thankfully known by the shorter name of Vizag, this city manages to combine a powerful steel industry, major port and lots of natural beaty. It is a great economic destination that is also known as the financial capital of Andhra Pradesh. This coastal city is also known for its medication, programming, and pharmaceutical industry.

GDP (PPP) – 43.5 billion

(Thanks to multiple sources including INDIA TODAY for the above)