Thursday 1 November 2012

Inertia to spend more money affecting reforms in India?

The UPA Govt is on reforms spree. The LPG and diesel prices, FDI in retail, insurance etc etc. It was long expected and a welcome step. Business Houses and bourses took it very positively day it was announced. The middle class has had mix response. Some people were happy that Govt has taken positive steps for the economy. Some have been critical on the fact that already burdened under high inflation the high prices of LPG (also limiting number of subsidized cylinders to 6 per family) and diesel will be a big pressure on them. People who have their retails shops are also threaten with opening up on FDI in retail.
There are 2 category affected from these reforms. For FDI reforms, one , there are people who are only consumers and the others who are consumers as well as sellers (shop owners). Then in the other category, for LPG and diesel reforms, there are those who are poor and really would be highly affected or would suffer. Then there is middle class and upper middle class who have this habit of living in this subsidized world and though can afford these changes but are not mentally prepared.
In the first category, consumers welcome the retail opening up and sellers are opposed to it. Obviously there are impacts to these mom and pop stores because of FDI in retail. People have more options, they are choosing from shops and buying has increased and money is been divided between different sellers. but saying that such steps would stop the charm of local sellers and brands is baseless. Taking an example of Delhi, the markets of Chandani Chowk for clothes, Khari Bawli for masalas, markets of Lajpat and Sarojini Nagar, Connaught Place and many other wholesale markets are still very famous. The idea is to give consumer something extra in design or less in prices.
For the second category, as already mentioned, as people those who can afford but have the habit of living in subsidised world, easy prices, not getting exposed to world prices, we have assumed it to be our right and we dont want to move to higher prices, No matter how much we talk and discuss that there are no reforms, Govt. is not working etc etc.
I am not sure how much of India's population is financially ready for these changes but we sure are not mentally ready for this and we never will be, until imposed upon us.

1 comment:

  1. Yes, you are right. I also agree. The last statement which says we are never ready until something is imposed upon us gives the jist of human behavior

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