Category: Changing India

X-Factor Not Ex-Factor: Scare for Sidhu as Charanjit Channi May Well be Here to Stay Come 2022

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Masters in Political Science, an MBA, a law graduate and now doing a PhD, that too on the Indian National Congress. Punjab’s new Chief Minister, Charanjit Singh Channi, is not only the most educated minister in Punjab but is also now being seen as the X-factor for the Congress ahead of 2022 polls.

Travel from Chandigarh to Patiala, Sangrur, Ludhiana, Jalandhar and Amritsar, Channi now stares at you from every poster on the road. Some say the move has been late on the part of the Congress, replacing Captain Amarinder Singh with Channi just five months before elections amid heavy anti-incumbency, unlike the BJP which did so in other states well in advance.

But others say Channi, an ‘accidental CM’ by all means, is the party’s best bet to return to power. If it does, Channi may well be here to stay. “How will anyone remove a poor, educated Dalit face as CM if Congress wins?” a senior party leader in Punjab asked.

Read Here | Channi’s journey from being elected to municipal council to becoming first Dalit CM of Punjab

Channi’s Three Pitches

News18.com was at an ITI Kapurthala event on Wednesday which was in news only for Channi’s bhangra dance with students. But his 30-minute speech there, his first as CM, was key as he laid out his humble background and his vision for Punjab. “I have a roadmap to take Punjab ahead. I have been preparing it for a while,” Channi said, mentioning how he will not tolerate bribery or corruption and will set things right on that front within five months. “Either I will go, or corruption will go. Call me if someone asks you for a bribe,” Channi said.

Channi made three clear pitches in his speech. First, he recalled Bhim Rao Ambedkar’s humble beginnings and focus on education to compare his own humble start. “I took inspiration from Ambedkar, and like him strengthened myself throughout life. I never paid fee in school due to reservation, then got a waiver to pay just Rs 26 yearly fee in college as I played handball from sports quota and later got Rs 150 monthly stipend at university. I did my BA, then law, then MA in Political Science, then MBA and now I am doing a PhD on Indian National Congress,” he said.

Channi, in fact, said the day he took oath, he sat with his teacher from 2 am to 3 am to work on his PhD thesis, which he wants to submit by December. On posters in Punjab, the educational qualifications of Channi find mention with a line “doing Ph.D…”

The second pitch was that he is a common man, unlike Captain or Akali Dal’s Sukhbir Badal. Like PM Narendra Modi, Channi says he’s ‘Mukhya Sevadar’ (prime servant of the people). “I can never put my phone on silent. It is always on. I was also shocked the day I took over to find 1,000 men in my security ring and 200 luxury cars — some costing Rs 2 crore and as big as my room. I don’t want all this and have asked my security to be reduced to 5-10 men. Who will harm or kill me? Am I Sukhbir Badal that I have to carry so much security? Badal has no public support so opts for that big a convoy,” Channi said.

The third pitch was rolling out his vision in a short time. Channi said he wants to create 1 lakh government jobs within five months, stop the contentious outsourcing of jobs in the state, focus big on education and “take Punjab ahead”. Those close to him say Channi has also asked for a plan to scrap the contentious Power Purchase Agreements signed by the erstwhile Badal government and wants to proceed with action in the sacrilege cases and drug abuse cases against the big names.

The buzz on the ground is that even if Channi can deliver on 2-3 big bang promises, he will be a hit. “Cheap power promise will soon be rolled out. The new CM has already waived all pending electricity and water bills of the poor,” a Punjab government official told News18.com.

Channi’s Challenge: Sidhu & Time

However, Channi has time as his biggest adversary as five months is hardly enough to effect any big change. “Five months will be over before Channi realises what a CM has to do,” a senior Akali Dal leader argued.

Another challenge is pan-state acceptability as the 19 percent Jat Sikh population in Punjab may not take kindly to a Dalit Sikh face becoming CM. In the last elections, a Jat Sikh face in Captain Amarinder Singh could rally all sections of the society. Channi and Navjot Singh Sidhu both come from Punjab’s Malwa region while the two deputy CMs come from the Majha region. Punjab’s Doaba region has been left out of the big picture, an omission that may need to be compensated in the cabinet revamp.

Channi’s biggest challenge may, however, be his own state party president and claimant to the CM’s chair come 2022, Navjot Singh Sidhu. So far the impression in political circles is of an over-bearing Sidhu acting as ‘super CM’, something that former Congress state chief Sunil Jakhar has flagged to the Gandhis and in public.

Also Read | Punjab Crisis: In the Singh-Sidhu battle, Congress is the real loser

Sidhu had objected to a Jat Sikh face in Sukhjinder Randhawa being chosen as CM, perhaps foreseeing that a strong face like Randhawa may not make way for him in 2022 if the party wins. Sidhu, in fact, wanted MLA Amar Singh, who was once his personal assistant, to be chosen CM. Channi was hence the compromise choice after Manpreet Badal suggested his name and Sidhu concurred.

However, word in political corridors now is that Sidhu might have been check-mated here with Channi coming into his own and endearing himself to the people with his words and actions in the initial days. Channi also has a good equation with Rahul Gandhi and the party seems pleased with the national message it has sent.

If Congress manages to win Punjab despite all odds, Channi is a new X-factor.​

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

All you need to know about Centre’s Rs 6 lakh crore National Monetisation Pipeline

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Finance Minister Nirmala Sitharaman on August 23 launched the National Monetisation Pipeline (NMP), which is aimed at raising Rs 6 lakh crore through monetisation of infrastructure assets. The four-year programme, developed by the NITI Aayog, will identify brownfield assets owned by the government and public sector undertakings that will be redeveloped in partnership with foreign or private investors.

The government aims to enhance capex spending, multiply growth and employment, and revive credit flow through this programme. It will be co-terminus with the National Infrastructure Pipeline that was launched in 2019.

How it pans out

The NMP is expected to garner Rs 6 lakh crore over four years between FY 2022 and FY 2025. The programme includes more than 20 asset classes under 12 ministries. These will cover sectors like roads, rail, power and transmission, ports, airports, gas and pipeline, warehousing, telecom, mining, housing, stadium and hospitality. This is how the sectors will be monetised:

The top five sectors that will capture 83 percent of the aggregate pipeline value are roads (27 percent), railways (25 percent), power (15 percent), oil and gas pipeline (8 percent) and telecom (6 percent).

Projects that are in the pipeline to be leased are 90 passenger trains, 400 railway stations, 26,700 km of roads, 28, 608 circuit km transmission lines, 14, 917 towers owned by BSNL and MTNL, and 286,000 km of Bharatnet fibre network.

Framework of NMP

The NMP will not include disinvestment as the government will still hold the rights to these core infra assets. The assets will have to be mandatorily handed back to the government after the time period. Structured contractual partnerships will be established with key performance indicators (KPIs), and performance standards will have to be maintained. A significant share of the asset base will remain with the government and it will lend its support through policy and regulatory interventions.

Allaying fears of disinvestment, Sitharaman said, “There is no land (involved) here. The entire National Monetisation Pipeline is talking about brownfield assets where investment has already been made, which is either languishing or which has not been fully monetised, or is under-utilised,” she said, adding the ownership of these projects will still be with the government.

Challenges

More clarity is awaited on the number, size and type of assets that will be available to the private sector for investment. Also, experts believe that if the government is able to get the first few projects well positioned, implementation of the programme will get a boost. Structural and legacy issues could be a glitch at the implementation stage, say experts. However, some believe that if well executed, the programme could be one of the biggest reforms in the infrastructure sector as yet.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Taliban draw closer to Kabul, Washington and allies rush to evacuate diplomats

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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News Updates: Covid-19 – India recorded a single-day rise of 38,667 coronavirus infections, taking the total number of cases to 3,21,56,493, according to data from the Union Health Ministry data released on Saturday. The number of coronavirus-related deaths  rose to 4,30,732 with the addition of 478 fatalities.  India has now reported less than 50,000 daily new cases for 48 consecutive days, the ministry said. The number of active cases has increased to 3,87,673, which is 1.21 per cent of the total infections, and the recovery rate is recorded at 97.45 per cent, according to the data updated at 8 am.

Earnings corner – Glenmark Pharmaceuticals reported a 21 year-on-year increase in profit after tax (PAT) to Rs 306.5 crore for the quarter ended June 30. Its revenue grew 26 percent to Rs  2,964.9 crore, and EBITDA 20 percent to Rs 573.6 crore.

Afghanistan crisis – American troops have flown into Kabul to help evacuate embassy personnel and other civilians in the Afghan capital, a US official said on Saturday, a day after Taliban insurgents seized the country’s second- and third-biggest cities.

The Taliban launched a multi-pronged assault on Mazar-e-Sharif, an Afghan official said. Mazar-e-Sharif is a major city in northern Afghanistan defended by powerful former warlords. Munir Ahmad Farhad, a spokesman for the provincial governor in northern Balkh province, said the Taliban attacked the city from several directions early on Saturday.

Follow this section for latest news updates on August 14, 2021:

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

The potential of digitization in rural India – A case for women entrepreneurship amidst COVID-19

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The COVID-19 pandemic has severely impacted the economy, affecting both male and female-owned enterprises. According to the Sixth Economic Census, only 13.8 percent of Indian establishments are owned by women, a majority of which are micro-enterprises.

Micro-enterprises are self-financed firms that predominantly function in sectors such as handicrafts, tourism, and the beauty industry.

These sectors have been severely affected by the pandemic, thereby devasting and affecting women-led enterprises disproportionately. Male employment has fallen by 30 percent versus its pre-lockdown level, while female employment witnessed a decline by 43 percent.

The condition of women-led enterprises has further deteriorated due to the lack of awareness around government support schemes, benefits, and financial knowledge such as loans, concessions in interest moratorium, etc.

COVID-19 has exacerbated the struggle for women-owned establishments, and they continue to struggle to identify ways to recover losses and sustain themselves.

Deeply rooted socio-cultural norms that are an integral part of the societal fabric, act as barriers in the setting up of enterprises by women entrepreneurs in India.

The pandemic has further threatened the growth and survival of women-led businesses with the disruption of supply chains, closure of markets, and diminishing avenues for revenue generation.

Access to finance, always a challenge for women, has become even more inaccessible in the face of the pandemic, with cash inflow tapering down.

According to the United Nations Industrial Development Organization, in spite of women having to pay higher loan repayment rates, they still face greater difficulties in obtaining credit, often due to discriminatory attitudes of lending bodies. Financial institutions in the country are structurally designed to facilitate the aspirations of men.

In India, where land and finances are mostly in the name of male members of the household, access to credit is a big challenge for women who have no collateral in their names that can be used to avail of institutional loans.

Additionally, women-led micro and small businesses are viewed as high-risk ventures, as they include smaller companies working in lower-margin markets, and hence are more prone to facing instability than micro-businesses led by men.

Women entrepreneurs are thus faced with structural and systemic constraints, in addition to cultural norms and restrictions that greatly reduces their ability to take risks.

According to the Landscape Study on Women Entrepreneurship by EdelGive Foundation, based on a sample size of 1200 women across 13 states, arranging finances turns out to be the single largest challenge faced by most women. It is followed by balancing business and home responsibilities, hinting at limited financial support from their families.

Unpaid work across the globe is gendered in nature, with the burden of such activities being disproportionately borne by women. In India, women spend an average of 351.9 minutes per day on unpaid work, as compared to an average of 51.8 minutes per day by men.

The pandemic further catalyzes these challenges, through increased responsibilities for women at home in the absence of other family members who are venturing out to school or work, thus adding to their workload and hours of unpaid labour.

To overcome these deeply embedded socio-economic and financial challenges that women face, tailor-made schemes and government benefits such as lower interest rates, customised lending and self-help- groups, have made it possible for women entrepreneurs to start and sustain their enterprises.

Furthermore, COVID-19 has also shed light on the importance of digitization of businesses that has been proving to be a cost-effective opportunity for women-led enterprises to work digitally, instead of investing in land and resources.

With the increasing need for businesses to depend on virtual solutions to flourish and sustain economic growth, the need for women-owned enterprises to quickly digitize all processes to safeguard their workplace from disruptions and shocks has also emerged as prudent.

The smartphone is recognised as the most useful tool of digital technology, with rural India witnessing an increase in smartphone penetration rising from 9 percent in 2015, to 25 percent in 2018.

The increase in rural internet users has seen a year-on-year growth of 35 percent in 2018, as opposed to 7 percent growth in urban India during the same period. It alludes to the increased dependence on smartphones being used as a tool to further knowledge sharing, social media, and even leverage businesses where applicable.

The use of digital technology in rural and semi-rural India has seen a rise in the face of COVID-19, with women leveraging digital tools to market, network and sell their products.

Many stakeholders across the ecosystem have in fact made digital upskilling projects available to women, with organisations like Maan Deshi Foundation and SEWA leading the way.

While the response to these upskilling initiatives has been positive with many women availing of them, there have also been instances where women – of their own volition – have engaged on social platforms to upskill themselves.

In fact, during the survey conducted as part of our UdyamStree campaign, we came across 23-year-old Titli, a resident of a small village in West Bengal, who proactively chose to upskill herself using the sole digital tool that she had access to – a smartphone.

When COVID-19 cost both Titli and her husband their livelihoods, she decided that setting up an individual enterprise would be the most prudent way to ensure income generation for her household.

Quickly identifying sanitization as the need of the hour, Titli went on to access YouTube to educate herself on the process of manufacturing hygiene/sanitization solutions.

After availing of the help of her uncle who had prior knowledge of the manufacturing processes for the same, she then sought assistance from a self-help group in the area to raise an initial capital of Rs. 5,000, which was given to her as a loan for setting up the business. Today, Titli successfully runs a black phenyl business that has ensured avenues of income for the entire household.

Many women across semi-rural and rural India have in their efforts to sustain their families, gone on to set up enterprises by availing of help from micro-lending groups and SHGs. They have quickly realised that business models that leverage digital mediums are the way forward, for both the success and survival of their enterprises.

However, the mere identification of the opportunities that digital platforms provide is not enough, support and assistance across the ecosystem are needed for them to succeed.

Assistance to hone the entrepreneurial spirit of women, facilitation of a level playing field, and access to the internet can pave the way for the creation of successful, financially independent, and resilient women entrepreneurs. It is only through the creation of an enabling environment that women entrepreneurs can succeed.

–Vidya Shah is the Executive Chairperson at EdelGive Foundation. Views are personal.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Eduvanz partners with Flipkart to provide easy EMI loans to students to buy electronic learning devices

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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As schools across the country continue to remain shut amid the COVID-19 pandemic and education being imparted to students online, Eduvanz has partnered with Flipkart to bridge the gap of accessibility of learning devices such as laptops, desktops and smart phones for students.

The fintech company is offering EMI loans for students to purchase laptops, tablets and smartphones on Flipkart, while building their credit history.

The partnership is part of Flipkart’s Back to College programme, which aims to fulfil the educational needs of millions of students as they begin virtual classes this year.

As per an NSO report, only one in 10,000 students in India has a computer-whether a desktop, laptop or tablet. However, almost a quarter of houses have internet facilities accessed via a fixed or mobile network using any device, including smart phones.

“Online education offerings for classes 1-12 are projected to increase 6.3 times by 2022 from the base of 2019,” an industry report said, adding that the post K-12 market is expected to grow to touch $1.8 billion.

For Flipkart, nearly 40-45 percent of the demand for electronic essentials come from students.

Eduvanz CEO Varun Chopra said, “The pandemic has led to a tectonic shift in the Indian learning and education system. With the adoption of the phygital model, India is at the cusp of a technology driven learning revolution. On the upside, this device based delivery mode has provided the solution for pandemic induced challenges but the lack of affordable financing options has brought learning to a halt for millions of students across the country. As India’s leading lender for learners, we are committed to making learning and education accessible to all. Through our partnership with Flipkart, we aim to cater to the digital learning needs of Indians across all categories.”

The Indian online education sector is poised to grow to $8.6 billion by 2026 and the need for e-learning tools and gadgets is bound to increase exponentially as Indian learners will embrace the new mode of education.

Rakesh Krishnan, Senior Director of Electronics at Flipkart said, “We have been at the forefront of meeting the evolving needs of millions of our customers across the country and have established a platform offering the widest selection of products, doorstep delivery and affordable payment options. As the learning scenario in the country undergoes an overhaul, we are working with our partners to bring a variety of solutions for the students to enhance their learning potential in an affordable manner. In this pursuit, we are excited to partner Eduvanz to offer easy financing solutions to them in order to fulfil their online learning needs.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Zomato IPO: Delivering the India consumer story on your plate!

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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“Why order food online when you can eat home-cooked food?”

From early customers to now IPO investors – everybody has put this question to Deepinder Goyal. In response, the Zomato founder once said, “Food is entertainment.”

The killer of everyday boredom, the breaker of the dal-chawal cycle, the harbinger of appetizing treats, the purveyor of convenience…

From a startup that sought to solve a ‘hungry’ problem to becoming the first Indian unicorn to hit the public markets – Zomato’s rise is the coming-of-age of not just the New India, but also its young startups.

“Going public is sort of growing up,” said Deepinder Goyal in a chat with CNBC-TV18’s Managing Editor Shereen Bhan at the HT Summit in 2019.

The IPO-bound train of startups is taking on more passengers as it rushes forth with payments providers Paytm and MobiKwik, insurance platform PolicyBazaar, beauty & fashion retailer Nykaa and e-commerce giant Flipkart with many more waiting on the platform with a ticket in hand.

After undertaking a big shake-out of how traditional India consumed food, Zomato is now crucially riding to build an appetite among Indian investors, who are scratching their heads skeptically over how to swallow up and invest in businesses like Zomato, which are loss-making, but full of potential.

The Investor Pitch

“We are all set to grow to a much larger scale. We have already proven our success. Trying to expand into more cities in India will obviously take more capital. The new revenue models we are thinking of will require huge capital expenditure. So, these are the things for which we need funding,” said Deepinder Goyal in his first pitch to venture capital investors on CNBC-TV18’s Young Turks way back in 2011. A decade later, he is making the same pitch to public market investors.

In a country with over a billion people, who are taking to the internet faster than a click, online food delivery aggregators are only scratching the surface. The runway is long with just about 70-100 million people, who think of ordering food online on a monthly basis. In FY21, Zomato had about 32 million monthly active users.

Over FY18-21, Zomato’s revenue grew at a CAGR of 62 percent. But, some investors would prefer to look at the bottom line, which is in the red. In FY21, losses stood over Rs 800 crore.

However, not only Zomato’s, but no food delivery company’s bottomline is in the green globally. Still, over the last six months, global stock markets have welcomed Deliveroo in the U.K. and DoorDash in the U.S. along with one of South-East Asia’s largest unicorns – Grab. So, Zomato’s rise or fall will be closely tracked. Not only domestically, but globally too.

In recent years, the primary concern has been cash burn pumped by the ‘privilege’ of getting large cheques from private investors. Now, Zomato’s public market investors will surely throw the dreaded question in the upcoming quarterly reviews: when will the cash burn end and profits turn up on the P&L statement?

In response, Zomato has indicated that it wants to scale up first before turning its attention to profits. In regulatory filings, the company said, “We expect our costs to increase over time and our losses will continue given significant investments expected toward growing our business.”

Despite showing up at the stock markets with a loss-making prospect, Zomato is expected to become the largest IPO of the year in India with a post-money valuation of $8.9 billion. That’s a surge of 49 percent since it closed its previous funding round at a valuation of $5.4 billion. Through the IPO, Zomato targets a fundraise of $1.3 billion or Rs 9,375 crore.

Consider this: While making his first appearance on CNBC-TV18’s Young Turks in 2011 as the founder of Zomato’s former self Foodiebay, Deepinder Goyal pitched his restaurant-listing idea to investors and asked for just $1 million in funding!

The Kitchen Sink: The Years Of Growing Up

In the early 2000s, the lightning bolt of entrepreneurship struck Deepinder Goyal when he was a student at Indian Institute Of Technology, Delhi. “We were a group of friends and all of us always wanted to have a startup,” he said.

So, Deepinder started a web development company to build online sites for small restaurants in Delhi. It failed. But, he walked away with an insight: Why create separate websites for these restaurants when all of them should be on one website?

In 2008, Deepinder Goyal opened restaurant-listing site Foodiebay with his Bain & Co colleague Pankaj Chaddha with an initial investment of Rs 25 lakh.

The duo doubled up as food connoisseurs while visiting restaurants before starting to list menus, write reviews and provide ratings for people who needed a ‘heads up before heading out’. By 2011, Foodiebay needed $1 million to sustain itself over the next 18-24 months. The seed fund came from Sanjeev Bikhchandani’s Info Edge.

After rebranding Foodiebay as Zomato, the business started overseas operations – from UAE and Sri Lanka to Lebanon. The ambition grew as global investors – Sequoia Capital and Temasek – arrived with big cheques. Soon, food delivery became the core engine of Zomato with restaurant listings, reviews and ratings now playing an auxiliary role.

In 2018, Zomato shifted gears becoming a unicorn following multiple rounds of investment by the Chinese-owned Alibaba affiliate Ant group, which skyrocketed valuation to $2 billion. That year, co-founder Pankaj Chaddah left. Zomato’s monthly revenue rate hit $100 million and monthly orders crossed 20 million.

Most importantly, the battle was on. In 2018, rival Swiggy raised $1 billion – the single largest fundraise by any foodtech startup in India at the time. The online food delivery segment was inching close to becoming a duopoly.

As competition went up, Deepinder Goyal knew what was coming. “All it takes to fight in that space is money,” he said.

Duopoly, Discounts & Daggers

In fact, Swiggy is older than Zomato when it comes to food delivery. Started in 2014, the Bengaluru-based Swiggy pushed rapidly in South India while Zomato busied itself with global expansion of its restaurant listing business via acquisitions.

Once Gurgaon-based Zomato entered the food delivery market roughly two years after Swiggy, the competition started playing out in different halves of India. Zomato ruled the North while Swiggy dominated the South. Eventually, many smaller players could hardly face the financial firepower of the two biggies in the space.

“Over the last couple of years, it has been a two-horse race for three times. Then, somebody else has come in, somebody else is gone,” said Deepinder Goyal in an interview with CNBC-TV18 in 2019.

As it is today, Swiggy was battling Zomato toe-to-toe in all parameters – average order value, monthly deliveries, reach in terms of cities and more.

The battle escalated between the two rivals when UberEats went up for sale. Given UberEats’ strong presence in the South, it made sense for Swiggy to show interest. But, withdrew after hearing the ‘astronomical’ quotation from the other side of the table.

Itching to go truly pan-India, Zomato swooped in to acquire UberEats to rattle Swiggy in its backyard. In exchange, UberEats secured a plump 10 percent stake in Zomato.

In this kind of aggressive market, where not an inch was given up, both Zomato and Swiggy began to run out of funds as fast as they raised them.

“When somebody else, who is trying to compete with you, has a lot of money, for a short time, you have to react with money itself,” said Deepinder Goyal.

He assured that Zomato was ‘not slugging it out with Swiggy in a stupid way’, but finding ways to keep up the ambition and yet reduce the cash burn led to disgruntled stakeholders.

In 2019, Zomato’s delivery riders went on a strike in more than one city. They protested the food delivery aggregator’s decision to withdraw some of the incentives, which led to lower earnings per delivery. This followed a layoff of nearly 10 percent of customer, delivery and merchant support teams at Zomato’s headquarters in Gurgaon.

Meanwhile, the restaurants went up in arms as deep discounts offered by Zomato and Swiggy kept customers from visiting the diners. Zomato was accused of favouritism, monopolistic trade practices, greed and exploitation. It was just the start. This clamour would only rise to a crescendo in times to come.

The Pandemic Period Of Pain And Gain

More than 75 percent of Zomato’s revenue comes from the food delivery vertical. The pandemic closed the tap. Restaurants were shut as total lockdown was enforced to stop the spread of COVID-19. Wide-spread fear of catching the virus kept consumers from ordering food online as well.

Last year, Zomato’s monthly transacting users fell by half from 10.7 million to 5.8 million. There was another blow. Monthly active users reduced from 41.5 million to 32.1 million.

Meanwhile, Zomato got busy with COVID-19 initiatives. Under its non-profit organisation Feeding India, it sought to provide food to the poor, especially the daily-wage workers. Later, it also sought to crowdsource funds to secure oxygen cylinders.

On the sidelines, as online grocery marketplaces were a hit during the pandemic, Zomato started its own pet project so that it could put its latent delivery fleet to some use and open another source of income. But, Zomato Market failed. On the grocery delivery front, Swiggy surged ahead taking on players such BigBasket and Dunzo. Today, Zomato has invested $100 million for a 10 percent stake in Grofers with the hope of becoming a challenger in the sector after listing.

Also, days before Zomato’s IPO fanfare, news emerged that SoftBank is investing $450 million in Swiggy as it offers a better ‘superapp play’ with a grocery delivery business that is better than Zomato’s.

Back to food delivery, Zomato’s orders picked up once people grew bored of eating home-cooked food all the time and cases began to taper off as restrictions eased as well.

Last year, the average order value on Zomato touched Rs 400 as family orders went up as against the earlier single-orders from young professionals in offices. (To be kept in mind: AOV is expected to fall once offices open up.)

Zomato and its peers were in the driver’s seat as they no longer had to offer steep discounts to acquire customers.

Zomato’s presence is spread across 525 cities in India. In a blog post, DeepinderGoyal pointed out that Zomato was onboarding customers from small-town India, including those who had never ordered food before, let alone place the order online. The advertising and sales expenses were slashed by half.

Solely reliant on food delivery services, both restaurants and customers had to pay a higher charge. Higher commission and delivery income along with withdrawal of discounts led to a much better looking unit economics. In FY21, Zomato posted a profit of Rs 20 per order as against a loss of Rs 30 in the previous year.

In addition, the company also asked employees to volunteer for pay cuts which led to a reduction of 16 percent in payroll costs. Layoffs followed as well.

“While the event impacted the size of the business, it has accelerated the journey to profitability,” said Deepinder Goyal.

Revenue fell by 24 percent to Rs 1,994 crore in FY21 (YoY). However, the losses narrowed from Rs 2,345 crore in FY20 to Rs 816 crore in FY21. But, the problems don’t end here.

The Rift With Restaurateurs Splits Open

At present, Zomato has about 3.5 lakh active restaurants listed on its platform. For two years, their representative body the National Restaurants Association Of India (NRAI) has been escalating the fight against food delivery aggregators.

In 2019, one by one, the restaurants and their local associations joined the #logout campaign against ‘Zomato Gold’ once it was extended to online orders, which took away the ability of diners to attract footfalls and upsell. People would sit at home and avail the 1+1 offers.

Zomato responded by sending legal notices to restaurants, which didn’t go down well, and ultimately, the Zomato Gold program had to be tweaked.

Now, ahead of Zomato’s IPO, the association has filed information with the anti-monopoly watchdog Competition Commission of India (CCI) on ‘unfair and restrictive trade practices’ by food aggregators such as Zomato and Swiggy.

The alleged practices highlighted by NRAI include bundling of services, data masking, price parity agreements, exclusivity of listed restaurants, violation of platform neutrality, vertical integration and lack of transparency on the platform.

NRAI says restaurant partners are being asked to share the burden and give discounts to maintain appropriate listings.

“The issues raised by the National Restaurant Association of India (NRAI) are misplaced”, said Gaurav Gupta, Co-founder, Zomato.

Another allegation is the ‘exorbitant commission charged’. As per NRAI’s filings with CCI, Zomato charges about 25-30% of the food order as commission, which went up during the pandemic as restaurants were largely reliant on food delivery platforms to stay afloat. A massive dent on a restaurant’s margins per food order.

Now, NRAI is calling for a ‘Order Direct’ campaign with the intention of bypassing Zomato and Swiggy. At one point, the association also planned to start its own food delivery platform.

“Order Direct has always been there since customers could always directly call restaurants. We drive 20-30 percent more business for restaurants than what they can do through order direct,” said Gupta.

That’s not all. Zomato’s IPO prospectus revealed that it is facing multiple litigations.

Competition regulator is probing the Zomato-UberEats deal. CCI has also threatened penalty for not making some merger filings for UberEats acquisition.

Zomato is also involved in 24 consumer related proceedings that are currently pending. Maharashtra FDA has issued 26 notices, alleging some listed restaurants lacked requisite licenses.

Although Zomato was among the first to introduce paternity leave and period leave for its employees, it is involved in 18 labour related proceedings around wrongful termination, incorrect payouts to delivery partners and reduction of pay, as per the prospectus. Delivery riders protested during the pandemic, asking for personal protective equipment and pay. At the end of FY21, Zomato had about 170,000 active delivery partners.

‘Out For Delivery’

As Zomato hits the markets, the risks are clear, but so is the vision. Currently, Zomato stands on a three-legged stool – food delivery, dining out and sustainability.

Farm-to-fork business Hyperpure is Zomato’s next big play. Launched in 2019, the business-to-business venture seeks to source chemical-free and planet-friendly supplies – vegetable to groceries – for restaurant partners.

“Restaurant partners ordering supplies through Hyperpure get a ‘Hyperpure Inside’ tag on their Zomato page, which is intended to provide customers with an assurance of the quality of ingredients used at the restaurant,” says Zomato. As of March 2021, Hyperpure sent ‘clean supplies’ to 9,225 restaurant partners across six cities in India.

Now, Hyperpure is being built into Zomato’s 10-year vision. “I want Zomato to enable clean food for everyone,” said Deepinder Goyal.

That’s the plan. For now, Zomato is ‘out for delivery’ in the stock markets. Only time will tell if Zomato can serve a good dish to public investors.

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FASTag for cars, UPI for 2-wheelers at Delhi Metro’s first cashless parking; check details here

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Delhi Metro Rail Corporation (DMRC) on July 6 introduced India’s first FASTag or Unified Payments Interface (UPI)-based parking facility at Kashmere Gate Metro station. It will help vehicle owners save time they would have otherwise spent in entry and exit and payment queues.

Launched as a pilot project at Kashmere Gate, the DMRC is planning to set up a similar system at other parking facilities across Delhi and the National Capital Region (NCR).

This exclusively cashless parking facility, which can accommodate 55 four-wheelers and 174 two-wheelers, has been opened near Gate No. 6 of Kashmere Gate Metro station.

The four-wheelers can now enter and exit the Kashmere Gate parking lot and pay the fee through FASTag, an electronic toll collection system. It also means that only vehicles with a FASTag will be allowed to park in this facility.

“The parking fee will be deducted through FASTag, thus reducing the time for entry-exit and payment,” said the DMRC in a statement.

Two-wheelers can enter and exit by swiping the DMRC smart card, which will be used for registering the respective timings and calculating the fare. No money will be deducted from the card.

“The parking fee can be paid by UPI apps through scanning a QR Code. In the future, the payment can be made through DMRC/NCMC cards,” the statement read.

The Intermediate Public Transport (IPT) lanes for auto-rickshaws, taxi and e-rickshaws were also inaugurated at the Kashmere Gate metro station as part of the Multi-Model Integration (MMI) initiative. “The lanes will ensure smooth movement of vehicles and enhance the last-mile connectivity,” the DMRC statement read.

Under the MMI, the Delhi Transport Infrastructure Development Corporation Limited is also establishing a food court at the metro station, while the DMRC is constructing a three-lane bus terminal with a capacity of five buses in each lane.

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Land prices near national highways to rise 60-80% in near term: JLL report

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Property prices near India’s national highways are expected to increase by 60-80 percent in the short term. Further, the price of real estate around micro markets will increase by 20-25 percent after the facilities become operational, according to a report published by JLL.

The government’s focus on providing world-class infrastructure in its highway networks is going to lead to a short-term squeeze of prices by anywhere between 60 and 80 percent. The short-term rise in prices will be on the back of increased connectivity and improvements in infrastructure. The report by JLL also predicts that the price of land around micro markets will further increase by nearly a quarter after wayside amenities open up.

The National Highway Authority of India (NHAI) is all set to take advantage of these market dynamics and has already identified several locations to be developed. The NHAI has selected 650 properties in 22 states across India, with a consolidated area of over 3,000 hectares that will be developed with private sector participation in the next five years. Of these, 94 sites are located on the Delhi Mumbai Expressway, nearly 180 sites are along existing highways and 376 sites will be located on new or under-construction highways.

JLL’s Head, Strategic Consulting and Valuation Advisory, A. Shankar said, “We envisage that NHAI will give an impetus to modernisation of the Indian highway network in the coming years, ultimately culminating in various advantageous effects for highways users, market players, developers, investors, and facility operators. Further, we estimate a land price appreciation in said sites’ micro markets by 60-80 percent in the short term and 20-25 percent as the facilities become operational.”

A total of Rs 4,800 crore will be invested by private investors in the projects over the next five years, with capex investment ranging between Rs 1 crore and 10 crore per site or an average of Rs 2 crore per hectare of site area.

“Out of the 650 identified sites, bids are already invited for 138 sites and had received enthusiastic participation from market players. The majority of the said 138 site tenders are still active to receive bids as of 30 June 2021,” Shankar added.

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It’s criminal to click selfies in Gujarat’s Dang district; find out why

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In southern Gujarat’s Dang district, it is a criminal offence to click a selfie. Officials said the move was made to curb accidents that are often associated with attempts to take selfies. The district’s Additional Collector T.D. Damor said this kind of stricture has been in place here for the last two or three years and now stands extended through a fresh notification issued earlier in June.

“People, especially youngsters, in their attempt to click a good selfie, can go to any extent and harm themselves. Many cases of people falling into a gorge or being swept away in water current were recorded in the past. In some cases, people also died while many got injured,” Damor told PTI.

“The aim behind the decision is to stop accidents which claimed lives of some people in the past and also injured many,” Damor added.

Dang is popular among tourists with its hills and waterfalls. One of its hill stations, Saputara, saw the death of a man who had fallen into a gorge while trying to taking a selfie in 2018. A few months later, another person fell into the nearby Gira waterfalls, with the finger of suspicion once again pointing to an attempted selfie.

India recorded the highest number of deaths due to selfies between 2011 and 2017, according to a study by the US National Library of Medicine.

From October 2011 to November 2017, there have been 259 deaths while clicking selfies. The mean age was 22.94 years. About 72.5 percent of the total deaths occurred in males and 27.5 per cent in females,” the study had found.

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The next frontiers for India’s next half billion

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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India’s Next Half Billion (NHB) is represented by people like factory workers, security guards, domestic help, and gig economy workers. These Indians either have or will come online for the first time via their mobile phones between 2017 and 2022. They represent the lower 60 percent of India’s income distribution and have traditionally been underserved, excluded and disempowered. Not surprisingly, their experience of using and engaging with technology is fundamentally different to that of most readers of this piece.

The NHB is critical to India’s growth story. Helping them flourish requires taking a holistic view of what constitutes a “meaningful life” for them. There are four elements to this: 1) access to aspirational products and services; 2) opportunities for employment and productivity; 3) protection of individual agency; and 4) strong and responsive institutions. In order to help create a meaningful life for the NHB, we must think both differently and comprehensively.

At our organisation, putting the NHB at the centre of our work has helped us remain clear about our purpose and led us to support many bold entrepreneurs across for-profits, non-profits and government. We are fortunate to have flexible funding that allows us to adopt a dual chequebook approach—we make both equity investments in early-stage enterprises and provide grants to non-profits, with a focus on tech-led solutions. Earlier this year, we articulated both our investment and grantmaking theses.

Bringing equity and grants together to help create a meaningful life

The internet and mobile phone have the power to unlock greater incomes, choices and opportunities for the NHB, similar to what India’s economic liberalisation did for the urban middle-class. Tech-led business models can provide the NHB access to a range of affordable services and products that can improve their lives.

The digital journey of the NHB progresses through various stages, from basic use cases of the internet (e.g. personal communication), and gradually towards conducting online transactions regularly to access various services. However, there are several barriers along this digital journey. These include lack of local language content, low internet access among women, low confidence in online payments and lack of customised products. The good news is that significant progress has been made in overcoming the barriers to the NHB’s digital journey in recent years.

Affordable mobile data and smartphones, public digital infrastructure and entrepreneurial innovations have increased the quantum and range of uses of the internet. COVID-19 has, of course, been a gamechanger in accelerating digital adoption.

Over the last decade, many bold and innovative entrepreneurs have proved that it is possible to build successful tech-led businesses focused on the NHB. Design features such as a “mobile-first” approach, use of vernacular languages and relatable UI/UX have contributed in no small measure to increasing the NHB’s comfort with accessing various services online and thus speeding up their digital journey. And the emergence of a thriving early-stage equity investment ecosystem in India has given wings to these bold entrepreneurs.

On the other hand, not all problems can be solved by businesses alone. The challenges faced by the NHB are deep-rooted, pervasive and interconnected. Driving social impact at scale requires building a supportive ecosystem across all the four elements of a meaningful life. This is where grant capital can be uniquely catalytic. Grants can be useful not just in supporting grassroots efforts in communities and government programme implementation, but going beyond these to support a range of efforts—a better understanding of issues (e.g. through data and research), developing sector-level institutions and infrastructure, informing policy reform and laying the ground for potential market-based solutions.

At our organisation, this understanding of the combined power and relative advantages of equity and grants has helped our investees and grantees touch millions of lives from the NHB. We have learned many lessons along the way but recognise that there is still much more to be done.

The next frontiers

The NHB has come a long way in the last decade and today stands at another inflexion point. The pandemic has sparked off fundamental transformations in our economy and society. On the positive side, digital adoption has increased. However, the pandemic has triggered many challenges—economic shocks and decline in incomes for many, increasing inequalities, and several social and environmental crises. Over the next few years, the lives of the NHB will play out in the context of these shifts. This will create new opportunities for entrepreneurs, organisations and investors, who must anticipate the “next frontiers” in serving the NHB.

From the perspective of equity investments, the accelerating digital journey of the NHB in the aftermath of COVID-19 will create opportunities in many existing and emerging areas. Entrepreneurs will have to continue pushing the bar on addressing barriers in the NHB’s digital journey, such as addressing language barriers, contextualising models for them and increasing women’s participation. “Utilitarian” segments like ed-tech, agri-tech and health-tech will likely see a further deepening. We have also started seeing many new solutions focused on empowering Small & Medium Enterprises (SMEs) by giving them the tools to compete in the digital economy. Several other areas like mobility (e.g. intra-city solutions and electric vehicles), civic-tech, property tech and legal tech are also promising.

At the same time, various ecosystem-building efforts will be critical, creating opportunities for non-profit entrepreneurs supported by grant capital. These include initiatives that seek to provide greater agency to the NHB, build strong and responsive institutions to support them, and enable them to better interact with our contemporary economy. For example, there is much work to be done in the area of “Responsible Tech” (i.e. responsible data privacy, data sharing and security practices) in the form of generating evidence, sparking conversations, building collaborations, influencing policy and institutionalising sector-level best practices.

Going forward, we expect to see grant capital play a greater role in increasing government capacity to deliver services (e.g. municipal services), enforce rights (e.g. property rights) and dispense justice more efficiently. Another high-impact area where non-profits can play a role is in supporting Open Digital Ecosystems (ODEs) i.e. shared, open-source, interoperable tech infrastructure that can be leveraged by governments and private entities to unlock a range of innovative services. ODEs can unlock more than $700 billion (or over Rs. 50 lakh crore) for India across sectors like agriculture, urban governance and education, to name just a few. Finally, initiatives focused on developing the capacity of the non-profit sector will also be important.

An inclusive growth agenda for India

India’s well-being is inextricably linked with that of the NHB. Social change is a long and complex process; success is hard to predict and measure. Building a supportive ecosystem for the NHB, which provides them agency, safeguards them from harm, and fosters strong and responsive institutions to further their interests, is essential to a holistic approach in helping them flourish. At the same time, tech-led innovations can provide them a range of essential and aspirational services. While such innovations might initially serve customers higher up in the income pyramid, over time, they find acceptance amongst the NHB.

Addressing the next frontiers for the NHB will require many bold and mission-driven entrepreneurs to rise to the challenge. India’s entrepreneurs are increasingly coming from its smaller towns and cities; they are drawing from their own lived experiences to solve problems they themselves have faced. In the coming years, we hope to see many more of them, especially from among the NHB themselves, emerge and find the support they need to thrive. Their efforts can go a long way in helping create a meaningful life for every Indian.

—Roopa Kudva, Rohan Vyavaharkar and Kartik Sahni are, respectively, Managing Director, Director–Marketing & Communications and Chief of Staff at Omidyar Network India. The views expressed in the article are the author’s own

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow