Telecom, BPO, financial services, retail and realty have come into their own.
Before liberalisation, the rules for business were very different. The government decided how big the market for any particular commodity was and accordingly handed out licences. Some sectors, like telecom and financial services, deemed important for national security and inclusive growth, were kept in the public sector. But things began to change in the 1990s, which saw the emergence of new sectors like telecom, financial services, BPO, retail and realty.
It was an American who realised the worth of Indians in the business of BPOs. Jack Welch of GE, on a visit to India, realised that the country offered people with good linguistic skills who, with the right training and information technology backbone, could be made to answer the calls that the company’s customers made from all over the world — and at a fraction of the cost. GE was among the first to locate its call centre at Gurgaon, on the outskirts in Delhi. Other leading global companies followed suit. Today, millions across the country draw their livelihood from this sector.
Telecom also took root in the mid-1990s when the doors were thrown open to private players. First off the block was mobile telephony. The government in the initial years stayed away from it. But after some policy intervention that attracted more investment and competition, India became the fastest-growing market anywhere in the world and second in size after China. Bharti rose from an operator in one telecom circle (the country is divided into 22 circles) to first a national operator and then an international player with operations in Sri Lanka and Africa.
The spurt in consumerism also brought in a boom in financial services. Indians began to show an amazing appetite for all kinds of purchases — electronics, automobiles, houses. This, coupled with the fact that Indians accord the highest shame to not being able to repay loans, made India an exciting market for the biggest names in the business. Some went overboard and had to pay the consequences in the financial meltdown of 2008. When it seemed that private financiers would move out, public sector banks that had become nimble-footed over the years stepped in.
The widening options in consumer finance led to the rise in the realty sector. In the pre-liberalisation days people saved all their lives to buy a house at the time of retirement. Consumer finance ensured that young people could buy a house first and then repay the loan over the years. Real estate developers were quick to seize the initiative. India became one of the most exorbitant real estate markets in the world. Realtors like KP Singh of DLF began to rank among the richest people not just in India but across the world. Since then, the market has gone through several corrections. But it remains the ultimate draw for the average Indian.
Retail was the last to take off. There are around 14 million small shopkeepers in the country. Since this has always been a vote bank, no government was ready to upset the applecart. Hence, the sector was kept closed to foreign investment, except for cash and carry and single brand retail. Of late, the realisation has struck one and all that supply chains will become far more efficient if the sector is thrown open to foreigners. Meanwhile, the last few years have seen the emergence of Indian retailers like Kishore Biyani. Large groups like Tata, Reliance and Aditya Birla too have joined the bandwagon. The consumers have been the beneficiaries. n
