Thursday, July 26, 2012


The grey market can be converted into a full-fledged industry!

The enduring legacy of Gaffar Market in Delhi’s Karol Bagh area is well-known to not only residents of Delhi but even to the people outside Delhi. It’s a grey market per se that stands for mobile phones, cameras, television sets, accessories and garments at a much cheaper rate than that available at the authorised shops. One should drop the notion that the products in Gaffar market are backdated; in fact, when iPhone was launched, it reached the market months before it was available at Apple’s stores! Nikon, Microsoft, Olympus, Tag Heuer – you name it – it’s all dumped in the grey markets of India at much less cost and there by attracting shopping bonanza. The electronics companies are clueless on how to beat the grey market, as it is continuously eating away their market share pushing down their sales through authorised dealers. Apart from slashing prices and rolling out value added services, the producers also trying to rope in shops in other grey markets like in Delhi’s Palika Bazaar, Mumbai’s Heera Panna or Kolkata’s Fancy Market.

The products sold at grey markets are often illegally imported from places like China, Japan, Singapore, Hong Kong and Nepal; with huge margins which are so high that even after visiting those places and bringing in the products, the retailers are still left with decent profits! The premium watches, gaming consoles and digital cameras are the main product categories that flood the grey markets. The market share for premium watches through grey markets are almost 50 per cent of total market size of Rs.1,000 crores, in console gaming it is 30 per cent of the full size Rs.400 crore market, and 25 per cent of Rs.2,000 crore digital camera market. The excessively high tax and import duties have a cascading effect on the prices creating differentials between authorised and grey markets. For instance, Sony’s console gaming costs Rs.19000 plus at legal retailers while it is sold at around Rs.16,000 in grey market outlets. For digital cameras, a mammoth 40 per cent import duties, 5.5 per cent Octroi (applicable in Mumbai) and 4 per cent sales tax; only boost the retail crisis and is a shot in the arms for grey markets. According to KPMG estimates, the grey markets in India accounts for 20 per cent of Color Televisions, 30 per cent of GSM mobiles, 90 per cent of VCD and DVD players and 70 per cent of car stereos. In premium watch industry, grey market accounts for a bigger market share than the organised market, selling 13 to 15 million units a year compared to 12 million units by organised players. While organised industry is facing stagnation over last few years in watch industry, the grey market though progressed with 5-10 per cent annual increase.

The grey market is no longer stuck with shady or used products sold at half the price especially meant for cost sensitive consumers. The quality of the products is no longer subject to deep suspicion that it will be a piece of junk in a few days’ time. These are indications that grey market is moving closer to organised markets, albeit at lower cost of the products. With no signs of cooling, grey market can further accelerate its growth by arranging electronic fares like the Singapore or Hong Kong electronic fares. Th is will pick up the grey market emergence velocity and establish it into genuine electronic and consumer durables hubs and polite knock on the door of the organised players to get ready! And above all, make it an tourist hub too in the lines of Sim Lim square of Singapore.


Thursday, July 19, 2012


Clinical trials are still rampant

The Supreme Court of India most recently rapped the Union Government and the Madhya Pradesh Government over the knuckles for failing to save lives corroborated by clinical trials of drugs carried on rampantly and sometimes illegally. The data revealed by Directorate General of Health Services (DGHS) under RTI shows some shocking statistics. According to the DGHS, 1,600 people have died over the span of only two years between 2008 and 2010 by the clinical trials conducted by the multinational companies.

Between January and June 2010, as many as 117 clinical trials by global companies and 134 Indian companies took place in India. In 2009, the figure stood at 258 and 195 while in 2007, it was 246 and 275. The stark figure of 2,031 deaths between 2008 and 2011 have raised our government’s heckle, compelling it to install review committee to oversee the permission granting mechanism for the clinical trials. Sanjay Parikh, an advocate, who appeared in the court for petitioner NGO, Swasthya Adhikar Manch, accused the MP government for easing off the accused, which carried out the trials mostly on women, children and mentally retarded, with a paltry Rs.500 fine! The government is under pressure as eye brows are being raised from all quarters, which will validate the total ineffectiveness of their regulatory mechanism as spree of deaths continue to rise! The stark figure was pegged at 132 in 2007, 288 in 2008, 637 in 2009 and finally rising to 668 in 2010. What is even more disconcerting is the pharmaceutical companies’ apathy to generously compensate the deceased families and bring about a prudent end to the unfortunate occurring! Out of the 668 death cases in 2010, with all government’s urging, the pharma firms could only compensate 22 families in all! In the $400 million sector, the pharmaceutical firms manage to provide compensation that averages around Rs.1.5-2 lakhs per family with a total cost of Rs.53.30 lakhs.

India is fast developing as one of the hottest destinations for clinical trials, even for medicines that has got demand anywhere in the world. It is devious to test drugs for diseases like cancer (it is understandable to test India-specific drugs like anti-malaria or anti-diarrhea) as it is as common in the West as it is here. But it is going on regardless because conducting clinical trials in India will be 80 per cent cheaper than in the West. Equally appalling is the fact that these companies themselves appoint the investigator and the Drugs and Cosmetics Act allows them to have the final say! Th at means there is no counterbalance to the obvious underreporting by the company appointed investigators in case of deaths and health hazards.

To conduct clinical drug tests, it is mandatory to obtain approval from the Drug Controller, which many believe, is fraught with negligence and corruption. In Indore, an 800 page protocol for clinical tests was placed before DCGI seeking approval, which was granted in just 4 days! The question remains how an 800 pages protocol can be examined in such a short period?

The only solution here is to have complete transparency and a nation-wide awareness campaign. I can bet that 80 per cent of us have no clue on whether we are being used as Guinea Pigs during hospitalisation or not! A central portal is needed to make sure that all complaints and grievances are addressed!


Thursday, July 12, 2012


Hoarding of NCERT books needs urgent attention

This year too, National Council of Educational Research And Training (NCERT) is short of book supply. So, what follows is a chocked supply from the distributors and a recurrent blame-game between book shop owners and students (and their parents). It’s a same old battle for the parents who hop from one shop to another in their desperation to get the required books for their children. The situation leading to — some parents are buying books from the black market. NCERT has been adamant that enough books have been published (as per order) and all publications are available in their office, over the counter. The parents are swarming the NCERT counters, but still are coming back with empty hands.

For instance, the history and civics books for class IX, which till April 15, 2012 were not available even though the session had commenced on April 1, 2012. Thus, the book mafias consequently thrive on the same by selling books at Rs.50 in Noida, which should actually cost Rs. 30. The Delhi government has taken the copyright for classes I to VIII for the state-run schools from NCERT, yet the schools are plagued with acute shortages. Most of the books, especially those meant for higher classes are hoarded by the distributors and are sold at higher prices! In Jharkhand, around 60 lakh students (belonging to I to VIII) in 40,000 state-run schools are facing severe problem of books. Their books are supposed to be free under the patronage of Centre’s Sarva Shiksha Abhiyan — but availability is choked at some point of the supply chain. For government schools, books have to pass through 5 points before it reaches the students finally and for the private schools it has to make its way out through four points, post printing. What is even more shocking is the state’s Human Resource Department (HRD) which has delayed placing the tender to appoint a printer for the books! This may lead to the non-availability of books by up to 6 months. Paradoxically, money worth of Rs.45 crores is ready, but there is no printer at the disposal.

Similar patterns emerged from Patna as well! Central Board of Secondary Education (CBSE) students have to move from one shop to another because of the non-availability of NCERT books. Thus, the photocopies of the text books are being sold at exorbitant prices. The problem of books scarcity is further compounded by the increased prices from this year. The textbooks for classes I to VIII are seeing a price rise by upto 50 per cent, and for classes IX to XII, it’s going to rise by 15-20 per cent for 2012-13. The total demand for NCERT books for the current academic year is approximately 3.5 crores. It’s a lose-lose situation for the students and their parents - shortage compounded by price hike. As such the parents have been shelling out more from the black market; now with increased price the books will be even more expensive from the hoarders.

It’s imperative for the HRD ministry to shorten the supply chain and maintain an online database of books procurement and sales. Moreover, NCERT needs to come up with their own shops for books sale and also keep the track of books across the supply chain. All in all, the supply chain needs to be shortened, made transparent and above all be tracked. Or else, the students would start their education with a visit to the black market and lesson of illegal hoarding as their first lesson of life.


Thursday, July 5, 2012


Custodial deaths are due to bad working environment

On the hindsight, it is believed that it is the arrogance and bullying of our police force that lead to most of the custodial deaths. Surprisingly, between 2001 and 2010, more than four people died per day under police and judicial custody in India. The National Human Rights Commission (NHRC) revealed that police had dragged out as many as 1,504 people across the country during the same period that caused their deaths inside the police stations. Torture being the lead cause of custodial deaths looms very large, according to Asian Center for Human Rights by its report – Torture in India, 2011. So much so, the incumbent government paid no heed to the Prevention of Torture Bill, headed by the Minister of State for Planning – Ashwini Kumar, that aimed at reducing custodial deaths. In fact, it is actually the performance-stifling parameters that lead to such civil violations by the police forces, who are thoroughly frustrated by the system (or the lack of it).

The working environment of our police forces is piled upon as a gigantic failure. Numerous police stations are decaying and face dearth of basic infrastructure that is required for investigation or maintenance of required records. A police station in Uttar Pradesh found an innovative way of dealing with substantial power outages – with no solutions, it has set up the desk outside the building in the open field! It’s a common problem in all police stations especially in the hinterlands. In another bizarre incident, this time in Himachal Pradesh, police personnel literally struggled for hours trying to unclasp a pair of rusted, tattered and a decade-old handcuff from a prisoner. Not to miss, there are about 7 police vehicles per 100 police staffs, which makes it compelling for the police in urban centres to use their own motorbikes with only marginal fuel cost reimbursed. Further, policeman’s duty encompasses 24x7 throughout the year – even though they are entitled for leaves – they are often called back in the middle of their vacation on account of perpetual staff shortages. In any case, most of the police officers work 12 – 16 hours a day. Low ranking police personnel generally live in the police barracks as the housing allowance they receive is never enough for private dwellings. Similar uncountable reasons form the deadly concoction of their frustration.

The Supreme Court in 2006 gave a landmark judgment aiming at a major police reforms. Some important directives include the state police must be purged of political influence by setting up a State Security Commission, a new Police Establishment Board will look after all transfers, promotions and posting for below the rank of Deputy Superintendent of Police personnel and many more. Many states didn't comply with many of the directives. Moreover, these directives didn't address the plight of low ranking personnel’s living conditions, who are the main perpetrators of a culture that ignores the abuses that happens inside the police stations often culminating in custodial deaths.

There is no denial to the fact that custodial deaths are beastly and inhuman. Police officers' inhuman working environment clubbed with performance pressure clubbed with overall system failure is the real and the root cause of custodial deaths. Merely draft ing Prevention of Torture Bill would only be half-baked solution rather what we need is holistic police reforms, starting from making the lives of the lower rankers worth living.