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MNCs find Yoga Guru Ramdev’s ‘multinationals dangerous’ campaign a ‘gimmick’

Patanjali, whose turnover was not officially known being a private, unlisted enterprise, recently said its income during 2015-16 was Rs 5,000 crore, with a target of Rs 10,000 crore in 2016

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Baba Ramdev and PM Narendra Modi. Wikimedia

New Delhi, August 16, 2016: While on one hand, Prime Minister Narendra Modi is promoting ‘Make in India’ and actively seeking foreign investments, on the other hand, Yoga guru Baba Ramdev is openly attacking multinationals, calling their products “dangerous” in a concerted ad campaign.

MNCs are terming the campaign a marketing gimmick, but they can’t entirely ignore it either, as Ramdev’s consumer products empire is rapidly growing and challenging their bottom lines.

At stake is a piece of the $40 billion processed food industry, growing annually at 11 percent per year. Stakeholders hope the government will eventually crack down on the “misleading” advertisements of the Baba Ramdev-led Patanjali, whose top brass is considered close to the powers that be.

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“We live in a democratic nation, where the consumer is king. The consumers decide what is good and what is bad for them,” said Sagar Kurade, President, All India Food Processors’ Association (AIFPA), reacting to the advertisements.

“This country has a policy in place where any multinational company is free to invest in the food processing sector and any domestic company is free to grow, considering the rules and regulations associated with the sector are adhered to,” Kurade told IANS.

Patanjali Yogpeeth, Wikimedia Commons
Patanjali Yogpeeth, Wikimedia Commons

In a promotional by Patanjali on 104.0 Fever FM, Baba Ramdev is himself leading the charge.

“Hair oils have cancer-causing mineral oils, biscuits and noodles have refined flour, drinks have a cold drink (aerated drinks) and liquor, food items are adulterated, cosmetics have chemicals. These products and foreign companies are dangerous for us and our country,” he says.

“Since they take the country’s wealth outside and don’t do any charity work here, the alternative is Patanjali’s pure and home-produced campaign, the main aim of which is charity and patriotism. Adopt Patanjali and give economic freedom to our country.”

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Such an advertising campaign comes close on the heels of India relaxing its foreign equity norms to allow 100 per cent investment in trading of food products that’s manufactured or produced inIndia, including sales through e-commerce, to cut wastage, check price rise and help farmers.

“In a vibrant economy — whether a domestic company is trying to become a multinational or a multinational is trying to capture the domestic market- they are free to compete against each other,” Kurade said.

Baba Ramdev is now a business professional like any other company. He’s promoting his brands. If the outlook was that only Indian products will be sold, then there are a number of Indian companies — Dabur and Emami are Indian companies,” added Amit Dhanuka, CEO of Kejriwal Bee Care India.

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“This is just a marketing gimmick and nothing else,” added Dhanuka, a past President of AIFPA.

“There has already been a complaint against him (Baba Ramdev) the way he has been advertising and it is just a matter of time before the government will become harsh on him. This is something which is momentary and with time people will understand and all the image he has built will wane.”

Patanjali spokesperson S.K. Tijarawala defended the campaign. “Modi is the head of the government and free to keep the government’s view. I don’t think there’s any bar on trading and dealing with Indians,” he said, alluding that allowing foreign equity does not bar the domestic industry.

Patanjali Logo, Wikimedia Commons
Patanjali Logo, Image source: Wikimedia Commons

Both Kurade and Dhanuka, as also other stakeholders IANS spoke to — most of whom requested anonymity — felt that a large market like India cannot be dented by a single company, more so as it is dominated by small-scale units and the unorganised sector.

“The fact of the matter is that almost 75 percent of the food processing industry is small- and medium-sized enterprises sector driven. Big companies are primarily competing for 25 percent of the market share,” said Kurade.

But the market for big players is also not small either. Patanjali, whose turnover was not officially known being a private, unlisted enterprise, recently said its income during 2015-16 was Rs 5,000 crore, with a target of Rs 10,000 crore this year.

In contrast, the operating income for the Indian arm of Nestle — that has a presence in this country for over 100 years — was a little over Rs 80,000 crore last calendar year, while for Britannia, which was set up around 125 years ago, it was around 8,500 crore in 2015-16.

Dhanuka also made a technical point on the Food Safety Standards Authority of India (FSSAI).

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“He (Baba Ramdev) is showing his products are approved by FSSAI. The fact is it doesn’t approve a product. It is a regulatory body. It comes out with different standards. As an Indian company, it (Patanjali) should follow them. Every company follows those regulations, not just Patanjali.”

Without going into the specifics of any issue, Patanjali’s Tijarawala said there was a need for an institution that trades in home-grown products and uses the profits for the development of the country.

“They (foreign companies) are taking the profits with them and that is of no use for India. Our country will strengthen only when we promote trade in the country by promoting and manufacturing of swadeshi (home-grown) goods. This will also generate employment,” he said.

Asked if this did not go against the government’s policies, Tijarawala said: “We don’t have any differences with the government. Let them bring FDI. Let them push ‘Make in India’. That’s their job. Our job is to strengthen our people by providing opportunities. Where is the controversy?” (IANS)

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The Rafale Deal: Corporate Rivalry Impacting National Interest

A deeper look found a correlation between the end of Shourie's dreams of being appointed Union Finance Minister and the beginning of his tirade against the Prime Minister on one issue or the other.

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Defence Minister Nirmala Sitharaman has been obtuse in accusing the Congress of becoming a pawn in corporate rivalry. She made the comments during a recent seminar on 'India's strategic interest in the context of the Rafale deal'.Pixabay

A recent European Union intelligence sharing exercise with India has revealed that Lockheed Martin, the US-headquartered company which manufactures the F-16 fighter jets, has been up to mischief mongering on the Rafale issue.

The Rafale jets, which India wants, is manufactured by the French aerospace company Dassault Aviation, a rival of Lockheed Martin.

That Lockheed Martin could be working in the shadows to sour the Rafale deal for India so that it could move in with its own deal was validated when Vivek Lall, Lockheed Martin’s high-profile head of strategy and India operations, said that the company was in the process of finalising the sale of 200 fighters to India.

During the UPA regime, the government had signed an MoU for 126 Rafale fighter jets to replenish a major shortcoming in air defence preparedness because the Indian Air Force did not have quality fighter jets. When the NDA government led by Prime Minister Narendra Modi came to power, this deal was revised and an inter-government deal was struck to receive 36 fully-loaded Rafale jets. The controversy now raging in India is related to the pricing for the fighters negotiated by the NDA.

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Defence Minister Nirmala Sitharaman has been obtuse in accusing the Congress of becoming a pawn in corporate rivalry. She made the comments during a recent seminar on ‘India’s strategic interest in the context of the Rafale deal’. Pixabay

In December when the Rafale case came before the Supreme Court, Chief Justice Ranjan Gogoi observed that processes were generally followed over the procurement. He also noted that the controversy had been triggered by comments by former French President Francois Hollande over the selection of the offset partner and that mere comments could not form the basis for a probe.

However, this has not prevented the Rafale purchase controversy from becoming a high-octane political battle between the Congress party and the Bharatiya Janata Party (BJP).

Repeatedly over the past few months and more stridently now in the lead-up to the Lok Sabha elections, Congress President Rahul Gandhi has led a no-holds barred attack on the government and the Prime Minister specifically on the issue. From the earlier public disinterest on the controversy, it is now now getting some traction — the Congress party believes this could be possible because it has relentlessly raised the matter at all public forums.

Bringing up the case of the state-owned Hindustan Aeronautics Ltd (HAL) was said to be part of the orhestrated plan to present the case of the American companies while also appearing nationalistic. In the government’s estimate, HAL’s record is abysmal and it cannot be given a big responsibility like building fighter jets — more so in the light of the safety record of MiG fighters purchased from Russia and made under licence from HAL.

The BJP-led government at the Centre believes — and it is certain it has evidence of this — that the Congress party is doing this as it has become a party to corporate rivalry between the US and French aerospace companies. For the record, Lockheed Martin is believed to have found a sympathetic ally in another US aerospace major, Boeing, which manufactures the F-18. Dassault has another rival in French manufacturer Airbus Industrie, which is associated with BAE for the manufacture of the Eurofighter. It is also angling for a fighter jet contract with India.

Rahul Gandhi’s attacks on the government over the Rafale issue started after his visit to the US in August 2017 when he met several defence lobbyists, CEOs of US defence companies and Pentagon officials.

Defence Minister Nirmala Sitharaman has been obtuse in accusing the Congress of becoming a pawn in corporate rivalry. She made the comments during a recent seminar on ‘India’s strategic interest in the context of the Rafale deal’.

modi
Contrary to popular perception, the Trump administration is said to be extremely unhappy with India because the NDA government under Modi has been successful in building strong relationships with Saudi Arabia, the United Arab Emirates and Qatar. Pixabay

The government’s efforts to trace the footprints of the dramatis personae at the forefront of the campaign to target the government over the Rafale deal has produced surprising results. It has found what it believes are eye-opening linkages between Prashant Bhushan, Yashwant Sinha and Arun Shourie — who filed a PIL in the Supreme Court accusing the Prime Minister of corruption in the deal — and arms dealers and defence manufacturers. At least in one case, the linkages show deep connections between members of Shourie’s family with aerospace companies, arms dealers and defence lobbies.

A deeper look found a correlation between the end of Shourie’s dreams of being appointed Union Finance Minister and the beginning of his tirade against the Prime Minister on one issue or the other.

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The government is also aware of the links between a top BJP leader’s son-in-law and a French manufacturer. The son-in-law is said to be advising Rahul Gandhi and is believed to be making government documents available to him for the campaign against Rafale.

Lockheed Martin’s alleged actions to work the political ecosystem to pull down the Rafale procurement deal also has a larger strategic context. Contrary to popular perception, the Trump administration is said to be extremely unhappy with India because the NDA government under Modi has been successful in building strong relationships with Saudi Arabia, the United Arab Emirates and Qatar.  (IANS)