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Business News/ Opinion / Online-views/  The idea of 24x7 shopping
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The idea of 24x7 shopping

The idea is a reminder of the distance that India has traversed in the last three decades and more and, more importantly, how much more we have to go

Photo: Ramesh Pathania/MintPremium
Photo: Ramesh Pathania/Mint

On Wednesday, the Union Cabinet cleared the “Model Shops and Establishments (Regulation of Employment and Conditions of Service) Bill, 2016", allowing malls, shops, restaurants, banks and cinemas to operate 24 hours a day. Once effective, it will be one more boost to the rapidly growing consumer economy—consumers (at least those who possess spending power) have never had it so good.

Fittingly, this out-of-the-box idea came just days ahead of 1 July— the 25th anniversary of the unprecedented acceleration in economic reforms to transform India. It is a reminder of the distance that India has traversed in the last three decades and more; and more importantly shows how much more we have to go before the last Indian is provided for. And this is best captured by the narrative of the transformation of the Indian consumer, the biggest beneficiary, as the country abandoned its insular economic credentials.

In a predominantly young India, most urban consumers experience life through the malls in its town and cities, through easy availability of consumer goods offline/online and from a variety of choices—and not what it was say three decades ago.

If today we are spoilt for choice, there was a time, not so long ago, when we had none, with the exception of the Maruti 800 (the car which probably captures the transformation that India has undergone in the last three decades). Our most prized possessions were a Levi’s or Wrangler jeans, hand-me-downs from visiting rich relatives looking to appease their guilt of sponging on our hospitality; and, of course, for the Gulf-returning expats, it was the gold chain and the two-in-one stereo player.

To be sure, the decade preceding 1991 is where the country’s politicians started seeding the idea of a liberal economic framework—gradually distancing themselves from the socialist policy principles which defined the first three decades of independent India.

Beginning with the first-ever structural adjustment loan drawn from the International Monetary Fund to tide over the balance of payments crisis in 1981, the process to dismantle the licensing regimen commenced; of course the years of Rajiv Gandhi’s tenure as prime minister ensured a big leg-up for information technology and further revisiting of the notion of the public sector as the commanding heights of the economy (the Delhi and Mumbai telecom circles were spun off into Mahanagar Telephone Nigam Ltd, as a model PSU free of bureaucratic controls).

The phase beginning July 1991 accelerated the process of policy change. The reduction of tariff barriers (in some instances it was 400%) unleashed competition and consumer aspirations; just as a pick-up in global economic growth provided a perfect launch pad for India too. It was this constellation of circumstances which unleashed the surge in growth, catapulting India to a $2 trillion economy (another story that the decade of policy paralysis ending 2014 nixed this growth trajectory). The resulting improvement to the material well-being of large swathes of the population caused a trading up (captured in a series gleaned from Census 2011 and published in Mint.

Along the way, another phenomenon happened: there was a convergence of consumption patterns between rural and urban India. The two things, trading up and convergence, led to the creation of a consumer economy—which was sufficient for consumer goods companies to look at scale economies (an estimated 30-40 new products are launched every quarter in India).

In fact, the Indian consumer has become the bulwark of the economy. The two back-to-back droughts and the rapid slowdown in the economy actually forced back consumption, reaffirming their critical status. Presumably, with the India Meteorological Department forecasting normal rains this year, rural India will rebound and so will consumer sentiment—and hopefully bottom lines of companies.

It is evident then that the consumer economy has matured enough to deal with the idea of 24x7 shopping. Given the scale of India’s population this may also result in some collateral gains—with people active at night, anti-social elements who normally take over vacant spots will be less visible.

In fact, the model law once adopted by states together with pending amendments to the Factories Act will allow women to work night shifts. The new law makes it mandatory for establishments to provide for cab services, night crèches and ladies’ toilets for women working night shifts. If all goes well these changes may usher in the next round of social change in the country, giving an even more prominent place for the Indian consumer in the national economy.

Anil Padmanabhan is executive editor of Mint and writes every week on the intersection of politics and economics.

His Twitter handle is @capitalcalculus

Comments are welcome at capitalcalculus@livemint.com

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Published: 04 Jul 2016, 12:57 AM IST
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