The Indian Prime Minister’s address on Independence Day is the major event of the political year, equal to the US President’s ‘State of the Union’ speech. It was particularly important this year as India has a new reforming prime minister in Narendra Modi.
It it is thus hugely significant that top of his agenda was opening up the country to foreign business, and the need for toilets, as the Financial Times reports:
“I want to tell the world, ‘come, make in India’,” he said from the walls of the 17th-century Red Fort in Delhi in his first Independence Day speech. “We have the skills, we have the strength, we have the people.”
Modi then focused on toilets, and confirmed that the government was targeting sanitation for all in 10 years:
“I don’t know if people will appreciate my talking about dirt and toilets from the Red Fort. But I come from a poor family. I have seen poverty, and the attempt to give dignity to the poor starts from there”
The need is truly desperate, as the chart above shows from the World Health Organisation. They suggest that 597 million people still defecate outside in India. This vast number equals 10% of the world’s total population. It is also 10 times more than 2nd-placed Indonesia, where 54m have no access to toilets.
The blog knows that most companies are currently not set up to focus on critical issues like this. But that is no reason to ignore the potential. There are not many $10bn markets where competition is currently non-existent, and where the technology and know-how required are available immediately.
Equally important is that the alternative of hoping for traditional growth markets to recover looks very much like wishful thinking:
- The market for luxury goods in China is looking very weak with the anti-graft campaign in full gear. And China was half of the global luxury market in 2013
- The Eurozone economy is already weakening again, whilst the German Bundesbank is warning it will be hit by the increase in global tension in the Ukraine and elsewhere
- US auto and housing markets face major question marks with the West having reached ‘peak car’ levels and US housing markets already slowing down
Of course, moving into this new market represents a challenge. But it is also likely to be a stepping-stone to further, currently untapped markets focused on basic needs, as we described in Chapter 7 of ‘Boom, Gloom and the New Normal’.
As such, it will provide valuable learning experience for the future. And it will also be a lot more satisfying than banging your head against a brick-wall, now the profitable markets of the SuperCycle have now gone ex-growth.
