Are we there yet?

"The Myth of the New India", Pankaj Mishra's piece in the New York Times is an eye-opener of sorts. He talks about how the whole hoopla around India is misguided, and perhaps quite elitist as well. That "India has arrived" is blatantly false; we have, after all, the per capita income of sub saharan Africa - around $728. (I dare say, though, that this figure would be up 30% if we considered the "black money" hanging around)

The whole Mittal saga and the subsequent announcement that India is now the big guy on the block is ridiculously overstated:

This sounds persuasive as long as you don't know that Mr. Mittal, who lives in Britain, announced his first investment in India only last year. He is as much an Indian success story as Sergey Brin, the Russian-born co-founder of Google, is proof of Russia's imminent economic superstardom.

True, isn't it? Mittal has a pronounced accent that's very much Indian, but his achievements are that of an Indian NRI, in Britain and Holland and Luxembourg and such fancy places. He's a true blooded Indian, and has answered questions on his inclination to move to a British passport with "Why should I?". Coming from the son of a land that counts its children in green cards and citizens, I find that very pleasantly patriotic.

Yet, his achievements have nothing to do with the Indian economy. Which is why India shouldn't have been all ruffled when Guy Dolle of Arcelor made a Zinedine Zidane out of himself, referring to Mittal's origins during the battle and eventually having to shake hands with the very man he set out to defame. That was Mittal's battle, not India. Having said that, though, it's heartening to know our country will stand up for one of its citizens. I just hope one day it will do something for those languishing in prisons abroad, or in bonded labour in the gulf.

So, back to the equation at hand: Is India Hot, or Not? Without alluding to shampoos I will agree with Mishra that it is not.

Yesterday was a real revelation for me in this regard - and in quite a surprising way. I am a member in a bootstrap entrepreneurs club and in yesterday's meeting, was privy to a discussion about an online business focussed on Bangalore. The business involved building a website to access certain valuable information placed online by certain retailers. I was a little perplexed about the business model, and began to think about the size of the market.

There are around 500,000 software professionals in Bangalore, and perhaps another 500,000 of rich/semi-rich citizens with computers and Internet access. Gives us a million people total, but I would hazard a guess that 10% of them would use a computer to serious effect - searching for items, buying online etc. That's about 100,000 people - this is the total size of the Bangalore market for anything online.

There are perhaps six other such cities in India - Delhi, Mumbai, Hyderabad, Chennai, Pune and Kolkata. That gives you a total market of around 700,000 people. Out of a billion population, your total online market is short of a million.

What use is a "mass market" online solution? No wonder there are no big retailers online, and none of the big mass market vendors spend money on a mass market web site. The better thing to do is to work with more traditional elements to get to these people - meaning newspaper ads, hoardings, brochures etc. Even tele-sales!

I think this might change eventually, but right now India needs a lot more of the "old economy" stuff. Like toll free number registries. Like Refrigerated transportation for milk and vegetables. Like innovation for rural areas - including farming, water harvesting, power storage and so on.

Writing online stuff right now is simply trying too hard to get the same customers all your friends are trying to get. What you should do now is try and target those people nobody's talking about, and who're a mere statistic. The thing one must know is, they're a statistic with a lot of money (collectively).