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Correspondent

23 August 2024 at 4:29:04 pm

Festive Surge

India’s bazaars have glittered this Diwali with the unmistakable glow of consumer confidence. The country’s festive sales crossed a staggering Rs. 6 lakh crore with goods alone accounting for Rs. 5.4 lakh crore and services contributing Rs. 65,000 crore. More remarkable still, the bulk of this spending flowed through India’s traditional markets rather than e-commerce platforms. After years of economic caution and digital dominance, Indians are once again shopping in person and buying local....

Festive Surge

India’s bazaars have glittered this Diwali with the unmistakable glow of consumer confidence. The country’s festive sales crossed a staggering Rs. 6 lakh crore with goods alone accounting for Rs. 5.4 lakh crore and services contributing Rs. 65,000 crore. More remarkable still, the bulk of this spending flowed through India’s traditional markets rather than e-commerce platforms. After years of economic caution and digital dominance, Indians are once again shopping in person and buying local. This reversal owes much to policy. The recent rationalisation of the Goods and Services Tax (GST) which trimmed rates across categories from garments to home furnishings, has given consumption a timely push. Finance Minister Nirmala Sitharaman’s September rate cuts, combined with income tax relief and easing interest rates, have strengthened household budgets just as inflation softened. The middle class, long squeezed between rising costs and stagnant wages, has found reason to spend again. Retailers report that shoppers filled their bags with everything from lab-grown diamonds and casual wear to consumer durables and décor, blurring the line between necessity and indulgence. The effect has been broad-based. According to Crisil Ratings, 40 organised apparel retailers, who together generate roughly a third of the sector’s revenue, could see growth of 13–14 percent this financial year, aided by a 200-basis-point bump from GST cuts alone. Small traders too have flourished. The Confederation of All India Traders (CAIT) estimates that 85 percent of total festive trade came from non-corporate and traditional markets, a robust comeback for brick-and-mortar retail that had been under siege from online rivals. This surge signals a subtle but significant cultural shift. The “Vocal for Local” and “Swadeshi Diwali” campaigns struck a patriotic chord, with consumers reportedly preferring Indian-made products to imported ones. Demand for Chinese goods fell sharply, while sales of Indian-manufactured products rose by a quarter over last year. For the first time in years, “buying Indian” has become both an act of economic participation and of national pride. The sectoral spread of this boom underlines its breadth. Groceries and fast-moving consumer goods accounted for 12 percent of the total, gold and jewellery 10 percent, and electronics 8 percent. Even traditionally modest categories like home furnishings, décor and confectionery recorded double-digit growth. In the smaller towns that anchor India’s consumption story, traders say stable prices and improved affordability kept registers ringing late into the festive weekend. Yet, much of this buoyancy rests on a fragile equilibrium. Inflation remains contained, and interest rates have been eased, but both could tighten again. Sustaining this spurt will require continued fiscal prudence and regulatory clarity, especially as digital commerce continues to expand its reach. Yet for now, the signs are auspicious. After years of subdued demand and inflationary unease, India’s shoppers appear to have rediscovered their appetite for consumption and their faith in domestic enterprise. The result is not only a record-breaking Diwali, but a reaffirmation of the local marketplace as the heartbeat of India’s economy.

OBC Oversight

The expansion of the new Mahayuti cabinet led by CM Devendra Fadnavis has set tongues wagging. The conspicuous exclusion of OBC leaders like Chhagan Bhujbal, Sudhir Mungantiwar and Sanjay Kunte has sparked speculation of the move being an emerging risk for the Mahayuti coalition, especially BJP.


To offset this, the ruling coalition has done a ‘strategic recalibration’ by inducting the BJP’s Pankaja Munde and her cousin, the NCP’s Dhananjay Munde in the cabinet. However, this prompts the question whether the Munde cousins can fill the leadership vacuum among Maharashtra’s OBCs. The BJP’s dominance in Maharashtra has always been a delicate juggling act — satisfying the aspirations of its urban, upper-caste core while appeasing its growing OBC voter base. It was Pankaja’s father, the late Gopinath Munde, whose deft welding of the diffuse OBC communities made it a potent vote-bank.


The last 18 months have seen Chhagan Bhujbal, a stalwart member of the ruling Ajit Pawar’s NCP, emerge as the most vocal voice of the OBCs by taking a firm stance against Maratha quota activist Manoj Jarange-Patil. Bhujbal, projecting himself as an ‘elder’ leader concerned with safeguarding the OBC community’s reservation pie against Maratha encroachment, had managed to gather the fragmented OBC castes and sub-castes during his rallies to counter Jarange-Patil’s insistent demand of securing a Maratha quota under the OBC category. Bhujbal’s stance had resulted in strains within the erstwhile cabinet under CM Eknath Shinde.


Now, Bhujbal has cried foul over his exclusion in ‘Mahayuti 2.0,’ hinting that his advocacy for OBCs may have cost him a cabinet berth. While Bhujbal’s outspokenness may have made him a liability in Ajit Pawar’s calculations, sidelining him underscores the Mahayuti’s tenuous position in balancing the demands of its OBC base and the politically assertive Marathas.


In this context, the induction of the Munde siblings, Pankaja and Dhananjay, appears a calculated move. The BJP and the Mahayuti seek to tap into Munde’s enduring appeal among OBC voters. Yet, the choice is fraught with challenges. Pankaja Munde, estranged from the BJP’s leadership for years, has been a vocal critic of Devendra Fadnavis, even blaming him for her 2019 electoral defeat. Though all that is water under the bridge, the Munde family’s chequered political record and internal dynamics could undermine the Mahayuti’s efforts to project them as the new torchbearers of OBC politics.


Complicating matters further is the simmering tension between Maharashtra’s OBCs and Marathas. Jarange-Patil, who remained quiescent during the Assembly polls, has again threatened to go on a collective strike from January 25 next year, intensifying his demand for Marathas to be included under the OBC category.


In Maharashtra’s fractious politics, where caste and coalitions shape outcomes, the BJP’s gamble hinges on the Munde cousins rising as credible OBC leaders. Whether this youthful shift strengthens the BJP or backfires remains uncertain.

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