A ‘powerful’ day

Interesting statistic for the day. The earth will need 30 terawatts of power by the year 2050. Which is actually nothing much since the sun gives us 120,000 terawatts of power. So, if we use just 1% of our land area to generate solar power at reasonable efficiency, we can get all out power needs from the sun.

My bet is this will happen to a reasonable extent, with India’s current massive thrust on Solar energy being a significant trigger. And if we do, the world will move to a long term trend of practically zero incremental cost for energy. (And Solar is not the only energy game where this seems to be happening).

Imagine a future in which practically all activities we do – from taking a flight to washing clothes to growing food – will have very little cost. It will be a different world.

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Domestic tourists are from Mars, Inbound tourists are from Venus – Part I

Just saw a post on Quartz titled ‘Foreign tourists are seeing a different India than locals‘. Arguably having been the keenest watcher of Indian tourism & particularly Indian domestic tourism over the last 10 years, I can say this with confidence – the article gets its basic premise right but does not go anywhere near enough in exploring the fundamental differences between the two. So let me give it a whirl & explore one big difference in this post.

Indians take vacations to get way from crowded & dirty cities as often as possible. This quest more often that not compels us to take short weekend breaks to nearby destinations. Data of traveller behaviour on HolidayIQ.com (every month almost 5 million Indian travellers plan breaks using travellers reviews shared on HolidayIQ.com) suggests that weekend getaways number more than 10x of long vacations in India. Such weekend getaways, are therefore by definition,  not to the great big tourist attractions of the nation but to the small peaceful enclaves near cities with some greenery left. This includes places like Araku Valley in Andhra Pradesh where hordes of people from Hyderabad, Vizag and Bhubaneshwar run to on weekends, Tarkarli in the south konkan coast of Maharashra, a favourite of people from Mumbai & Pune, Pachmarhi in Madhya Pradesh which offers respite to travellers from Nagpur, Bhopal & Indore and Mandarmani, the beach to which people from Kolkata flee regularly. Contrast this with the behavior of foreign (inbound) tourists. There are two dominant categories of foreign tourists to India – (1) the backpackers and (2) the geriatrics. The backpackers are youngsters mostly from Israel & the west who come looking for instant spirituality, undiscovered beaches and great weed, although not necessarily in that order. Most of them end up in Goa, Gokarna, Manali, & Rishikesh. The geriatircs are retired folk, mostly from Europe  who come to India as a once-in-a lifetime experience to either do the golden triangle (Delhi, Agra, Jaipur) or over the last decade, Kerala.

So the biggest difference lies in the fact that the core motivation of domestic & inbound tourists are quite different which leads them to drastically different destinations in India. But there is one place in India that both domestic & inbound tourists go to in large numbers – click here to find out 🙂

Whither Budget Business Hotels in India?

A few years ago, in one of those ritual paroxysms that grip the Indian business community every so often, everyone decided to set up budget hotels across India. As is wont in such circumstances, serial announcements  were made, each one rivaling the previous about the number of rooms that would be set up across India in just 3 to 4 years. And as is wont again, nothing much has happened since.

Let me tell you why.

The basic premise went thus. With India’s economy booming at almost 10% growth every year there was a lot of new business activity expected. Most of this activity would require people to travel resulting in a huge  increase in the demand for mid-range and economy hotels for these itinerant business men. Given that the current capacity was all in low-end, dirty (nay, mostly filthy) ‘lodges’ that sprout next to bus stands and railway stations, there was clearly an opportunity to provide clean, hygienic, smart hotels that would provide great accommodation at a compelling price point.

Unfortunately, the script has not quite worked out the way it was intended to. Uptake has been sluggish for the few hotels that managed to get launched. And it has left a number of highly-paid heads being scratched vigorously (mostly of people who have never ever done low-end business travel in India themselves).

To understand why the whole things has been a damp squib, a good starting place would be to deconstruct the basic premise I outlined earlier. The hypothesis had the following elements:

1. Indian economy will grow

2. That will lead to massive growth in business travel

3. Most of this additional travel will be in the mid to lower end of the market

4. Evolving consumers will demand a new product in business travel accommodation

5. This ‘new’ product will be ‘hygienic, smart, functional’ rooms at around Rs 1000/- per night cost

My guess is that the first four elements of the hypothesis turned out to be broadly correct although probably much lesser in extent or speed than envisaged in business plans. Extensive reading of hotel reviews on HolidayIQ, lots of conversations with actual consumers and my own personal experience of low-end business travel back in my CA student days suggests to me that the problem is primarily in point 5 above.

We all agree that the average Indian budget business hotel (the ‘lodges’ we talked about) is extremely unhygienic and generally unkempt. But that is to miss the primary value they provide. In addition to providing a room with a bed to sleep on, these lodges provide travellers with a perception of being important. In classic Indian ‘high touch’ style, there are multiple minions (the quintessential ‘chhotus’) who hover around the traveller and cling on to every word and take barked orders with meek accetance and generally scurry about. This sense of finally being a VIP is the biggest value provided by small business hotels to small businessmen. And it is precisely this value that has been lost in the new breed of hotels. With their policy of no room service and general parsimony towards having employees, this new breed of ‘hygienic and smart’ hotels are exactly what their target customer wants to avoid. After all, who wants to walk into a people-less hotel and realise that one is truly unimportant.

And in this lies their failure.

The post-liberalisation generation

I read recently that 2009-10 is an important year for India since all children born during the beginnings of India’s economic liberalisation of 1991-92 turn 18 years of age now.

The news brought back memories. My dad was in the civil services and during that tumultous phase was for a while one of the three secretaries (ie. a  senior bureaucrat) of the ministry of finance during Mr Manmohan Singh’s stint as India’s finance minister. I remember those days being vicariously involved in the whole liberalisation process. Dad would rush off to many meetings looking excited (a 55 year old bureaucrat getting excited is always a sight!) and would come home all agog with the news that things are changing in India.

I was a child of the cusp. My working life started in 1989 just before all this brouhaha (as a trainee software jock in TCS after qualifying as a chartered accountant, but that is another story) and in 1991 the world changed pretty definitively. The most immediate impact of India’s economic liberalisation was that my salary went from an adequate (at that time at least) Rs 2500 per month to an absurdly indecent figure of Rs 10,000 per month. What with that and my dad’s old amby, I was even able to attract girlfriends, which is of course the acme of life at that stage. So, I remain forever a commited free-marketeer and hormones are partly to blame.

Learning from Thailand’s tourism

We all know that Thailand has a pretty effective inbound tourism sector, clocking up about 3 times the number of foreign tourists we get (just to keep this stat in context, India has 6 times the land mass of Thailand and of course 20 times its population).

My recent trip to Phuket gave me some clues as to why this happens. The most important reason that I can see is that the Thai people are ‘naturals’ for tourism, with a warm & cheery disposition that makes an outisder welcome immediately. The second key reason is that the logistics of tourism involving the co.ordination of activities between multiple small actors works surprisingly smoothly in that country.

Let me take an example. We did a a one-day trip to Phang Nga, the place made famous by innumerable photos of awesome towering limestone rocks and sea caves. We booked this trip with a small tour operator just outside our hotel in the Karon beach area. ‘Tuk’, the smiling and cheerful young lady who ran the outfit spent enough time with us to go through all the options needed before consensus could be reached by an opinionated family of 4.  Then she made a call, confirmed availabilty and booked us for the trip. She said the cab to pick us would reach at 9 am the next morning.

It did. The cabbie picked up a couple of more small groups in a clean van and drove us over a neat expressway for about an hour to the pier from where we were to take a boat. At the pier we were met by ‘ying ying’ another smiling thai girl (so now you now why they get a real rep!) who was to be our guide on the boat trip. We got on to the boat and reached the caves where we were transferred to small canoes handled by young local lads. And then we were shifted to a small man-made island on stilts where we had lunch at a small restaurant. And so on..

Here is the notable thing. Tuk, the cabbie, ying-ying, the canoeists, the floating restautant – none of these people were officially a part of the company that operated the trip. However, every person performed their role to perfection and with complete predictability. We did not have to call or talk to anyone to co-ordinate anything. Imagine the same thing in India – the likelihood of one of these pieces not working seamlessly would have been very high.

I do not know how the Thais do this. But I do know one thing. If we can emulate this to even 50% of the efficiency of the Thais, we can substantially improve our tourism image.

Bintan Island in the Riau archipelago – a prologue

I am sure the seventeen men that controlled the Dutch East India company (the Herren XVII of the Vereenigde Oost-Indische Compagnie, to show you that I know this sort of stuff well) knew about it before me, but I felt no less an explorer when I landed on Bintan island. After all, it is not everyday that you get a chance to reach an outlying island among the group of almost 20,000 islands that make up one of the world’s most populous and to me one of its more likable countries.

These days, it is just a 45 minute fast-ferry ride from Singapore to the Bintan island in Indonesia, but in the old days, this island was an incidental part of the great southern arc that stretched from Malabar (Kerala) in India to the outer reaches of the south-eastern islands of today’s Indonesia, creeping almost up to modern Papua New Guinea – the production epicentre of the ancient world’s great spice route. One of the great spice islands it certainly was not and so was probably ignored in the maritime rivalries of Spain, Portugal and England. And left to curious travellers of the early 21st century to find some of the more beautiful beaches on earth.

An Indian Beach bum looking for the fastest way to get to a world-class beach? Rush to Bintan.

Visas for Indians are on arrival (for most westerners, visa is exempt) and for a stay upto 7 days, you need to pony up USD 10 per person. The catch is, being a government requirement, you need to have the exact 10 USD. So, ensure you carry the exact cash with you.

Of course, the mystery of why A R Rahman has replaced Celine Dion as the default muzak in ferries, restaurants & the such (although, thank god for that I say) in this region has not been fully cracked. Obviously, the return of India’s ancient cultural colonisation springs to mind. But there might be more to it…