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Strategies & Market Trends : India Coffee House

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To: JPR who wrote (7115)9/23/1999 10:57:00 AM
From: JPR   of 12475
 
news.bbc.co.uk

India's general elections are mammoth and costly affairs. Government officials estimate that this election - with more than 600 million voters, 5,000 candidates, and overseen by nearly five million people
- is likely to end up costing millions of dollars.
Most business leaders remain worried by increasing
electoral costs, but for owners of small firms catering to
the election market, it is all good news.
Fierce campaigning has caused a dramatic surge in the
demand for traditional election products such as flowers,
flags, badges and posters and many small business are
working round the clock to meet the sharp increase in
orders.
Marigolds and roses are the flowers most commonly used
to garland political leaders, and distributors say they are
seeing up to seven times more profit than during the rest of the year.
A bumper harvest of marigolds has helped meet the sudden rise in demand, but retail prices are still often more than five times higher than in non-election periods.
Substantial sums The two main political parties, the BJP and Congress, are also spending substantial amounts of money on
flags, pamphlets and other printed products.
A spokesman for the Association of Small-Scale Industries says printers and small textile business owners are making the largest gains, with profits rising 10 to 15 times above average.
Most parties favour smaller firms because of their low
labour costs, and flexibility in adapting to demand.
Some printers have moved their operations nearer the
BJP and Congress headquarters, and almost all of them are working round the clock to meet their orders.
But many firms remain reluctant to disclose their profits
after a recent ruling by the Election Commission banned
candidates from spending more than $3,000 on their
election campaigns.
Commentators say many candidates are vastly overspending in their campaign budgets. And while some small businesses are profiting from frequent elections, a great many more are resentful of the endless disruption to business.
With the previous elections held only a year ago, and a
caretaker administration in charge for the past five
months, most decisions about the economy have been
severely delayed.

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