05 October 2006

The road to glory

There was a time when, to an Indian, owning a car was an achievement. Those who owned one were rich; those who owned more than one were filthy rich. There were two types of cars to choose from: Fiats and Ambassadors. Their shapes, their engineering, even the colours they were available in, didn’t change much over the years. Whoever owned a car owned one of these models, moving around town with an air of superciliousness. The rest of India either admired them or hated them.

In the 1980s, things changed with the entry of Maruti Suzuki. They introduced a small car and a small van – Sanjay Gandhi’s dream, although no-one gives him any credit for it – in bright colours, with low noise, faster pick-up and better fuel efficiency than the Fiat or the Ambassador prevalent on the roads at that time. Marutis became extremely popular, overshadowing attempts by the Contessa and the Standard 2000 to create a luxury segment in the Indian auto industry. Millions of Indians began to see new possibilities. For the middle-class, owning a car in the future was going to be a reality.

After a 15-year journey, that future is here. Indians are buying cars left right and centre, with a million new cars coming on the roads every year in various models, sizes and colours. Not just Indian brands, but foreign car companies are now in India with their manufacturing and marketing facilities, introducing new models every three years. India has now become one of the fastest-growing car markets in the world. Cars have become the new symbol of recognition in society – a metaphor for status and privilege, and the new consumerism that has flooded the country.

With better engineering, the new cars also represent speed. To accommodate this, India is now gearing up to revamp her roads and highways. Cities are expanding their roads, building flyovers, and installing better traffic-control systems. Still, progress is slow and congestions on city roads are worrisome, sometimes frustrating, particularly during rush hours.

The situation in Bangalore, for instance, is so bad that, on several occasions, travelling to and from the airport – a distance of 10 kms – has taken me more than an hour. People in Bangalore are infuriated with the traffic. Media reports have voiced that well-known business houses in Bangalore are planning to curb further investments in the city and move elsewhere, in an effort to highlight the government’s lack of concern in addressing the traffic-congestion issue.

However, some Indians are unfazed. They are taking to the highways with their fast cars. Going out on a 200-km road trip over the weekend, driving between cities or between a city and a holiday resort, instead of the usual train, is becoming common these days. Even when the highways weren’t so good, in 2001, I had done the 1100-km journey between Mumbai and Bangalore (and back again) in less than 18 hours. Although slow by Western standards, believe me, it was a pleasure!

Now the Indian government has stepped in, upgrading the national highways into 4 or 6-lane traffic. A major project is building the Golden Quadrilateral, a superhighway that connects Delhi, Mumbai, Chennai and Kolkata. Some portions are already over, welcoming fast cars and motorbikes with open stretches never experienced before. For Indians with fast cars, looks like the glory days are here.


Anonymous said...

The real estate is one sector that features as one of the most badly hit sectors following the global economic meltdown. Especially in developing countries like India, where real estate was going great guns, so to say, faced a steep downfall following the recession and inflation. Especially in the metros and the developing cities like Bangalore, real estate suffered dearly as the demand for the residential units, though increasing became a pent up demand. The badly hit economy particularly the IT sector that has a strong foothold in Bangalore, and the high rates of interest in home loans made the demand for residential units go down or at best become a pent up demand. It is believed that once the situation stabilizes the demands would start surfacing. Another very problematic issue that the real estate dealers are facing is that patrons of the currently booked flats are not willing to pay the original price that they had agreed on but the current price that is less than the original amount owing to the current economic condition. Not only the residential units but the commercial properties like the hotels in Bangalore have also naturally seen a drop in their occupancy. The ITC hotels in Bangalore that registered the highest occupancy, as high as 83%, have been forced to cut down on their tariffs by almost 20% as the occupancy has also gone down by 20%. On the contrary, the business hotels in Bangalore are surviving the tough times as the number of business travelers has not been affected as hard as the umber of leisure hotels. The budget hotels in Bangalore have seen a hike owing to the obvious reasons.

runawaysun said...

Thank you, Martin, for reading my blog and commenting on it.

I am, of course, a little puzzled about your comment as I do not see the connection between my post - which is on the changing Indian consumer, automobiles and roads in India two and a half years ago - and your comment on the present real estate market in Bangalore.

However, I agree with your comment - that the real estate and hospitality markets in Bangalore are currently in a slump.

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