Indian Newspapers Thrive with Economy

The onslaught of digital media in the developed countries of the world regularly brings pronouncements of the death of the traditional newspaper. But this assumption of digital triumph misses out on the reality in countries across the global South.

As incomes rise and literacy levels go up, so does the desire to consume news and information. And while many are jumping straight to online and mobile phone sources, just as many are enjoying more traditional print media offerings like magazines and newspapers.

India boasts both a fast-growing economy and the largest number of paid-for newspapers in the world. The print media industry in India has seen phenomenal growth since 2005, with the number newspaper titles increasing by 40 percent to 2,700 (World Association of Newspapers). The two factors driving this growth in newspapers are rising literacy and a booming economy

The World Association of Newspapers found China leads the world for newspaper subscribers, with 93.5 million readers a day. India is second. It is estimated the Indian newspaper industry will generate US $3.8 billion in revenues in 2010, a 13 percent growth rate over the last five years.

Estimates place growth in the newspaper industry in the next four years at 9 percent a year, to US $5.9 billion (KPMG).

Part of the reason India is defying the decline in newspaper numbers and readership seen in developed countries is poor internet penetration across the country. Because of this, only 7 percent of the population uses the web for information. And the country’s high number of illiterates (just 65 percent of the population can read) means even if many could afford a newspaper, they couldn’t use it.

According to Amar Ambani, head of research at India Infoline Group, “Unlike the West where the internet publishing and advertising has significantly hit the print media, the Internet threat to print media is still in its nascent stage in India, given the low penetration of computers and adequate bandwidth across the country.”

Newspapers are also growing in a highly competitive market exploding with new television channels on cable and satellite and other media distractions like mobile phone applications.

The newspapers (http://www.world-newspapers.com/india.html) are a strong reflection of how much the economy has changed in the past decade. They contain advertisements for property, mobile phones, cars and dating services.

Cost is also a critical element in their success: at only four rupees each (US $0.09 cents), many Indians buy several newspapers at a time for their home. The publications are able to charge so little because of the health of the advertising revenue coming in. Newspaper advertising in India increased by 30 percent between January and Match 2010 alone, the quickest jump in ads for the Asia-Pacific region (Nielsen India).

There is a hierarchy in the newspaper industry: English-language newspapers attract wealthier readers and can charge the most for advertising. But rising literacy rates combined with increasing personal wealth is fuelling growth in regional papers written in local languages. India has 22 official languages and English as an associate language. The country as a whole has about 33 different languages and over 2,000 local dialects. Hindi newspaper circulation rose from 8 million in the early 1990s to over 25 million in 2009.

The Times of India (http://timesofindia.indiatimes.com) is now the world’s largest circulation English-language newspaper, with 4 million readers. It uses this success to charge 10 times what regional papers can for advertising. At present, the regional newspapers’ bread-and-butter is mostly government-paid advertising.

But if trends continue as they are, then the tables will turn on big beasts like the Times of India. Regional papers will grow as people look for an opportunity to read in their own local language.

Flush with cash and confidence, Indian newspapers are also innovating new ways to advertise untried in other countries. Talking ads attached to the actual newspaper’s back pages caused a great stir when they were trialled in India recently (http://www.guardian.co.uk/media/greenslade/2010/sep/28/newspapers-advertising). The talking ads for a car company delivered a sales pitch but also alarmed and annoyed many people because the talking ad wouldn’t stop talking.

Ambani puts the success of the Indian newspaper industry down to five factors: the economic boom in semi-urban and rural India; growing local content; more opportunity to grow the number of readers; rising advertising spending; and rising literacy as a result of rising secondary school enrolment. He believes students aged between 10 and 15 are getting the newspaper habit and they represent huge future growth in newspaper readers.

By David South, Development Challenges, South-South Solutions

Published: October 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

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A Local Drink Beats Global Competition

For many decades, strong American and multinational food brands have penetrated markets in the South. This is a global business success story for those companies, but the downside has been the marginalizing of local alternatives. This not only reduces wealth-creating opportunities for local entrepreneurs, but also leads to products like sugary soda pops (http://tinyurl.com/yzwal98) pushing aside healthier, local alternatives like tea.

But one company in Indonesia has been pioneering a healthy local drinks empire while also seeing off aggressive foreign rivals. Teh Botol Sosro, a tea drink in Indonesia bottled by family-owned business Sosro, was not only the first bottled tea brand in the country, but also in the world, it claims. The company started bottling the jasmine-flavoured black tea drink in the 1970s.

The Indonesian company has shown that it is possible for local flavours to beat powerful international brands like Coca Cola in the battle for drinkers’ palates. While Coca Cola has tried to sell many bottled tea drinks in the Indonesian market, they have not been able to push aside the local product, The Teh Botol Sosro. Brewed by the Sinar Sosro company, it has captured 70 percent of the non-carbonated drinks market.

It is a drink of cool, black, sweetened tea with a hint of jasmine. Invented by the Indonesian family of Sosrodjojos, Sosro (http://www.sosro.com/) was founded in central Java in the 1940s.

Culturally, Indonesians have either coffee or tea with their meals. The brand’s marketing slogan plays on this: “Whatever you eat, you drink Teh Sosro.”

The company has aggressively fought off competition not only from local rivals, but also from Coca Cola’s Frestea brand and Pepsi Cola’s Tekita. The company stayed sharp in its business strategy, never letting a rival product take hold. Just as a rival would introduce a new product, Sosro would reply with a new drink attuned to Indonesian tastes. This ability to not be complacent about the company’s success, and to use its knowledge of local tastes to always outsmart foreign competition, has kept the company where it is today.

Sosro pioneered bottled drinking tea with its launch in 1970 and started with a dried tea only distributed in Central Java.

The journey to cold, bottled tea is an amusing one. The company first wanted to promote its tea in Jakarta, the capital, by having public tastings. But by brewing the tea on the spot, the too-hot tea took too long to drink for impatient Jakartens. The solution was to not brew the tea on the spot, but instead to brew it off-site and deliver to markets in big pans on trucks. But the bad roads made this a bit of a mistake as well: the tea would spill on the journey.

The ‘aha’ moment came when the idea arose to store the brewed tea in bottles. The bottles were eye-catching and have evolved in design over the years.

The drink now comes in various packages, from a returnable glass bottle (220 ml) to a Tetra Pak (1 litre, 250 ml, and 200 ml) and a 230 ml pouch.

The Botol Sosro (http://www.sosro.com/teh-botol-sosro.php) is not the company’s only product: it also brews Fruit Tea, The Botol Kotak and S-Tee. The economic benefits of these popular brands stay local, as Sosro gets the tea from PT Gunung Slamet, which operates three tea estates covering 1,587 hectares in Indonesia.

By David South, Development Challenges, South-South Solutions

Published: March 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

As cited in Export Now: Five Keys to Entering New Markets by Frank Lavin and Peter Cohan (Wiley).

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Indonesian Middle Class Recycle Wealth Back into Domestic Economy

The global downturn and economic crisis is now into its third year. Economic growth has dropped across the South, as the knock-on effect of shrinking credit and slowing global markets took its toll.

One solution to re-starting growth and building up domestic industries is to target local products at the existing middle class, which in turn grows the middle class by creating better paying jobs.

Globally, 2009 saw 70 million people join the emerging-market middle class, with incomes between $6,000 and $30,000. And 1 billion people are expected to join the middle class by 2020. It has been called “the story of the decade,” by Goldman Sachs’s chief economist Jim O’Neill, who forecasts their global spending power will outstrip the developed world in two decades.

Indonesia’s middle class first began to grow in the 1980s. But rising prosperity took a heavy blow with the Asian economic crisis of the late 1990s, when the currency was devalued, pitching millions of people back into poverty.

Even so, Indonesia’s middle class is estimated to be between 35 and 40 million people (out of a population of 230 million) and they pay out roughly US $750-1000 on monthly household spending.

They are a mix of people, including professionals in management, banking, accounts, specialized law, bio-technology, engineering and other areas – all skills needed to run the market economy.

Like members of the middle class around the world, increasingly affluent Indonesians forge their identity through consumerism and lifestyle. This desire for goods and services represents a huge business opportunity. Often, this is captured by large multinational companies with long experience of selling branded goods and services.

Indonesia, however, is having great success growing its middle class despite the global economic downturn by building up the domestic market. Millie Stephanie, the director of Indonesia Tatler Magazine, told the BBC that two-thirds of the country’s economy runs on domestic consumption.

New middle class housing is springing up around the capital Jakarta. Home ownership for many, unthinkable a decade go, is now possible as banks make more loans possible. This in turn feeds into more consumption.

By turning to local products – something the Indonesian government is encouraging by increasing its own spending on local goods and services in 2010 by US $21.32 billion, according to Industry Minister MS Hidayat – a cycle is created where middle class wealth creates middle class jobs in local companies.

The department store chain of Matahari (http://www.matahari.co.id/) – the largest local department store in Indonesia – is a good example. Eighty percent of the goods it sells are made in Indonesia. The store targets the middle class with products like jeans that Indonesians can afford. And this strategy has helped Indonesia to get through the downturn.

According to Widia Augustinia, who runs the PT Inti Garmindo Persada jeans factory, the company was able to triple production despite the downturn.

“In the last few years we kept getting calls from our clients saying they had sold all our jeans and they wanted more, so we had to expand our business and had to hire more people,” she told the BBC.

One of the factory’s workers, 37-year-old Miriam, has seen her salary increase annually over the last four years while she has worked in the factory. The increasing wealth means she can now educate her children and buy a TV and a motorcycle.

This matters when half the population are living on less than two dollars a day. This recycling of middle class wealth into the Indonesian economy is making more workers become part of the emerging middle class with the jobs created.

In Africa, the Aureos Advisers (http://www.aureos.com/) private equity firm specializes in investing in African small and medium size enterprises, and is having great success with it despite the downturn. Its niche is finding and investing in companies that sell quality local products.

Run by Sri Lankan-born Sev Vettivetpillai, it raised US $150 million in 2009 to invest in Africa, much of it from pension funds.

“That’s a large sum of money in a market where raising capital is tough,” he told The Guardian newspaper.

Leverage was a game when cheap debt was around,” he says of the old private equity market that went up in flames in 2008. “Today a large chunk of growth is in emerging markets and we have proved you can invest responsibly in these markets and achieve attractive returns while paying attention to building sustainable businesses.”

And the faith in small and medium-sized African businesses has been paying off despite the economic turmoil: since most of the companies have little debt, they have not suffered in the downturn. And since many do not export much to Europe or the United States, they have not suffered from the consumer slump.

“When markets crashed 60 percent, good management teams were making sure they had cash, not much debt,” said Vettivetpillai. “Most banks don’t lend to these SMEs. And that has saved a number of those businesses. So we had an upward lift in earning growth in 2008 when many people showed a drop.”

By David South, Development Challenges, South-South Solutions

Published: March 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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A Solution to Stop Garbage Destroying Tourism

Tourism is an essential source of income for countries across the South. But many put that livelihood in jeopardy when they lose control of garbage collection. A popular tourist spot can represent a ‘paradise’ to visitors, but when it becomes too popular and local garbage collection systems collapse under the burden, ‘paradise’ can soon turn to an environmental hell.

The small, tourist-friendly Indonesian island of Bali (http://en.wikipedia.org/wiki/Bali) – known for its idyllic pleasures of spas, surf and serenity – is being overwhelmed by garbage. A survey of tourists found two-thirds would not return to the island because of the problem.

Tourism took off on the island in the 1970s. The economic benefits are clear: the island went from being economically marginal to ranking second only to the country’s capital, Jakarta, in wealth creation. The island received more than 2.38 million tourists in 2009, up 14.5 percent compared with 2008, according to Ida Komang Wisnu, head of the provincial statistics office. But tourism produces on average five kilograms of waste a day per tourist – 10 times what the average Indonesian produces (Bali Fokus).

In the past, the traditional way of serving food in Indonesia was to wrap it in, or serve it on, a palm leaf: a biodegradable approach. But with the huge expansion in use of plastics and non-biodegradable packaging, the waste disposal problem is out of control.

In Indonesia, government garbage disposal services tend to collect between 30 and 40 percent of solid waste, most of this from high income communities. The majority poor population are left to fend for themselves when it comes to waste disposal.

A solution by Yuyun Ismawati, an environmental engineer and consultant, has since 1996 focused on helping poor communities find ways to safely dispose of waste. In 2000, she started her own NGO – Bali Fokus (http://balifokus.asia/balifokus/) – and opened a waste management facility in the Bali village of Temesi. The recycling plant employs 40 people from the village, who sort garbage into recyclables, compost and residual waste. Income from the recycled waste and compost goes to helping local farmers.

She then expanded her concept to include households around Bali and elsewhere in Indonesia. She concentrated on housewives and targeted reducing the amount of household waste going to dump sites. A core team trains housewives in daily habits that separate waste and compost organic matter like vegetable and fruit scraps. Bali Fokus claims it has been able to reduce waste created by 50 percent in 500 homes. Some of the women sell their compost in local markets; recyclables are turned into sellable items.

From 2001 to 2003, Ismawati turned this approach into a replicable template called SANIMAS. By 2008, the SANIMAS template was being used in hundreds of communities across Indonesia.

Her solution to the deluge of tourist waste can be seen in the luxury Jimbaran Bay area of Bali. Traditionally, the area’s hotels would sell their waste to pig farmers. While the pigs feasted on the fancy scraps, the rest of the waste was put in plastic bags and thrown away in mangrove forests.

“I told hotels: Your job is to sell rooms, not to sell garbage,” Ismawati recalls. “We have to protect Bali or else tourists won’t want to come here anymore.”

Ismawati cleverly turned the relationship around: rather than a pig farmer paying for scraps, she convinced one of them there was money to be made recycling and sorting garbage. For this, the hotels would pay the farmer.

A network of 25 hotels now pays to have their garbage taken away and sorted by hand: an important source of full-time jobs.

The workers sort through paper, plastics, glass, aluminium, food scraps and vegetables. Each week, 140 trucks deliver waste to the facility. Only 10 leave with waste that has to go to a dump site.

Food leftovers are bought by local pig farmers and grass clippings and other organic matter is composted (http://www.recyclenow.com/home_composting/), and eventually makes its way back to the hotels and is distributed in the flower beds.

This system has created 400 jobs where the pig farmer once only employed 10 people.

“If you want a hi-tech solution in a developing country you will wait and wait and wait until you get the money, or big donors to fund it,” Ismawati told the Telegraph newspaper. “And even then it may not work.”

A graphic example of this is a donated waste recycling machine given by the local government. It can’t be used because the electricity to power it costs too much. Human labour is a cheaper option.

Bali Fokus’ successful approach has now been replicated in six other sites on the nearby island of Java. And the government of Indonesia has promised to help create 15 more each year.

In 2009 Ismawati won the Goldman Award (http://www.goldmanprize.org/), which honors grassroots environmental heroes from the six inhabited continental regions: Africa, Asia, Europe, Islands and Island Nations, North America, and South and Central America.

She is also working on using decentralized grassroots approaches to bringing sewage disposal and clean water to communities.

By David South, Development Challenges, South-South Solutions

Published: March 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Innovation: Cairo’s Green Technology Pioneers

One thing is ubiquitous to every country, community and society: garbage. It’s a social and environmental problem, but far from being mere waste, rubbish has its uses. This by-product of the goods and foods consumed can also be a source of fuel. As such it has many advantages, including providing free fuel to cash-strapped households, independence from unreliable municipal services and a way to dispose of waste.

An enterprising Egyptian man is showing his community how it is possible to lower the cost of gas and hot water while also avoiding the service disruptions common with municipal utilities. In the process, he is pioneering a local green innovation model that can be replicated elsewhere.

Biogas (http://en.wikipedia.org/wiki/Biogas) generators — which can transform organic household waste into fuel — have been very successful in India and China. It is estimated there are 20 million small-scale urban biogas digesters in China and 2 million in India.

Hanna Fathy’s roof in the Manshiyet Nasser neighbourhood, home to the Coptic Christian Zabaleen community of Cairo – the city’s traditional garbage collectors and recyclers – is now a utility system, providing biogas and hot water.

The area is made of narrow streets and makeshift houses. Residents live cheek-by-jowl in a neighbourhood that is home to tens of thousands of people.

The community was badly hit when the 300,000 pigs the Christian residents have kept for the past 30 years to eat Cairo’s vegetative waste — an effective garbage-disposal system — were slaughtered under government orders to prevent the spread of swine flu (H1N1) (http://en.wikipedia.org/wiki/Swine_influenza).

One woman told U.S. National Public Radio about the hard life in the neighbourhood: “I’m working all the time. My hands get dirty, there’s no water. The price of food is too high. The gas has gone up to seven pounds (US $1.28) a bottle, so it’s expensive to heat.

“Everything is so expensive, and I have to live like this?” she said.

Fathy plops kitchen scraps, stale tea and tap water into a jug which he pours into a homemade biogas maker on the roof of his house. The stew of waste mixes with water and a small quantity of animal manure used to start the process, and overnight makes biogas, which is then used for cooking. The digester is able to provide an hour’s worth of cooking gas a day in winter months, and two hours in the summer, from around two kilograms of waste. The remaining waste by product becomes liquid organic fertilizer for the garden.

Fathy has been developing the biogas digester with the NGO Solar Cities (http://solarcities.blogspot.com), which provides designs, technical advice and support to Cairo citizens keen to embrace green technologies.

What is interesting is not only the technology but how that technology is being developed. The approach is to innovate and adapt the technology to local resources and skills. This increases the chances of take-up and buy-in.

The designs for the digesters and heaters have evolved through experimentation, brainstorming and availability of local materials.

Each biogas system costs about US $150 for materials, a cost that is being picked up right now by donations. Solar Cities believes there are only eight biogas digesters in Egypt so far, most built in 2009.

Solar Cities’ founder, Thomas Culhane, points out many urban dwellers do not believe they can generate biogas and associate it with rural systems that use animal manure. But the abundance of urban kitchen waste is in fact an excellent source material for biogas.

Culhane believes the biogas digesters are an excellent solution to two problems: the vast quantities of garbage piling up in Cairo, which has had its traditional disposal system disrupted by the slaughter of the pigs, and the city’s emissions of greenhouse gases that contribute to climate change.

Fathy has one goal: to be completely self-sufficient. He has been also prototyping a solar heater on his roof as well as the biogas digester. The solar water heater makes use of items that can be easily found: it recycles black garbage bags, has an aluminium frame and a glass cover. The whole thing rests on a Styrofoam block and uses copper tubes. The water is stored in a bright blue barrel.

Biogas, solar power and other forms of green energy face many obstacles if it is to expand further in Egypt. The average cost of each unit will need to come down to match the income of the users and compete with the government-subsidized energy sector.

Fathy has also found neighbours are skeptical and can’t believe biogas can be made this way.

Another man, Hussain Soliman, had both a solar water heater and biogas digester on the roof of his apartment building before the crumbling building collapsed.

The complete solar water heating system designed by Solar Cities can be assembled for under US $500. It uses two 200-litre recycled industrial shampoo barrels for the holding tank and back-up water supply. The solar panels need to be kept clean from dust every week, but other than that, Culhane insists the heaters require little maintenance.

Now in temporary government housing, Soliman is still enthusiastic about the technology and is re-building a solar heater and biogas digester for his new home.

“I’m planning to collect the organic waste from restaurants in the neighborhood to increase my gas output,” he told IPS News. “I’ll give the restaurants plastic bags and they can separate out the organics, and I’ll collect the bags at the end of each day.”

By David South, Development Challenges, South-South Solutions

Published: January 2010

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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