Tuesday, May 1, 2012

New Delhi's Nehru Place Electronics Market blacklisted by US

Twenty five or thirty years ago, I used to visit New Delhi quite often for business purposes. A huge market known as ‘Chandani Chowk market’, where trading in all sorts of commodities took place, existed opposite Delhi’s famous Red Fort. I had appointed a dealer for Delhi area, to market products manufactured by my company, and his shop used to be in a part of this market, known as Electrical Market. Because of this reason, I used to visit that area at least once in every six or eight months. On one side of this Electrical market, there used to be a smaller market, which dealt exclusively with Electronic products. In those days, Electronic products that were available in India, were very few and limited, such as transistor radios and voltage stabilizers. The highest selling product was so called ‘Transistor portable radio’. Only 4 or 5 big companies such as Philips, Bush, Murphy and National Ekco had Government permission then, to manufacture these radios. No other big business. was allowed to enter the field. Yet, there were number of small manufactures or bed room manufacturers, who would do assembly of these radios and voltage stabilizers. These small entrepreneurs mostly supplied their goods to this Chandni Chouk Electronics market. This market was also famous for making available, branded radios at a very cheap rate. This was done by labeling, radios manufactured by bedroom manufacturers with labels of Philips, Bush or Murphy. This business was done openly with total disregard of any laws or rules. Naturally such deals were strictly on cash basis and no invoice or receipt was ever given and if given it would be in the name of some other product. It is needless to say that the quality of these fake radios used to be very inferior, as there was no quality control and no guarantee.

With globalization and removal of most of the restrictions on manufacture and import of electronics stuff, I had since thought that New Delhi's electronics market and all the illegal businesses carried on there would be closed by now. But my assumption has turned out to be totally wrong. New Delhi's shady market is still very much thriving. The only changes that have taken place are that the market has shifted to a new venue and instead of transistor radios, the trading now goes on in computers, phones and their components. 'Chandani Chouk Electronics market' has now shifted to Nehru Place in New Delhi. Out of some 10000 shops around this place, 3000 shops are dealing in electronics and specially computers, phones and their parts. 
This Nehru Place market has now the dubious distinction of receiving a new certificate of commemoration.(?) A US Government department known as U.S Trade Representative (USTR) has recently published on 20th December 2012, a world wide list of markets that have been blacklisted for trading in highest number of pirated goods. This list is being called as ' Out-of-Cycle Review of Notorious Markets,December 20, 2011'. This list includes, along with 14 other ill famous markets, Nehru Place electronics market also. The other markets in this list are Bahia Market (Guayaquil, Ecuador), China Small Commodities Market (Yiwu, China), Ciudad del Este (Paraguay), Harco Glodok (Jakarta, Indonesia), La Salada (Buenos Aires, Argentina), Lo Wu Commercial Center (Shenzhen, China), PC Malls (China), Petrivka Market (Kyiv, Ukraine), Quiapo Shopping District (Manila, Philippines), Red Zones (Thailand), San Andresitos (Colombia), Silk Market (Beijing, China), Tepito (Mexico City), Urdu Bazaars (Pakistan).

USTR report about Nehru Place electronic market says that “ Like many other markets in all other major cities of India, Nehru Place market is ill famous for trading in pirated computer software, movies and music media, and smuggled or illegally procured electronics items”.

If we go around this market, we can see here many shops dealing with items like personal computers, servers, networking gear, computer software, copiers, paper, ink, printers, which are all connected with information technology industry. All related services are also easily available here. There are many shops , who trade in genuine materials, legally imported or procured. This makes this market a Mecca for all those who are connected with electronics or computers. There are many entrepreneurs and shops here that assemble computers and servers against orders. There is also a market for used or second hand computers. Most of the business is carried out here, except for authorized shops, on cash basis and without any tax compliance. The prices are therefore much cheaper here and with haggling one can get huge discounts. 
From all this description, it is obvious that Nehru Place electronics market has a huge potential. However, for development of this market into a genuine trade hub, it is imperative that the goods and services traded in this market must be legally procured after full tax compliance. Unfortunately, the market is developing into a hub for smuggled and tax evaded goods and services. If this continues, even though the market is thriving at this point of time, a time may surely come when just like old 'Chandani Chouk Electronics market', the very existence of this market may also get erased.

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