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  • Innovative Solutions Celebrated in Ashden Awards

    Innovative Solutions Celebrated in Ashden Awards

    By David South, Development Challenges, South-South Solutions

    SOUTH-SOUTH CASE STUDY

    The world’s population is heading towards 9.6 billion by 2050 (UN). Combined with a growing middle class and rising living standards across the global South, that means ever-greater demand on the world’s finite resources. This raises a crucial question: Where will the energy to power rising living standards come from, and how much damage will be done to the planet’s environment by pollution created generating it (https://www.un.org/en/development/desa/news/population/un-report-world-population-projected-to-reach-9-6-billion-by-2050.html)?

    The solution advocated by the world’s scientists is to move to sustainable energy creation, which does not rob from the future to create energy for today.

    Such an approach requires fresh thinking and engagement from those who are actually involved in the struggle to raise living standards and improve human development.

    One way to do this is to use high-profile awards and prizes to lure out fresh thinking and innovators and help them get the funding they need to realize their plans.

    The International Ashden Awards (ashden.org) – considered the “leading green energy awards” – is about championing and promoting “practical, local energy solutions that cut carbon, protect the environment, reduce poverty and improve people’s lives”. It recently announced the finalists and winners for 2014.

    The international finalists are 10 sustainable energy enterprises drawn from Africa (Burkina Faso, Tanzania), India and Southeast Asia (Cambodia, Myanmar). A handy, clickable and searchable online map (http://www.ashden.org/winners) further explains the winners and finalists for 2014 and previous years.

    “With the stark warnings from the IPCC (Intergovernmental Panel on Climate Change) of the impacts of climate change, especially for the most vulnerable, we need to find solutions before it is too late,” said Ashden founder-director Sarah Butler-Sloss.

    “Our role at Ashden is to shine a light on those organizations around the world that are helping reduce carbon emissions and finding ways of adapting to the effects of climate change.”

    The mix of non-profit organizations and businesses among 2014’s winners and finalists shows there is no shortage of enthusiasm and fresh thinking out there. Proof the global South is alive with innovators with solutions.

    Among the five international winners – who will receive between US $8,566 and US $68,531 each – is India’s Greenway Grameen (greenwaygrameen.com). It is tackling the problem of harmful pollution caused by cooking. Despite rapid economic growth and the spread of consumer goods such as televisions and mobile phones, most Indian women still cook with wood or dung. This is not only time-consuming, it also produces health-damaging smoke. Greenway Grameen was founded by two young MBA graduates in 2010 to make and sell affordable, desirable cookstoves that reduce smoke, cook food more quickly and stay cleaner for longer, dramatically improving the quality of life for many women and girls. As of March 2014 more than 120,000 of Greenway’s made-in-India smart stoves had been sold, benefitting around 610,000 people.

    Another Indian winner is Infosys (infosys.com). India’s fast-growing economy is making ever-greater demands on its electrical grid. Global IT giant Infosys is leading the way to more sustainable growth by embracing green building measures, decreasing electricity consumption per staff member across its Indian business campuses. Success lies in seizing every opportunity to cut energy consumption in its existing buildings – from reducing the size of chiller plants for air conditioning to painting roofs white to reflect the heat. Cutting-edge design of new buildings also helps keep offices cooler and maximizes natural light. Taking US $80 million off its electricity bills, Infosys has proven the business case for large companies to invest in energy efficiency – not just in India but around the globe.

    Among the other winners:

    – Tanzania’s Off Grid Electric (offgrid-electric.com) is a leader in solar energy in East Africa, using mobile money to sell solar power as a daily service at an affordable price. Mobile money – where customers pay with their mobile phones – is increasingly used as a method of payment. Off Grid stands out because it understands the importance of customer service, offering an all-day customer care telephone line and ongoing support from a local agent. More than 10,000 households have taken up the service since April 2012. As fast as systems are manufactured they are off to customers – thanks to a sophisticated mobile phone app-based customer registration and product-tracking system.

    – Myanmar’s Proximity Designs (proximitydesigns.org) is introducing treadle pumps (http://en.wikipedia.org/wiki/Treadle_pump) and other sustainable agriculture technologies to the country for the first time. Lifting water from wells and carrying it across fields is back-breaking, time-consuming work for rural farmers. Combined with water-saving drip irrigation technology, foot-operated treadle pumps that draw up water from wells can dramatically increase yields and incomes. Farmers are now seeing their lives transformed with some harvests and incomes more than doubling – and the pumps are helping ease the daily drudgery of farming. With over 90,000 households benefiting so far, Proximity Designs continues to adapt and introduce new products like solar pumps, to meet the needs of this rapidly changing country.

    – Cambodia’s Sustainable Green Fuel Enterprise (http://www.sgfe-cambodia.com/environment) is turning leftover coconut shells and other waste into clean-burning briquettes for use as cooking fuel in the capital Phnom Penh’s homes and restaurants. While most Cambodians cook on wood charcoal, contributing to the country’s rampant deforestation and air pollution, this pioneering Cambodian business – led by Carlo Figà Talamanca – can scarcely keep up with demand.

    The finalists are also an innovative lot too. Kéré Architecture (kerearchitecture.com) in Burkina Faso, Africa, has set a new standard for green school buildings. The school it built has a ventilated roof and other clever design features, providing a much cooler environment for children to study in. Not only that, the school was built by local people, and largely with local materials. Germany-based Francis Kéré, originally from Burkina Faso, designed and built the school in his home village. Kéré Architecture has since designed and built more than 20 innovative, naturally cooled public buildings in Africa.

    India’s Sakhi Unique Rural Enterprise (sureindia.co.in), or SURE, is a not-for-profit social enterprise in central Maharashtra that has selected, trained and supported more than 600 female micro-entrepreneurs to sell clean energy products such as solar lanterns and cleaner cookstoves to other women. For the women entrepreneurs, selling energy products boosts income and carries a social cachet, while customers also see their lives improved with time-saving products.

    Another Indian innovator, Mera Gao Power (http://meragaopower.com/), is demonstrating the business case for meeting the needs of some of the poorest people in India with unsubsidized commercial micro-electric grids, connecting more than 20,000 Uttar Pradesh families to clean, affordable power. Each system is easy to install and provides seven hours of light and mobile phone-charging for up to 32 houses. And with weekly payments of just US $0.42 cents, the electricity is even cheaper than kerosene.

    The Rajasthan Horticulture Development Society (http://horticulture.rajasthan.gov.in/) in India has come up with a novel way to boost green agriculture and boost farming incomes. Farmers in the desert state of Rajasthan are seeing their sons return from cities to work on their farms thanks to a new solar-powered agricultural boom. The Rajasthan Horticulture Development Society (RHDS) has provided more than 10,000 farmers with new solar-powered water pumps, enabling year-round cultivation of high-value crops and the kind of high-tech horticulture that’s never been seen in the region before. With farmers’ incomes more than doubling, the programme has given them the “gift of life”.

    And finally, Tanzania’s SimGas (simgas.com) is selling biogas plants that help people turn manure into clean gas for cooking instead of using charcoal, helping reduce deforestation. The plants are factory-produced and made of plastic, so they can be installed much more quickly than conventional plants and reach many more thousands of people. SimGas has just installed the largest plastic injection-moulding machine in East Africa, creating the potential to roll out biogas plants across East Africa.

    The Ashden Awards were set up in 2001 to champion trailblazing sustainable energy enterprises and programmes that improve people’s lives and tackle climate change. Ashden says its 150 award winners have improved the lives of 37 million people worldwide, and are now saving over 5 million tonnes of carbon emissions every year.

    Published: July 2014

    Resources

    1) Innovation Prize for Africa: The IPA is an initiative of the African Innovation Foundation (AIF) started in 2011. IPA honours and encourages innovative achievements that contribute toward developing new products, increasing efficiency or saving cost in Africa. Website: http://innovationprizeforafrica.org

    2) Champions of the Earth Award: The Champions of the Earth Award recognizes outstanding environmental leaders, whether individuals or organizations, that have exemplified inspiration, vision, innovation, leadership and action for the environment. This international award was established by UNEP in 2004. Website: unep.org/awards/

    The SEED Awards: The SEED Award recognizes innovation in local, environmentally-responsible and sustainable entrepreneurship. This international award is the flagship programme of the SEED Initiative, a partnership founded by the United Nations Development Programme (UNDP), UNEP, and the International Union for Conservation of Nature (IUCN). Website: seedinit.org

    4) Green Star Awards: The Green Star Awards recognize those who have made remarkable efforts to prevent, prepare for, and respond to environmental disasters around the world. This international award is a joint initiative between UNEP, the UN Office for the Coordination of Humanitarian Affairs and Green Cross International. Website: http://www.gcint.org/green-star-awards3

    Creative Commons License

    This work is licensed under a
    Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

    ORCID iD: https://orcid.org/0000-0001-5311-1052.

    © David South Consulting 2023

  • Solar Solution to Lack of Electricity in Africa

    Solar Solution to Lack of Electricity in Africa

    By David South, Development Challenges, South-South Solutions

    SOUTH-SOUTH CASE STUDY

    Electricity is critical to improving human development and living standards. Yet, for many in the global South, electricity is either non-existent or its provision is patchy, erratic, unreliable or expensive.

    Just as Africa has been able to jump a generation ahead when it comes to communications through the mass adoption of mobile phones – a much cheaper option than trying to provide telephone wires and cables across the continent – so it could also bypass the burdensome costs of providing electricity mains to everyone by turning to smaller electricity generation technologies such as solar power. This is called “off-grid” electricity.

    The UN has set the goal of universal access to modern energy services by 2030. A report issued in April 2010 by United Nations Secretary-General Ban Ki-moon’s Advisory Group on Energy and Climate Change (AGECC) calls for expanding energy access to more than 2 billion people (http://www.unido.org/fileadmin/user_media/Publications/download/AGECCsummaryreport.pdf).

    The report found that a lack of access to modern energy services represents a significant barrier to development. Some 1.6 billion people still lack access to electricity.

    A reliable, affordable energy supply, the report says, is the key to economic growth and the achievement of the anti-poverty targets contained in the Millennium Development Goals.

    When a person has electricity and the lighting it powers, it is possible to do business and study late into the night. Electric lighting also makes streets and living areas safer. Electricity can power a plethora of labour-saving and life-enhancing consumer goods: televisions, refrigerators, vacuum cleaners, air conditioners and fans, washing machines, clothes dryers, computers. And electricity recharges that most essential item, the mobile phone, on which millions rely to do their daily business.

    After witnessing the struggle African health clinics have to access electricity, a Nairobi, Kenya-based company has developed a simple solution to ensure a steady supply of solar electricity. One Degree Solar’s (http://onedegreesolar.com/) founder, Gaurav Manchanda, developed and sells the BrightBox solar-charging system for lights, mobile phones, tablet computers and radios.

    He first gained experience working in the West African nation of Liberia with the Clinton Health Access Initiative (http://www.clintonfoundation.org/main/our-work/by-initiative/clinton-health-access-initiative/about.html). Working at the country’s Ministry of Health, he found most health clinics operated without electricity.

    He identified solar power as the only viable energy source. Trying to deliver fuel to power generators by the road network had two impediments: the diesel fuel was expensive and the road conditions were poor.

    After seeing that large solar-power systems required significant maintenance and upkeep, he started to explore the possibility of low-cost, and simple-to-use solar electricity products that would be useful to community healthcare workers.

    This became the beginning of One Degree Solar and its mission.

    The company’s main product is the BrightBox, a cleverly designed solar charger. A bright orange box with a folding, aluminum handle at the top for easy carrying, it switches on and off simply with a bright red button. It has a waterproof solar panel. The BrightBox has USB (universal service bus) (http://en.wikipedia.org/wiki/Universal_Serial_Bus) ports so that mobile phones and radios can be plugged in. It is also possible to plug in four lights at once with the four outports on the side of the box.

    It meets the standards set by the Lighting Africa initiative (http://lightingafrica.org/specs/one-degree-brightbox-2-.html) of the International Finance Corporation and the World Bank.

    One Degree Solar claim it is possible to set up a BrightBox in 10 minutes. When the indicator light has turned green, the box is fully charged and capable of providing 40 hours of light.

    A full charge can power two light bulbs for 20 hours. Manchanda told How We Made It In Africa (http://www.howwemadeitinafrica.com/) that he has sold 4,000 units of the BrightBox since its launch in October 2012.

    According to The Nation, the BrightBox is currently retailing in Kenya for Kenyan shillings 7,000 (US $82).

    One Degree Solar’s product range is sold to local resellers and distributors. The products are designed to be repaired using locally sourced parts and can be fixed by local electricians.

    Most of the sales so far have been in Kenya but the firm has also sold units to other countries.

    Testimonials on the BrightBox website tell of the transformation to people’s lives the clean energy source makes: “BrightBox has helped us in so many ways! We used to spend 800 Shillings (US $9.50) a month for two paraffin lanterns. The fumes smelled and always made us feel sick.”

    Manchanda is a strong believer in Africa’s potential and its future and dismisses those who are negative about the continent.

    “That was not a holistic assessment, but rather, an unnecessary and damaging generalization,” he told How We Made It In Africa. “Fortunately, most news outlets in Africa are now available online and offer a wider range of perspectives. The middle class is booming in certain countries. We have seen the success of mobile phones in enabling people to access other services. I think hope and progress come with innovation. Technology access has helped create entirely new markets and reach populations that otherwise could have taken decades to service with traditional approaches.

    “India was in a similar space 15 years ago before the Internet boom, and today parts of Nairobi (Kenya) are just like Delhi (India): people have a cell phone or two, there are large shopping malls, a booming middle class, and new construction everywhere.”

    Published: June 2013

    Resources

    Global Off-Grid Lighting Association: Global Off-Grid Lighting Association (GOGLA) has been established to act as the industry advocate with a focus on small and medium enterprises. It is a neutral, independent, not-for-profit association created to promote lighting solutions that benefit society and businesses in developing and emerging markets. GOGLA will support industry in the market penetration of clean, quality alternative lighting systems. Website: http://globaloff-gridlightingassociation.org/

    Solar Sister: Solar Sister eradicates energy poverty by empowering women with economic opportunity. Website: http://www.solarsister.org/

    Solarpod: Sunbird Solar/Thousand Suns manufactures, sources and distributes the portable solar generator range. Website: http://www.thousandsuns.com/

    4) Little Sun: An attractive, high-quality solar-powered lamp in the shape of a hand-sized sun developed by artist Olafur Eliasson and engineer Frederik Ottesen. Website: http://www.littlesun.com/

    Southern Innovator logo

    London Edit

    31 July 2013

    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.

    Creative Commons License

    This work is licensed under a
    Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

    ORCID iD: https://orcid.org/0000-0001-5311-1052.

    © David South Consulting 2023

  • African Afro Beats Leads New Music Wave to Europe

    African Afro Beats Leads New Music Wave to Europe

    By David South, Development Challenges, South-South Solutions

    SOUTH-SOUTH CASE STUDY

    A surge in interest in African music in Britain is creating new economic opportunities for the continent’s musicians. The new sound heating up the U.K. music scene is “Afro Beats” – a high energy hybrid that mixes Western rap influences with Ghanaian and Nigerian popular music.

    Afro Beats draws its inspiration from the “Afrobeat” sound popularized in the 1970s (http://en.wikipedia.org/wiki/Afrobeat).Afrobeat recordings from that time are still making money as long-forgotten tunes are re-packaged by so-called ‘crate divers’ – enterprising people who rummage through old vinyl record collections and re-brand scenes and sounds.

    This is part of the global creative economy, which is thriving despite the recent years of economic turmoil. Musicians offer many lessons for businesses in the South, both in their adaptability to new conditions and their resourcefulness in experimenting with new business models to earn an income.

    Afrobeat stars and pioneers like Nigeria’s Fela Kuti (http://en.wikipedia.org/wiki/Fela_Kuti) have been popular outside Africa for many decades. But Afro Beats – a new name with the addition of the crucial letter “s” – is being declared as the beginning of a new phase in taking African music global.

    As the digital music revolution has rocked the global music business, artists have had to adapt and change their business models. For all but a very few “big names,” it is no longer possible to build a career on royalties from recordings and hits. Stars and novices alike must battle with music pirates, who sell CDs and downloads of other people’s tunes and keep the money for themselves. Legitimate income often comes in micropayments from large music platforms like iTunes as people pay to download an individual song or mix and match tunes they like from an artist’s catalogue, rather than buying a whole album as they would in the past.

    Clever musicians have turned to building their brand, using live performances and the ability to sell other services and merchandise to make a living. They create their own web platforms, or mobile phone apps (applications), and do the marketing and distribution on their own to build a loyal fan base. Others are creating their own mobile radio stations by distributing CDs to the ubiquitous taxi mini buses that are the main means of transport in most African cities.

    But some things remain the same as in the past, such as the importance of having a champion, such as a radio DJ (disc jockey), who acts as a “taste maker,” discovering new acts and telling their audience about them.

    The DJ most associated with pushing the Afro Beats sound and scene is London-based DJ Abrantee (http://www.facebook.com/djabrantee).

    “I’ve been playing this music to three or four thousand people at African events in the U.K. for years,” DJ Abrantee told The Guardian. “For years we’ve had amazing hiplife, highlife, Nigerbeats, juju music, and I thought: you know what, let’s put it all back together as one thing again, and call it Afro Beats, as an umbrella term. Afrobeat, the 60s music, was more instrumental – this Afro Beats sound is different, it’s inter-twined with things like hip-hop and funky house, and there’s more of a young feel to it.”

    Abrantee (abrantee.com) promotes Afro Beats in the United Kingdom in myriad ways: he broadcasts six days a week on a radio station, including an Afro Beats-themed show on Saturdays. He travels around to DJ and takes Ghanaian and Nigerian tunes with him. He says Africa is so musically vibrant, he can’t keep up with it all.

    “This is specifically the western African sound: there are a lot of shared ideas between these two neighbouring countries,” he explained to The Guardian. “I see Afro Beats as music which makes the heart beat. And it’s funky, and hyped, and energetic and young.”

    Afro Beats has also been able to reach a young audience. “It’s striking how young they are – when I do these Afro Beats events there’s thousands of people, and they’re all youngsters, really.”

    One of the Afro Beats stars is D’Banj (mohitsrecords.com/d-banj) – a Nigerian rap star – who has been receiving attention for his song Oliver Twist.

    The Afro Beats sound is also provoking a new interest in all things African amongst youth with African parents. This is a big change from when American “cool” set the trends. As DJ Abrantee notes, “the parents are really pleased, and proud, that their kids are all of a sudden embracing their culture. It didn’t used to be cool, but now they’re going through their parents’ record collections going, ‘Have you got this old song by Daddy Lumba?’.”

    Some of the Afro Beats leaders include Sarkodie’s ‘U Go Kill Me’, Ice Prince’s ‘Oleku’, Atumpan’s ‘The Thing’, Castro ftAsamoah Gyan’s ‘African Girls’.

    Afro Beat’s popularity in Britain has led to African artists collaborating with musicians in the UK. Afro Beats musician Sarkodie has collaborated with London-based artists Donaeo and Sway.  DJ Abrantee sees this trend continuing and expanding. “You’re going to see more U.K. artists doing Afro Beats collaborations now,” he said.

    Other Nigerian artists who have benefited from the increasing awareness are Wiz Kid, 2Face Idibia and P-Square (mypsquare.com).

    Abrantee believes Ghana and Nigeria are having a big impact on the global music scene.

    “The floodgates have opened. Music is always evolving, and everyone’s always looking for the next drug. Funky house has died out, grime is still there but it’s gone back underground, electro-pop’s got U.K. urban music in the charts, but that’ll die out, it’s got a short shelf-life. … and people are finally noticing I’m getting 3,000 people coming out to dance to Afro Beats.”

    British-Ghanaian hip-hop performer Sway sees connections between Afrobeat and Afro Beats.

    “Fela Kuti is obviously a massive legend in the game, and what he was doing is not too different to what D’Banj is doing now – taking western influences and adding them to African culture, and coming up with something new, that appeals to everyone,” he said.

    And technology is seen as the binding element that is connecting African music and musicians to other scenes.

    “African music in Africa is evolving in relation to what’s going on abroad too,” said Sway. “Via the Internet they’re picking up certain trends much quicker: so for example you have Auto-Tune and western styles of singing cropping up on all these Afro Beats tracks.”

    And Sway believes the quality of production of African music has improved: “There’s been a serious change in the music coming out of Africa lately.

    “The sound is heavier and clearer, the videos are better, there’s been a positive growth in the African music scene. It was just a matter of time before people paid attention.

    “When you’ve got African swag and African traditions combined with up-to-date western styles, and singing in English, well – you’ve got a winning formula on your hands.”

    Published: February 2012

    Resources  

    1) Mongolian Rock Pop book: In the Mongolian language, this UNDP book details how pop musicians led on business innovation during the turbulent transition years of the 1990s. Website: http://www.scribd.com/doc/23917535/Mongolian-Rock-and-Pop-Book

    2) Afrobeat: An interactive exploration of Afrobeat and its participants from National Geographic. Website: http://worldmusic.nationalgeographic.com/view/page.basic/genre/content.genre/afrobeat_686/en_US

    3) DJ Abrantee: More from the champion of the Afro Beats scene. Website: http://www.abrantee.com

    https://davidsouthconsulting.org/2022/11/21/africa/

    https://davidsouthconsulting.org/2022/11/19/african-culture-as-big-business/

    https://davidsouthconsulting.org/2022/11/17/african-ingenuity-attracting-interest/

    https://davidsouthconsulting.org/2022/10/26/africas-consumer-market-in-spotlight-for-2011/

    https://davidsouthconsulting.org/2021/03/12/afro-coffee-blending-good-design-and-coffee/

    https://davidsouthconsulting.org/2021/01/05/afropolitan-african-fashion-scene-bursting-with-energy/

    https://davidsouthconsulting.org/2022/11/17/cashing-in-on-music-in-brazil/

    https://davidsouthconsulting.org/2022/12/18/disabled-congolese-musicians-become-world-hit/

    https://davidsouthconsulting.org/2022/10/20/ghana-wants-to-tap-global-trendy-party-scene/

    https://davidsouthconsulting.org/2022/10/24/made-in-africa-fashion-brand-pioneers-aim-for-global-success/

    https://davidsouthconsulting.org/2021/11/09/mauritanian-music-shop-shares-songs-and-friendship/

    https://davidsouthconsulting.org/2023/02/07/mongolian-rock-and-pop-book-mongolia-sings-its-own-song/

    https://davidsouthconsulting.org/2020/12/17/mongolias-musical-entrepreneurs-led-way-out-of-crisis-2018/

    https://davidsouthconsulting.org/2021/11/09/ring-tones-and-mobile-phone-downloads-are-generating-income-for-local-musicians-in-africa/

    https://davidsouthconsulting.org/2022/06/25/shoes-with-sole-ethiopian-web-success-story/

    https://davidsouthconsulting.org/2021/03/05/southern-innovator-issue-2/

    https://davidsouthconsulting.org/2021/11/09/taxis-promote-african-music-beats/

    https://davidsouthconsulting.org/2022/04/15/youth-surge-in-the-south-a-great-business-opportunity/

    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.  

    Creative Commons License

    This work is licensed under a
    Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

    ORCID iD: https://orcid.org/0000-0001-5311-1052.

    © David South Consulting 2023

  • The Battle for India’s Coffee Drinkers in Buzzing Economy

    The Battle for India’s Coffee Drinkers in Buzzing Economy

    By David South, Development Challenges, South-South Solutions

    SOUTH-SOUTH CASE STUDY

    A showdown in India over coffee is creating new opportunities. It is also demonstrating how the country is changing, with rising incomes in some places and great disparities in others.

    Finding the right place to have a coffee and meet with friends for a chat is important to many urban Indians. And the fight is on for these customers.

    Older establishments like the legendary College Street Coffee House in Kolkata (http://en.wikipedia.org/wiki/College_Street_Coffee_House) – owned by a cooperative society – compete with new rivals modelled on the popular American chain Starbucks (http://www.starbucks.com/). This fierce competition takes place in an economic environment of rising food inflation of up to 16 percent this year and economic growth surpassing seven percent.

    Coffee is the second most popular drink in India after tea. Its consumption has been steadily growing over the years, rising from 50,000 metric tonnes (MT) in 1995 to 94,400 MT in 2008 (Coffee Board of India). Once mainly drunk in the south of India, the taste for coffee has spread around the country with the rise of fast-paced modern lifestyles. The caffeine (http://en.wikipedia.org/wiki/Caffeine) jolt of a cup of coffee is attractive to people on the move and working hard.

    India also holds its own as a coffee growing and exporting nation, accounting for about 4.5 percent of world coffee production and the industry provides employment to 600,000 people. The state of Karnataka accounts for 70 percent of country’s total coffee production followed by Kerala (22 percent) and Tamil Nadu (7 percent).

    India has the domestic demand, and it has the product. And now a bitter battle for the nation’s coffee drinkers is underway. The difference between what is on offer at the cooperative-run coffee houses and the newer establishments is stark: at the older places, service is old-fashioned – waiters in white suits deliver coffee and food to tables – with a no-frills menu on offer. Coffee comes in simple forms: black, white, cold, hot for eight rupees (US 0.18 cents). At newer establishments, coffees come in many varieties and permutations, flavoured and with added extras. Menus also can be varied and establishments can include things like internet access.

    The appeal of the older establishments is price.

    “It’s good here because it’s cheap,” College Street Coffee House customer Arindam Chouwdhry, 19, told The Guardian newspaper. “We can’t go to these new places. We are from the middle class only.”

    And turnover is brisk, according to manager, Deepak Gupta. “We serve up to 1,500 cups a day. Business is good.”

    Owned by the India Coffee House chain (http://en.wikipedia.org/wiki/Indian_Coffee_House), a worker’s cooperative society with 400 outlets across the country, the Coffee House was established in the 1950s with the mandate to serve cheap food and drink and act as a meeting place. It attracts workers, intellectuals and political activists. But with the huge economic changes in India over the past decade, traditional coffee houses are facing fierce competition.

    In the state of Kerala, home to avid coffee drinkers, 15 of the cooperative’s 50 branches are now losing money. In the capital, Delhi, a further 10 coffee houses have closed. Things are so bad for these traditional coffee houses that the most famous branch of the Indian Coffee House has not paid its rent for years and is waiting to be closed by the municipality.

    “The younger crowd seems to go elsewhere,” said its resigned manager, Janak Raj.

    In many countries, coffee houses have become essential tools for economic development. They not only offer a stimulating drink, but a place to hang out, meet friends and business partners, catch up on news and access the internet. This role in economic development can be found as far back as the coffee houses of Europe during the beginning of the industrial revolution: deals were struck and people could meet the like-minded to hatch business ideas.

    Coffee houses and cafes also reflect the economic and social changes in Indian society. They have come to be status symbols, showing what economic power you have achieved. And as services and quality change, they show how the level of prosperity changes.

    New competitors to the cooperative coffee houses’ are offering a more modern environment to lure in a trendier crowd. Café Coffee Day (http://www.cafecoffeeday.com/index.php), which claims to be India’s largest chain coffee shop, with the motto “where the young at heart unwind”, has air conditioning, mirrors, comfortable chairs and posters on the walls for decoration. And the price is different as well: choco-frappes go for 95 rupees (US $2.11).This price means the customers need higher incomes to afford to go there.

    “McDonald’s is the cheapest hangout and everyone can go there,” said a customer, Sima. “This is much nicer and only a bit more expensive so we come here. But only a few people can go to Barista’s.”

    The chain Barista’s (http://www.barista.co.in/users/index.aspx) is 10 years old with 230 outlets. It is growing fast with 65 more new outlets opening this year. According to its head of marketing, Vishal Kapoor, Barista’s does not simply offer coffee, but “an overall experience.”

    They bill themselves as “crème” cafes: places where salads and smoothies are on offer beside the coffee.

    “It’s very exciting what is happening in India,” Kapoor said. “The classic coffee houses are part of an era that is ending.”

    “People use the cafes as places to meet for privacy. “It is a kind of private space,” says Ruchika, a bank worker.

    Nonetheless, despite its success, Barista’s is still too expensive for most Indians.

    Published: April 2010

    Resources

    1) 48 innovations in coffee culture: This eclectic mix of innovations, trends and tit bits on global coffee culture is sure to inspire any budding coffee entrepreneur. Website: http://www.trendhunter.com/trends/coffee-innovation

    2) Watch a video report from the coffee houses. Website: http://www.guardian.co.uk/travel/video/2010/apr/01/india-coffee-house-kerala

    3) Coffee Board of India: The Board focuses on research, development, extension, quality upgrades, market information, and the domestic and external promotion of Coffees of India. Website: http://www.indiacoffee.org/login.php

    4) Practical advice and contacts on how to start a coffee shop. Website: http://www.howtostartacoffeeshop.co.uk/

    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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