According to HUL chairman Harish Manwani, rural India is a powerhouse bigger than urban markets with a potential opportunity of $1.8 trillion
Mumbai: Indicating that Hindustan Unilever Ltd (HUL) which sells almost 40% of its brands in the hinterlands will increase its focus on rural markets, the consumer goods major on Monday called for convergence of urban and rural marketers so that prosperity spreads to the rural areas, reports PTI.
Describing rural India as a powerhouse which can even be bigger than the urban markets, HUL chairman Harish Manwani said, "rural India is an incredible opportunity of potentially adding $1.8 trillion to our economy, equal to current GDP."
Addressing shareholders at the 79th annual general meeting of the company in Mumbai today, Manwani said, "it is often said there are two Indias--Bharat which exists in villages and India that thrives in urban areas. If we want to make a mark on the global stage, then these two Indias must converge."
Manwani further said, "We have an opportunity to create a thriving rural middle-class, even bigger than in urban India. We need to build a new generation of leaders and entrepreneurs from villages who will help power the future of our nation."
He also said a new vision for agriculture will uplift millions of small farmers but added the country needs to look beyond agriculture and we need a strategy to provide rural India access to markets and technology, financial inclusion and human capital development.
Calling for improving agricultural productivity, he said, "if our agricultural growth can pick up to 4% as envisioned by the Planning Commission, the cascading impact that rural prosperity will have on the national economy could add up to an additional 2% to our GDP and enable us to go for double-digits growth."
Manawani also emphasised on sustainable sourcing and said the company is working in Karnataka, Punjab and Maharashtra with small tomato farmers to help them adopt sustainable agricultural practices.
"In 2011, 60% of tomatoes used in Kissan Ketchup in the country were from sustainable sources," he said.
He further said the company's wide distribution reach can help the Reserve Bank in its financial inclusion plan.
"Along with the government, banks and corporates can play a synergistic role in realising this plan. Companies like HUL have a wider distribution network than any government agency as our products reach almost every village in the country. And leveraging this high quality last-mile can help bring financial inclusion to every Indian," he said.
Manwani pointed out as to how access to urban services had led to new sources of livelihood in villages located in 19 rural-urban clusters like the National Capital Region, which has emerged as a single geographical entity from Meerut in UP to Faridabad in Haryana.
"Creating another 50 rural-urban hubs where every village is within one hour of travel to an urban centre would be transformational. This could ensure that over two-thirds of the rural population have easy access to urban India. These urban hubs will support rural areas and become the big markets of tomorrow," he said.