Arong has been in the news ostensibly because it arbitrarily raised the prices of its products just as the Id shopping was heating up. The consumer affairs officer was called in, who inspected and closed the retail outlet. However, in a short span of eight hours only not only was the shop reopened but the officer was transferred as well. All the above showed the disproportionate power of a monopoly capital. The social media went agog with posts to boycott Arong, and attacks on the government started. It seems from the posts that the PM was visiting Finland and when she was informed of the catastrophe promptly reversed the transfer order of the officer. What she did to Arong we do not know, not many cared to report as well, but one infers that business carried on as usual, unfazed and in all probability with the continued steep graph of the prices.
I see four things that are central to the story. People were happy with the revoke of the transfer order of the officer and no longer bargained for the closure of the shop. That Arong is a monopoly, that Arong prices stuff so high and that Arong has no competitor. The fourth anchor in the story is that monopoly capital and the fate of nationalism are closely connected. I will address the above aspects not necessarily in the order that I have listed.
Arong is the retail outlet of BRAC, a countrywide movement by Fazle Hasan Abed which started in 1972 right after Independence in 1971 based wholly on the idea of micro finance. Around the same time, Md Yunus too started the network of microfinance which led into the Grameen Bank. Abed’s efforts created BRAC, also grew into a money lending body and in its early days, villagers called it as BRAC Mahajan. Grameen became a model for micro credit banking and was largely followed by BRAC. BRAC expanded its scope and developed numerous levels of enterprises but where BRAC stood out over Grameen was the grand integration of a long and almost open-ended value chain. While Grameen was a scalable banking model, BRAC diversified to create an entire range of bottom up economy based wholly upon a pool of poverty! Arong is an outlet that showcases products brought over a long chain of value integration.
As part of economic development, Bangladesh with its hard working and determined people could set up a mind-boggling edifice of outsourced garment factories. Jeans, T Shirts, formal and casual wear, cotton, linen and knitwear across the world stood on the toiling masses of pathetically exploited Bangladeshis. It is not unusual to find volumes of published papers on the immorality of exploitation of Bangladeshi labour, especially women in this huge garment business driven by the greed of global capital. Notwithstanding the exploitation, employment in the garment factories gave workers a much higher level of wages than what could be ever earned in any other occupation. A problem with all developing countries is that there is little scope for labour to move into more lucrative sectors from agriculture. Investments into the garment business made this movement possible. But textile weaving, especially the sari, lungi and gamchha were the lean hour activities of the peasants. Very soon, labour and hence skills moved out of the traditional textile sector into the garment factories due to higher relative wages, leaving the traditional weaving sector bereft of labour, time, skills and after a few decades, also the memory and knowledge. Since economics of textile weaving was so suboptimal, wages had to be artificially higher in order to bring weavers to the loom.
Now we cut to West Bengal. Since we did not have investments into the garment business on the scale that it was in Bangladesh, our weavers stuck to weaving cloth. Village after village, the sari, lungi and gamchha model prevailed. The proliferation of retail business in smaller towns and mofussils, the explosion of hawkers and the multiplying door to door sellers of saris created and sustained a huge market for cotton cloth for the looms of West Bengal villages. Soon, a international specialization took place, weaving became largely a business of West Bengal while hosiery and stitched garments, the preserve of Bangladesh. It is not surprising to see the patented brands of Bangladesh of the jamdani woven in West Bengal and sold in shops of Chittagong at a fraction of the prices of those originating in Bangladesh. Similarly, almost all our desi brands source products of lingerie and garments from Bangladesh.
The interregional specialization, as usual has benefitted the consumer in terms of competitive prices. Much of fashion is available cheaply; only brands are priced high. It is a rule of humans that as soon as the basic needs are satisfied, they look out for new conquests; it is really Maslow all the way. The Bangladeshi is now very well dressed and there is a worldwide consensus about the ravishing looks of Bangladeshis. Naturally, with the mirror at hand and the selfie at arm’s length one can only legitimately aspire for even better clothes and brands. Hence the desire for Arong. Even a few years before now, a middle-class citizen did not perhaps dare to enter into an Arong store; besides Arong exists in Europe and the USA and sells in Euros and Dollars; it has never been oriented to a BD taaka market. Yet, due to the pathologies of our times, we imagine that the world is within our reach, rarely reckoning the fact that we are really not as rich as we are made to believe through the television ads, easily available consumer goods, food within our reach and so on. We miss out that there is something that is beyond our reach; unfortunately, the products of Arong fall in that category of the superrich. In nationalisms as strong as that of the Bangladeshis, in a rising democracy as that of Bangladesh, inequality is intolerable especially if that is about the unattainable consumable for the rising middle class, for the rising and the aspiring are sociologically the one and the same only. Hence, there is a deeper resentment against Arong. The construction of the company as corrupt, influential and the contagious call of boycott reeks of populism in which the middle-class anger gets directed at the aristocrat and Arong is indeed one with its international designers and exclusive veneer.
To my mind, the problem is not so much a matter of Arong as it is a lack of competition. It is difficult to imagine a brand in India to be castigated in as consensual terms as Arong has been. This is because the high prices of Arong products would have served as an opportunity for many junior brands to rush in. Cottons, Killol, Sabhyata and even Westland are brands those which entered into the side margins of Fab India not only forcing it to bring down prices but also creating a scope for both investments as well as innovations for the rest of the brands. Monopolies can survive in atmospheres of low capital and social mobility; in societies where capital can move fast, monopolies are natural to be weaned out. The crisis in Bangladesh is therefore in the mobilization of capital and of labour to create competitors to Arong. Herein lies an enormous scope for profits as well as creativity and hence, in the very same model of BRAC and Grameen, an opportunity for yet another round of microfinance networking.
Monopoly capital can puncture national cohesion just as micro finance can constitute a foundation for its nurture. The Arong is a very slight hint at the dangers facing a fragile nation which is just about looking up and alighted the highway of growth; the capital has to be infused and fused with local creativity and enterprise for the country to remove the minute hint of a malignant cell.