Monday, August 1, 2011

Rise of Dalit Entrepreneurship: Swwapnil Bhingardevay

At the beginning of the millennium,Swwapnil Bhingardevay decided to diversify his business interests. His Hindustan Petroleum LPG distribution business, which he had since 1985, was doing well, and he was ready for fresh challenges.

Only, the kind of challenges he faced were very different from what he had in mind. He decided to set up an ethanol factory in his hometown of Karad near Satara, Maharashtra, and a Rs 6 crore loan fromCanara Bank helped him get going. But, around the same time, the government killed the business by making blending of ethanol in fuel, which was earlier mandatory, optional.

Differential treatment

Bhingardevay decided to exit ethanol and enter rectified spirits. But since the ethanol unit hadn't started operations, he was unable to keep up with loan repayments. "When I asked the bank for further funding assistance for the new business, they asked me to repay the Rs 42 lakh interest first," he says. "No sooner had I repaid them than they did a U-turn." Later, another bank officer from the same caste told Bhingardevay this kind of behaviour wasn't unusual.

"They never go out of their way to help our people." Eventually, he managed to raise Rs 1.5 crore from the Karad Urban Co-operative Bank, in a day, to repay Canara Bank. "This happened only because the MD of the bank was from the same community and personally sanctioned this loan," says Bhingardevay.

The resistance from banks doesn't surprise him. "Over the years, I have faced a lot of problems because I belong to a certain community. Banks look at us with past notions and prejudices," he says, adding that the perception is that dalits cannot successfully run a business, never mind what evidence you present.

When Bhingardevay pointed out he had successfully been running an LPG distribution business for 15 years, it was insinuated that he had managed to get that purely on account of reservation and, hence, it didn't count for much. Neither did his qualifications.

A commerce graduate, Bhingardevay also studied law at ILS, Pune, one of India's premier law colleges. That's also one reason why he moved back to Pune from Satara once his children were born. "I don't want my children to go through the trials that I have or suffer," he says.

"You don't face as much discrimination in a bigger city." Milind Kamble, president, DICCI, who has known Bhingardevay for over a decade, says he is as committed and professional as any other businessman. "He has a fighting spirit, and no matter how many problems he faces, his attitude hasn't changed," says Kamble.

Being discriminated against hasn't affected his belief in meritocracy. He has restarted the ethanol business and employs about 125 people, though he is pressed to estimate how many are dalits. "Ours is a chemical industry and it is important to hire people on merit," he says. There are some contract labourers as well, but again, there is no conscious effort to select dalits over the others.

Sweet and sour

Khandoba Prasanna Sakhar Karkhana posted a turnover of Rs 25 crore last year, and Bhingardevay says this year's projection is Rs 40 crore. His LPG business continues on the side. Meanwhile, a decade and one more successful business later, not much has changed.

Bhingardevay took the brave step of trying to set up a sugar factory in the Maratha-dominated sugar belt. While he was arranging funding, another local businessman started setting up a factory a few kilometres away. The rules say there must be a minimum aerial distance of 15 km between two factories. Bhingardevay registered his protest and even went to the Bombay High Court, but it did not change anything. Neither did a recent High Court ruling that increased the distance to 25 km.

Sugar inMaharashtra is an industry where political connections and caste play a role. The other person is a Maratha, and he also has also been at the head of a sugar co-operative for 20 years and runs his own medical college and hospital in the region. Bhingardevay tried to meet Nationalist Congress Party leader and Maratha strongman Sharad Pawar, who is highly influential in the sugar industry in Maharashtra, to resolve the issue, but couldn't gain access.

From land problems to encroachment to electricity woes, the list of obstacles is endless, says a confidante of Bhingardevay, on condition of anonymity. "Often, when people from within the community approach local politicians for assistance, they are promised help," he says. "But as soon as they leave the room, the politicians ridicule them, saying how can a 'mahar' dream of doing business." Bhingardevay does more than dream: he is preparing to move the Supreme Court in the sugar factory case.

Source: Economic Times

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