Feb 27, 2016

Guru Inc: India's holy men enter the world of big business

Rama Lakshmi
Washington Post
February 27, 2016

Gurmeet Ram Rahim Singh
Baba Gurmeet Ram Rahim Singh
NEW DELHI — For more than a decade, the orange-robed guru Baba Ramdev hosted a popular TV show, showing millions of Indians how to breathe correctly, eat herbs and knot themselves into impossible yoga postures.

Ramdev, 50, always augmented his talks with a diatribe about the dominance of foreign companies in India.

Today, the guru of good health is a business magnate himself. His ashram manufactures hundreds of herbal and organic products including soap, shampoo, cleaners, juice and honey. The company, called Patanjali, is worth more than $600 million, Ramdev says.

Some call it Guru Inc. — the rise of businesses run by gurus and holy men. Buoyed by the popularity of religious television programming in the past decade, many spiritual leaders in India are starting their own product lines, tapping into the renewed faith in the country’s ancient knowledge systems such as yoga and ayurveda.

In the past year, Patanjali has become the fastest growing consumer product company in India, with plans to quadruple the number of manufacturing plants by year’s end.

“Our goal is not to build a brand. The brand is just a byproduct,” Ramdev said at a news conference in New Delhi this month. “We want that Indians’ wealth should remain here, it should not be taken out of the country. This makes the multinational companies sweat. Why? Have we untied and let loose their buffaloes?”

Ramdev is one of the most visible success stories of Prime Minister Narendra Modi’s “Make in India” movement — a push to boost indigenous manufacturing that includes India’s ayurvedic and yoga market, a $490 billion industry.

A report by the brokerage firm IIFL Associates projected that Patanjali’s revenue is likely to reach $3 billion by 2020. The report said the company poses a “credible threat” because it does not try to beat other established companies at their game, but “it changes the game for them.”

“The global consumer product companies are now waking up to the fact that the rise of Ramdev’s products is not a fad,” said Arvind Singhal, chairman of Technopak, a consumer market consultancy. “They now acknowledge that they have a challenge in their hands.”

He added that Hindustan Unilever, an Indian subsidiary of Unilever, recently acquired a local herbal hair oil company, a move aimed at countering Ramdev’s market gains.

India’s modern gurus defy the stereotype of men who opt out of worldly occupations, live in Himalayan caves and meditate for days.

Today, they own large swathes of real estate, hoard untaxed wealth and gold, and drive luxury cars. They hobnob with powerful politicians and businessmen – Ramdev is a longtime ally of Modi. Some are battling charges of sexual misconduct and improper land acquisition in courts.

Ramdev is not the only guru whose face now adorns products on supermarket shelves. The spiritual guru Sri Sri Ravi Shankar of the Art of Living makes herbal toothpaste and hair products. Shankar’s discourses relate to urban stress and trauma and he propagates breathing techniques.

Last month, the flashy Baba Gurmeet Ram Rahim Singh — whose devotees call him a “messenger of god” and “saint” — lent his name to a line of organic products, expanding beyond the music videos and movies he makes and stars in.

Ramdev is no stranger to controversies. He opposes homosexuality and has claimed he has the cure for AIDS. He opposes sex education in schools and recently called for a movie to be banned because it portrayed Hinduism unfavorably.

In recent months, there have been several media reports about complaints about his food products, including fungus in butter and insects in noodles. He responded by accusing foreign companies of conspiring to tarnish his image by paying consumers to file false complaints.

Last year, Nestlé India’s popular instant noodles, called Maggi, faced a national scandal after local tests found monosodium glutamate and high lead levels in some samples. The company did its own testing and said the noodles were safe, but withdrew the product for several months. During that time, Ramdev quickly launched his own brand of noodles to capitalize on Nestlé’s misfortune.

“Increased competition energizes the market,” said Suresh Narayanan, Chairman and Managing Director for Nestlé India.

Ramdev’s company was India’s biggest television advertiser during the last week of January, overtaking several global companies. Thousands of his followers who run neighborhood stores also double up as his retailers. And now he has partnered with large retail supermarket stores.

Ramdev likes to remind his opponents that his products are not made in huts but in large factories.

“We have destroyed the mind-set that if a product is made by a foreign company and expensive, it must be good. And if it is cheap and Indian-made, then it must be bad,” said Acharya Balkrishna, the managing director of Patanjali.

Security guards at Patanjali plants — there are 10 around India — greet visitors with the Hindu chant of “Om.”

Orange-robed holy men double as factory supervisors between daily yoga and meditation sessions. And Ramdev’s top advisers are not business school graduates, but disciples who work pro bono, producing items such as toothpaste and other toiletries. One television commercial for toothpaste shows holy men grinding herbs on the labels.

Ramdev has no designation in the company and draws no salary. He sleeps on the floor at the ashram, weaving tales about restoring India’s ancient glory.

“His products have an Indian soul,” said Sandeep Tanwar, 43, a consumer shopping for toothpaste and honey in a Patanjali outlet in New Delhi recently.

Market analysts expect that such guru businesses will continue to be popular.

“Patanjali’s products leverage the prevailing mood of resurgent national pride among Indians now,” said Vandana Das, president of the advertising agency DDB Mudra, which handles the campaign for his products. “Earlier there was a mind-set that if you are using a foreign brand, you are cool. That is no longer there.”


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