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Business in Rural India

March 25th, 2006 · No Comments

[via The Indian Economy Blog] Washington Post writes:

Started in late 2000, Project Shakti has extended Hindustan Lever’s reach into 80,000 of India’s 638,000 villages, on top of about 100,000 served by conventional distribution methods, according to Dalip Sehgal, the company’s director of new ventures. The project accounts for nearly 15 percent of rural sales. The women typically earn between $16 and $22 per month, often doubling their household income, and tend to use the extra money to educate their children.

Hindustan Lever is not alone in recognizing the vast potential for profits in rural India. As urban markets become saturated, more businesses are retooling their marketing strategies, and in many cases their products, to target rural consumers with tiny incomes but rising aspirations fueled by the media and other forces, according to experts.

“In four to five years the rural market will be a major sector that is well beyond anyone’s imagination,” said Rajesh Shukla, principal economist for the National Council of Applied Economic Research in New Delhi. “Nobody was expecting this was going to happen.”

Tags: Deeshaa (Rural Development)

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