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Mr. Laroia, your trade
promotion organization is probably unique in developing
countries if not in the world -- you have been able to
treat at least 75 percent of your activities on a
cost-recovery basis. What are the benefits of this
entrepreneurial approach?
It serves two purposes.
First, a client who pays our organization for services
expects a decent job from us. My staff, and our
organization's strength, is thus fully utilized. Our
activities are better planned and better prepared. It
helps both ways.
Second, if the service is
free, it is not valued. Full payment, even part-payment,
makes the participating company more serious about the
job and the way it approaches the product and services.
Nevertheless, you don't
charge for everything you provide…
Trade promotion cannot
all be on a cost-recovery basis. Some services have to
be gratis or at a low fee. For example,
information has to be by and large gratis, even
though there are segments that can be highly value-added
-- information services for members or for people who
subscribe especially. In fact, substantial parts of the
trade information services have to be available almost
free to trade and industry.
Similarly, with markets
that are very far off, you need to enthuse industry to
participate in efforts to promote business and trade.
You have to fix the tariff for participation at an
attractive level, that is, a subsidized rate. This is
true particularly for our events in the Latin American
continent, for example, or even some of the developing
markets in sub-Saharan Africa or North Africa region,
where we find industry may not be very optimistic about
business prospects. We introduce them to such prospects
by making participation possible at a very reasonable
charge.
We look at trade
promotion in its totality.
How large an effort can
you make on this basis?
We hold 70 to 75 trade
promotion events abroad in 35-38 countries. Out of this
70-75 percent are self-financing. Some of them, in fact,
generate a surplus, which enables us to cross-subsidize
some of the other events.
Our organization is
uniquely placed among many of the other trade promotion
bodies in the developing world by the fact that we also
own a large trade fair complex in Delhi. We have a
100-acre trade fair complex with around 75,000-sq m of
exhibition space. That brings in a lot of revenue.
Is it really an advantage
to have such an infrastructure?
We can undertake
activities without relying on funding from the
Exchequer. Funding support is dwindling in many parts of
the world, governments are not providing more public
funds for trade promotion. Having our own trade
promotion infrastructure in the form of exhibition halls
and a trade fair complex also helps us to mobilize
resources. |
