Business Woes from Saharanpur's Internet Ban

Saharanpur:  The violence between groups of Thakurs and Dalits that engulfed Saharanpur district in Uttar Pradesh between April and June 2017 continues to haunt its residents. The UP administration had ordered an internet shutdown for 10 days, reportedly to prevent the spread of rumours that had erupted after another caste clash on May 23 in Shabbirpur.

Those running businesses in Saharanpur say they were affected in unexpected ways. They struggled to make regular transactions and incurred losses they haven't yet recovered from.

Forty-eight-year-old Rajkumar Jatav has been manufacturing ladies' shoes for 25 years in Saharanpur town. Helped by his sons Sushant and Rajkkumar, he runs a small-scale factory which employs 15 workers who make flat slippers, sandals, heeled shoes and joothis for the local market. Jatav says he suffered a loss of about Rs 1.25 lakh ($2000) during the 10-day internet shutdown.

"I did not get raw materials like paste solutions, synthetic leather, heels and sequins from my suppliers based in Kanpur and Agra when I failed to pay them the 50% advance through online transfer," says Jatav. "The situation outside the town was also tense. So there was no chance I could go or send someone to the banks either."

Jatav had started using the digital payment system only after demonetisation. "I started doing online payments after November 8, 2016, after I faced a lot of problems with cash availability during that time. Internet payments came as a boon for me and also for my suppliers," he says. But within six months of getting used to online transactions, Jatav faced this new hurdle: an internet shutdown. "To complete the shoe order, we have to invest from our pocket first, but when I couldn't, my suppliers refused to send me the material, which meant I could not complete a big order," he says. He calculates that the cancelled order cost him Rs 2 lakhs. In addition, a few of Jatav's reliable and talented shoe workers quit because he was unable to pay their wages on time.

Jatav's annual business turnover is around Rs 24 lakh (Rs 200,000 a month), and he gets his raw material from the markets of New Delhi, Bareilly and Agra. "I even tried to give my suppliers an account payee cheque but they declined it saying that it will take a lot of time to clear. I requested them again and again but to no use. For a supplier there are thousands of Rajkumar Jatavs. I am no special client to get the raw materials on credit," he says. Jatav admits that he is not prepared for another shutdown, and he would not be able to run his business if it happened again.

Many traders in Saharanpur city say narrate similar experiences. In May, a family business of trading edible oil wholesale saw its most unfamiliar financial challenge yet. It had been only three years since Shailendra Bhushan Gupta had taken over his elder brother's 26-year-old store. Gupta started to expand and diversify too, by launching an agency to trade the Fortune brand of oils. He employs five people, and his monthly turnover ranges between Rs 30-40 lakhs ($46,600-62,200). The 40-year-old also modernised some of the business practices, shifting much of the payments to suppliers online, for speed and ease of use.

During the internet shutdown in Saharanpur, Gupta did not expect to be affected, given the stability of his store and the large sale volume of his agency. But unexpectedly, his supplying company cancelled his order of 1000 litres of oil when he could not make the payment. "As per the agreement, I have to deposit at least 50% of the order amount in advance, and the rest of the payment is made when the oil is delivered to us. But during those 10 days, I could not make payment through any means, and my order was declined by the supplying company," he says. Gupta also tried to make the payment through RTGS but couldn't do that. The oil trader says that he ended up suffering a jolt of Rs 18 lakhs ($28,000).

Gupta is slowly trying to make up for the monetary loss and credit worthiness with his suppliers. "How can an internet shutdown be a solution for anything?" he asks. "I seriously don't know what to do if it happens again."

A property dealer in same central market faced a direct hit during the internet ban. Ashok Pundeer, who has been selling and renting commercial and residential properties for the past five years,  estimates that he suffered a loss of Rs 22 lakhs ($34,200) during the internet shutdown as he could not get many properties registered in that period. "I had to return the token money to many buyers because there was no internet," he says. "All of us know that registry (property) and documentation is now done online in Uttar Pradesh. The clients were new and they refused to take the deal forward."

A property dealer is not easily trusted, admits Pundeer. This means he is paid only after the deal is done, and a lot of word-of-mouth business depends on his image and credibility. Every lost client is a potential loss of more. "It's not just me, but many dealers have incurred huge losses due to shutdown," says Pundeer. "Koi ration ki dukaan to hai nahi property dealing. Jo kuch hona hai online hi hona hai. Ab kya batayein, dekha jayega jo hona hoga," he throws his hand up in frustration, saying the real estate business is no grocery shop, and if there's no access to online transactions, then very little can be done.

Trying to keep an optimistic outlook, Pundeer says, "Jitna kuan khodo, utna paani milega". For his business to recover, he will have to double down with more focus and effort.

(With inputs from Saurabh Sharma)

Mahesh Kumar Shiva is a Saharanpur-​based journalist and a member of 101Reporters.com, a pan-India network of grassroots reporters. has been reporting for 23 years on crime, healthcare, society, politics, culture, sports, agriculture and tourism in his city. He has previously worked with publications like Dainik Janwani, Dainik Jagran, Amar Ujala, Ajit Samachar and more.

Shutdown stories are the output of a collaboration between 101 Reporters and CIS with support from Facebook.

Video

Rajkumar Jatav talks about the challenges his shoe manufacturing business faced during the shutdown. Video Courtesy: Mahesh Kumar Shiva