NEW DELHI: Fresh from changing the way India communicates, Sunil Bharti Mittal now wants to change the way it shops. Along the way, he hopes to change the way the rest of the world eats.

In August, Mittal, the 49-year-old chairman of Bharti Enterprises, one of Indias biggest conglomerates, signed a deal to bring Wal-Mart here. Though neither Wal-Mart nor Mittal has disclosed the financial details of the joint venture, it pledges to set up Indias first modern wholesale distribution system, bringing goods from farm and factory to retailers.

If he succeeds, Mittal will have built a critical link in Indias dysfunctional infrastructure, in which an estimated 25 percent of the produce grown by Indian farmers rots before it can be sold.

“The cold chain, the trucking, the storage, will all ensure that the whole nation gains,” he said recently in an interview. India “can become a food supplier to the rest of the world.”

Mittal admitted, “I like to express myself through large, transformational projects.”

The line may sound arrogant, but thanks to his success in telecommunications, Mittal has become a new figurehead of Indian capitalism. He leads the welcomes for visiting politicians and businessmen, encouraging them to invest in India. And this week, he has taken his show on the road, spearheading a business delegation to the United States that is ostensibly celebrating 60 years of Indian independence, but also selling India as a destination for foreign businesses and capital.

Mittals ambitious plans with Wal-Mart are part of what he calls a constant search for the “next big fix.”

The first was building Bharti Airtel, basically from scratch, into a more than $40 billion nationwide telecom company. Together, the “telecom industry and Sunil have demonstrated the benefits of the government getting out of the way,” said Scott Bayman, the former chief executive of GE in India.

As the son of a respected but middle-income politician in Punjab, Mittal lacked the generations of family money that helped start the careers of many powerful Indian businessmen. (He is no relation to Lakshmi Mittal, the head of the steel giant Arcelor Mittal).

After graduating from Punjab University, he started a bicycle parts company with a small amount of cash from his father, then delved into various businesses before settling on telecommunications.

Kamal Nath, Indias minister for commerce and industry, remembers Mittals first telecom project, selling a device that brought push-button dialing to India for the first time. “He was so excited when he was selling those,” Nath reminisced in a recent interview.

Bharti Airtel got its big boost when the company won a license for cellular service in the New Delhi area in the mid-1990s, though few knew it at the time.

“People were not expecting that the cellular license would bring that kind of profitability,” said Hitesh Kuvelkar, associate director of research for First Global Securities in Mumbai. At the time, most analysts predicted cellphone penetration in India would not top 5 percent. Today, it is about 19 percent.

Initially, Bharti shared Delhi with Essar Group, the Indian conglomerate, but as the steel industry went through a bad patch, Essar took their focus off the telecom industry and Bharti grew quickly. “Delhi became their cash cow,” said Kuvelkar.

Detractors have hinted that Mittals fathers political connections won him favors that helped the business grow, a charge Mittal denies.

The company had the equivalent of $5 million in profits in 1992, the year his father died, Mittal said. For the year ended March 31, Bharti Airtels profits were 42.6 billion rupees, or $1.1 billion.

Mittal said that in the last 15 to 20 years, Indias corporate sector has operated “completely along the lines of what you see in the United States.”

But if Bharti Enterprises encapsulates Indias new market-economy consensus, it also embodies some of the vestiges that continue to dominate the top ranks of business here. Just 39 percent of Bharti Airtel, with a market capitalization of $40 billion, is publicly traded. Forty-six percent of the company is owned by Bharti Telecom, which in turn is owned by Bharti Enterprises, a privately held group controlled entirely by the Mittal family. Bharti Enterprises does not disclose financial details of its deals.

Still, critics of Mittal and his business plans are few, and they are generally loath to speak about him publicly. In a rare dressing-down, Rajeev Chandrasekhar, the former chief of a rival telecom, complained this month in The Times of India that Mittal has taken more credit than he should for Indias telecom revolution, citing a recent interview. Mittal responded in an open letter, saying he had been misquoted and inviting Chandrasekhar out for a drink.

TWO Russian mini-submarines completed a hazardous voyage two and a half miles to the floor of the Arctic Ocean yesterday in the Kremlin’s attempt to claim the energy wealth in the region.

After spending most of yesterday underwater, the two subs surfaced near the North Pole, guided to a football pitch-sized hole cut in the Arctic ice by the nuclear powered icebreaker Rossiya.

“It was difficult,” said Artur Chilingarov, the leader of the expedition, in remarks reported by the state-owned ITAR-Tass news service. He and two crew spent eight hours and 40 minutes submerged, the news service said, the last 40 minutes hunting for the break in the ice.

Expedition organisers said the greatest risk facing the six crew members, three aboard each vessel, was getting trapped under the ice and running out of air. Each sub had a 72-hour supply.

The second sub and its crew, including a Swede and an Australian, surfaced more than an hour after the first after spending about nine and half hours under the ice.

Mr Chilingarov told cheering colleagues aboard Akademik Fyodorov, a polar research vessel that he was proud to have helped plant a titanium capsule containing a Russian flag on the North Pole seabed.

“It was so good down there,” Mr Chilingarov, 68, said. “If someone else goes down there in 100 or 1,000 years, he will see our Russian flag.”

Part serious scientific expedition and part political theatre, yesterday’s dives could mark the start of a scramble among nations that border the Arctic for control of the seabed in the northern polar waters.

Warming global temperatures have made the region, a frozen terra incognita for most of history, increasingly open to shipping and energy exploration.

Organisers said the dive was the first to the sea floor at Earth’s northernmost point.

“Russia is a great power which needs resources, territories - and the prospect of its development determines its action,” Yevgeny Gaziyev, a Muscovite, said.

Sergey Lavrov, the foreign minister said during a visit to Manila that the expedition should substantiate Russia’s claim that the Eurasian continental shelf extends to the North Pole.

“I think this expedition will supply additional scientific evidence for our aspirations,” Mr Lavrov said.

Russian researchers planned to use the dive to help map the Lomonosov Ridge, a 1,240-mile underwater mountain range that crosses the polar region. The ridge was discovered by the Soviet Union in 1948 and named after an 18th-century Russian scientist, Mikhail Lomonosov.

In December 2001, Moscow claimed that the ridge was an extension of the Eurasian continent, and therefore part of Russia’s continental shelf under international law. The United Nations rejected Moscow’s claim but Russia is set to resubmit it in 2009.

If recognised, the claim would give Russia control of more than 460,000 square miles, representing almost half of the Arctic seabed. Little is known about the ocean floor near the pole, but by some estimates it could contain vast oil and gas deposits. CANADA SAYS IT’S ALL A PUBLICITY STUNT

CANADA yesterday mocked Russia’s Arctic claim as a publicity ploy and vowed to assert sovereignty over Canadian lands and waterways in the frozen wilderness.

“This isn’t the 15th century,” the Canadian Foreign Minister Peter Mackay told CTV television.

“You can’t go around the world and just plant flags and say ‘We’re claiming this territory’. We’re not at all concerned about this mission; basically it’s just a show by Russia.”

One of only five nations with territory inside the Arctic Circle, Canada’s conservative government in Ottawa announced last month it is to build eight patrol ships to guard its interests in the icy region, believed to contain huge untapped oil and gas reserves.

Other nations with territory inside the Arctic Circle include Norway, Russia, the United States and Denmark via its control of Greenland.

CONSUMER resistance to the idea of genetically modified foods must be overcome if there is be a solution to the growing problem of food inflation, scientists have said.

Horror stories about the dangers of so-called “Frankenstein foods” prompted a backlash in the UK against the use of more intensive farming technology.

But with the price of staple goods - including milk, cereals and vegetables - soaring well above inflation, a growing number of experts are concluding that consumers will soon have to choose between expensive food and cheaper GM.

Economists say climate change and growing global demand could leave Britain facing a “food-security” crisis for the first time since the end of rationing in July 1954.

Scientists are now calling for a fresh debate about GM crops, which they claim will reduce prices and mitigate the impact of farming on the world’s environment.

Although unnoticed by many shoppers, food prices are rising faster in Britain than almost anywhere else in the Western world. Bread, for example, is up 15 per cent and milk up 10 per cent.

A COMBINATION of poor harvests - as a result of severe weather brought on by global warming - and demand for crops which can be used as biofuels, have led to rising commodity prices in a phenomenon that analysts have dubbed “agflation”.

Yesterday, the National Farmers’ Union warned that the cheap-food era will soon end.

At present, millions of acres of commercial GM crops are grown in US, India and China and elsewhere, but there are none in Europe.

Alex Salmond, the First Minister, has pledged that Scotland will remain free from GM crops, but food containing GM ingredients is available - provided that it is labelled as such.

However, some experts believe Scotland must reconsider its position on GM crops if prices are to stay low and food remain in plentiful supply.

Dr Simon Best, chairman of the Bioindustry Association, said: “We have got used to the luxury of low food prices but excessive demand and climate change will prompt many people to rethink their priorities as shopping baskets become more expensive.

“Organic farming requires four times as much land-use. It is an extensive method of agriculture, rather than intensive. Acceptance of biotechnologies will allow us to develop cheaper and better food and mitigate our environmental impact.”

Professor Bill McKelvey, chief executive of the Scottish Agricultural College, said: “Food prices are going to go up and there is going to be a greater need for high production. One option for us is that we should consider the use of GM.”

The issue of GM foods has polarised opinion in recent years. Advocates claim it will enable farmers to gain higher crop yields through better weed control and reduce the use of toxic pesticides.

Poor countries, they say, will be less reliant on hand-outs, the nutritional content of basic foods can be improved and vaccines to fight disease can all be added to GM crops. In essence, they claim it is the answer to the growing problem of feeding the world.

BUT critics, such as Friends of the Earth Scotland, believe the large-scale release of GM organisms into the environment would irreversibly damage the countryside, eliminating diversity and turning it into a green monoculture.

They claim it may cause damage to human health, contribute to the evolution of pesticide-resistant “superweeds”, and make organic farming impossible because of cross-pollination.

In 2003, several sites in Scotland ran trials of GM crops, which attracted mass protests and the destruction of plants. There are no longer any GM crops in Scotland, though trials with GM potatoes are taking place in England.

Keith Adamson, a farmer at Wester Friarton, Newport-on-Tay, Fife, was involved in Scottish trials of GM crops and saw protesters attacking his field of GM oil-seed rape.

Despite this, Mr Adamson believed the UK could not continue to shun the technology.

“That is going to hurt a lot of people… GM will be needed to feed the growing world population,” he said.

“GM crops may be seen as the monster at the moment, but I think in the future it will be our godsend.”

THE Scottish Executive has stated its clear opposition to GM crops,

but Anthony Trewavas, a professor of plant science and fellow of the Royal Society of Edinburgh, who gave evidence on the GM debate at a committee of the Scottish Parliament, insists the products have been eaten by Americans and Canadians for over a decade without any evidence of harmful effects.

“If there is the political will to use GM products, we can go some way to solve the problem of starvation,” he said. “Animal feed has come from GM products for a long time. The stuff is cheaper because of the reduction in the use of pesticides.

“The Executive’s intention is to be GM-free and that’s a mistake. You should not stop people making that choice.”

Dr Best added that technology was already being used to extend the season of fruit and vegetables and improve the quality of meat.

“Techniques such as selective breeding and reproductive assistance are already in widespread use. Organic farming doesn’t mean animals are roaming around having sex when they feel like it.

“GM crops and cloning get a negative reaction among many consumers because Europe was never allowed to have a rational debate about the potential benefits. It is now time we had that debate.”

An Executive spokeswoman said: “GM crops are not grown in Scotland and we believe this respects the wishes of Scottish consumers who want local, high-quality produce. It helps Scottish farmers compete in overseas markets which place a premium on pure, naturally produced food, and it enhances Scotland’s international reputation for the production of high-quality foodstuffs.

“Scotland has a wonderful and varied environment, which is rich in biodiversity, and our farmers have a long history of working with the land to produce quality crops and products that people want to buy. We do not wish to jeopardise this.” Crisis alert as impact of rising farm prices felt at checkout

MOST consumers in Britain probably have not noticed the increase in their weekly shopping bills, but the

price of cereals in the UK has jumped by 12 per cent in the past year and butter prices in Europe have increased 40 per cent.

Corn has doubled in price over the past 18 months, wheat prices have gained about 50 per cent, while sugar and cocoa prices are also on the up.

Analysts with Deloitte last week warned bread would go up by a further 5p a loaf because of rising wheat prices.

Sixty years ago, the average British family spent more than a third of its income on food - today the figure is a tenth. But for the first time in a generation, agricultural commodity prices are surging.

Nestle’s chairman, Peter Brabeck, has warned that food prices around the world are set for a “significant and long-lasting” period of inflation, partly because of demand from China and India, and the increasing use of crops for biofuels, as well as general population growth.

This week the UN warned that rising prices for food would affect its ability to fight famine in Africa.

A report by the United Nation’s Food and Agriculture Organisation and the Organisation for Economic Cooperation and Development, stressed that long-term prices would be up to 30 per cent higher than expected.

“Growth in the use of agricultural commodities as feedstock to a rapidly increasing biofuel industry is one of the main… reasons for international commodity prices to attain a significantly higher plateau,” the report said.

The warning is likely to re-ignite the debate on food versus fuel. Under America’s “ethanol policy”, a quarter of US maize is converted into bio-fuels. As the US supplies more than two-thirds of the world’s grain imports, the effect on food prices will be dramatic.

James Withers, deputy chief executive of the NFU Scotland, said consumers can no longer take food production for granted. “For the first time since the end of the Second World War, food security has been an issue again,” he said.

“Food has been artificially cheap for a long time and we have expected to walk into Tesco and see the aisles fully stocked with food.

“The government has no food security policy and believes the rest of the world will feed the UK and that’s not true. If you don’t keep Scottish food production going… you could have a real food security crisis.”

He cited the example of Argentina, which last year dramatically reduced beef exports, hitting world meat prices. Last month, thousands of Mexicans took to the streets to protest at the price of corn flour to make tortillas, which had risen by 400 per cent.

David Hughes, emeritus professor of food marketing at Imperial College London, commented:

“For some people on low incomes, if the price of food continues to increase… they will be hard hit.

He also believes that, as a nation, we will be forced to look closer to home to feed ourselves because the variety of produce will not be what we have come to expect.

He said: “Would we run out of food? No. We’d just have to adapt… eat more potatoes, more local, home-grown food. We’d have to look at more seasonal foods and totally re-think the way we eat.”

TANYA THOMPSON Dogged by protests from beginning

GM TRIALS were first announced in Scotland in 2002.

The testing prompted furious debate in the media and when the trials began, protesters descended on Munlochy, on the Black Isle, Ross-shire, one of 60 test sites in Britain.

The campaign attracted a “rainbow alliance” of demonstrators, who took a range of actions from blocking tractors sowing GM oilseed rape to lobbying parliament and MSPs.

Other protests that took place in Scotland included those at Daviot in Aberdeenshire and Newport-on-Tay.

In December 2002, protesters said they had been vindicated, when evidence from a six-year government research programme into the official trials showed for the first time in Britain that genes from engineered GM crops were interbreeding on a large scale with other crops and weeds.

Doctors from the British Medical Association suggested a GM ban to the Scottish Parliament.

The tests were later abandoned. Controversial science at cutting edge

GM FOOD involves altering the genes of a plant, animal or micro-organism, or adding a gene from another living thing.

The ultimate aim of GM is to create better, more successful crops, and tackle issues such as pesticide use and falling food supplies.

Using genetic modification, genes can be switched on or off to change the way a plant or animal develops.

It can be used to reduce the amount of pesticide farmers have to use by altering a plant’s DNA so it can resist the insects that attack it.

Genetic modification can give plants immunity to viruses, making crops less likely to fail and boosting yields. It can also improve their nutritional value.

The Food Standards Agency (FSA) said:

“No-one has ever been reported as suffering from illness because the food they had eaten had been genetically modified.”

Despite this, the UK has resisted involvement in commercial GM crops.

Anti-GM campaigners have expressed concerns about GM cross-pollination, claiming it could make organic farming impossible.

Related topic

- «news.scotsman.com»
http://news.scotsman.com/topics.cfm?tid=9