[sacw] War in Kargil - a great money making machine

[Harsh Kapoor]

30 July 1999
FYI
South Asia Citizens Web
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The Wall Street Journal
July 27, 1999
Page B1 / Advertising

In India's War, Foreign Companies Hear a Call to Ads
By Jonathan Karp

NEW DELHI -- War is hell. But it also can be a hell of an opportunity for
companies to cash in on patriotism.

In the recent two-month undeclared war between India and Pakistan in
Kashmir, India has witnessed an unprecedented outpouring of public
support. Stirred by daily footage of combat and flag-draped coffins,
ordinary citizens have rushed to give blood to the troops and cash and
jewelry to welfare funds aiding families of fallen soldiers.

This isn't just India 's first televised war. It also is the country's
first commercialized war. Leading the charge of donors, often loudly, are
big companies who aren't shy about taking out big ads to brag about their
war efforts.

Hutchison Max Telecom Ltd., a Bombay cellular-telephone operator that is
49%-owned by a unit of Hong Kong's Hutchison Whampoa Ltd., took out ads
pledging to donate one rupee (about two U.S. cents) for every minute its
customers talked on a designated Sunday. The ad, showing a bayoneted rifle
upright in the ground, read: "Speak up for the lives lost at Kargil," a
reference to the Kashmir district where the fighting took place.

The company created the ads after its employees volunteered to donate one
day's salary. It takes pains to deny commercial intention. "We're not
benefiting from it at all. We're a long way from earning a profit," says
Hutchison Max spokesman Sunil Mehta. "It's the thought that counts."

Another sales-linked war-related campaign was staged by Baron Electronics
Ltd., the Indian supplier to Japanese consumer-electronics company Aiwa
Co. In two-page magazine ads, Baron listed names of fallen Indian soldiers
and promised to donate to bereaved families 100 rupees for each Aiwa
television or music system purchased. Kabir Mulchandani, Baron's chief
executive officer, says he was looking for a way his company could show
social responsibility. Aiwa, citing a Japanese-government order to stay
neutral, kept its distance.

"We never even dreamed it would help our sales," Mr. Mulchandani says,
noting that Indian consumers aren't likely to spend $400 on an appliance
just because $2.30 will go to a welfare fund. So far, they haven't. But
with normal sales of 60,000 TV sets and stereos a month, Baron hopes to
donate $23,000 this month. "We definitely thought it would help our
image," Mr. Mulchandani says, adding: "There's nothing wrong with that."

Since the Kashmir fighting erupted in May, some $44 million has been
donated to the government's National Defense Fund, which is used to assist
soldiers' families. Half of those donations have come from companies.
Their role is stirring some strong criticism. "Shameless jingoism," says
Surjit Bhalla, director of Oxus Fund Management in New Delhi. "From
multinationals to domestic corporates to news agencies, the shrill cry is
the same -- buy my product because I am more unthinkingly nationalistic
than my competitor," he wrote recently in India 's Economic Times.

Suhel Seth, chief executive of Equus Advertising Co., devised a
war-related campaign for client Daewoo Motors India Ltd. In late May, just
after India launched air strikes in the Himalayas to dislodge what it said
were Pakistani troops and Islamic guerrillas, Mr. Seth approached Daewoo
with the idea of giving money to war widows.

The chairman and vice chairman of Daewoo Motors India , who are both
Korean, as well as the company's Indian managing director, approved the
plan. Soon after, Daewoo presented the army with a check for two million
rupees ($46,400) and five Cielo cars (which the army plans to auction
off). Daewoo also took out full-page newspaper ads announcing the gift and
saluting fallen heroes. "They gave up their lives . . . so that we may be
safe," the ad proclaimed in large bold letters. The ad didn't mention
soldiers, war or Kashmir. "We are not taking sides," says S.G. Awasthi,
Daewoo Motors India 's managing director. "And we didn't attach this to
any {car} sales."

Daewoo Group, of Seoul, one of the most aggressive multinationals in South
Asia, can't afford to be perceived as partisan. The conglomerate has even
bigger business interests across the border in Pakistan, where it built
Prime Minister Nawaz Sharif's showcase project, a billion-dollar highway
for which the government hasn't fully paid.

Pakistani businesspeople expressed surprise at Daewoo's Indian gift, but
Daewoo executives in Islamabad declined to say if it has affected their
business prospects. A Korean representative from Daewoo in Pakistan, who
asked not to be identified, says, "My government warned me not to comment
on the war."

Mr. Seth believes it's unethical for a company to link its donations
directly to customers' purchases. But he says it's admirable for a company
to help bereaved families in wartime with no strings attached -- and tell
the world about it.

"Multinationals are doing everything they can here to be local," he says.
"Here is an opportunity to express sympathy for the people, not for the
government or for the army. It's a chance to say, `Look, we are one of
you. We are making money from your soil, and we are giving something
back.'"