Why the Indian consumer is an unprotected species

  • Sanjoy Narayan, Hindustan Times
  • Updated: Jan 11, 2015 12:44 IST

Do you know anyone who is happy with his telecom service provider? Anyone? If you are one among India’s 930 million plus (and growing) mobile phone subscribers then you’re likely familiar with how scant is the regard that telecom operators have for their customers when it comes to the quality of services they provide. Dropped calls have become so obligatory anywhere in India that when a five-minute call is completed without dropping it seems astonishing. As the number of subscribers to mobile telephony increases (at an estimated rate of a million a month), the quality of services offered becomes poorer. This is mainly because telcos don’t expand their infrastructure or invest more to meet the increased demand, leaving customers dissatisfied.

The ubiquity of mobile telephony can make telcos seem to be the biggest offenders when it comes to providing good-quality services. Anyone who is a broadband subscriber for internet services will tell you how what you see is never what you get: if your telco promises you 1 or 2 Mbps download speeds be assured that you’ll never get that. Actual speeds could routinely be up to 30% lower.

Why blame only telcos? The Indian consumers are almost universally at the receiving end of poor quality of whatever they are buying, whether it is cars, appliances, and even food, or paying for any kind of service. Take real estate developers. Reputed or otherwise, they are multiple offenders for whom taking the customer for a ride appears to be hard-wired into their business strategies. It usually begins with smokescreens about the area of the house you are buying with craftily construed terminology such as carpet area and super built-up area, and clever fudges about common areas and areas of balconies all designed to confuse the consumer, with the only constant being this: that what you think you’re buying will never be what you will actually get. But realty companies dupe consumers in other ways as well: projects routinely overshoot promised completion dates not just by one, two or three years but five. What’s worse, wronged consumers have little option but to smile and bear the injustice.

Indian consumers are an unprotected species. Rarely do aggrieved consumers get redressed. Recently, a large Indian realty firm had to recompense its buyers after a court ordered it because it had promised facilities that it had not delivered; and carmakers have only recently begun recalling defective cars sold in India but that’s often because of glitches detected in the same models in other countries. If the degree of consumer protection is an indication of how mature a market-driven economy is then India has a long way to go.

For setting right their grievances Indian consumers have few options. Seeking justice in consumer courts is usually a long and tedious process with cases sometimes taking decades to get settled. Besides, there are many grey areas with respect to what comes under the jurisdiction of such courts — real estate, for instance, doesn’t. After the new Companies Act of 2013, Indians can now file class action suits — where a group of complainants can form an association to bring a suit against a common entity but, in practice, as of now, it is restricted to shareholders of a company who can form an association to file a suit against the promoters.

There may be hope on the horizon, though. The Competition Commission of India (CCI) could emerge as a messiah for consumers, albeit in an indirect way. The CCI has been vested with powers to take suo motu action against manufacturers and sellers who use market dominance or cartels to rig prices or to indulge in anti-competitive practices. Its actions in such instances can be beneficial to consumers — only indirectly. But if your phone call drops because of an errant service provider, or you’ve been sold a lemon instead of a car, like legions of other Indian consumers, you could be left to fend for yourself.

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