KFC's Indian expansion faces obstacles
KFC's Indian expansion faces obstacles
By Narayanan Madhavan
BANGALORE, India (Reuter): Kentucky Fried Chicken (KFC) has
discovered that serving its standard fare in some 9,400 outlets
worldwide is fraught with challenge and opportunity when it comes
to India.
In a land of increasingly affluent consumers and die-hard
nationalists who cannot stomach its presence, a busload of
policemen guard the PepsiCo-owned food chain's first outlet in
the southern Indian city of Bangalore, often called the nation's
Silicon Valley because of its computer industry.
KFC has had to down it shutters on three days since it set up
shop in India this year.
In September, KFC's Bangalore outlet closed for a few hours
after municipal officials said its food contained monosodium
glutamate (MSG) beyond permissible limits. KFC took the matter to
court and won a stay of closure. It says the amount of MSG used
is well within safe limits.
It shut down for a day on Nov. 1 after peasant leader M.D.
Nanjundaswamy brought 25,000 supporters to protest against the
restaurant, which he says will divert food grains from human
consumption. "It directly affects Indian agriculture," he told
Reuters.
On Sunday (Nov. 12), KFC was forced to shut its Delhi
restaurant -- its second Indian outlet-- after a hurried weekend
action by the city's Hindu nationalist government on the ground
that its sanitation was inadequate. "They found two flies," a KFC
spokesman said dryly.
KFC was approaching Delhi's high court on Monday to seek a
stay order against what it perceives as an unjust action.
Inside the restaurant on Bangalore's Brigade Road, customers
don't seem to care about the criticism, although they admit the
crowd has thinned somewhat after the Nanjundaswamy organization's
threat to ransack the store and environmental campaigns.
"There are Chinese restaurants selling the same stuff
(monosodium glutamate) by the kilos. Why not them? Why pick
solely on KFC?," said Shashi Uthappa, a housewife in Bangalore.
"If we want to die, it's our choice."
"We eat here everyday. Nothing happens to us," said student
Menaka Shewakramani. "In the U.S., they are so health conscious.
If they can have KFC there, why not here?."
Last week, Delhi's government, which is controlled by the
Hindu nationalist Bharatiya Janata Party (BJP), asked municipal
officials to take action against KFC's outlet in the capital,
saying the store was using sodium aluminum phosphate, a harmful
ingredient not permitted under local laws.
"Sodium aluminum phosphate is a common ingredient in baking
powder," said Sandeep Kohli, managing director of KFC in India.
The BJP and its ideological inspiration, the Swadeshi Jagaran
Manch (National Awakening Forum) are strident in their criticism
of KFC, and the Delhi government does not want KFC to be granted
any more licenses.
Concerns about junk food and a dislike of foreign products
make for a heady mix as the BJP prepares for general elections,
due by mid-1996. The party is gunning for aspects of Prime
Minister P.V. Narasimha Rao's four-year-old free market
program, which brought in consumer giants KFC, Pepsi and Coke.
Alongside this a minor, but equally intriguing, debate rages.
Is KFC's fare a winner with Indian palates, long used to spicy
chicken from the tandoor oven?
The Times of India recently quoted some celebrities saying
they prefer tandoori chicken. But KFC's customers like both.
"Variety is the spice of life," declared student Nadeem,
happily countering those who say KFC's chicken lacks spice.
"If you can bring in potato chips and cornflakes, why not
this?," added Ila Gurjar, a customer at Bangalore.
Politicians or no politicians, spice or not, KFC is catching
its customers young. Many older customers said they preferred
spicy tandoori chicken, but that their children loved KFC's fare.
"They like it more," Rama Reddy said, pointing to her two
children. "I don't think it's bad for them. Otherwise I wouldn't
bring them here."