Aug 18: FMCG goes regional, vote-theft talks gains steam, trade talk timeout

Good morning! In a real world reminder of ‘all publicity is good publicity’, India and Pakistan’s more than average bonhomie in the past few months has led to an explosion in ad rates for the upcoming Asia Cup. India-Pak matches are driving the biggest demand, and rates have been locked at ₹16 lakh for 10 seconds. Advertisers should probably just be happy we’re still only 1/100 of Super Bowl prices - ₹24 crores for 10 seconds, incase anyone was wondering.

Now, let’s get into the Dispatch! 🚀

Today’s reading time is 5 mins.

What’s happening and why? The fast-moving consumer goods (FMCG) sector in India is experiencing a notable shift, with consumers increasingly favouring newer and regional brands. Experts in the field, like Varun Alagh (CEO, Mamaearth) are saying that buyers are being drawn to localized offerings from regional players that deliver better value. These players are mounting stiff competition against well-established FMCG giants by adopting aggressive pricing and offering superior margins to distributors - factors that have begun to affect the growth of large companies in the segment. The brands they offer are also typically younger, more agile, and leverage vernacular strategies tailored to regional consumer preferences. Additionally, these players have a deeper understanding of local consumer behaviors and nimble operations resulting in quicker pivots when needed.

Big guns react: The who’s who of FMCG firms such as Nestle, Britannia, Dabur and HUL have also acknowledged emerging challenges from small regional players in some of their product categories (right after the quarterly results…). While the overall FMCG industry’s June-quarter growth saw no significant increase in volumes, small ‘newer’ players have seen faster growth. To counter the rising challenge the big movers are deploying financial resources and conducting focused competitive analysis in smaller territories.

Broader trends: Consumers’ emerging value-seeking and localized preferences are not the only change impacting the FMCG sector. Additional insights also reveal that rural India is the one pushing the pedal - growing at twice the pace of urban areas, marking six consecutive quarters of rural outperformance. Small manufacturers have played a pivotal role in this surge. As this evolves, large firms are recognizing the need for targeted responses as they adjust strategies and refine offerings in a rapidly changing market.

What’s happened? On August 7, 2025, Rahul Gandhi, Leader of the Opposition and senior Congress figure, alleged that the Election Commission of India (ECI) enabled widespread "vote theft" in the 2024 general elections. Citing internal Congress analysis, he claimed Mahadevapura in Karnataka showed more than 100,000 irregular voter entries - including duplicate voters, invalid or fake addresses, bulk registrations, invalid photos, and misuse of voter-registration forms. He also pointed to similar alleged irregularities in Haryana, Maharashtra, and during the Special Intensive Revision (SIR) of electoral rolls in Bihar.

Protests, Yatras and Detentions: Following his allegations, Gandhi launched a 1,300-km Voter Adhikar Yatra (Voter Rights March) from Sasaram, Bihar, framing it as a constitutional fight. Opposition leaders also staged protests in Delhi, marching toward the ECI headquarters; approximately 200–300 opposition figures including Rahul Gandhi, were detained.

“Give me proof” says Election Commission (EC): The EC has responded by demanding that Gandhi either submit a sworn affidavit substantiating his allegations within seven days or publicly apologize - insisting there is "no third option". The CEC, Gyanesh Kumar, asserted that failure to submit such an affidavit would render the claims “baseless and invalid.” He described the allegations as an affront to the Constitution and accused political actors of eroding public trust through politicization.

The Bihar Tale: EC has defended the SIR process in Bihar, noting it was a routine corrective measure endorsed by political parties over the past two decades - not a partisan tool. He clarified that voter lists are available online in a searchable, though not machine-readable, format - consistent with Supreme Court directives since 2019. The Commission also fact-checked an AI-generated Congress video, describing it as misleading, and reiterated that the SIR is being conducted transparently with participation from booth-level officials and party agents

Investigations Pushback: Electoral officers in Karnataka, Maharashtra, and Haryana have issued notices to Gandhi, requesting documentation to substantiate his allegations as preparation for inquiry. In one instance, a voter named Shakun Rani was alleged to have voted twice. The claim was however dismissed after an official inquiry and she confirmed she voted only once. In UP, an official review has found that Rahul Gandhi’s claim of voters registered in multiple states was based on misreading of data. 

Trade talk timeout: The U.S. has reportedly called off its Aug 25–29 India trade delegation amid rising tensions, with Trump’s additional 25% tariff on Indian goods kicking in Aug 27, taking some duties to 50%. Talks stalled over U.S. access to India’s agri/dairy industry and Russian oil purchases. 

India gets the bump: S&P upgraded India to BBB from BBB- after 18 years, citing fiscal discipline, growth, inflation targeting; forecasting 6.8% GDP growth. Brokerages see lower borrowing costs and UBS expected yields <6% by Jun 2026.

iPhone 17 manufacturing in India: Foxconn’s $2.8 billion Bengaluru plant has begun small-scale iPhone 17 production, supplementing Chennai. Despite a brief interruption due to exits of Chinese engineers, operations have been stabilized. Apple is targeting 60 million iPhones in 2025 (vs 35–40 million FY24-25).

Samsung laptops get made-in-India feature: Samsung has started making laptops at its Greater Noida plant, expanding beyond phones, wearables, and tablets. After a meeting with the IT Minister, it signalled more local devices ahead.

Diamond dependence: U.S. buyers are saying there’s no substitute for India’s diamond hub as Surat-Mumbai polish most of the world’s stones with skilled labour, scale, and speed. Even as lab-grown rises and tariffs loom, America’s supply chain still runs through India.