दृष्टिकोण – Indra's Viewpoint

I passed out from IIT, Kharagpur in mechanical engineering and joined Hindustan Motors in1961. For the first time I realized, with whatever I had learned at the best institute, I couldn’t immediately be of much use in any department of the company. An on-the-job training was essential. The company had two types of appointments. In one the employee had to join a department directly and after some amount of learning from the coworkers, he had to get into the work of the department. In another executive trainee programme, the new employee used to get a tanning in various departments before getting fixed up in one where the company wanted. I joined as an executive trainee. I was to work as trainee in various departments before getting fixed up in a department. The training as such was nor very well organized and it depended on the self interest of the trainee to learn. The case was same in other organizations too where my friends had joined. The interaction between the institutes and industrial enterprises was totally missing and still lacks. I am sure with better interactions the gap between the real requirement in the industry, and teaching and training in educational institutes could have been reduced then and can be reduced even today. Perhaps the professional education for medicines is more practice-based.

Finding an acute lack of certain specific knowledge required for working in any sector for the freshers of even high-ranking institutes, many top companies set up its own academies and training facilities.
Accounting firm Ernst & Young (E&Y) has set up its tax academy for the graduates in Mumbai that trains them as tax associates and offers jobs to successful students. E&Y experienced the difficulty in finding chartered accountants in short supply to man its rapidly growing tax audit business. I decided to train graduates and employ them as associates even if they are not qualified chartered accountants.

TCS has started its own academy to train 2,000 science graduates in Chennai.

Infosys’ has built a $300 million campus in Mysore that can lodge 13,500 trainees at a time-the largest facility of its kind anywhere in the country to get the new graduates trained as per the company’s requirement. Infosys Technologies even plans to partner with US universities for training its faculty at its Mysore training campus.

ICICI is partnering with a few associates to set up an Institute of Banking & Finance.

Some companies are tying up with the institutes and universities to modify the curricula to suit their requirements so that after the course the students can directly be taken to work in the companies.

ICICI Bank has tied up with Delhi University to offer a certificate course in banking and insurance. Retail giant Pantaloon has seeded MBA programmes in seven business schools with promise to absorb the graduates passing out of these courses. Pantaloon has also tied up for a three-year BBA program with a focus on retail with the Madurai Kamraj University.

Consulting firm, Accenture has tied up with XLRI in Jamshedpur to launch the XLRI-Accenture HR Academy to train people for the booming outsourcing business.

India’s major progressive companies are either setting up in-house training institutes to meet their growing demand for talent or tying up with universities to create courses that will meet their requirements. Unlike the common, short duration on-the-job training

modules, these in-house institutes are conducting structured courses ranging from few weeks to few months to train science and commerce graduates or even graduates in engineering and technology. The training module is to make graduates industry-ready. In most cases, after the completion of the programmes, the trainees are absorbed as employees by the companies, if they qualify the norms set by the company. Those found unsuitable are dropped at various stages.

Based on McKinsey and Nasscom, India is going to face a huge shortage of manpower for the IT and BPO university. Several recent studies have revealed that India is facing a deepening crisis in higher education with declining standards.

I am confident, most of the shortages can be met with in-house education and training facilities. In a country that produces 10 million employable youths (above class XII) every year, the right talent can’t be a shortage. I am sure, an effort is underway to improve the quality of education at earlier stages of education.

Further, as still interactions between the industrial enterprises and the professional educational institutes are minimal because of lack of appreciation of the mutual benefits, it must be made mandatory for the companies of substance to include the name of the professional institutes with which it interacts on professional issues in its balance sheet. Some of the working executives will more than love to join the faculty on part time basis, if so required. It will certainly improve quality of higher education too.

Rural youth find favour with ICICI Bank

Perhaps India is the most fortunate in the world to have a President like Kalam. I wish all the political parties could have consensus to have him continue for the second term too, even though that may not be a tradition. Here is what he told while concluding his speech on the eve of republic day of India. I only wish every proud Indian must go through his speech. The government of India must get the whole of the speech printed in all the languages of India and distribute free in all educational institutes.

When the nation marches towards its missions, many challenges will come on the way. Courage is a very important trait for all sections of the society in overcoming these challenges. I would like to narrate one incident. On 8th June 2006, I was in the flight of Su-30-MKI. The captain of the aircraft was Wing Commander Ajay Rathore. The duration of the flight was 40 minutes; I participated in all flight actions. When I landed, there were many youth and media personnel. One young man asked me a question, “Mr. President, please tell me, since you have flown in the supersonic fighter aircraft at the age of 74, were you afraid anytime during the flight.” I told the young man, “All the 40 minutes of the flight, I was busy on the control and the instruments, and experiencing the “g” build up. I was advised by the captain to track the targets and also look at the ground using the synthetic aperture radar. In addition, I was observing the performance of the instruments developed indigenously. I was continuously busy in the flight operations and I didn’t have time to allow the fear to enter into me.” Now, dear young friends who have assembled in front of me and the nation, I have a message of Courage for you.

COURAGE TO GIVE
Courage to think different,

Courage to invent,

Courage to discover the impossible,

Courage to travel into an unexplored path,

Courage to share the knowledge

Courage to remove the pain

Courage to reach the unreached

Courage to combat the problems

And Succeed,

Are the unique qualities of the youth.

As a youth of my nation, I will work and work with courage to achieve success in all my missions.

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A HISTORIC SHIFT- The visible and invisible costs of offending an ascendant India by SWAPAN DASGUPTA

India is a country of farmers with very small landholding. With the division in the farming family, the land holding is the first major causality. It gets fractionalized. Over 80% of farm families today account for and cultivate about 40% of the country’s total agricultural land. The agriculture then can sustain the family only by farming for high-value food items, such as vegetables and fruits. Surprisingly, with division of the land in members of the farmer’s family, I observed better yield because of the extra effort or competition between the members of the family. My own family got divided in five units. Today just one unit that is still engaged in farming is producing much more than what was the production when all the five units were together. I discover a similar story of the increased agricultural output in the family of my in-laws. Each of the three brother-in-laws is reaping output more than they used to get in the joint endeavour. Unfortunately, none of them have still switched over to high value agriculture. The farmers in our villages could have gone for some high value agriculture, such as pulses and oilseeds or even sugar cane. But for the reason of security at the time of harvesting due to law and order trouble, the farmers do not go for it. As reported, the small farmers in India accounted for 44% of India’s total agricultural production.

Certain social taboos are also restricting the farmers from switching over to vegetable farming that can have better yield. In good old days only the farmers of specific caste used to cultivate vegetables and sell, and people of a specific caste used to have cows and buffalos with intention of selling milk and milk products. However, the time has changed. Wherever there are facilities to sell milk, most of the families in rural areas are doing that for additional earnings.

The organized retail sector may lead to growth of contract farming. That may bring revolution in farming sector unless the entrepreneurs of retail sectors become too greedy to part with the farmers’ share. Farmers can grow organic food, vegetables, flowers, and even fruits in abundance if they get the technical input to do that. Hardly, a fraction of the country’s potential of production is getting realized as on today.

Retailers can provide the strong market linkages and enabling environment for high value farming.

As reported, Reliance Retails and Bharati have plans for contract farming.

Mahagrapes, the marketing arm of grape-producing cooperatives in Maharashtra, saw a 59% increase in their profits when they forged connections with food processing and retail firms.

For India’s Safal vegetable cooperative, farmers’ profits were nearly 80% higher when they linked to the organised market.

And all these transformation in rural India will be hastened if the educated members of the family take the agriculture with interest and as a commercial business. Education and experience will offer farmers a better chance of success, especially in export markets where compliance with foreign standards requires higher levels of awareness and knowledge. Both farmers and retail firms may gain a more equitable way of doing business with each other. Firms gain an incentive to invest resources in farmer training and capacity building, and farmers face fewer fluctuations in capital and input costs.

However, India is not far behind in adapting to technological changes. In Asia, India has emerged as a leader in genetically modified (GM) crops by tripling its area under Bt cotton to 3.8 million hectare in 2006, surpassing China, which remains at an area coverage of 3.5 million hectare, according to annual report prepared by the US-based International Service for the Acquisition of Agri-biotech Applications (ISAAA). Again, could one, ten years ago, think of that one day India will be exporting eggs in million numbers?

Let the government assume the facilitator role and provide the infrastructure such as one through the implementation of long pending irrigation projects, and the rest will be taken care of by the farmers.

It’s Buddha who had cursed Patna, then Patliputra that it would always be in trouble because of fire, flood and feuds between the people. And it goes on till date. I had thought that at least on the dais of ‘The Global Meet for a Resurgent Bihar’ and outside even, all the political heavyweights would be together, present an united face of Bihar leadership, and complement the efforts being made by some real enthusiastic younger generation of Bihar to bring back the past glory by involving the non-resident sons of Bihar who owe something to the land where they were born or belong by heritance. Unfortunately, it was not seen.

President Kalam presented the clear roadmap for the development strategies for Bihar, perhaps for the second time in a year, and also perhaps remorsefully remarked, “If Bihar develops, its political parties will also develop.” But Lalu Prasad described the meet as “Sab golmaal hai” (Not everything’s right with it). Lalu ji had his doubts, “if it will help Bihar in any way”, and considered ‘such a meet as platform only for big announcements as was the case in 1995. Nothing materialized.’ Such remarks are if not anything demoralizing. Ram Vilash Paswan, Sarad Yadav, and even George Fernandes would have been at least present even without any invitation. But perhaps the Buddha’s curse wishes to taste the strength of the Bihar’s youth.

I would have also loved if the directors of professional institutes and vice-chancellors of the state would have participated and mixed with NRBs to know what they must do to make their students employable. Bihar is getting IIT and may get Indian Institute of Science Education and Research, and other institutes too. But all these institutes of higher education must aim at producing the employment generators for the state instead of producing employment seekers.

NRBs can certainly help in creating an education hub at all the district head quarters. And all the well wishers may help Bihar in establishing professional training and skill building institutes for providing skills for all the children of the state, who fail to go for higher education. NRBs can also initiate many more English and other languages coaching institutes with latest audio and video facilities so that all the students that have graduated in different streams become employable. I presume they know where the students of Bihar lack this badly. Some NRBs can also encourage and facilitate in making younger lawyers, teachers, and doctors to start BPOs in the cities and towns of Bihar. If it can happen in Andhra Pradesh and Delhi, why can’t it be done from Bihar?

I have not found the name of any industrialists of importance addressing the meet but for Deveshwar of ITC. It may be that the organizers wouldn’t have invited them. But today with the amount of interest being shown by some big houses in rural and retail sector, the organizers would have invited some like Ambani Brothers, Kumarmangalam Birla, Sunil Mittal, and Goenkas. When I look in future, after the GQ and E-W Expressways are complete, a number of rural malls and food processing industrial complexes can come up along it. I wish the government could have been more proactive to contact the industrialists rather than expecting them coming to the state at least with present state of the perception about the brand image of Bihar. Besides, all the tax concessions, the government and particularly the CM must impress on the investors that Bihar provides a better work culture through flexible labour laws through an ensured discouragement to hooliganism in the name of trade union for which the neighbouring state West Bengal has earned a bad name.

My biggest complain is about the media. I didn’t find any national newspaper of the capital such as Times of India or Hindustan Times covering the news of the meet. When I compare its coverage of ‘Vibrant Gujarat’. I consider the media is extremely partisan and not carrying out its responsibility. As the fourth pillar of democracy, it has an extra responsibility for the underdeveloped region of the country.

I never had any big expectation about the NRIs investment. Perhaps, the government and the organisers would have prepared a document profiling at least 20-30 most successful NRBs. It would have been clear. I don’t think there are many from Bihar in US or in other developed countries that are in position to make big investments. Most of the NRBs are only working as employees, as Biharis were the last to follow ‘the brain drain’ route or to go abroad in large number. However, if NRBs can group together, and put their synergy, they can change the prosperity profile of Bihar. Let them start at the grassroot levels where they can help with constructions of toilets, biomass power generation, low-cost housing suiting to the local needs, knowledge center with computer and Internet, and healthcare unit with at least maternity facility in rural Bihar. But most importantly, they must keep on visiting their villages and not only the towns where they got educated.

I congratulate the organizers and expect that they will do better and serve more. Let me end this writeup with “Bhagna Mandir Ban Rahaa hai, swed ka Bal do.”

A News

Agriculture contributes slightly more than 20% of India’s GDP but supports nearly 75% of its population.

Cumulative wastage in the agriculture related supply chain is estimated to be about $11 billion, or 9.8% of agriculture component of GDP.

India’s milk production has jumped more than five-fold from 17 million tonnes in 1950-51 to over 90 million tonnes in 2004-05. Over the same period, the production of eggs has skyrocketed from 1.8 billion to 45.2 billion and fish production from 752,000 tonnes to 6.3 million tonnes.

India that in 1966 imported about a sixth of its total requirement of cereals became a net exporter of grain. Unfortunately, for the first time after many years, India is importing wheat. Oilseeds production too has increased, from around 5 million tonnes in 1950-51 to over 25 million tonnes today.

The net availability of food grains that had risen from 394.9 grams per capita per day (gpcd) in 1951 to 510.1 gpcd in 1991 has since fallen to closer to 435 gpcd. In pulses, today’s availability levels are barely half what they were in 1951, having plummeted from 60.7 gpcd to 29.1 gpcd.

Availability of edible oils has grown sharply particularly since the beginning of 1980s (3.8 Kg/annum in 1980-81 to 8.2 Kg/annum in 2000-01) , but per capita cereal availability has declined from the beginning of 1990s (171 kg/annum in 1991 to 141 kg/annum in 2001) and the availability of pulses today is 10.9 Kg/annum less than half what it was at the time of independence (25.2 kg/annum in 1961).

India’s average yield in paddy is about 3,000 kg per hectare, when China’s is 6,350. In wheat, Indian yields are around 2,750 kg/hectare, when China does over 3,800. Even in cane, where India is the world’s largest producer, Chinese yields are about 10% higher than India’s. Production and yields for most important crops including rice and wheat have plateaued since the beginning of the 1990s.

Only about a quarter of the country’s agricultural land is irrigated even six decades after Independence.

Agricultural labourers even today form a larger part of the country’s population than they did in 1951. In that year, three-fourths of those who lived off farming were cultivators and the remaining one-fourth (who made up 7.5% of the total population) were labourers. Today, almost half of these people who earn their livelihood from agriculture (10.4% of the total population) are labourers, not farmers. The proportion of farmers in India’s population has fallen to 12.4% in 2001 as against 19.4% in 1951, but that of farm labourers has increased from 7.6% in 1951 too 10.4%- a significant rise.

Annual growth in Indian agriculture has plummeted to 0.9% over 2002-04. Agricultural profitability has fallen by 14.2% since 1991-the decade of economic reforms. The last seven years of the 19909s India have registered a dismal 0.67% per annum growth of rural employment, the lowest since 1947. Spiraling input costs have made 43.42 million Indian farmers in debt. Only 10% of all farmers are having access to crop insurance.

Public outlay on agriculture research stagnates at around 0.5 of the agricultural GDP. Even the states like Punjab and Haryana today register retarding productivity.

Global warming has reduced the span of winters, leading to early maturing of wheat- every one-degree rise in temperature above normal levels during the second half of December leads to a yield loss of about 315 kg per hectare.

Wheat constitutes around 35% of domestic consumption. The production profile of the cereals consists of: Rice about 91 tonnes, Wheat about 70 tonnes, Pulses about 13 tonnes, and Coarse cereals about 35 tonnes.

India will import a record six million tonnes of wheat at a price nothing less than $260-270 per tonne. MS Swaminathan calls it “wake up call.” A few years ago, India was exporting wheat, but the realization then was no more than around $90 per tonne.

The more visible result of the crisis of agriculture is the spate of farmer suicides in several states like Andhra Pradesh, Punjab, Maharashtra and Karnataka – not one of which is a BIMARU state.

Fortunately with certain affluence, the consumption pattern has changed, and small farmers are responding to the necessity of high-value farming. Thirty years ago, the average rural Indian consumed approximately 15 kg of cereals each month. Today, this figure has slipped below 13 kg. At the same time, Indian consumers – even the very poorest – have increasingly turned their attention to high-value foods. Between 1970 and 2003, the poorest 30% of India’s rural population accounted for the country’s highest growth rate in milk and milk product consumption. Per capita consumption of vegetables during this period tripled in rural areas and nearly doubled in urban ones. Overall, consumption of high-value foods grew at almost 1% per year over the past three decades. By 2020, India’s monthly expenditure on milk, meat, eggs and fish is projected to double, and to more than double for fruits and vegetables.

Solutions are known, but India is to be serious to take all the actions before it is too late to prevent a disaster because of the failure of the agriculture sector. I add only one item required to improve agriculture. Remove or regulate intermediary traders who pay less to farmers, who charge more for all the inputs such as insecticides, and seeds, and that too fake and poor quality.

I wish IITians come out in big and generous way to Prafulla’s assistance and he gets back to a normal living soon.

A good Reading: Kaizen must be a way of life

Here are two references about the importance of compassion that we must try to practise with all including the animals.

Last week the Dalai Lama said, “I knew a Tibetan monk for a long time. He was taken away to a Chinese gulag and kept there for 18 years. When he was released he fled to India, along with other Tibetans, for refuge”.

He continued calmly, “I met him and asked him about his experiences in prison”. The monk replied, “At times I was in great danger”.

“What kind of danger?” asked the Dalai Lama. “I was in danger of losing my compassion towards my Chinese captors”, he replied.

How do you deal with an ‘enemy’, someone who actually has inflicted pain upon you, asked someone. “Your enemy”, replied the Dalai Lama to all listening, “becomes an object for you to practise compassion. It is easy to practise compassion on those you love, but the enemy becomes an object for you to further your practice”.

Compassion is not something that’s meant to be shown only to humans; we need to be sensitive towards other living beings too.

Swami Vivekananda would say: “Always cultivate the heart, for through the heart the Lord speaketh, but through the intellect you yourself speak”.

In Belur Math, Kolkata, the Swami lived with his dog Bagha, goat Hansi, an antelope, a stork, several cows, sheep, ducks, geese and a kid called Matru with whom the Swami played like a little child.

Ramakrishna Paramhansa was fond of a dog in the Dakshineshwar temple garden. He called the dog Captain and he often sat on the front terrace of Mother Kali’s temple.

Captain was devoted to Ramakrishna who would remark: “Captain has been born as a dog as the result of his karma. He had some good samskaras (tendencies) in his previous life, so he is here. He is a blessed soul”.

As reported, besides higher level of confidence in overall economy, Indian business owners are most optimistic globally about growth of their business turnover. This is according to an International Business Report (IBR) survey published last week by Grant Thornton International.

For the past two years, growth in manufacturing sector production was 9.1%.
The Index of Industrial Production (IIP) figures released by the government last week show that growth was primarily driven by manufacturing, which soared 15.7% in November. This is a great news.

According to the central bank, exports of India’s manufactured engineering goods grew at an average annual rate of 33.8% during the most recent three years and 40% of these exports were manufactured by small- and medium- size enterprises.

Though manufacturing forms only 17% of India’s GDP, it contributes 75% to exports, and accounts for over 50% of FDI, while employing 11% of the workforce, generates $450 billion worth of output.

India needs to create 8 Million jobs every year incrementally to sustain even current rate of unemployment. Manufacturing only is the right cure for the teeming millions of Indian unemployed youths going to join the workforce. Manufacturing is a force-multiplier, as every rupee of investment increases GDP by Rs 4.

Indian manufacturing must grow at 12-14% if India is to maintain an 8-9% per annum GDP growth rate over the next decade. And the growth rate of 12% in manufacturing can create about 1.6-2.9 million direct jobs annually in addition to two-to-three times this number of new jobs indirectly.

As per one estimate, poor infrastructure adds 3-6% to the Indian manufacturer’s cost of doing business even as there is a gain of 4-5% on account of better engineering skills and R&D of the country.

According to McKinsey, it is possible for Fortune 500 company to manufacture products in India at about 70% of the cost of a similar product in the US. Tata Motors’ ‘Indica’ costs about 40% less than what a comparable car developed in the West would have cost.

According to McKinsey estimates, half of all global offshoring by US companies already involves skill-intensive sectors. By 2015, the figure may go up to 70%. India can emerge as one of the three largest exporters among Low Cost Countries with skill-intensive manufacturing exports of $250-300 billion and can create an additional 25-30 million jobs.

But India is to compete with China. As per an automotive industry estimate (three years ago), the cost differential between India and China was 22-24%. Nearly two-thirds of this was because of interest rates and the cascading impact of taxation, while the balance was due to logistics issue and rigid labour market.

Implementation of VAT, Value Added Tax, once completed in all states of India is expected to reduce the cost differential between India and China to a more manageable 5-6%. Why should India go on perpetuating a system where it appears as if each state is a country with separate sets of taxations?

India must also go for less high-tech and more labour-intensive manufacturing segments. On an average, it takes six parsons in the small industry to do the job of one person in the corporate (big industry) setup. So a judicious approach is necessary to encourage the growth of SMEs, while maintaining the competitiveness with the large scale manufacturing companies.

India can no longer expect to compete and play a big role in global trade without a substantial growth of its manufacturing sectors of all hues- low-skill, high-skill, apparels, leathers, chemicals, home goods, souvenirs, or perhaps everything that are in demand by the consumers, in domestic market or more so globally. Manufacturing must embrace rural India to bring in prosperity to the millions of people there. Many entrepreneurs have come out with business models in manufacturing for rural India that must be emulated by hundreds and thousands of entrepreneurs and supported by the government and successful business leaders.