Indian History: Learning during US Visits

After retirement, my only past time has been reading a lot and a very little writing too, including this entry too. But whenever I am in US, it is more intensive and purposeful.

During my almost six-months stay in 2005, I regularly spent about four-five hours of afternoon in ‘Borders’, the bookshop in San Jose. Anand used to leave there after my lunch and pick me while coming back from his office. Later on Borders got closed. In Cary, where Anand shifted in 2010, the location of Barnes and Noble is not convenient. However, I did go for few days. I preferred these bookstores rather than the local libraries, as I could access the latest books and particularly magazines and journals, and thus keep on tracking the latest views on the subjects of my interest.

This year with almost perfect eyesight after the cataract operations of both the eyes, I focused on few books that were available with Anand in Cary and Rajesh in Austin. In Cary, I went through two of John Keay’s history books- ‘India: A History’, that I had brought here in 2010. I got his another very revealing book, ‘India Discovered’ that I purchased through Amazon this time. The book reveals how the history of ancient India was written after various revelations by the officers of East India Company and other Europeans through deep archeological studies, explorations and excavations. None but just one Indian archeologist, and historian, Rakhal Das Banerji had any mention in the book.

“Alexander Cunnigham, the Archeological Surveyor, while touring the Punjab in the winter of 1872-3 investigated Harappa ruins (now in Pakistan). But by that time, more than a hundred miles of track had been ballasted with bricks from Harappa by the railway contractors of Lahore-Multan line.”

It was R. D. Banerji, ‘one of Sir John Marshall’s Indian recruits’, discovered Mohenjo-daro and the famous seal and recognised it as belonging to the same class as those on the Harappan seals. Marshall himself, descended on Mohenjo-daro for the 1925-6 season and was impressed by its drainage system. The houses, which were unexpectedly roomy, had each its own well and bathroom, from where a waste pipe connected with covered conduits which ran the length of every street and alley. They were built of finely chiselled brick ‘ laid with a precision that could hardly be improved upon’. This implied a ‘social condition of the people much in advance of what was then prevailing in Mesopotamia and Egypt’.”

Surprisingly, even now Noida where I live in India, most of the drains are open.

In Austin, I have gone through a book on World WarII that Rajesh would have bought for Svanik. Let me confess I hardly knew anything about the war that changed the face of the world. It is strange to even think how Japan could have gone for a war with US, and a man from Germany could massacre the whole of Europe and particularly the Jews.

Presently, I am going through DK’s ‘History‘ with Adam Hart Davis as editorial consultant. I shall like to share some of the things:

“Flint tipped dental drills, found in Indus Valley, date back as far as 7000 BCE. Teeth in remains found nearby showed signs of a skilful drilling to remove rotten dental tissue…….

The Valley (with the most notable Neolithic culture, starting C.7000BCE) ranked among the first great civilizations, in the company of Mesopotamia and Egypt.

Mohenjo-Daro and Harappa were probably the world’s first planned cities with broad avenues and narrow side streets lined with spacious town houses, all set out in a well defined grid pattern. Remarkably, Indus cities thousand of miles apart were laid out in a similar way.

Some Indus Valley artifacts, most famously the jewelry, have been found at sites as far as in Mesopotamia and Iran indicating widespread trading links. It indicates advances made in methods of transportation, especially in boats suited to long distance travel along sea routes. The Indus people seem to have been among the first to develop a precise weights and measures system.

Herbalism is also central to Ayurvedic medicine, which originated in the Vedic period of India shortly before 1000BCE……The Ayurvedic system is typical of the approach to science and technology that began to emerge in India during the 1st millennium BCE. People began to think rationally, organise their thoughts, discuss them with others, and derive theories. This approach led not only to an encyclopaedic knowledge of human anatomy and of a vast range of diseases, but also to well thought out systems of diagnosis and treatment- the basis of modern medicine. (Page 52)
The Ayurvedic system flourished across the Indian subcontinent. Its main exponent was Sushruta, whose 6th- century BCE work Sushruta Samhita describes more than 100 surgical procedures. Many historians of medicine refer to him as the ‘Father of Surgery’.”(page 53)

All these readings make me proud of our heritage and will also do that to many countrymen.

It is interesting that even today most of the research works about Harappa and Mahenjo-daro has shifted from the historians in UK to those in US.

Posted in Uncategorized | Leave a comment

US Visit 2013: some experiences

This visit to US has been very exciting till now. We completed a stay of more than two months with Anand at Cary. We are now in Austin with Rajesh. In Cary, we met many parents from India and one couple from Pakistan too. Here below is a group photo.

20131009-111956.jpg
In ‘Harmony’ community, Cary, the number of Indians owning the properties is pretty significant. Families from Andhra Pradesh are in majority. It was pleasant to see even the women from rural Andhra driving big utility vehicles. And it is because of these youngsters that so many parent are visiting US every year which they could not have dreamt otherwise.

Interestingly, these Indian young men and women have expertise and engagement in varied professions. I found one young Andhra woman running two pre-school centres. Some are working as doctors. But I was excited to meet the mechanical engineer from Andhra who works in the quality control of John Deere manufacturing facility here. However, the majority of young Indians are in big and small units in IT sector that are in TRP such as CISCO and IBM.

I can’t but write about the Pakistani couple- Mohamad Akbar and Suraiya. They are very simple ones from rural background and with very little formal education and knowledge. Suraiya got her eyes operated for cataracts here in Cary. They kept on talking about the very high cost of the operation. Lately, we used to go in evening to a meeting point created by the Housing association by fixing up two benches in one corner. I used to call Suraiya as Jodhabai. It was through Suraiya that we got acquainted with each other. Actually, Suraiya one day had lost her way to her daughter’s house. We had helped her to get back to the right place. She was almost crying and was helpless because of her inability to communicate in the languages the people here knew. (On left side in the photograph)

I met a family from Kolkata too. I used to meet Balay Chaudhry while going to drop Emma to her elementary school. One evening we visited the house of his daughter, Sukanya and her husband Surya.It was because Balay had invited us.We went for some adda, typical in Bangal and had tea too. Both Sukanya and Surya are from Indian Statistical Institute, Baranagar, Kolkata. Surya teaches in the university and Sukanya works for some consultant firm.

20131009-112640.jpg
It was a great evening.

Posted in Uncategorized | Leave a comment

Manufacturing India : Despair or Hope

Even with all the gloom of Indian slowdown affecting, India has some attractiveness and India story is tact for some. As reported, “The rupee’s drop is making India a more attractive destination amid rising wages in China and labour strife in Bangladesh. To benefit from the currency advantage, India will have to ease rules and reduce bureaucratic delays.”

Honda, the Japanese carmaker has started a feasibility study for building a third plant and is considering Gujarat (Sanand) as a base, even before its second new plant in Tapukara, Rajasthan, begins production by early-2014.

Media reports confirm it. “Emerging markets will be the headquarters to thousands more of the world’s largest companies — as many as half — in the next decade or two, a study published by the McKinsey Global Institute said Thursday.” “The world’s competitive landscape will be transformed over the next 10 to 15 years by the rise of a formidable new breed of large emerging-market companies.”

India must shake off its lethargy, think big and go all to take advantage of the situation.

The good news is that some manufacturing companies such as Bharat Forge, JK Tires are diversifying and expanding their manufacturing activities.

According to the 2013 Global Manufacturing Competitiveness Index (GMCI) report, prepared by the Deloitte Touché Tohmatsu Limited (DTTL) Global Manufacturing Industry Group and the Council on Competitiveness, India dropped two spots in rankings, falling from second to fourth since 2010. However, the report also expresses its hope that India can become again the world’s second most competitive manufacturing nation in the next five years behind China. One of the good news is that India’s manufacturing exports grew at a CAGR of 17.1 percent between 2006 and 2011.

However, India with huge rural population in farming with very poor productivity is far behind in manufacturing in real term. It will be worthwhile to look into few comparative data of the GMCI report about some developed and emerging nations:

Comparing Manufacturing GDP CAGR for 2005-10, India has a rate of 8.5 percent, whereas the figures for China is 11.9, while the manufacturing GDP percentage of total GDP in 2010 for India was 14.2 percent against that for China being 32.4, for Germany 20.7, South Korea 30.5, even Japan 19.4. As the new National Manufacturing Policy of India expects to boost the share of manufacturing from 16 percent of GDP in 2009 to 25 percent by 2022, the nation has still many more miles to go to reach the goal.

When we compare manufacturing exports percentage of total export in 2011, India figure was at 50.3, whereas that for China was 93.2, Germany 82.7, US 64.3, South Korea 85.3 and Japan still 88.

There are many things to improve:

Logistics cost in India that is pretty high at 13-14 percent of GDP compared to 7-8 percent in developed countries.

In R&D, though the number of MNCs operating its technologies centres are significant, but domestic companies are far behind in getting in innovating new products that can earn global brand status. The figure of researchers per 100 of population is dismal.

India still has the advantage of labour cost that is at 0.9 US dollar in comparison with that in China that is at 2.8 in 20011 and Brazil at 12. However, perhaps the productivity of the labour in India is very much low. India must focus on the quality of education in big way. Instead of declaring the majority of population of billion plus as poor and doling money, the government in power must focus on quality education and training in skills in demand.

And fortunately, India has its built-in strength. Is it not exciting to learn that’India tops the global chart of remittances with a whopping $71 billion in remittances in 2013, just short of three times the FDI it received in 2012,’ according to a revised World Bank forecast? It leaves behind many nation including China that gets$60 billion as remittances.

Manufacturing must become the main focus for the new governments that will rule the states and centre after the next elections.

Posted in governance, manufacturing | Leave a comment

Ramanujam and Satyendranath Bose

I knew only the story of Indian mathematician Ramanujan and Prof. Hardy, and how Prof Hardy introduced Ramanujam and his works on number to the entire world:

“Indian mathematician who was self-taught and had an uncanny mathematical manipulative ability. Ramanujan was unable to pass his school examinations in India, and could only obtain a clerk’s position in the city of Madras. However, he continued to pursue his own mathematics, and sent letters to three mathematicians in England (which arrived in January of 1913) containing some of his results. While two of the three returned the letters unopened, G. H. Hardy recognized Ramanujan’s intrinsic mathematical ability and arranged for him to come to Cambridge.” (Refer)

Here is the other story of Satyendranath Bose.

Albert-Laszlo Barabasi, the foremost expert in the new science of networks in US, in his book, Linked, has a chapter, ‘Einstein’s Legacy’ that has an interesting mention of Satyendranath Bose. I happened to go through the portion in the book last weekend while travelling to Boone with the family. It excited me as I have seen Bose during IIT’s days, when he visited Azad Hall and got an opportunity to talk with him. During my years in Hindu Hostel of Presidency College, I had also heard the stories about the academic competitions between Satyendranath Bose and Meghnath Saha while they were still students.

“In June 1924 Albert Eintein received a letter and a brief manuscript, written in English, from an unknown Indian physicist from Dacca named Satyendranath Bose. Unknown to Einstein, the manuscript had been recently rejected by the ‘Philosophical Magazine of the Royal Society’ in London. Einstein liked the manuscript so much that he set aside his own work and translated it into German, arranging for its publication in ‘Zeitschrift fur Physik’. He even added a praising note:”In my opinion, Bose’s derivation of the Plank formula signifies an important advance. The method used also yields the quantum theory of an ideal gas as I will work out in detail elsewhere.”
—– ——-
“Bose’s paper was still at the publisher when Einstein appeared at the Prussian Academy to present his own rebuts, titled ‘Quantum Theory of Single-atom Gases’, in which he extended Bose’s method to gas molecules. Six months later he was ready with yet another publication, the ‘Second Treatise’. In these papers Einstein predicted a very strange phenomenon, known today as ‘Bose-Einstein condensation’.

“At ordinary temperatures gas atoms bounce into each other at different speeds. Some are fast, others are slow. In the language of physics, some of them have high energy, others have low. If you cool the gas all the atoms slow down.To bring them to a halt, you would have to cool the gas to absolute zero, an attainable temperature. Einstein predicted that if a gas made of indistinguishable atoms is sufficiently chilled, a significant fraction of the particles will settle to the lowest energy. That is, atoms can be forced into their lowest energy state at a critical temperature above absolute zero. When particles reach this state, they form a new form of matter called a Bose-Einstein condensate.”
—–
“Then in 1995 a group from the National Institute of Standards in Boulder, Colorado, led by Eric A. Cornell and Carl E. Weiman, cooled rubidium atoms to low enough temperatures to form a Bose-Einstein condensate.”

“According to a July 2012 New York Times article in which Bose is described as the “Father of the ‘God Particle'”, the scientist’s interests wandered into other fields, including philosophy, literature and the Indian independence movement. He published another physics paper in 1937 and in the early 1950s worked on unified field theories. Several Nobel Prizes were awarded for research related to the concepts of the boson and the Bose-Einstein Condensate. Bose was never awarded a Nobel Prize, despite his work on particle statistics, which clarified the behavior of photons and “opened the door to new ideas on statistics of Microsystems that obey the rules of quantum theory,” according to physicist Jayant Narlikar, who said Bose’s finding was one of the top 10 achievements of 20th-century Indian science.”

And 2013, Nobel ….
Why doesn’t Mother India produce sons such as Raman, Ramanujan or Satyendranath Bose?

Posted in education, Uncategorized | Leave a comment

Manufacturing India:manufacturing competitiveness?

So finally, I got at least one item in Anand’s household that has a ‘Made in India’ tag. It is a small memo book with 80 sheets of 3×5 in size. Why are the Indian manufacturers not aggressively in competition with other countries that are exporting to America and other developed countries?

As rightly “>reported, “India has one of the lowest costs of labour and “on paper” a competitive price of power. In reality though, labour productivity is very low and power is unavailable for up to two shifts a day in many industrial clusters – forcing them to use inefficient diesel generator sets – that nullify any factor cost advantage. India’s road and port infrastructure are still far from ideal. Our port turnaround times are upwards of 80 hours – roughly five times that of Sri Lanka. The average truck speed in India is 35 to 40 km per hour roughly half of that in China.” India can’t be anywhere unless it improves the fundamentals for enhancing interest in manufacturing. The favourable exchange rate for export is hardly advantageous and matters on long term.

Even a country such as US is refocusing its policies to keep manufacturing growing. India must learn some lessons.

A 2012 report had predicted that United States would slip to fifth place from third in manufacturing competitiveness in the next five years as India and Brazil race ahead.

However, as recently reported, “US manufacturing competitiveness has steadily increased over the last decade in comparison with key peers. Analysts at Boston Consulting Group have been in the forefront of these predictions, estimating in 2011 that the US would largely reach parity in terms of effective manufacturing costs with the Eastern regions of China by 2015 – an observation a number of other consultants and analysts have also made.”

Some US manufacturers are moving production back to US soil or deciding to stay here rather than moving offshore.

And as BCG predicts, increasing US competiveness with China and advantages over most other developed economies is likely to lead to an export surge and a growing number of badly needed American jobs.

As “a result of its increasing competitiveness in manufacturing, US will capture $70 billion to $115 billion in annual exports from other nations by the end of the decade. About two-thirds of these export gains could come from production shifts to the US from leading European nations and Japan.”

While some agree, some though doubt the BSG’s prediction and opine that BCG fails to meet the burden of proof required to back up the numbers in its report, and even that the BCG analysis doesn’t seem to take into account rising Chinese productivity.”

Manufacturing still matters for the US and its companies. Obama government has given a new push for manufacturing in US. And even the company such as Apple though getting manufactured its iPhones and other products in Asian countries have started rethinking.

India must move ahead and I wish the big business houses encourage manufacturing sector by getting into the manufacturing of high-tech items, while India’s organised retail sectors must also encourage manufacturing in rural India through innovative means rather than selling only imported goods.

Posted in manufacturing, Uncategorized | Leave a comment

Manufacturing India: Manufacture and Export

“Unless India gets back to encouraging manufacturing, sees growth in manufacturing, it is critical as manufacturing ultimately creates the biggest jobs. We thought we could leapfrog that era and move directly to the digital era. That is not going to happen we need to promote manufacturing and promote exports.”
–Anand Mahindra

While in US, I keep on wondering why India can’t export all those that the American households get from the Chinese source. I find every shops small or big in malls of cities such as New York or towns such as Cary of North Carolina flooded with the China manufactured items, where I hardly find any trace of similar items with ‘Made in India’ tag.(Even though I do see even the tags with the names of Bangladesh and Honduras). And the manufacturing technologies of these items for the American households are not some that are not known to Indian manufacturers, business persons or traders.

America is the world’s richest country and largest importer. In 2012, the US bought US $ 2.334 trillion worth of imported products.

Here are the top 10 US imports from China that cost America $ 444.4 billion and constitute only 19% of the total US imports.

1. Electronic equipment: $113.3 billion
2. Machines, engines, pumps: $102.2 billion
3. Furniture, lighting, signs: $24.8 billion
4. Toys, games: $23.1 billion
5. Footwear: $17.9 billion
6. Knit or crochet clothing: $15.6 billion
7. Clothing (not knit or crochet): $15.3 billion
8. Plastics: $13.2 billion
9. Iron or steel products: $10.1 billion
10. Vehicles: $10 billion

Interestingly, India’s exports to America only amounted to $41.9 billion and are only1.8% of overall US imports.
1. Gems, precious metals, coins: $7.2 billion
2. Pharmaceuticals: $4.3 billion
3. Gums, resins: $3.6 billion
4. Oil: $3.3 billion
5. Machines, engines, pumps: $2.3 billion
6. Organic chemicals: $2.2 billion
7. Other textiles, worn clothing: $2 billion
8. Clothing (not knit or crochet): $1.9 billion
9. Iron or steel products: $1.6 billion
10. Electronic equipment: $1.5 billion

The same is the case when one studies the exports of China vs. that of India to almost all the rich countries of the world such as Japan or UK.

India’s exports to Japan amounted to $7 billion or 0.8% of overall Japanese imports, while China’s exports to Japan amounted to $188.4 billion or 21.3% of overall Japanese imports.

India’s exports to the UK amounted to $9.3 billion or 1.3% of overall UK imports, while China’s exports to the UK amounted to $56.3 billion or 8.2% of overall UK imports.

It will require a total change in the mindset of the institutions and individuals who matter in making manufacturing the mainstay of the business thinking.

Is it not a shame to read a story in Economist, ‘300m menstruating Indian women eschew sanitary pads in favour of rags, dry leaves, straw or newspapers.’ Can’t the country that claims to innovate and manufacture the cheapest car of the world produce affordable pads and the governments and political parties distribute it free instead of handing over laptops or TV sets to the girl students and families? Will it not provide employment to many of the poor women in rural India and if executed properly can even be exported?

Why can’t micro spinning enterprises be established in every Panchayats in cotton producing areas of the country which in turn can provide employment too in rural India? Why does India show interest in exporting raw cotton or iron ores to China with no value addition?

Indian manufacturing will have to innovate and manufacture all types products required by the global market. Many more entrepreneurs, small and big, must get into manufacturing.The established ones must scale up the production, improve the quality, and reduce the life cycle cost and globally compete. The government and the institutions engaged in R&D must orient for encouraging manufacturing sectors.

A dawn of manufacturing is a necessity for India. It can come by developing export. Every establishment of the country must export, be it big ones such as Tata Motors and Mahindra and Mahindra or SAIL and BHEL or BMEL or HAL, and must change its strategy of surviving with government support in local market.

A ray of hope comes from a futuristic statement, “India should dream of exporting defence equipment instead of importing them.”

Finally, India must take lessons from the Walmart story in US and must safeguard the small manufacturing sector of the country from Walmart and global retail giants coming in India from selling all the goods from their Chinese sources that they have taken pain to develop. I give only two data for consideration:
1. Between 2001 and 2007, the value of products that Wal-Mart imported from China grew from $9 billion to $27 billion.
2.According to the Economic Policy Institute, trade between Wal-Mart and China resulted in the loss of 133,000 manufacturing jobs in the United States between 2001 and 2006.

MNC retailers must be encouraged to develop Indian manufacturers to produce the quality products for its outlets around the world and also to market the unique Indian produces.

I wish Manmohan Obama forthcoming meeting in US brings good news of US collaborating with India for manufacturing many items jointly rather than discussing only the deals of purchasing and selling of some military wares.

Posted in industry, manufacturing, Uncategorized | Leave a comment

Manufacturing India: Expectation from NaMo

It is good that finally NaMo is the prime ministerial candidate of the main opposition group of the country. Many in the country wish him to bring a victory for the NDA, the alliance group. If the major minority community doesn’t become partisan and vote in the interest of the country, NaMo may get an opportunity for changing the course of this country and may get a chance to bring back the past glory of the country and more so the growth.

Many have expressed their varying views and counter views about the possibility of getting NaMo on the national stage.

Some are critical too, as I could see in a debate on NDTV channel. But I only wish the leaders of the major minority community change their mind and appreciate that India is also the homeland of a large number of other minority community too and learn from them.

I feel pity for some political outfits and their leader, particularly Nitish Kumar. His opposition of Modi rather his every statement after the breakup with BJP is just opportunistic and so shallow. How does he justify the expenses from the taxpayers money on his advisor, Pawan Kumar Verma to just attend the debates and discussions on TV channels? How is Bihar getting benefitted out of that?

What I wish from this change is the total overhaul of the new government priority about taking the country in the manufacturing in big way and that too in every areas from high-end to low-end of technologies.

India must produce, compete and export everything that the people all over the world need. And more importantly, it stops importing items that are not essential copying what the so called developed countries has done. It must stop exporting its raw materials such as cotton, iron ores or anything where a larger value additions is possible before export. However, it must export in time rather than allowing rotting of the food produces, be it grains, vegetables, milk or fruits.

The country must put good education from primary to post Ph.D levels and right skilling of all the working population as its top priority. It must work for the conservation of the resources, for improving the productivity, and for effective interaction between the industry and academics.

Whatever I wish may be utopian, but how can the present way of running the government machinery be justified. Why should not India be the best place for doing business? Why should not there be a numerical target instead of allocation of certain amount of money for different projects? Why should there be no accountability built in the system?

Why can’t India be comparable to the other developed countries in five years time frame or in a decade in at least few basic things? Why can’t India build some global brands? Why can’t some 10 Indian universities be in the list of globally best ones?

Will NaMo present a dream to the people of the country that makes him different?

Posted in indian politics, manufacturing | Leave a comment

Manufacturing India: CAD

The Indian economists and many columnists in past few weeks have been discussing CAD (Current Account Deficit) so much that today even a commoner knows the reason of worries of the government. CAD most simply is the difference between the revenue from the export and the expenditure on the import. In a simpler language, if a country goes on importing more than it exports, it finally gets into a serious crisis for its economy. India is in that crisis.

Unfortunately, with the rise in growth of revenue for few years the present UPA government became complacent and allowed almost free import that should and would have been controlled. With an economist in the prime minister chair, the country would not have gone in this pathetic situation. For example in my own auto sector, unlike the earlier effort of phased in-house and indigenous manufacturing that expected support from the government as well as the main OEMs, OEMs and even main ancillary component manufacturers started importing freely a large percentage that constitute its final products. Today many in the manufacturing business of various products in different sectors too are resorting to as much cheap import as possible. The government didn’t encourage local manufacture nor the industrial policy ambience created entrepreneurs in manufacturing sectors.

In low end high volume low tech household items too, the country has gone for a huge import instead of encouraging the local manufacturing.

Jayanti Ghosh, an economist and columnist very aptly writes in her article in Frontline, ” Many commodities that were previously produced in India have simply disappeared from markets to be replaced with imports coming not just from China but many other parts of the world. It is well known that toys, decorations and similar things increasingly come from China, and electronic goods from various parts of Asia. Shopping malls sell garments made in Guatemala and Morocco even though similar garments are made in India; builders use marble from Italy rather than the stuff sold by small processors in Rajasthan and elsewhere; imports have replaced domestic production in the urban markets for many fairly standard goods that are very much part of mass consumption such as pens, soaps, household goods, and so on.”

One can see it easily during the festival seasons. All the fancy lightings and even the statues of Lakshmi and Ganesha for worshipping in Diwali and all the colour sprayers in Holi are from China. It means only a huge drain of the country’s wealth. With such a huge population to consume the household goods, its manufacturing must be domestic to provide employment. India certainly does not lack the talent and the human resources to manufacture those items. It’s the government policy that has not encouraged instead discouraged the people to go for its manufacturing.

India’s high tech manufacturing continued mainly with PSUs almost as in China. But unlike the Chinese counterparts, these Indian firms, such as BHEL, BMEL, HMT hardly did significant enough to compete with international manufacturers and export and survived mainly under the government’s protection. As example, BMEL couldn’t indigenise the parts for the Tatra Vehicles for the Indian Army it manufactured, and went on importing them.

Unfortunately, most of the big business houses even in private sector hived off the manufacturing companies they had. Even the company such as Tata Motors couldn’t make a significant contribution in exporting its locally manufactured products because it hardly innovated the way its competitors did in developed countries.

Is it not surprising that the country is interested in counting on exporting of iron ores and cotton rather than competing and becoming one of the biggest manufacturers and exporters of steel and its products and clothes and apparels? Where is the rationality for worrying CAD?

CAD can’t remain a headache if the manufacturing of the country becomes globally competitive.

Posted in industry, management, manufacturing | Leave a comment

India’s State of Economy

Does it help India if its prime minister says, days after days, months after months, years after years, India is not the only country hit but all emerging markets have been hit or for that matter, the present situation is due to external factors or as one country took a policy decision in its interest.

Few days back, the finance minister P Chidambaram came out with ten point prescription to cure the economy: 1&2. controlling fiscal deficit and current account fiscal deficit, 3.Adding to the reserves, 4. Reviving the investment cycle, 5. Quicken the capex programme of PSUs, 6. Capitalise the public sector banks, 7. Capitalise the public sector banks,8. Encourage manufacturing, 9. Encourage exports, 10. Resolve impasse in coal, iron sector.

Chidambaram speaks well. His speech is impressive. Listeners are attentive. And interestingly, Manmohan Singh was there throughout, but neither Sonia nor Rahul. For them, the passing of Food Security Bill was the priority and not the state of the Indian economy. Neither they are interested in that nor they know much about it.

But what is so new about it? Why has it taken almost 10 years to pronounce this for this government? Who stopped the government to have taken the actions mentioned in the Chidambaram list?

Chidambaram vowed to contain fiscal deficit at 4.8% of GDP and CAD at $70 billion this year. But how many persons who matter believe it in this pre-election year?

And then after the tremendous pressure from parliamentarians, the prime minister made a statement in the Rajya Sabha with no concrete plans to meet the deteriorating economy indicators coming almost on daily basis, and blamed the main opposition party for the present situation on a day when the government provided a fresh data that India’s economy grew at the slowest quarterly rate since the global financial crisis in the three months through June, lower than expected and hurt by a contraction in mining and manufacturing.

The prime minister may discard the opinion of the opposition leaders for political reasons but why should he overlook the views of so many on live TV channels and in print media. Why should not he hear to the sane voices from the industry or his own former advisors or working members? Why should the people of the country not believe the retiring governor of RBI?

“RBI governor’s parting remarks It was “inaccurate, unfair and misleading” to attribute the moderation in India’s economic growth — which tumbled to 5 per cent in the year ended March 31 from 6.5 per cent in 2011-12 — to the RBI’s tight monetary policy. “Growth had slowed because of a “host of supply-side constraints and governance issues” which were clearly beyond the purview of the RBI.”

Manmohan Singh singlehandedly got two policy decisions changed in his tenure, the first was on Nuclear Deal, and the second to bring in FDI in multi brand retails. As the media reported, he staked his prime ministership even for the first one. Sonia yielded. Why couldn’t he convince the ill effect of food security bill and got it postponed for right time? Why can’t the government eliminate the leaks of the PDS if the bill is so much necessary? Is he not aware of the corruption in transportation? As some opined, ‘to rush through the food Bill nationally without putting any checks-and-balances systems in place is criminal’.

However, the prime minister did neither enumerate some short term specific action plans nor talked of the way he will boost up the implementation mechanism. He preferred to give his prescription-“The easy reforms of the past have been done. We have the more difficult reforms to do such as the reduction of subsidy, the insurance and pension sector reform, eliminating bureaucratic red tape and implementing the Goods and Services Tax (GST).”

Who stopped him to go for building consensus on some, or a special session for the other or to come out with some more bills to eliminate the bureaucratic red tape? Is he not afraid of communicating with opposition leaders because of his Madame Boss?

Posted in economy, governance | Leave a comment

Food Bill Through, India Not

So finally, Rs.1.35 trillion Sonia’s game changer Food Security Bill has crossed the barrier of the approval from Lok Sabha members. All the political parties collaborated, some to show their concern for the so-called poor but not the country, some because they never wished show them against poor.

It has given one more right to 67 percent of 1.2 billions citizens to go to the court if they don’t get their entitlements provided in the bill? I wonder how many will go to the court, even after they might have slept empty stomach for not only some but for many nights.

I am saying this as I have not read any story till date about the same people with the right of good education or for that matter that of the employment of a minimum 100 days per year going to court to complain against their rights that the same politicians have provided through the bills.

Sonia single-handedly pursued the food bill as her first priority over the other bills or policy decisions that were vital to save the nation from deteriorating economic health: “There are people who ask whether we have the means to implement this scheme. I would like to say that we have to figure out the means. The question is not whether we can do it or not. We have to do it,” she said, directly addressing the criticism of the impact of the Rs. 1.30 crore expensive scheme on government’s meagre finances even against the advices of a large number of economists including the governor of RBI and reputed citizens of the country.

As many opine, food security bill if marketed well in the 2014 general election may bring back the UPA in its third incarnation, as the loan waivers and MNREGA did in 2009. It is to be seen if the voters overlook all the mis-governance, corruptions, scams and the dwindling economy with falling rupee, increasing CAD with higher inflation and lack of employment potential.

Without showing any concern to the opposing economists (but for the Nobel Laureate Amartya Sen), the government and opposition wrestled to walk away with maximum brownie points. I don’t know if who was the clear winner.

Politicians won, the country lost. Market reacted with Sensex sinking and Rupee falling to Rs 66 with respect to a Dollar.

Posted in economy, indian politics | Leave a comment