Thursday, June 03, 2004
Reforming Indian Civil Service
Here is an article that explores how the Indian Civil Service could be reformed to help alleviate poverty.
LEADER ARTICLE
Yes, Prime Minister: Road Ahead for Reform of Babudom - The Times of India
LEADER ARTICLE
Yes, Prime Minister: Road Ahead for Reform of Babudom - The Times of India
Wednesday, May 26, 2004
Continuation of my earlier two cents... plus description of plight of Indian farmers
Micro-finance was one of the things I had in my mind that could help rural entrepreneurship. However, there needs to be more than that - a complete set of tools to help the business succeed - a one stop shop.
But the irony of the whole thing is - these "one stop shops" were the cause of mass suicide by farmers in India. Some 2000 to 3000 farmers have committed suicide in a single state since 1998 (http://in.news.yahoo.com/040521/43/2d82u.html).
A detailed explanation of what led to the current situation is in this article - http://www.cpiml.org/liberation/year_1998/november/article3.html
The gist of this is - with de-regulation, several private firms, Mult-National Corporations (MNCs), and individuals entered the agricultural sector. MNCs tried to boost their sale of pesticides by offering huge sales bonuses to the pesticide dealers, who in turn sold adulterated (and ineffective) perticides to farmers, also instructing them to spray much more than what was required. The result was that the bulk of farmers investment was in perticides (more than 50% of the total investment in the crop), which were totally ineffective in protecting the crop. Over time, these fertilizer dealers became one-stop-shop for seeds and even credit. Eventually, as the crop failed (after being attacked by pests), the farmers were left with nothing. Even banks could not step in to provide loans since most of these farmers were tenants and did not have their own land that could serve as a colateral.
There were policy announcements in the State and sanctions of ex-gratia payments of Rs 10,000 to the farmers - but this money reached very few (thanks to corruption). The Chief Minister might have taken good decisions, but grassroot-level corruption and greed failed to create an impact. (He was voted out in the current elections just like the Prime Minister - two great leaders who tried their best to deliver could not retain office because of workers at grassroot levels).
So - what is the precise problem? The government does (or some in the government do) make an effort along with NGOs to uplift the needy. Alas, around the country (and in much of the third world), there is a nexus between the key people at grassroot level and the local thugs - in most cases these local thugs are the key people in charge of welfare - they rise to these positions by threating and murdering people. This makes it almost impossible to make any initiative effective. There have been numerous stories of honest crusaiders and activists being killed when they tried to do something good (since their actions were hurting the local thugs).
At the pinnacle of such crimes is the Indian State of Bihar - where a criminal's wife is the Chief Minister of the State, and the criminal himself in the Minister in charge of Railways in the Federal Government. Almost complete lawlessness exists in Bihar. An IIT engineer, who gave up lucrative job offers and decided to serve his state and build roads in Bihar was murdered recently (http://www.indianexpress.com/full_story.php?content_id=36191).
If you have to identify a major causes of the problem, it is this corruption at grass root level and the elevation of thugs to important positions.
What is the local law enforcement doing? A cop barely earns enough to support his family. Cops are naturally tempted to accept bribes. There are few cops who dare to challenge this - and they eventually fall in line after receiving threats or are eliminated.
So - is the situation absolutely dismal - no - not if you have money. Money can buy you anything. Generally the middle and upper classes are not affected by this and at times are blissfully unaware or chose to ignore this.
While this ground situation may seem more specific to India, the picture can easily be extended to any developing country - whether its the Phillipines, Bangladesh, or any of the African countries. The cause for poverty is not the lack of availability of resources - it is the lack of distribution of resources. The history of mankind has been about suppression of man by man... and this dark history repeats itself!
Well - that was quite a roundabout explanation of the problem, I guess. The more I think about it, the more I feel I dont know where to start. One would say, focus on one thing and make it happen. While that is absolutely true, the issue of making good work scalable still remains unsolved. I do, however, think the mico-finance approach accompanied by a complete entreprenereal and educational package would be a good starting point.
Rahul Bajaj, Chairman of one of India's largest conglomerates provides an illustration of how on of his approaches worked (http://timesofindia.indiatimes.com/articleshow/696114.cms). While this article talks about growth and reduction of poverty at the marco-economic level, his anecdote of a businesswoman from Liberia approaching him with the proposal of introducing three-wheeler vehicles in West Africa is interesting. Bajaj points out that mere introduction of three-wheeler vehicles is not going to generate a market and jobs - there needs to be a comprehensive approach that includes low-cost bank loans to unemployed youths, who can buy these vehicles and use them as taxis (Also some other related work would involve working with local authorities to allow permits for such taxis and standardize fares and so on).
In a nutshell, capitalism has solved basic problems of food, clothing, and shelter to a great extent as evidenced by the progress made by the developed nations. The nations that adopted the socialistic approach, giving excessive power to the states only bred inefficiency and corruption. Evolution of a model based on capitalism with a human face could be the answer. Any comments?
But the irony of the whole thing is - these "one stop shops" were the cause of mass suicide by farmers in India. Some 2000 to 3000 farmers have committed suicide in a single state since 1998 (http://in.news.yahoo.com/040521/43/2d82u.html).
A detailed explanation of what led to the current situation is in this article - http://www.cpiml.org/liberation/year_1998/november/article3.html
The gist of this is - with de-regulation, several private firms, Mult-National Corporations (MNCs), and individuals entered the agricultural sector. MNCs tried to boost their sale of pesticides by offering huge sales bonuses to the pesticide dealers, who in turn sold adulterated (and ineffective) perticides to farmers, also instructing them to spray much more than what was required. The result was that the bulk of farmers investment was in perticides (more than 50% of the total investment in the crop), which were totally ineffective in protecting the crop. Over time, these fertilizer dealers became one-stop-shop for seeds and even credit. Eventually, as the crop failed (after being attacked by pests), the farmers were left with nothing. Even banks could not step in to provide loans since most of these farmers were tenants and did not have their own land that could serve as a colateral.
There were policy announcements in the State and sanctions of ex-gratia payments of Rs 10,000 to the farmers - but this money reached very few (thanks to corruption). The Chief Minister might have taken good decisions, but grassroot-level corruption and greed failed to create an impact. (He was voted out in the current elections just like the Prime Minister - two great leaders who tried their best to deliver could not retain office because of workers at grassroot levels).
So - what is the precise problem? The government does (or some in the government do) make an effort along with NGOs to uplift the needy. Alas, around the country (and in much of the third world), there is a nexus between the key people at grassroot level and the local thugs - in most cases these local thugs are the key people in charge of welfare - they rise to these positions by threating and murdering people. This makes it almost impossible to make any initiative effective. There have been numerous stories of honest crusaiders and activists being killed when they tried to do something good (since their actions were hurting the local thugs).
At the pinnacle of such crimes is the Indian State of Bihar - where a criminal's wife is the Chief Minister of the State, and the criminal himself in the Minister in charge of Railways in the Federal Government. Almost complete lawlessness exists in Bihar. An IIT engineer, who gave up lucrative job offers and decided to serve his state and build roads in Bihar was murdered recently (http://www.indianexpress.com/full_story.php?content_id=36191).
If you have to identify a major causes of the problem, it is this corruption at grass root level and the elevation of thugs to important positions.
What is the local law enforcement doing? A cop barely earns enough to support his family. Cops are naturally tempted to accept bribes. There are few cops who dare to challenge this - and they eventually fall in line after receiving threats or are eliminated.
So - is the situation absolutely dismal - no - not if you have money. Money can buy you anything. Generally the middle and upper classes are not affected by this and at times are blissfully unaware or chose to ignore this.
While this ground situation may seem more specific to India, the picture can easily be extended to any developing country - whether its the Phillipines, Bangladesh, or any of the African countries. The cause for poverty is not the lack of availability of resources - it is the lack of distribution of resources. The history of mankind has been about suppression of man by man... and this dark history repeats itself!
Well - that was quite a roundabout explanation of the problem, I guess. The more I think about it, the more I feel I dont know where to start. One would say, focus on one thing and make it happen. While that is absolutely true, the issue of making good work scalable still remains unsolved. I do, however, think the mico-finance approach accompanied by a complete entreprenereal and educational package would be a good starting point.
Rahul Bajaj, Chairman of one of India's largest conglomerates provides an illustration of how on of his approaches worked (http://timesofindia.indiatimes.com/articleshow/696114.cms). While this article talks about growth and reduction of poverty at the marco-economic level, his anecdote of a businesswoman from Liberia approaching him with the proposal of introducing three-wheeler vehicles in West Africa is interesting. Bajaj points out that mere introduction of three-wheeler vehicles is not going to generate a market and jobs - there needs to be a comprehensive approach that includes low-cost bank loans to unemployed youths, who can buy these vehicles and use them as taxis (Also some other related work would involve working with local authorities to allow permits for such taxis and standardize fares and so on).
In a nutshell, capitalism has solved basic problems of food, clothing, and shelter to a great extent as evidenced by the progress made by the developed nations. The nations that adopted the socialistic approach, giving excessive power to the states only bred inefficiency and corruption. Evolution of a model based on capitalism with a human face could be the answer. Any comments?
Tuesday, May 25, 2004
My two cents on Changing the way we organize
The purpose is to explore a scalable model that will help uplift the standard of living of millions around the globe who are still untouched by the realms of modernism and the Web.
Lets take the case of the thousands of farmers on the outskirts of the Indian Cyber City - Hyderabad. On one hand, you have gleaming glass buildings of the world's top corporations adorning the skies of Hyderabad - a city that has abundant power and water. And less than 100 kilometers away, farmers are comitting suicide because of scarcity of water and not being able to pay electricity and other bills. Clearly, pure capitalism, where profit is the only motive, is not the solution to these problems - it only serves to increase the divide between the rich and poor.
So is socialism / communism / Marxism the solution to this problem? Well in theory, probably yes - but neither of these models have solved these issues. One might argue that corruption is a reason why these models have failed. But these models provide fertile grounds for breeding corruption. If you leave the problem solving to a few people of the State, corruption is bound to creep in. That is what happened in India from 1947 to 1991 as a result of the so called "license raj" or permit system.
Web space is the ultimate concept - sooner or later the world will get there. But a lot needs to be done before the world gets there. In India, for instance, where the middle and upper classes are riding the wave of the internet economy, over 300 million people still do not have the basic necessities of life - no shelter above their heads... and getting two square meals is a luxury. How do we make these people a part of the web space?
First, there is a need for a system that provides a source of livelihood and raises the standard of living of these people - provides them with food, clothing, and shelter - and makes sure the villages have decent roads, drinking water, and electricity. If these issues are not addressed soon, the migration from rural to urban areas will only be expedited, and the problems resulting from that are well documented.
What is necessary is the existence of sufficient employment opportunities in the rural areas. Entrepreneurship in the rural areas needs to be promoted. That is where the "Open Source Entrepreneurial Model" comes into picture. At the same time, steps should be taken to make sure good education is available for the next generation (if not for the current one). And that is where the "Open Source Educational Model" comes in.
Obviously, merely having these models in place is not magically going to solve the problem. There has to be motivation for people to implement these models. There are selfless people working with NGOs who are already doing great work along these lines. But the world needs more and more of such wonderful people. There are several more who are sitting on the border, waiting for a suitable launch pad and for some basic conditions to be met. Now one would argue that this is not pure selflessness, but we do not live in Utopia. Different people have different aspirations and view points - and all these must be respected. (Each person, sooner or later, will come to the point of realization of the Ultimate Truth - the destination is the same, but the path and time taken is different). This is where the profit-based service enterprise comes into picture. Like Dr. V's Arvind model - to attract the best talent - we do not have to promise the highest pay - but overall good quality of life - and above all a sense of satisfaction.
No model is exclusive. There is so much that needs to be done, and there is an urgent need to come up with a scalable approach. The sooner this happens, the more lives can be saved, more hungry mouths can be fed, more children can go to school. And at the same time, capitalism, socialism, non-profits - all can co-exist. They have their own role in society. Even these models have evolved - pure capitalism died in America with the great depression of 1929, and pure socialism / communism have also collapsed. Over time, as society evolves, the models also evolve and blend. However, since this evolutionary process of merging the extremes of capitalism and socialism has been a rather slow and painful process, there is a need to find a middle path.
Lets take the case of the thousands of farmers on the outskirts of the Indian Cyber City - Hyderabad. On one hand, you have gleaming glass buildings of the world's top corporations adorning the skies of Hyderabad - a city that has abundant power and water. And less than 100 kilometers away, farmers are comitting suicide because of scarcity of water and not being able to pay electricity and other bills. Clearly, pure capitalism, where profit is the only motive, is not the solution to these problems - it only serves to increase the divide between the rich and poor.
So is socialism / communism / Marxism the solution to this problem? Well in theory, probably yes - but neither of these models have solved these issues. One might argue that corruption is a reason why these models have failed. But these models provide fertile grounds for breeding corruption. If you leave the problem solving to a few people of the State, corruption is bound to creep in. That is what happened in India from 1947 to 1991 as a result of the so called "license raj" or permit system.
Web space is the ultimate concept - sooner or later the world will get there. But a lot needs to be done before the world gets there. In India, for instance, where the middle and upper classes are riding the wave of the internet economy, over 300 million people still do not have the basic necessities of life - no shelter above their heads... and getting two square meals is a luxury. How do we make these people a part of the web space?
First, there is a need for a system that provides a source of livelihood and raises the standard of living of these people - provides them with food, clothing, and shelter - and makes sure the villages have decent roads, drinking water, and electricity. If these issues are not addressed soon, the migration from rural to urban areas will only be expedited, and the problems resulting from that are well documented.
What is necessary is the existence of sufficient employment opportunities in the rural areas. Entrepreneurship in the rural areas needs to be promoted. That is where the "Open Source Entrepreneurial Model" comes into picture. At the same time, steps should be taken to make sure good education is available for the next generation (if not for the current one). And that is where the "Open Source Educational Model" comes in.
Obviously, merely having these models in place is not magically going to solve the problem. There has to be motivation for people to implement these models. There are selfless people working with NGOs who are already doing great work along these lines. But the world needs more and more of such wonderful people. There are several more who are sitting on the border, waiting for a suitable launch pad and for some basic conditions to be met. Now one would argue that this is not pure selflessness, but we do not live in Utopia. Different people have different aspirations and view points - and all these must be respected. (Each person, sooner or later, will come to the point of realization of the Ultimate Truth - the destination is the same, but the path and time taken is different). This is where the profit-based service enterprise comes into picture. Like Dr. V's Arvind model - to attract the best talent - we do not have to promise the highest pay - but overall good quality of life - and above all a sense of satisfaction.
No model is exclusive. There is so much that needs to be done, and there is an urgent need to come up with a scalable approach. The sooner this happens, the more lives can be saved, more hungry mouths can be fed, more children can go to school. And at the same time, capitalism, socialism, non-profits - all can co-exist. They have their own role in society. Even these models have evolved - pure capitalism died in America with the great depression of 1929, and pure socialism / communism have also collapsed. Over time, as society evolves, the models also evolve and blend. However, since this evolutionary process of merging the extremes of capitalism and socialism has been a rather slow and painful process, there is a need to find a middle path.
