Can India be First World?

We dream of leapfrogging to First World status, here’s how to do it in real life
By Sanjeev Sabhlok – What will it take for India to become a First World nation?

Such a question is about matters more important than mere economic growth.

It is about freedom, rule of law, justice, separation of religion and state. Such a question can reset our expectations and start a meaningful conversation about what we want to be as a nation.

It is time for us as a nation to step back and look at the big picture. The facts that face us are not pleasant.

Transparency International has ranked Indian governments as the most corrupt in the Asia-Pacific region. Our businesses, despite being one of the world’s best, continue to be let down by our governance system. We continue to rank close to the bottom on ease of doing business. We remain one of the least free countries in the world.

We do not protect private property. We do not have credible rule of law. The concept of justice is largely fictitious. There is very little infrastructure. Our school systems are dysfunctional. Vocational training is non-existent or of very low quality. And we continue to be one of the world’s poorest countries.

Second, we need to redesign our governance system. Today, neither ministers nor bureaucrats are accountable. They see themselves as rulers. We need to invert this mindset and hold our servant – the government – to account.

No First World country has India’s antediluvian, super-centralized IAS-type tenured service to govern everything. more> https://goo.gl/kjrftm

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Three consortia led by Alstom, Siemens and Stadler Bussnang eye Rs 2,000 crore ($310m) coach factory project

By Rajat Arora – The proposed rail coach factory that would produce coaches with aircraft-type interiors is expected to come up on railway land in Kanchrapara near Kolkata on a public-private partnership basis and will involve a total investment of Rs 2,000 crore.

This is the second-largest tranche of foreign direct investment (FDI) in the rail sector under the government’s ‘Make in India’ initiative.

The first major FDI in railways came in 2015 when projects to set up two locomotive factories were awarded at a total cost of Rs 3,300 crore ($511.5m). more> https://goo.gl/RJGrrK

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If BJP wins 2019, will there be a 2024 election?

Don’t underestimate RSS opposition to the idea of India
By Salman Anees Soz – I believe RSS and BJP view the 2019 election as an important milestone in their desire to realize their long-standing dream of establishing a Hindu rashtra.

I believe the likelihood of India’s conversion to a Hindu rashtra has never been greater. Most government institutions are brittle. Indian democracy as we know it, stands at the precipice.

Two issues are of particular concern. First, there is very little acknowledgement of the possibility that there was always an alternative Hindutva idea of India and that it had significant support. Second, those of us opposed to Hindutva often do not look at the world from the perspective of its proponents. The game, however, has changed.

RSS is resolute in its “idea of India” as a quintessentially Hindu country. It has toiled hard for decades in pursuit of this vision. The Sangh Parivar has always had a core base of support. This leads me to believe that there was a section of Hindu society that felt aggrieved that after the creation of a country for Muslims, Hindus were denied their own country.

This grievance has simmered for decades as the Gandhi-Nehru vision prevailed and the first past the post system kept Hindutva forces from gaining power at the national level until 1998. The defeats of 2004 and 2009 delayed the project but the 2014 election finally provided a once-in-a-lifetime opportunity for Hindutva proponents. BJP had an aspirational narrative, an astute strategic approach, a compelling leader in Modi, boots on the ground and a real hunger for power. more> https://goo.gl/ZLj5b6

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India’s inward nuclear turn

It has taken 12 years for the Indo-US nuclear deal hype to give way to sober realism
By Brahma Chellaney – India, duped by its own hype over the nuclear deal, had announced plans to import Western reactors costing tens of billions of dollars. The Indian plans helped to motivate Toshiba to acquire Westinghouse – a takeover that ultimately proved a huge blunder, plunging Toshiba into a grave financial crisis.

Having invested considerable political capital in the vaunted Indo-US deal, India today confronts an embarrassing situation: the nuclear power promise is fading globally before New Delhi has signed a single reactor contract as part of that deal. To save face, India, with one of the world’s oldest nuclear energy program, has embarked on a major expansion of domestically designed power reactors.

Given that the Indian nuclear plant construction time frame averages seven years, India’s decision to ramp up its nuclear power capacity may contribute little to meeting its goal of making 24-hour electricity available to all villages and towns by 2022. But the decision will yield major economic dividends, including boosting domestic industry and creating tens of thousands of jobs. By providing $11 billion worth of likely manufacturing orders to Indian industry, the decision will help to transform the domestic nuclear industry.

In this light, the travails of the Indo-US deal may be a blessing in disguise for India. more> https://goo.gl/WXPswv

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Modinomics rings hollow

Look beneath government hype, and signs of deep economic distress are evident
By Kapil Sibal – This government is in denial.

It believes that black economy has been given a fatal blow. At 7.1% India continues to be the fastest growing economy in the world. Spurt in public investment has created jobs. FDI flows are evidence of investors’ confidence in the growth story of India. Reforms have led to ease of doing business.

Let us critically examine each of these claims.

On November 8, when the prime minister announced demonetization of all 500 and 1,000 rupee notes freezing 86% of India’s economy. If this ill-thought decision was an attempt at eradicating unaccounted wealth then it failed miserably. Most cash is either invested in real estate, gold or is stashed abroad. Undisclosed cash in circulation represented only around 5% of unaccounted wealth.

Now that real estate is outside the GST net, cash will continue to be a factor in real estate transactions. What is alarming is that unaccounted cash entered the banking system and is slowly being withdrawn and reconverted into undisclosed cash.

Modi believes in seducing foreign investors in digitizing the economy, little realizing that most of India earns less than Rs 10,000 a month and seldom accesses digital platforms for bank transactions.

Record levels of Sensex, we all know, do not reflect the true state of the economy. With real estate giving no returns and interest rates down, the only option for investors is in equities. This is risky because once the bubble bursts investors will be badly hurt. more> https://goo.gl/PjHNHq

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Farmers revolt

India’s farm distress needs structural solutions, quick fixes such as loan waivers won’t do
Times of India – All of a sudden it seems to be Kashmir in Madhya Pradesh: at least five protesters shot dead in Mandsaur district, prohibitory orders and internet shutdowns enforced.

This is testimony to the deep-seated crisis in India’s agricultural economy and must serve as a wake-up call to the Centre as well as state governments. The usual populist fixes – such as farm loan waivers – is not going to defuse this crisis.

Rather, policy makers must now remove the structural bottlenecks in India’s farm economy. Agriculture supports more than half of India’s population but makes up just 15% of its economic activity. It follows that holistic solutions to farmer distress will have to combine creation of non-farm jobs and enhancement of farm incomes.

A bird’s eye view of agriculture points to an anomaly. Around 77% of farmland is devoted to staples such as cereals. This results in output almost equivalent to what high value crops such as fruits and vegetables yield on less than 20% of the land.

Rectifying this mismatch will solve many problems. This is where government policy has a crucial role to play.

The Indian farmer has to function in an over-regulated environment made worse by capricious bans on exports. This is compounded by restrictions on internal food trade, unfounded fear of new technology such as genetically modified crops and the new bogey that has coincided with the unchecked rise of gau rakshaks: restrictions on cattle trade. more> https://goo.gl/o30N06

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Head off digital colonialism

How Indian IT can compete with Google and Facebook and show the world a better way
By Mishi Choudhary and Eben Moglen – The world’s major societies are now wrestling with the enormous social power wielded by the internet’s “platform companies.”

In Europe they speak of “GAFA”: Google, Apple, Facebook and Amazon. Twitter, Uber and other aspirant companies hover just out of the main ring. Europe’s open and democratic societies have been as fully colonized by the platforms as the US: the plurality of their citizens’ email is read by Google, most of their citizens’ social and family lives are surveilled by Facebook, and so on.

Essentially, three basic approaches to deal with the power of these American data miners have emerged.

First, the US government sees them as pillars of post-industrial American power, and as an immense national security intelligence resource. It is therefore their strategic ally.

Second, proponents of “digital sovereignty,” mostly autocracies, have chosen to build national search engines and social media structures, favoring domestic private market entrants (as has happened in Russia and China), and by exercising control over national telecommunications networks to block the US companies.

Third, the European Union has attempted to control the companies’ behavior by regulation and litigation.

India has a golden opportunity to find a fourth way.

India can. India can invent competition that challenges not just the platform companies but their basic, anti-environmental business model.

Indian internet companies can provide global digital service platforms that protect, rather than destroy, privacy. Indian internet industries can provide reasonably priced, universally available, privacy respecting services that compete directly with services provided by the US data miners, priced reasonably in local terms in all the developed and developing societies. more> https://goo.gl/IuSU18

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How to speed up judiciary

Let’s make India’s slow courts, currently exacting an enormous human and economic toll, world class
By Amitabh Kant – India ranks 178th among 189 countries on the Enforcing Contracts indicator, making it one of India’s worst performing indicators in World Bank’s Ease of Doing Business study.

This largely accounts for India’s overall poor ranking and has acted as a major barrier for investments to India.

The glut of cases in the lower courts is where the root of the problem lies. Most importantly, we need to acknowledge it and monitor it on a continuing basis.

We need to have access to high resolution data on judicial processes at both the high court as well as the lower court level. A number of courts do not have data under the “Date filed” column, the most crucial piece for identifying delays.

The quality of data is circumspect and is non-uniform between courts, which use different abbreviations, categorization, and formats which makes comparing data between courts an arduous and costly process. Significant progress has been made towards computerization of courts.

However, computerization must include within its ambit the standardization of data collection across courts and not merely computerization within silos. more> https://goo.gl/e1aJ7W

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A breakthrough strategy

According to The Times of India report, “Path-breaking economic strategy” (Sep 27, 2016), the finance and coir minister, Dr T M Thomas Issac stated, “My first objective is to find the resources for government expenditure. All available funds are now being used run the government and with the salary arrears for government personnel due next year, it is even more critical. The next target is bring revenue deficit below one per cent. The third and the biggest mission is to source loans and investments on the budget of Rs 20,000 crores ($3B) for the first year.”

That doesn’t read like a “path-breaking strategy,” but a desperate effort to continue the failed Kerala status quo activities. Here is a breakthrough strategy for reviving Kerala economy.

Bruce Katz at the Brookings Institution provides an effective formula for regional economic development. He says, “The development of new platform technologies benefits entire economies, but the big winners are the cities and regional ecosystems that invent them and become centers of entire new industries.” Couple this formula with a historic trend to act as effort multiplier, and you have a true path-breaking strategy.

The historic trend to take advantage is internet adoption. Internet adoption has greater potential for economic transformation than the developments that followed postal mail service, telephone or printing press by enabling rapid exchange of information that aid economic interactions. However, focus in the developed economies have shifted more to entertainment applications [2, 3, 4, 5] of internet. The net result is that currently available network products are entertainment-centric. Deploying fully capable networks for economic development targets (such as e-payments) with currently available products incur excessive costs, since they are designed for high bandwidth entertainment applications.

This has created a market gap for economic-development enabling network systems and solutions. The author invented and patented underlying broadband technologies – US Patents: 6,674,749 / 6,807,169.

Developing economic-development-enabling network products will help fill the market gap, create new product categories and help emergence of a sustainable industrial base in Kerala.

A similar effort was launched in the past with KELTRON, but was not successful due to insufficient preparation and less than optimum market conditions. Now, conditions are ripe for an industrial initiative using KELTRON as a base for creation of a world class network industry sector.

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An example of government inefficiency

The Times of India report, “Oppn gheraos mayor, alleges docu forgery” (Aug 26, 2016), illustrates the lack of common sense and petty mindset of the elected officials in the Kochi Corporation, and provides operation details of a “Red Tape paradise.”

The report says, “The LDF councilors led by opposition leader K J Anthony gherooed Kochi Corporation Mayor Soumini Jain on Thursday (Aug 25) alleging that the mayor forged a file a file related to the appointment of a clerical staff as coordinator for the Smart City project.”

“The file is related to appointment of a senior clerk named O V Jayaraj as coordinator of Union Government Funded Smart City project. He was officially appointed as the mayor as the coordinator on July 30, but the mayor misled the state government and the principal secretary that the appointment was made on July 20. Actually, it was on July 22 that the mayor directed the corporation secretary to to from a cell to look after the Smart City project. The secretary received the file on July 26 and order setting up the coordination cell was issued on July 30,” V P Chandran told the council. When Jayaraj was transferred from Ernakulam to Manjeswaram on July 22, he approached the Kerala Administrative Tribunal pointing out that he was the Smart City project coordinator and secured a stay order.”

“The mayor tried to explain details related to Jayaraj’s matter, but could not do so because of the din.”

The situation at the Kochi Corporation is an illustration of the pseudo-democracy in operation. The opposition leader, E J Anthony is misguided in his allegation of misleading the councilors. It is the Mayor’s prerogative to say when the Mayor decided to appoint O V Jayaraj as the Smart City project coordinator, without requiring confirmation by the appearance of relevant documents in the “Red Tape paradise.” The Mayor is occupying a position of responsibility and has the authority to make decisions of that office. And the Mayor’s role is not to dutifully follow the rules of the “Red Tape paradise.” If discrepancy in the dates in documents is significant (in the order of months), then probably a case can be made for forgery. Here the opposition councilors are quibbling about 2 days, wasting time and ignoring more important issues.

The issue actually reflects lack of professionalism on the part of councilors of the Kochi Corporation. This incident and similar such incidents can be avoided completely, if there is a rule in the “Rule Book” that the decisions of the Mayor and other officials of the corporation have to be documented within 2 weeks (15 days) of making the decision.

A related topic is why Kochi Corporation is operating with paper document files. If Kochi Corporation truly plans to become “smart,” it is high time Kochi Corporation implemented a modern online document management and workflow automation system, eliminating red-tape inducing paper documents and files. At present there is no coordination between the various government agencies, resulting in inefficiency and conflict-generating decision-making. In this example, the newly appointed Smart City project coordinator had to appeal to the Kerala Administrative Tribunal to cancel his transfer order. Whichever agency or official that decided to transfer him would have able to know that the Mayor was in the process of appointing him for the new position if there was adequate coordination. This is one instance of the complications due to lack of sufficient collaboration between various Kerala Government agencies. Imagine all similar conflicting decisions being made throughout the Government of Kerala, resulting in inefficiencies and unproductive efforts. These inefficiencies can be avoided by implementing an internet-enabled collaboration system for the Kerala Government and all its departments and subsidiary agencies.

There are political lessons to be learned from this example as well. At present, the political parties seems to think that they can “do as they please,” once they win the election. And the opposition considers it their duty to obstruct anything the party in power tries to do. All political parties and government officials need to understand the “purpose of government” and act accordingly.

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