Times Now


Image not found
Current Issue
15th Aug 2011
Read Contents


Image not found
Suppliment IER
May-July 2011
Read Contents
   
The India Economy Review ISSUE DATE
15th Aug 2011
Click Me    Archives
OTHER SECTION


Share |
GROWTH OR DEVELOPMENT 
Disinegrationist Development & Wasting Welfare
T.H.Chowdary, Director, Centre for Telecom Management & Studies    30/05/2011 1:27:14 AM

India’s economy has been, soon after liberalistion in 1991, growing at an envious eight percent and above. The growth of population has slowed down; it has come down from 2.8% to about 1.7% per annum. These rates help doubling of the per capita income (PCI) in about 12 years. This is in contrast to the miserable 3.5% annual growth in GDP and 2.8% population growth per annum before 1991. At those rates it would take 70 years for PCI to double! The pre-1991 miserable performance was due to the Nehruvian permit-licence-quota socialism which stifled the initiative of the growing number of enterprising engineers, MBAs and other highly qualified young people. Is economic growth a sufficient condition to build a prosperous, powerful, intellectual and ethical India? The prosperity should not be only for the few enterprising people. If that is so, the great wealth that is being created will be concentrated in a small section of our population. Inequality as between the enterprising and wealth creating sections of the people and the hardly educated, unemployable masses would grow. Growing inequality creates envy and instability in the society. These are the fuel for the Maoist above-ground intellectuals and underground guerilla armies and casteist groups (some of which are fostered and financed by multinational conversion (MNC) enterprises) to indulge in militant socially disruptive and destructive activities. The public policy of all political parties and governments should be to contain this inequality and help the economically lower strata of people to lift themselves up into prosperity. There has been however an unpardonable negligence on the part of all political parties, especially the growing regional casteist and communal politicians (who have made politics a profession of benefit and profit) in building capability among the poor to raise themselves up with some help from the State. A few practices that have been the reason for India to be still a developing country even after 64 years of independence will be examined in this paper.

  • Socialism as practised in India has been a fraud. Our brand of socialism did not result in transfer of wealth from the rich to the poor but only from the honest rich to the dishonest rich.
  • The sleeping sickness of socialism is now universally acknowledged — but not officially in India….. The public sector enterprises are the black holes, the money guzzlers and they have been extracting an exorbitant price for India’s doctrinaire socialism.
  •  History will record that the greatest mistake of the Indian republic in the first 50 years of its existence was to make less investment in human resources — education, family planning, nutrition and public health — than in brick and motor dams and factories.
                                                                                                                                                                            — Sri Nani Palkhiwala

Neglect of Education
Malaysia, South Korea, Indonesia, China & Sri Lanka gained independence from colonial and exploitative rule later than India. Korea was devastated by the war of attrition between the North and South and then, between the US and China. Almost every productive industry has been destroyed. Malaysia gained independence in 1957 from the British masters. It was wrecked by communist insurgency for over five years after it gained independence. Its population has also been furiously increasing. Indonesia gained independence (from the Duetch) later than India. It was occupied by Japan and exploited. Sri Lanka too got independence from Britain later than us. The per capita GDP in South Korea is $ 29,836; in Malaysia $ 14,670; in Indonesia $ 4,394; Sri Lanka $5,220; in China $ 6,828; in India it is $ 3,389 (these figures are on purchasing power parity basis). Why is Indian’s per capita income so much lower than all these countries? China became truly independent and united in 1949 after a devastating civil war and Japanese occupation in 1949, two years later than us. Today China is a near super-power. Why is it that India, which had a better scientific and industrial base and even better educational institutions compared to every one of above countries, lagging behind everyone of them as regards per capita GDP and also has the highest percentage of people below poverty line. The main reason is that while the countries mentioned above have all succeeded in making their people literate to the extent of 90% within ten years, in India our literacy is still low at 70% after 60 years of Independence. Our matriculates are about 25% and graduates are about 12%. As in no other county in the world, Dr.Ambedkar saw to it that the the state has a duty to impart free compulsory education to every child between ages 6 and 14 years. Despite this constitutional direction, successive political parties running governments in the states and in the center have neglected education. Education liberates people from ignorance and incapacity from misery; education gives the choice of profession and does not condemn a person to the ancient profession of his caste into which he is born.

Education gives the choice of profession and frees a person from the confines of the age-old profession related to caste. Economic development gives opportunity for the educated to quit their villages and move to anywhere in Indian or outside to prosper. The rigours and disadvantages of the inherited caste can be overcome only by education for all and economic development. Education should be of such quality and kind which will provide a job for everybody provided, he is employable.

The crime of the highest order committed by the political class is the neglect of education. What it takes India to achieve what these days is fashionably called inclusive growth is good quality education for all at governments cost upto matriculation and thereafter, financially assisted education for those who want to get into different professions. Since government has yet not achieved the goal of free compulsory education for all children between ages 6-14 whatever resources it can spare for education should primarily be utilized for universal pre-university education. Higher education can very comfortably be left to private sector just as telecom, civil aviation and ports sectors which are high rates of growth and spread.

De-valuation of Merit and Intellect
Indians living in India during the British rule got Nobel prizes but after Independence, no Indian (Mother Teresa is not an Indian, she was here on a conversion mission through the device of looking after the indigent) got a Nobel prize. But Indians denied jobs and opportunity within India and therefore had gone abroad, have been getting Nobel prizes. Sir V.S.Naipaul, the grandson of indentured labourers from the Hindi belt of India has, as a citizen of Trinidad and Tobago got Nobel prize for literature (Rabindranth Tagore got one when India was still British-ruled and none living in India after him), Hara Govind Khorana, Chandrsekhar Subramanian, Ramakrishnan and Amartya Sen are all of Indian origin living and working abroad. They got Nobel prizes for their work while abroad. Why is it that no Indian living in India is getting a Nobel prize? It is because we have devalued merit through the instrument of reservations. This is a very sensitive subject and yet if we are honest, we should express our thoughts freely on the subject. People of SC & ST had been, by design subjected to adverse discrimination and conditioned to perpetual poverty. In order to correct this historic crime, we are paying reparation. We have provided reservations for admission to educational institutions, recruitments to government jobs and created special finance corporations and other organs of state to advance them rapidly. Reservations were inscribed in the Constitution first for 10 years from 1950 when we adopted the Constitution. But this is being extended decade after decade without demur from any quarter. Anyone adversely commenting about reservations is dubbed a communalist and Hindu fundamentalist. This is unfortunate. The way we have been implementing reservations has created a new caste — Government Brahmins; that is, privilege by birth. Those SCs & STs who, because of reservations got good education and good government jobs are having their children & grand children also getting reservations for government jobs and admissions to colleges. Opportunities for employment in government and semi-government organizations are becoming a fraction of those in the rest of the economy. If reservations for the SCs & STs are restricted to one generation or at best for two generations, that is self, son and grand son, and those too for two people in any generation of the first beneficiary, then by now together with free and compulsory education for all, every SC, ST would have had an opportunity to lift himself from the disadvantages of poverty and would have come abreast of everybody else in the society.

The demand for reservations has extended to almost every section of the population. For example, in Andhra Pradesh Js. Puttaswamy Commission which went into the claims of several castes in Andhra Pradesh for inclusion in the backward class (B.C) list found that excepting Kammas (chowdary) and Velamas (called Raos in Telengana areas), every other caste demanded to be included in the backward caste list. Even the Brahmins demanded to be included in the BC list. The reason they gave was “all those who are forwarded among us had gone to the US. Only the backward are left in India. Therefore we must be declared BC”. As if BC classification is not sufficient, caste groups have been demanding that there should be further classification into ABCD groups. The most disadvantaged are to be declared the extraordinarily backward castes (EBCs). Thus the Hindu society is being splintered into castes and more castes. When the Kaka Kalelkar Commission went into the question of reservations for BCs in 1955 it enumerated 2,399 castes as BCs. The Mandal Commission in its report in 1980 enumerated 3,743 B.Cs and now if the claims of all those who demand to be declared as BCs are added up, castes will be more than 6000. Is it not strange that castes go on increasing? This is because politicians have been using caste for building up vote banks.

Now reservations are sought to be extended to non-Hindus; to those SCs who had converted to Christianity on the promise that in Christianity there are no castes. Although they are Christians for generations, the ex-SCs and leaders of Indian Christianity are demanding that they be equated to SCs of Hindus and given reservation. More surprising is that Muslims who claim to have ruled India for several centuries are saying that among them also, there are castes equivalent to Hindu SCs and Hindu BCs! There are enough number of politicians, mostly casteist and regional, who are supporting everybody’s demand for inclusion in the BC list. In fact, the claims are for declaration as backward, more backward , most backward, utterly backward, totally backward to be included even in the ST category! (eg: the Gujjars in Rajasthan and Jats in UP and Kapus in Andhra Pradesh). Now this reservation mania has gone to such an extent that even amongst SCs, there are some wanting further classification. For eg, in Andhra Pradesh there are 54 SCs. The most prominent among them are Madigas and Malas. Most Malas have converted to Christianity but they don’t declare their conversion to avail of reservations. Because of better educational facilities for the converts, the 30% Malas among the SCs are getting 70% of the jobs reserved for the entire SCs. Therefore, Madigas who constitute about 60% of the SCs, are agitating, sometimes violently, that there should be sub-classification among the SCs, and that the 15% reservation should be split up sub-caste-wise depending upon their population. These demands are supported by all parties but the government finds itself in a constitutional bind.

It is not only at the entry level that reservations are provided. They demanded and got reservation even for promotions, for SCs, STs, BCs & EBCs. Therefore arises a ridiculous situation like a professor of medicine is superceded by an SC or ST person whom he taught. The doctor is devastated that a student who entered the college in a reserved quota and just passed and got a government job in the reservation quota superceded him and becomes his boss. Such things detract from meritorious performance of one’s duty.

There does not seem to be an end to reservation. They are being demanded and extended for more years, for more and more sections of Hindus and perhaps to Christians & Muslims also. Hindus will be divided and ranged into mutually opposed castes while minorities (Muslims & Christians) will be untied by religion. They would therefore rule the country as in the medieval period.


That reservations for admission to professional colleges for SC & STs are not producing desired outcomes is evident from the figures in Table 1.

When 15% and 7.5% of seats are reserved for SCs & STs respectively and fully filled up every year, why is their percentage in the outcome highly less than 15% & 7.5%? They pay no fees; no mess and lodging charges; text books are given free. Without studying why the outcome is so poor and costly, what is the sense in continuing the system without reform?

The remedy, if at all it can be achieved by the political system in the country, is to put a sunset date for all reservations, leaving them to one or two generations and that too for one or two children in a family and do them away in the matter of promotions and restrict them to entry level, for colleges and government services.

Opium Feed to the Poor
Soon after independence, the budget of the Government of India was a total of about Rs. 110cr.; by the year 2011-12 the tax revenues are over Rs. 8 lakh cr; Government will borrow Rs. 4 lakh cr. The budget is a total of 12 lakh cr. In the early 1950s there was very little social sector spending. It has now risen to over Rs. 4 lakh cr. There are subsidies for agriculture. These could be justified as food and its availability to all people is essential. On the amount of debt government has so far incurred, it is paying interest of over Rs. 2 lakh cr. Obviously, this amount goes to the rich who alone could lend to the government. There are certain social merit goods for which subsidies are justified. Education upto matriculation is such a social merit goods. But what is known as fee reimbursement in Andhra Pradesh to over 25 lakhs of university level students is a total mis-spend. It is primarily aimed at getting votes. For eg: the annul intake of students into engineering colleges in Andhra Pradesh is 2,75,000. (all over India it is about 13 lakhs). About 75% of these are unfit to be employed as asserted by various professional and business associations and companies. Why should such students be subsidized? The entitlement — wallahs (those who assert right to life, right to house, right to wife, right for a degree, right for free rice) and the subsidy justifiers say that this is for social justice, for inclusive growth, for giving access to education. When education upto matriculation for all itself is a constitutional requirement but is not yet attained, giving total fee reimbursement to millions of university level students excepting about 15%, is a criminal misapplication of the resources of taxed people’s money by government. What good are these unemployable engineering and other graduates going to do the society in return for the tax money spent upon them? Would not a loan be a better option to deliver access to degrees level education? Would not merit scholarships be better so that the meritorious who are employable can return something to the society which is spending upon them? 

 Another give-away is the National Rural Employment Guarantee (NREG) scheme named very exceptionally (most schemes are named after Rajiv Gandhi or Indira Gandhi) after Mahatma Gandhi. It is a great waste. Every year about Rs. 40,000 cr are being spent. The example of my own village will illustrate the waste and harm of the NREG. There are 400 people (of about 1200 house holds) enrolled under the NREG. Instead of Rs. 100 per day they are now paying Rs. 125 for 125 days (instead of 100 days earlier). 50,000 man days of labour every year in a village with a population of 5000 to produce any social good is unthinkable. They don’t have any work. The non-governing government of Andhra Pradesh, under threat of political instability has increased the daily wage from Rs. 100 to Rs. 125. The result is the men just come to some office at about 10.00 Hrs mark their attendance, go away and get money. The wages for agricultural labour have shot up from Rs. 100 per day to Rs. 400 to 500 during the season of harvesting and such works which have got to be done only during a particular period. The result is farmers who are not even rich — the average holding in my village is 4.5 acres per family — are distressed and are wanting to abandon farming. They would rather lease their holdings to corporates. Sooner the corporate farming becomes a practice, the better. Then there will be relief for the distressed farmers .

This phenomenon of 70% rural population depending upon agriculture must be very disturbing. The contribution of agriculture to the GDP has come down from 68% in 1951 to 18% and yet 65% of the population of working age in the rural areas (whose population is 70% of India) are depending upon agriculture for their livelihood. Therefore, their PCI is about one eighth that of urban people. The impoverishment of farmers by the steep rise in agricultural wages is occasioned by money being freely disbursed in the NREG. So many people in the rural areas are unproductive because they are not employable in any sector other than those which need physical labour. This is due to lack of education, especially vocational education. The TV and news papers are showing the prosperity of the enterprising Indians (Mukhesh Ambani building a house costing more than Rs. 200 cr and more than 57 dollar billionaires; Indians are growing as billionaires at the highest rate anywhere in the world). Obviously, the multitudes will get restive and in order to contain their restiveness, political parties are competing to distribute money directly as in the NREG and in addition, by way of appliances like TVs, laptops, mixis, grinders, light bulbs and so on as in Tamilnadu. As time passes, political parties will have to promise more and more welfare competing with one another thus detracting from the spend on education and very grievously, on the defenses of India. our Chiefs of staff of Navy, Air and Army have already drawn the attention of the nation to the fact that China’s military power is three times India’s; Pakistan has near parity with India in regard to the defences. Gen. Shankara Ray Choudhury, former Chief of Staff wrote that we would have to fight two and a half wars simultaneously against China, Pakistan and Maoists within the country. When we are overwhelmed by a three to one superiority by China alone, imagine what could happen to India if we are to wage war with all the three which is not inconceivable.

Loan Melas
Another give-away is the waiver of debts, Rs. 70,000 cr for farmers. A moratorium would have been better. Taking a cue from the central government, Andhra Pradesh government waived another Rs. 5000 cr to farmers who have paid the debts to bring them to parity with those who have defaulted and got the loan waiver. In Andhra Pradesh there was a debt waiver mela — over Rs. 1900 cr for the SCs, Rs. 450 cr for Muslims, Rs. 350 cr for weavers and so on. Government of Andhra Pradesh (I am sure many other governments also) are urging people to take loans like for example when the former Chief Minister Y.S.Rajasekhara Reddy gave a lakh of Rupees as loan to one crore women to make them lakhpathis. Now when they are due to repay, political parties including Congress are agitating that these loans should not be collected. So governments and political parties are urging people to take loan and at the same time, they are organizing them for waiver of the loans. These actions are subverting the work ethic, the saving ethic and instead promoting dependency ethic; that is, government should give free housing, non-repayable loans, free provisions — from rice at Rs. 2/ Kg; then Rs.1/Kg; and now 35 Kgs free per month, marriage, pregnancy and child-birth grants; old age pensions. Government does not expect anything from them. It is promoting laziness. No nation which has spent more than what it produces has lasted for long as a great nation. For example, we see the decline of America because an average American addicted to credit card use is indebted to the extend of 18 months of his PCI. That is the reason why American power is declining.

A Few Right Actions
What is right is work must be got from people availing NREG but not in the village where they are. Work must be guaranteed for those who are willing to work at project sites where dams and canals are being built, where houses are being constructed, roads are being laid. They can be transported at government cost and housed in tents with their children also being looked after by government. That means instead of simply paying money for doing no work in the place where they are, they should be prepared to move. Only those people willing to work at sites shown by government should be guaranteed a job.

In addition to this, government must have program of totally stopping all welfare for families who have more than two children; that is the moment a third child is born all welfare must cease because that is an unsupportable burden on the rest of the people. If somebody says that God is giving them children, then they should apply to God for welfare and not to the poor government and poor citizens. It is this Manthra that China has been following one-child norm since 1978. It is because of this that there is hardly any growth in its population and that it has been able to build prosperity and power and become the second largest economy in the world in the shortest span of time and is poised to over-take the USA in the next few years. Government, leaders and responsible citizens must constantly emphasize the virtues of education and its quality work and saving ethic. They should say that people should try to live within their ability to earn and during the period of development, they should have only one or two children. That is one by choice and the second only by mistake.

Slogans like garibhi hatao, inclusive growth, Muslim First and social justice are all sweet words. They are unethical and totally populist. The purpose of populism is to get votes; the purpose of vote gathering is to get elected to legislative and ministerial positions cover up the real intention of feeding welfare opium to the people to keep them away from movements against corruption, inflation, loot of public money and its stashing in Swiss banks and for building vote banks. Pre-election promises of give-aways are no different from I.O.Us and should amount to distribution of cash for votes; hence punishable.

If the huge wealth our entrepreneurs are creating of which governments are getting about a third is used properly to build up human resources, through education and health and housing and drinking water, limited families then our nation can really become prosperous and powerful. Education rid of unnecessary and unjustifiable reservations will be productive of intellectual property (IP) that the country needs to sustain its prosperity and power. And above all, ethical and moral values like that one should live within one’s own means, one should not covet wealth without work, one should not produce children who will be a burden upon the society are what should be taught in the home and school and at large by all responsible people. This nation cannot afford wealth creation with increasing inequality. This nation should not create opportunities and incentives for the wealthy to take away the money and keep them in Swiss bank.

“You cannot bring about prosperity by discouraging thrift.
You cannot strengthen the weak by weakening the strong.
You cannot help the poor by destroying the rich.
You cannot establish sound security on borrowed money.
You cannot keep out trouble by spending more than you earn.
You cannot build character and courage by taking away man’s initiative and independence.
You cannot help men permanently by doing for them
What they could do for themselves.”
                                                                     — Abraham Lincoln

 If we make a mockery of reservations, launch festivals like loan melas and their waivers; if we bribe people by give-aways like in NREG, indiscriminate and unreasonable fee-reimbursements; cash grants for marriages, pregnancies, child-birth and pilgrimages while those in government loot money in collusion with contractors, licencees, land-gainers (in the name of SEZs which are later utilized for real estate activity), we will surely be incubating popular, deadly up-rising as in Algeria, Egypt, Libya…. The political class and the collusive greedy get-rich-quick business operators will be bringing disaster upon our country even as our “friendly” neighbours undermine our sovereignty and plan to slice off our territory in the north-east and north-west. 

(Dr. T.H. Chowdary held executive, managerial and directorial positions (General Manager, Deputy Director General) in the Departments of Information and Broad-casting and Telecommunications, of the Government of India. He was the founding Chairman and Managing Director of India’s Overseas Communications Corporation (VSNL). He was Governor, INTELSAT, (Washington) and Executive Director, INMARSAT, (London). He was Senior Expert of the International Telecommunications Union in Guyana and Yemen and was engaged by the CIDA (Canada) for writing the Green Paper for restructuring of Telecoms in South Africa and for drafting Information and Communications Policy in Nepal. He was Member of the Prime Minister of India’s National Task Force on Information Technology and Software. Dr. Chowdary was Information Technology Advisor in the rank of Minister of State to the Government of Andhra Pradesh, mentoring the State’s extensive programmes for e-Governance, Government to Citizen services (e-Seva), establishment of Internet Kiosks, computer education in schools and colleges and broadband applications. Dr Chowdary was Fellow of Satyam Computer Services and the founding Director of the Center for Telecom Management and Studies and also serves as a Chairman of Pragna Bharathi. He is the author of several books on telecommunications, information technology, Indian culture and politics.

The views expressed in the write-up are personal and do not re?ect the official policy or position of the organization.)



<<Back


Share |




 
 
Comment:  
Name:  
Place:  
Email:    
Display Email:
 
Enter Image Text: