Gurcharan Das's Blog, page 9
December 14, 2015
The Dharma Of Capitalism
Some nations seem to possess a code word, which is like a key — it unlocks the secrets of the country. That word is ‘liberty’ in America’s case. It is égalité, ‘equality’, in the case of France. For India, the code word is ‘dharma’. You wouldn’t know it, though, if you were a member of the India’s english speaking elite, but it resonates in the hearts of the vast majority of ordinary people.
Dharma is a frustrating, almost untranslatable word. Duty, goodness, justice, and law have something to do with it, but they all fall short. Dharma is chiefly concerned with doing the right thing, both in the private and the public life. Dharma provides the underlying norms of society, creating obligations for citizens and rulers, and it thus brings a degree of coherence to our everyday life. What makes dharma different from notions of morality in the other traditions, such as Christianity, is that it does not seek moral perfection. It is pragmatic; hence it is eminently suited to exchanges in the market place and to public policy. This is especially true of rajdharma, or dharma of the king or the state.
At the heart of the market system is the idea of exchange between ordinary, self-interested human beings, who seek to advance their interests peacefully in the marketplace. Dharma places restraints on buyers and sellers and creates a sense of trust between strangers. Since I trust you as a person of dharma, I readily accept a check from you. In the same way a taxi driver stops and takes me in as a passenger because he knows that the restraint of dharma will ensure that he will get paid at the journey’s end. Thus, millions of transactions in the global economy are conducted daily based on this shared trust.
People believe that markets are efficient but they are not moral. The truth is that market is neither moral nor immoral, but people are. However, the market sends powerful signals to people to behave in accordance with dharma. It tends to reward dharmic behaviour and punish adharmic behaviour. This reinforces a sense of trust in society.
I trust the woman who sells fruit to me regularly in Khan Market near my house in Delhi. One day she claimed that she had received exceptionally good mangoes but they were expensive because of their higher quality. I reluctantly bought the mangoes but unfortunately they turned out to be bad. I promptly punished her by shifting my allegiance to her competitor. Not only did she lose my custom but I also told half a dozen friends and neighbours. All of us shared similar stories of her behaviour. As word of mouth spread, she came to be known as a person of low dharma, and lost market share. In this way, the market punished bad behaviour.
Every purchase manager has the temptation to squeeze his supplier. If he does not treat the supplier dharmically and gives him a fair price, his own company will suffer when the supplier delivers sub-standard components. On the other hand, the market rewards good behaviour on the part of a company that treats its employees well. The best will want to join such a firm, and with the influx of talent it will be rewarded with high performance and market share. I know of one such company, a small one, that is able to consistently attract talented people from IITs and IIMs because it has built a reputation for having happy employees fairly. Behaviour in accordance with dharma strengthens a company’s brand.
In the same way, a company which builds a reputation for honesty and for doing good for the community is rewarded. I was recently asked by a large multinational to recommend a partner. I immediately suggested the Tatas. A person or a firm of high dharma is rewarded with a good reputation. Smart businessmen know this and work incessantly to improve their reputation.
These are some of the ways in which markets are not only efficient but they also reinforce good behaviour. The market system depends ultimately not on laws but on the self-restraint of individuals. Dharma provides that restraint in order for people to behave with tolerance and respect. However, there are limits to self-restraint and trust as there are crooks in every society. They have to be punished. Bhishma instructs Yudhishthira in the Mahabharata about the importance of danda, the ‘rod’of the state to punish persons of low dharma. The epic says that when dharma is low in a society, the dependence on danda or intrusive regulation rises. A society where dharma is weak suffers from pervasive corruption of public officials and ineffective public administration.
Such a situation is painfully obvious in contemporary India where public institutions of governance — the bureaucracy, the police and the judiciary —continue to fail to enforce the law. Why should it take fifteen years to get justice in the courts? This is because people of low dharma find ways to manipulate the courts and the police. The reform of these institutions is a key unfinished agenda of reform in India today. Too many tend to blame the market for the pervasive corruption, especially in high places, calling it ‘crony capitalism’. The opposite, in fact, is the case. Corruption exists mainly in the unreformed sectors of the economy where public officials still have discretionary authority over economic decisions.
Although two decades have passed since the reforms of 1991 when Indians began their love affair with free markets, capitalism is still trying to find a comfortable home in India. India reforms by stealth because no political party has bothered to explain the difference between being ‘pro-market’ and ‘pro-business’, leaving people with the impression that liberal reform mostly helps the rich. They do not understand that being pro-market is to believe in competition, which helps keep prices low, raise the quality of products, and leads to a ‘rules based capitalism’ that serves everyone. To be pro-business, on the other hand, means to allow politicians and officials to retain power over licenses, which distorts the market’s authority over economic decisions and this leads to ‘crony capitalism’. This confusion explains the timidity of reform and prevents India from performing to its potential.
Part of the reason, I am convinced, why capitalism is so disliked lies in linguistic confusion. Too many glibly equate capitalism with greed and confuse self-interest with selfishness. When Adam Smith wrote about self-interest he had in mind ordinary people going about making sensible decisions in their day-to-day lives. When I go to buy mangoes in the market, for example, I naturally want the best quality at the lowest price. This is not being selfish; it is merely being self-interested. If it rains, I will carry an umbrella—nothing selfish about that. In buying and selling each person gains by benefiting others, and an “invisible hand”, to use Adam Smith’s famous phrase, ensures that everyone gains from self-interested behaviour.
A selfish or a greedy person, on the hand, is not morally neutral —he promotes his interest at another’s expense, and that is wrong. Selfishness is a social attribute and a selfish person often transgresses on the rights of others. Self-interest, on the other hand, is not a social attribute and can be practiced in solitude on a deserted island. Self-interest is the pursuit of whatever is in one’s interest —a scientist pursues science, a doctor pursues medicine, and an artist pursues art. There is nothing selfish in that, which is why Adam Smith called it rational self-interest. In the Theory of Moral Sentiments, he said that what is rational is not only from the viewpoint of the person involved but also from that of a disinterested rational observer.
There is purpose to economic activity and the ancients in India were acutely aware of this when they posited artha, ‘material well being’, as one of the goals of life. They believed that the pursuit of money is justified to the extent that it leads to the good life. That good life also consists of other goals, in particular, dharma, ‘moral well-being’. Mahabharata reminds us that the goal of artha is subordinate to dharma. In other words, there is a right and a wrong way to pursue wealth. In today’s language, the pursuit of artha is to make the world a better place —to lift the poor out of poverty. Thus, the moral purpose of capitalism is take societies from poverty to prosperity. The problem begins when poverty has been conquered and a society has become prosperous and middle class. Beyond a certain point increased wealth does not make people happier, and they seek other goals. Successes of capitalism produce over time enervating influences when a generation committed to saving is replaced by one devoted to spending. This is a problem which will confront India and China in the next generation. Ferocious competition is another feature of the free market and it can be corrosive. But competition is also an economic stimulant that promotes human welfare.
It is in man’s nature to want more. And dharma seeks to give coherence to our desires by containing them within an ordered existence. Since no amount of regulation will catch all the crooks, self-restraint is needed on the part of each actor in the market place in order to achieve dharma within society. The choice for policy makers is not between unregulated free markets and central planning but in getting the right mix of regulation. Except for communists, hardly anyone in India wants state ownership of production, where the absence of competition corrodes the character even more. Dharma’s approach is not to seek moral perfection, which leads inevitably to theocracy or dictatorship. It offers a modestly coherent world that is also close to our day to day life and hence suited for exchanges in the market place. Self-restraint is one of the meanings of dharma and the trust that self-restraint helps to create in society is I believe the ‘dharma of capitalism’.
(This story was published in BW | Businessworld Issue Dated 14-12-2015)
November 15, 2015
Bihar polls over, it’s time to fix those leaky pipes
The solution to ending the constant distraction of “bread and circuses” is to go in for fixed term elections as most sensible countries have done, the latest being the UK. We need to restore the balance between giving the executive freedom to act and holding it accountable for those acts via elections. Elections should only be held in two fixed time periods every five years — once at the national level and two and half years later, simultaneously in all the states. Should a government fall between those dates in a no-confidence vote, the House should not be dissolved; legislators should be forced to cobble a new government or face President’s rule.
If India is to create jobs, the Prime Minister must begin to see the world through the eyes of a small Indian entrepreneur. On his or her narrow shoulders rests the responsibility for creating the vast majority of jobs. This is especially true in the construction industry, which is the biggest creator of jobs in every country. A builder took his life in Thane last month, and in his suicide note he complained about repeated demand for bribes from politicians. He said he could cope with the slowdown in his business but not the red tape and official harassment.
India’s problems are administrative and managerial, not so much political. Hence, Mr Modi must focus single-mindedly on the unglamourous work of fixing leaky pipes. Successful auctions in mining and spectrum are an example of fixing the plumbing. So is the creating of conditions for the efficient delivery of subsidies via cash transfers through JAM (Jan Dhan Yojana/Aadhar/Mobile banking). Last Tuesday’s liberalization of FDI, which cut red tape for investors by giving them automatic entry into many sectors, is another example. The Arbitration and Commercial Courts Ordinance is yet another. Yes, legislative reforms are important, but don’t underestimate the power of overhauling the plumbing left behind by the “license, permit, inspector raj”. Remember, India experienced its highest growth in history between 2003 and 2012 without the GST or the reform of its labour and land laws.
India has a lot going for it. Economic growth is up and inflation is down. Foreign investment and government revenues are rising and the current account deficit and fiscal deficit are declining. Importantly, interest rates have fallen and the rupee is stable. All this did not happen by accident. Major manufacturers like Foxconn in telecom and GE and Alstom in locomotives have come in; payment banks will soon enter the scene; telecom companies can now share spectrum; the defense sector has emerged as a major driver of growth. Even the Bihar election, contrary to the headlines, was mostly about development. What made the difference is that Nitish had something to show for it, especially in bringing electricity to villages.
However, there is a long way to go. Uneconomic power tariffs have again put the finances of the State Electricity Boards in a colossal mess. State- owned banks have had to be bailed out yet again. Our tax administration continues to diminish us as a nation. State-owned companies like Air India destroy India’s brand image daily. As did the Maggi saga. There is no effort to tackle the real problems in education and health. And more.
India does well when it bets on its people; it does less well when it bets on its government. Hence, the reform of the state — fixing the leaky pipes is even more important than economic reform. It will cut corruption and bring jobs quickly by making India attractive to the small entrepreneur. To stay focused on this agenda is Mr Modi’s and the nation’s priority.
October 18, 2015
Handle with care: The big takeaway from Nepal fiasco
Ten months ago, Prime Minister Modi was a hero in Nepali eyes after his brilliant address to the nation’s lawmakers. India’s stock rose higher after its generous aid to the victims of the April earthquake. Today, the Indian flag is being burned on the streets of Nepal.The trouble began when Nepal announced a new constitution last month. Much awaited, it should have brought joy and celebration. Instead, it brought a revolt among Madhesis in the terai belt bordering India. Forty persons died. Although a third of Nepal, Madhesis have long felt discriminated by the hill elite. The new constitution marginalized them further as many of their districts were merged into the hill states.
Madhesis retaliated by blocking trucks carrying food and fuel from India. As shortages developed and prices shot up, Nepal blamed India for its misery. India claimed innocence — it was a Madhesi blockade. But Nepalis accused India of siding with the Madhesis.True, India had championed their cause during the constitution-making process. A late frantic visit by Indian’s foreign secretary, Jaishankar, had strengthened the perception. Although of Indian origin, Madhesis were Nepalis, and Nepal felt that India had interfered in its domestic affairs. What if Pakistan became India’s adviser on how to treat India’s Muslims, or if Americans instructed us on how to manage Kashmir?
It is never easy for a big country to compel a small one to act in a certain way. It needs finesse and subtlety. India’s national interest is to have a friendly Nepal that does not fall into China’s hands. Diplomacy is the art of friendly persuasion — to align a neighbour’s interest with one’s own. This is where India’s diplomacy has failed.
To their credit, both sides have realized their mistakes. Modi has welcomed Prime Minister K P Oli’s rise to power. Oli has appointed a dissident Madhesi as a deputy prime minister and has promised to sort out Madhesi grievances.
But the anger, the pain of the blockade, and ill-will towards India remain. Our Nepali fiasco, ironically, comes on the heels of India’s triumph with another neighbour, Bangladesh, where a historic accord has recently erased a dispute as old as Kashmir while nudging the subcontinent towards a common market.
There are other lessons in this fiasco. Nepal’s old politicians need to shed their distrust of India. With huge hydroelectric potential, Nepal should not be suffering from constant blackouts. Instead of buying power from India today, it should be selling it to India. But xenophobia prevents it from allowingIndian entrepreneurs to generate power. It could learn from Bhutan, which has achieved the highest GDP per capita in South Asia by selling power to India. In fact, by hitching its economy to India and China, the world’s fastest-growing economies, Nepal could become a Switzerland.
Nepal’s old elite also needs to catch up with a new generation of aspiring, young Nepalis who will no longer put up with the old iniquities against minorities and women. Young Nepali women are deeply offended by an unequal provision in the constitution: children of Nepali men with foreign wives will get citizenship but not those of Nepali women married to a foreign husband. This law is aimed at the Madhesis. Manjushree Thapa, the Nepali author, puts it nicely: “Ruled by a deep-seated xenophobia, Hindu patriarchs fear that Indian men will marry Nepali women, and the children — born of Indian seed! — will populate Nepal. Nepal will then no longer be Nepali.”
India should learn not to take Nepal for granted and respect its autonomy. Nepal would be happier if it shed its unwise fears. It should bear in mind that, unlike China, India has only created empires of the spirit, never of the sword. As Chinese scholar and diplomat Hu Shih said: “India conquered China culturally for 20 centuries without sending a single soldier across her border.”
October 2, 2015
शिक्षा की शर्मनाक हकीकत
शिक्षकों का प्रदर्शन और भी बड़ी समस्या है। सिर्फ चार फीसद शिक्षकों ने शिक्षक पात्रता परीक्षा (टीईटी) पास की है और उत्तर प्रदेश तथा बिहार के चार में से तीन शिक्षक पांचवीं क्लास स्तर के प्रतिशत निकालने वाले सवाल तक हल नहीं कर पाए। देश के सर्व शिक्षा अभियान और शिक्षा के अधिकार अधिनियम पर हजारों करोड़ रुपये खर्च करने के बावजूद हाल के वर्षों में सीखने वाले परिणाम गिरते ही गए हैं। अगर मैं स्मृति ईरानी होता तो इस खराब हालत पर सिर झुका लेता और रोता। खूब रो लेने के बाद मैं सवाल पूछता कि गरीब भारतीय मां-बाप अपने बच्चों को उन सरकारी स्कूलों से निकाल लेने को क्यों बेचैन हैं जो नि:शुल्क पढ़ाते हैं और उन निजी स्कूलों में क्यों भेज रहे हैं जहां उन्हें फीस देनी पड़ती है? हो सकता है, फीस कम हो, लेकिन कड़ी मेहनत से कमाए गए पैसे को उस चीज के लिए खर्च करने में उन्हें बेचैनी होनी चाहिए जो नि:शुल्क उपलब्ध है। कुछ गरीब बच्चे गलत हो सकते हैं, लेकिन पूरा देश गलत नहीं हो सकता। एएसईआर के आंकड़े बताते हैं कि बच्चे चिंताजनक दर पर सरकारी स्कूल छोड़ रहे हैं। स्कूल शिक्षक खुद अपने बच्चों को सरकारी स्कूलों में नहीं भेजते हैं।
दुर्भाग्यपूर्ण ढंग से समस्या 2009 में बनाए गए शिक्षा के अधिकार कानून में है। संप्रग सरकार ने मान लिया था कि समस्या आंकड़ों और स्कूल जाने वाले बच्चों की संख्या में है। लेकिन 2009 में 96.5 प्रतिशत बच्चे तो स्कूल में थे ही। आरटीई कानून पढ़ाई जाने वाली चीजों के परिणाम और शिक्षकों की गुणवत्ता पर बिल्कुल मौन है। इसने दूसरी यह गलत बात भी मान ली कि बच्चों की उपलब्धि की समीक्षा का बच्चों पर दबाव पड़ेगा और इस बात ने विद्यार्थियों की परीक्षा को अवैध बना दिया। बच्चों की अच्छाइयों और कमजोरियों के बारे में अभिभावकों की जानकारी के बिना बच्चे अपने आप अगली क्लास में भेजे जाने लगे। परिणाम यह हुआ कि बच्चों के प्रदर्शन के लिए शिक्षकों की कोई जिम्मेदारी नहीं रह गई है।
सरकारी स्कूलों की गुणवत्ता बेहतर करने की जगह आरटीई ने निजी स्कूलों पर भ्रष्ट इंस्पेक्टर राज डाल दिया है और इससे काफी बड़ी संख्या में स्कूल बंद हो गए हैं। पंजाब और हरियाणा उच्च न्यायालय को इसमें दखल देना पड़ा और इस पर रोक लगानी पड़ी। सरकारी स्कूल विफल हो रहे हैं, इस बात को मानते हुए आरटीई ने गरीब परिवारों के बच्चों के लिए 25 प्रतिशत आरक्षण का कोटा निजी स्कूलों पर लाद दिया। अपने आप में यह बुरी बात नहीं है, लेकिन यह इस तरीके से किया जा रहा है कि सरकार ने निजी स्कूलों में दखल देना शुरू कर दिया है। कुछ राज्यों में लॉटरी की जगह राजनेता और नौकरशाह निर्धारित करने लगे हैं कि किस बच्चे को कोटे का लाभ मिलेगा। इसने निजी स्कूलों पर दूसरा ही इंस्पेक्टर राज डाल दिया है।
क्या किया जाना चाहिए? यह आश्वस्त करने वाली बात है कि व्यवस्था में किस तरह सुधार हो, इस बारे में मंत्री स्मृति ईरानी सुझाव मांगते हुए लोगों से संवाद और विचार-विमर्श कर रही हैं। इस संदर्भ में छह ऐसे मजबूत कदम हो सकते हैं जिनके जरिये वे 24 करोड़ स्कूली बच्चों के भविष्य बचा सकती हैं। एक, इस बात को पहचानें कि समस्या पैसे की नहीं, प्रबंधन की है। यह शर्मनाक बात है कि स्कूल में चार में से एक शिक्षक अनुपस्थित रहता है और उपस्थित दो में से एक पढ़ाते हुए नहीं पाए जाते। संप्रग के शिक्षा विशेषज्ञ शिक्षा दर्शन पर बात करने में अच्छे थे, लेकिन शिक्षकों की अनुपस्थिति जैसी वास्तविक समस्या के समाधान के मामूली काम में बुरी तरह विफल रहे। दो, नीति में स्कूल में पढ़ाने से अधिक ज्ञान देने और संख्या से अधिक गुणवत्ता पर जोर देने वाला बदलाव हो। गुजरात के गुणोत्सव कार्यक्रम का अनुसरण हो सकता है जिसमें नियमित रूप से जांचा जाता है कि बच्चे कैसा कर रहे हैं। नियमित राष्ट्रीय परीक्षाओं की शुरुआत हो। राष्ट्रीय उपलब्धि सर्वेक्षण (एनएएस) को इस तरह का बनाया जाए कि वह ज्ञान का बैरोमीटर बने। तीन, महान नेता महान संस्थाएं बनाते हैं। वरिष्ठता के आधार पर प्रधानाध्यापकों की नियुक्ति बंद हो। एक मजबूत प्रधानाध्यापक एक कमजोर स्कूल को भी पूरा बदल सकता है अगर वह सिर्फ प्रशासक नहीं, दिशानिर्देश देने वाला नेता हो। फिर वही बात, गुजरात के शिक्षा मॉडल का अनुसरण किया जाए और प्रधानाध्यापकों के चुनाव के लिए प्रधानाध्यापक योग्यता परीक्षा शुरू की जाए। स्कूल का नेतृत्व करने वालों को तैयार करने वाले प्रशिक्षण केंद्रों की स्थापना हो।
चार, पिछले वेतन आयोग के बाद शिक्षकों का वेतन बेहतर हो गया है। अब शिक्षण में बेहतर प्रतिभा आकर्षित करने के लिए प्रोत्साहन भत्ता शुरू किया जाए। तीसरे दर्जे की शिक्षक प्रशिक्षण संस्थाओं की जगह भारत के अच्छे विश्वविद्यालयों में प्रतिष्ठित शिक्षण संस्थाएं बनाई जाएं। पांच, निजी स्कूलों को न तो परेशान करें, न उनके साथ दुधारू गायों की तरह व्यवहार करें। 'लाइसेंस राज' से मुक्ति पाएं। यह उन वास्तविक शिक्षा उद्यमियों को शिक्षा क्षेत्र में प्रवेश करने को प्रोत्साहित करेगा जो सोचते हैं कि उनका काम पढ़ाना है। छह, चिली, सिंगापुर, स्वीडन, ब्राजील और पोलैंड के सबसे अच्छे तरीकों से सीखना चाहिए। इनमें से कुछ देशों के साथ वही समस्या थी जो हमारे साथ है। लेकिन अपनी शिक्षा व्यवस्थाओं में सुधार के लिए बड़ी ऊर्जा का निवेश कर उन्होंने अपनी समस्याओं का समाधान कर लिया है। स्मृति जी, अगर आप अपने पूर्ववर्तियों से भिन्न होना चाहती हैं तो आइआइटी को सताना, मुख्य स्थानों पर आरएसएस के लोगों को नियुक्त करना और संस्कृत तथा वैदिक गणित पढ़ाना बंद करें। 24 करोड़ स्कूली बच्चों के भविष्य को बचाएं और गर्व महसूस करें।
September 27, 2015
Smriti Irani, have a good cry. Then give 240m kids a chance
We had been warned. The respected national survey, Annual Status of Education Report (ASER), has repeatedly shown that less than half of Class V students can read a paragraph or do a simple arithmetic sum from a Class II text. Teachers’ performance is worse. Only 4% of teachers pass the Teacher Eligibility Tests (TETs) and three in four teachers cannot do percentage sums from a Class V text in UP and Bihar. Learning outcomes have declined in recent years despite the nation spending tens of thousands of crores on the Sarva Shiksha Abhiyan and Right to Education Act.
I would hang down my head and weep if I were Irani and presiding over one of the world’s worst education systems. After a good cry, I would ask a second question: Why do desperately poor Indian parents pull their children out of government schools, which are free, and send them to low-fee private schools? A parent must be desperate to spend hard-earned income for what is available free. ASER data shows that the share of rural private schools has grown from 19% to 29% in ten years; it is over 50% in urban areas. India now has the largest percentage of children in private schools.
The problem, tragically, lies in the Right to Education Act 2009 (RTE), which assumed the problem was to bring kids into school. But in 2009, 96.5% of children were already in school. The problem was of learning and RTE is silent on learning outcomes or teacher quality. It made another bad assumption — assessing children’s performance is stressful on kids — and made it illegal to test students to find out if they are learning.
Instead of improving the quality of government schools, RTE has unleashed a corrupt inspector raj upon private schools, leading to the closure of many on dubious grounds. The Punjab and Haryana High Court stepped in to stop this. RTE also forced upon private schools a quota of 25% seats for children of poor families. In itself, this is not a bad thing. At least, it’s a chance for the poor.
Irani has recently invited suggestions from the public to mend the system. Here is my response in six simple steps. One, the problem is management, not money. It is an outrage that one in four teachers is absent and one in two, who is present, is found not teaching. UPA’s experts were good at spouting pedagogy but failed miserably to bring accountability. Two, focus on learning, not schooling. Follow Gujarat’s Gunotsav, which measures outcomes.
Establish regular nationwide assessments. Overhaul the National Achievement Survey (NAS), making it a barometer of learning.
Third, great leaders make great institutions. Stop appointing headmasters on the basis of seniority. A strong principal can turn around a weak school if he is an instructional leader, not only an administrator. Again, follow Gujarat and institute a headmaster eligibility test for selecting principals. Set up training centres to create school leaders. Four, since teacher salaries have improved after the last pay commission, create incentives to attract better talent into teaching. Instead of third-rate Teacher Education Institutes (TEI), build prestigious teaching institutes at India’s top 10 universities, while strengthening the State Councils of Educational Research and Training (SCERTs) and District Institutes of Education and Training (DIETs). Five, don’t harass private schools or treat them like cash cows. Get rid of ‘licence raj’, which will encourage genuine entrepreneurs to enter education. Six, learn from the best practices in Chile, Singapore, Sweden, Brazil and Poland which have invested significant energy in reforming education.
India has been historically unlucky in the poor quality of its HRD ministers — in persons like Arjun Singh, who cared only to play the OBC reservations card. If you want to be different, Ms Irani, stop obsessing over IITs, appointing RSS people to key jobs, and teaching Sanskrit and Vedic mathematics. Implement these six steps and save the futures of 240 million schoolchildren, and go to glory.
September 13, 2015
Death penalty: Life can be far worse, says the Mahabharata
Human beings have long wrestled with the right relationship between crime and punishment. When we lived in tribes, individuals and clans avenged crimes. After we moved into civil society, we gave the state monopoly power to punish crimes under due process of law. However, the idea that ‘if a good person suffers, the bad one should suffer even more’ is embedded in our psyches. We deny it, proclaiming piously ‘I’m not the sort of person who holds grudges’. Yet we applaud when the villain gets what he deserves in life, in novels and movies.
Thirst for revenge is a powerful instinct in human beings. Many psychologists think it bad for it damages the ‘core of the whole being’. Others argue that vindictive emotions are legitimate and bringing criminals to justice restores moral equilibrium in our lives. Thinkers from Plato onwards believed in the legitimacy of retributive justice. Punishment creates moral equality between victim and offender; forgiveness makes the offender superior to the victim.
The other aim of punishment is to deter future crime — provide incentive for a normal person to obey the law. In the past 50 years, public opinion shifted in the West from retribution and deterrence to reforming and rehabilitating criminals. But rehabilitation programmes in prisons mostly failed and criminologists became disillusioned. Today, the global debate is more modest — about ensuring that punishment is fair and proportional to the crime. One is painfully aware, however, how difficult it is to achieve proportionality in practice. Prison sentences vary widely for the same crime in the same country.
Crime and punishment is the central theme of Ashwatthama’s story in the Mahabharata. By all accounts, Ashwatthama was a fine young man —confident, modest and fair-minded. The son of the great teacher, Drona, he grew up in the privileged company of princes. When war is declared, he finds himself on the wrong side. He fights with integrity and in the end accepts the defeat of the Kauravas. He is outraged at the deceitful death of his father, however, and vows revenge. He sets fire to the victorious, sleeping armies of the Pandavas. His night-time massacre is a deed so repulsive that it turns the mood of the epic from martial triumphalism to dark, stoic resignation.
When Draupadi, Pandavas’ queen, learns that all her children died in the night massacre, she cries for vengeance. When Ashwatthama is finally captured, the Pandavas debate over the right punishment for his horrendous crime. Death would be too kind, they agree. Krishna ultimately pronounces the sentence: ‘For three thousand years you will wander on this earth, alone, and invisible, stinking of blood and pus.’
Indians have long felt ambivalent about the death penalty; hence, very few executions have taken place since Independence (57 in 68 years). Most of the world has abolished it — only 36 have not and this includes India and the US. The UN resolution says that it ‘undermines human dignity’. But I am not convinced. I would argue that retaining the death penalty, in fact, enhances human dignity. The most serious argument for its abolition is that it is almost impossible to implement it fairly; why have we not used it, for instance, against the ghastly crimes of the Naxalites? Whether Krishna’s sentence meets the test of proportionality, the Mahabharata has the right idea — keeping a person alive, brooding and suffering over his deed, is a far greater punishment than death.
August 20, 2015
Trading communities thrive on risks, trust
Unlike the mood of diminished expectations in the West, ours is an age of rising expectations. India has risen in the past quarter century on the back of liberal economic reforms. Sixty-four countries, however, made the same reforms as India, but why did India become the world’s second fastest-growing economy? I am not sure if anyone really knows, but my own ‘politically incorrect’ answer is that if you make reforms in a society where there are groups who know how to accumulate and conserve capital, your reforms will have a bigger bang. Historically, India is fortunate to have had its Vaishya or Bania business castes—the Marwaris, Chettiars, Gujarati Bhatias, Sindhis, Khojas, Jains, North Indian Banias, Punjabi Khatris/Aroras, even Parsees, and more—and they have played a major part in India’s growth story. Not surprising then, that year after year, two-thirds of the surnames in the Forbes list of Indian billionaires are Vaishya. Our much-maligned caste system may have actually given us a competitive advantage.
There are many reasons for the extraordinary and continuing success of our ancient trading communities. I shall focus on three: An enormous appetite for risk, the central place of trust (sakh) in their business culture, and a family support system that grooms entrepreneurs. Let me illustrate with stories from one community: The Marwaris.
The virtue of risk taking
The business world rewards those who take risks. ‘You don’t want to compete with a Marwari!’ is the wisdom of the bazaar, partly because of the community’s astonishing risk-taking ability. GD Birla’s colossal success in the market for jute futures during World War I was the result of his extraordinary stomach for risk. It laid the foundation for the great Birla industrial empire.
Less well known is the remarkable story of Ramkrishna Dalmia, who came from arid Rohtak in Haryana, not far from Rajasthan—the homeland of the Marwaris. Although his great-grandfather had been wealthy, Dalmia grew up in penury in Calcutta during the Great Depression of the 1930s. He was 22 when his father died and had to support seven persons in a single room, which he rented for Rs 13 per month. Dalmia was young, adventurous and wanted to get rich quickly. He had speculated in silver, lost, and suffered the humiliation of defaulting on his debts.
Declared insolvent, he was persona non-grata in the marketplace when he received a cable from London informing him that the market for silver was set to rise.
Dalmia rushed to the bazaar and entreated his friends and associates to buy silver, but he was spurned. Friendless, he went to a wealthy astrologer (who had predicted that Dalmia would one day grow very rich) who agreed to purchase silver worth £7,500. Dalmia jumped on a tram and sent off a cable from the General Post Office. But the next day, during his daily dip in the Ganges, he was informed that the astrologer refused to honour the transaction. On returning home, he found a cable confirming the transaction along with the bad news that the market had gone down. He was in serious trouble.
The market, however, turned very quickly in the next few days and since he had not squared his account, he suddenly found that he had made a significant profit. A prudent man would have booked the profit, but Dalmia was a risk-taker. He stole his wife’s only ornament, pawned it for Rs 200 and made a fresh bet through another agent for £10,000. The silver market rose again and he doubled his capital, which he used to buy more silver. Soon his profits had risen seven-fold.
Dalmia wanted to unburden himself and he confided in his mother. She ordered him to square off immediately, retrieve his wife’s ornament and never again earn from stolen capital. She told him to get a job, earning Rs 50 per month, on which they could live comfortably. He complied with his mother’s wishes, cabled his agents to book his profits. But as luck would have it, his cable got garbled in transmission; the market rose again dramatically, and now, his profits were fifteen times his capital and he had become a very wealthy man, which laid the foundation of a vast industrial empire. When I was young, the names Tata-Birla-Dalmia were mentioned in a single breath.
Dalmia seems to have employed intuition, not unlike George Soros, when he bet against the British pound, but most Marwaris will tell you that they have a method and an art in managing risk. Despite their rationalism, the truth is that luck plays a big part.
Trust is at the heart of it
One of the lessons from Dalmia’s story is the central place of trust in business life. When Dalmia defaulted on his debt, he broke a promise, and the market punished him swiftly. By losing the trust of his peers in the market, he turned from a somebody to a nobody, a terrible thing to happen to any human being. In the world of Marwaris and Banias, the word for trust is sakh and it is linked closely to honour. It is a crucial indicator of a merchant’s standing. Sakh is at the heart of creditworthiness and business integrity and means much more than wealth and financial strength. It is acquired through an unblemished record in honouring obligations and being generous to the needy.
The legendary cotton trader Ramvilas Poddar began as a humble broker in raw cotton but soon reached an eminent position in the bazaar by quickly building a reputation for honesty and acquiring sakh within the community. This helped Poddar set up an independent brokerage and encouraged older and established firms to entrust their money to a relative newcomer in the bazaar.
GD Birla confirms the importance of sakh. In describing his life as a jute trader, he tells us that most of his transactions in buying raw jute or selling the finished product were based on the trader’s word. The commodity fluctuated on a daily basis and there were often great swings in the price between morning and evening. Sellers and brokers presented their offers on a rough sheet of paper in the morning, but the mills made their decision in the evening. The offers were invariably honoured no matter how the market had moved during the day.
Raju Kanoria, who also started his life in the jute business and went on to become president of Ficci, the prestigious chamber of commerce, corroborates that at the East India Jute and Hessian Exchange, prices were confirmed through a handshake. He adds that a similar system based on trust operated in the case of finished stock. The jute mills held finished goods in stock for buyers, against Pucca Delivery Orders (PDOs) made months in advance and the mills never dared to default on them. When Kanoria was eighteen, he had the good fortune to meet GD Birla, whose advice to the young man was ‘to trust people if you want to succeed’.
The visible embodiment of sakh is a negotiable financial instrument called the hundi. A centuries-old Bania innovation, it was akin to a bill of exchange: It allowed a merchant in a remote village to remit or receive large sums of money on the basis of trust. A merchant from Gujarat, for example, who sold his raw cotton in distant Bombay could, instead of receiving payment in cash with all the risks during transit, take a hundi of the equivalent amount drawn by the buyer in his favour. He could present the hundi to an agent in his village and collect his money there. This made it possible to transfer funds without having to physically carry money. While the hundi began as a remittance facility, it evolved over time for credit purposes: The lender extended the loan amount at a discount on the value of the hundi and subsequently encashed it at par. In short, the hundi became a negotiable instrument.
We forget that at the heart of the market system is trust between self-interested strangers who come together to exchange in the marketplace. The reason that buyers and sellers are able to trust each other is, in part, due to the underlying belief that the average person acts honestly—that he or she wants to do the right thing—and this gives people a sense of safety when they transact. This is why a seller readily accepts a cheque from a buyer. Millions of transactions in the global economy are conducted daily, based on trust without resorting to contracts.
Community Support System
Indian capitalism has always been family-based, and the extended family and community has always provided strong support.
Not only Marwaris, but other commercial communities apprenticed their young early. They provided them with rigorous training in technical skills. When they came of age, they were encouraged to set out on their own. They gave them venture capital from the corpus of the family or the community. They expected it to be returned after the person made a success in order to become capital for the next generation. When the entrepreneur travelled, he could stay in guest houses (called basas in the case of the Marwaris), run by their community which attended to the traveller’s commercial and other needs in a strange town.
There was also a system of checks. The young person who travelled invariably left his family behind in the care of the community elders, which deterred a young man from absconding abroad with the community’s capital. The community was always extremely mindful of its reputation, for one rotten egg could spoil the reputation not only of the family, but also of the community. This ethic continues even today.
The legacy of India’s business communities is to have historically harnessed the country’s great productive capacity. On the back of economic surplus generated in the home market, they built a rich trading history along a 5,000-mile coastline. As a result, India commanded as much as a quarter of world trade during certain periods and had a positive balance of trade with the world throughout history until the Industrial Revolution.
August 18, 2015
हम भारतीय पाखंडी कैसे हो गए?
भारत का सांस्कृतिक इतिहास इस मायने में अनूठा है कि इसने यौनेच्छा को मानव का अत्यंत सकारात्मक गुण माना। यदि पश्चिम की यहूदी-ईसाई परंपरा में सृष्टि रचना प्रकाश के साथ शुरू होती है (जब ईश्वर ने कहा, ‘प्रकाश हो जाए और प्रकाश हो गया)।’ भारत में सृष्टि की शुरुआत काम यानी इच्छा से शुरू होती है। ‘काम उस एक के मन में इच्छा का बीज है, जिसने ब्रह्मांड को जन्म दिया (ऋग वेद 10.129)।’ प्राचीन भारतीय भी यह मानते थे कि काम ही सृष्टि, उत्पत्ति और सच कहें तो हर क्रिया का उद्गम है। उन्होंने इसे त्रिवर्ग, यानी मानव जीवन के तीन उद्देश्यों में शामिल कर ऊंचा स्थान दिया। उन्होंने इसके नाम पर देवता की कल्पना की और इसे लेकर मोहक पौराणिक कथा बुनी। काम को लेकर यह सकारात्मकता भारतीय इतिहास के शास्त्रीय दौर में चरम पर पहुंची। संस्कृति प्रेम काव्य कामसूत्र और गुप्त हर्षवर्द्धन के साम्राज्य के दरबारी जीवन में शृंगार रस की संस्कृति में इसकी परिणति हुई। इसी के बाद खजुराहो और कोणार्क के शृंगार आधारित शिल्प गढ़े गए।
एक दौर के आशावादी और खुले दिमाग वाले भारतीय आज के पाखंडियों में कैसे बदल गए? हमारा झुकाव मुस्लिम ब्रिटिश हमलावरों को दोष देने का रहा है (और कुछ तो उनका संबंध रहा है खासतौर पर ब्रिटिश राज के नकचढ़े विक्टोरियाइयों का), लेकिन हिंदू भी काम को लेकर निराशावादी रहे। काम पर तपस्वियों संन्यासियों ने हमला किया, जिन्हें आध्यात्मिक प्रगति को कुंठित करने की इसकी क्षमता चिंतित करती थी। उपनिषद, बुद्ध और कई प्रकार के संन्यासियों ने इसकी भर्त्सना की और शिव ने तो प्रेम के देवता को ही भस्म कर दिया था। आशावादी और निराशावादियों में फंसा साधारण व्यक्ति भ्रम में पड़ गया। जहां कामेच्छा आनंद का स्रोत थी वहीं, उसने देखा कि यह आसानी से बेकाबू हो सकती है। धम्म की रचनाएं उसकी मदद के लिए आगे आईं और उसे एक राह दिखाई। इसने काम के सकारात्मक गुणों को स्वीकार किया, लेकिन हिदायत दी कि यह विवाह के भीतर संतानोत्पत्ति तक सीमित रहनी चाहिए। इस तरह एकल विवाह का नियम बन गया, लेकिन मानव सिर्फ सहजवृत्ति से ही संचालित नहीं होता। कामेच्छा हमारी इंद्रियों से गुजरकर कल्पना में प्रवेश करती है और फैंटेसी निर्मित करती है। इससे शारीरिक प्रेम का उदय हुआ, जो संस्कृत और प्राकृत के प्रेम काव्य में शृंगार रस के रूप में व्यक्त हुआ और बाद में भक्ति में रूमानी प्रेम के रूप में सामने आया, जिसकी सर्वोत्तम अभिव्यक्ति जयदेव के ‘गीतगोविंद’ में हुई।
काम को लेकर शर्मिंदगी महसूस करने या इसके निराशावादी पक्ष पर ही ध्यान केंद्रित करने या विक्टोरियाइयों की तरह घोर पाखंडी बनने की बजाय रविशंकर प्रसाद और संघ परिवार को काम की हमारी समृद्ध परंपरा की सराहना करनी चाहिए। मुझे संघ परिवार की औपनिवेशिक काल के बाद जन्मी असुरक्षा की भावना पर खेद होता है, जिसके कारण वे इस मामले में 19वीं सदी के अंग्रेजों से भी ज्यादा अंग्रेज बन रहे हैं। धर्म के प्रति भी इसका रवैया समृद्धि, अानंदपूर्ण, बहुलतावादी हिंदुत्व को शुष्क, रसहीन, कठोर और ईसाई या इस्लाम धर्म की तरह एकेश्वरवादी बनाने का रहा है। जब पोर्नोग्राफी की बात आती है, हम सबको तीन जायज चिंताएं हैं- यौन हिंसा, इसकी लत लगना और बच्चों को इससे बचाना। जहां तक पहली चिंता की बात है यौन अपराधों और पोर्नोग्राफी में कोई संबंध नहीं पाया गया है। दुनिया में कई अध्ययन किए गए हैं और इसमें कोई ऐसा सबूत नहीं मिला है। महिलाओं के खिलाफ हिंसा तो उन देशों में बढ़ी जहां पोर्न कानून उदार बना दिए गए और पोर्नोग्राफी पर सेंसरशिप लागू करने पर ऐसे अपराध कम हुए। दूसरी चिंता है लत लगने की तो शराब की भी लत लग जाती है। दशकों के अनुभव से हमने सीखा है कि अल्कोहल पर पाबंदी काम नहीं करती। जब-जब शराबबंदी लगाई गई यह भूमिगत होकर वेश्यावृत्ति जैसे आपराधिक हाथों में चली गई।
जहां तक बच्चों के संरक्षण की बात है, इसकी कुंजी वयस्कों की स्वतंत्रता पर रोक लगाने में नहीं है बल्कि पालकों के स्तर पर सतर्कता बरतने की है। यही वजह है कि सुप्रीम कोर्ट के मुख्य न्यायाधीश जस्टिस एचएल दत्तू ने पिछले माह यह कहकर इंटरनेट साइट्स को सेंसर करने से इनकार कर दिया कि, ‘कोई अदालत में आकर कहेगा कि देखो, मैं वयस्क हूं और आप मुझे मेरे कमरे की चार दीवारों के भीतर इसे देखने से कैसे रोक सकते हैं?’ उन्होंने कहा कि इससे संविधान के अनुच्छेद 21 का उल्लंघन होता है और व्यक्तिगत स्वतंत्रता जीवन के मौलिक आधार का अभिन्न अंग है। पोर्नोग्राफी के नकारात्मक पक्ष से निपटने का सबसे अच्छा समाधान प्रशिक्षित शिक्षकों पालकों द्वारा सेक्स शिक्षा देने में है। जब आप किसी विषय पर खुले में विचार करते हैं तो इससे स्वस्थ व्यक्ति का विकास होता है।
भाजपा के सत्तारूढ़ राजनेताओं ने इस मुद्दे पर बहुत गड़बड़ कर दी। गर्मी में सुप्रीम कोर्ट ने इस मामले में सुनवाई की थी। कमलेश वाधवानी ने विभिन्न कारणों से पोर्न साइट्स पर पाबंदी लगाने की मांग की थी। इसमें एक वजह पोर्न यूज़र को उसकी घटिया इच्छाओं से बचाने की अनिवार्यता भी थी। कोर्ट ने समझदारीपूर्वक पाबंदी लगाने से इनकार कर दिया। उसने पाया कि भारत के वयस्क यह निर्णय लेने के काबिल हैं कि उन्हें क्या देखना है, क्या नहीं। सभ्य होने का अर्थ है कि आप कह सकें : मैं बीफ तो नहीं खाता, लेकिन आप के खाने पर मुझे कोई आपत्ति नहीं है। मैं पोर्न तो नहीं देखता, लेकिन आपके देखने पर मुझे कोई आपत्ति नहीं है। एक स्वतंत्र, सभ्य देश में हम उन लोगों का सम्मान करना सीखते हैं, जो हमसे अलग राय रखते हैं। सेंसर करने या प्रतिबंध लगाने की बजाय आइए, अपनी खुली, उल्लास से भरी भारतीय परंपरा से सीखने की कोशिश करें, जिसने सिर्फ काम को सभ्यतागत जगह दी बल्कि प्रेम यौनेच्छा पर महान काव्य कला को प्रोत्साहित किया। आम नागरिक पर भरोसा दिखाकर हम संविधान की भावना पर भी खरे उतरेंगे।
August 14, 2015
सुधारों के लिए जूझते मोदी
मैं प्रधानमंत्री नरेंद्र मोदी से पूछना चाहूंगा कि उन्हें क्यों चुना गया। अमेरिकी विदेश विभाग के पूर्व अधिकारी डॉ. वाल्टर एंडरसन द्वारा मोदी के भाषणों के कंप्यूटर विश्लेषण के अनुसार, मोदी ने एक बार हिंदुत्व का उल्लेख किया तो पांच सौ बार विकास का। उन्हें चुनने वाले महत्वाकांक्षी युवा के लिए विकास प्रतियोगी बाजार में अवसर का कोड वर्ड था। मोदी ने ऐसा समर्थ वातावरण बनाने का आश्वासन दिया जो दमघोंटू लालफीताशाही और बदनाम 'इंस्पेक्टर राज के बिना व्यवसाय करने का लोगों को मौका देगा। अब तक वे इस वादे को निभाने में विफल रहे हैं। खास तौर से पूर्व प्रभावी कराधान ने व्यापार को सरल बनाने के उनके वादे को नीचा दिखाया है।
प्रधानमंत्री को मेरी सलाह है कि वह स्वतंत्रता दिवस पर किसी नए कार्यक्रम या योजना की घोषणा न करें। इसकी जगह मई, 2014 से घोषित योजनाओं पर अपना विस्तृत रिपोर्ट कार्ड पेश करें। देश खास तौर से 'व्यवसाय करने में सरलता पर प्रगति की प्रतीक्षा कर रहा है। विश्व बैंक की रिपोर्ट जल्द ही आएगी और कई लोगों को आशंका है कि यह अच्छी नहीं होगी। उन आशंकाओं को दूर करने की शुरुआत करना दूरदर्शिता होगी। हमने मोदी को चुना, इसका एक प्रमुख कारण गुजरात में कार्यान्वयन का उनका उत्कृष्ट ट्रैक रिकॉर्ड था। महान नेता सहज बोध से समझ जाते हैं कि काम पूरा करना ही सब कुछ है। इसलिए वे योजना बनाने के दायरे में अपने आपको नहीं रखते, बल्कि काम पूरा करने के महत्वपूर्ण पहलू में जाते हैं। वे दखलंदाजी नहीं करते, लेकिन अपने अधीनस्थों को प्रेरित करते हैं और उनके अवरोधों को हटाते हैं।
व्यवसाय की दृष्टि से भारत को कम अवरोधों वाला बनाने के लिए मोदी को उसी तरह बाजार को पूरी ताकत से 'बेचने की जरूरत है जिस तरह ब्रिटेन में मारग्रेट थैचर और चीन में देंग शियाओ पिंग ने किया। बहुत सारे भारतीय अब भी मानते हैं कि बाजार 'धनी को और धनी तथा गरीब को और गरीब बनाता है और इससे भ्रष्टाचार और क्रोनी कैपिटलिज्म को बल मिलता है। 'बाजार समर्थक और 'व्यापार समर्थक के बीच अंतर बताने के लिए मन की बात आदर्श मंच है। बाजार समर्थक होना प्रतियोगिता में यकीन करना है जो कीमत को नीचे रखने, उत्पादों की गुणवत्ता बढ़ाने में मदद करता है और ऐसे 'नियम आधारित पूंजीवाद की ओर ले जाता है जो सबको फायदा पहुंचाता है। दूसरी तरफ 'व्यापार समर्थक होने का मतलब आर्थिक फैसलों पर अधिकार बनाए रखने की राजनीतिज्ञों और अधिकारियों को अनुमति देना है और यह 'क्रोनी कैपिटलिज्म की ओर ले जाता है। दूसरा अधूरा एजेंडा है जनता को संविधान, खास तौर से कानून के शासन के बारे में जागरूक करना। कानून का शासन नैतिक सर्वसम्मति पर आधारित है जो 'तहे दिल से रोजाना प्रकट की जाती है। लोग इसलिए कानून का पालन नहीं करते कि उन्हें दंड का डर रहता है, बल्कि इसलिए करते हैं कि वे सोचते हैं कि यह उचित और न्यायसंगत है और यह आदत और स्वनियंत्रण का तरीका बन गया है। दुर्भाग्यवश आजाद भारत के नेता संविधान के उदार विचारों को फैलाने में विफल रहे हैं।
शासन में सुधार पुनर्जीवित भारतीय नैतिक मर्म से निकलना चाहिए। स्वतंत्रता आंदोलन की शुरुआत में मोहनदास करमचंद गांधी ने पाया कि संवैधानिक नैतिकता की पश्चिमी उदार भाषा का जनता के साथ तादात्म्य नहीं बैठता, लेकिन धर्म की नैतिक भाषा यह काम कर देती है। उन्होंने साधारण धर्म के वैश्विक नीतिशास्त्र को पुनर्जीवित किया। यह बौद्ध सम्राट अशोक से भिन्न तरीका था जिन्होंने धर्म पर आधारित नए स्तूपों का निर्माण किया। पूर्व आधुनिक भारत में धर्म का अभिप्राय नैतिक मर्म को थोपना और जनता के जीवन में सामंजस्य बिठाना, अनिश्चितता को कम करना और आत्मनियंत्रण था। इसने राजधर्म के जरिये सत्ता की शक्ति को नियंत्रित किया। इसी वजह से हमारे संविधान के निर्माताओं ने अपने भाषणों में धर्म की बात कही और यहां तक कि नए राष्ट्र के झंडे में धर्म चक्र-अशोक चक्र को स्थान दिया। गांधीजी भले ही अस्पृश्यता खत्म नहीं कर पाए, लेकिन उन्होंने स्वतंत्रता आंदोलन को अपने जीवन में आत्मसात किया। उसी तरह हमें विस्तृत नागरिकता योजना के हिस्से के तौर पर युवाओं के बीच संविधान को नैतिक आईने के विचारों के तौर पर तब तक प्रचारित करना चाहिए जब तक यह उनके 'दिल की गहराइयों में न उतर जाए। भारत का उदय सिर्फ हमारे लिए ही नहीं, पूरी दुनिया के लिए शुभ समाचार है। जब पश्चिम पूंजीवादी व्यवस्था से संतप्त है, ऐसे वक्त में राजनीतिक और आर्थिक स्वतंत्रता पर आधारित एक देश पूर्व में उग रहा है। यह फिर साबित हो रहा है कि खुला समाज, मुक्त व्यापार और वैश्विक अर्थव्यवस्था में बहुआयामी संबंध दीर्घकामी समृद्धि और राष्ट्रीय सफलता के मार्ग हैं।
August 11, 2015
Elusive tryst with destiny: Sixty-eight years into Independence, the market still remains in chains
The landslide victory of last year invited us to be more imaginative in thinking about the nature of human dignity and to question our prejudices. The election affirmed the aspirations of millions that had pulled themselves up through their own efforts in post-reform decades into the middle class. It forced us to challenge our bias against panwallas, auto-rickshawallas, and other street occupants. That anyone can aspire to the middle class is changing the master narrative of our society.
I grew up in the idealistic days after Independence when we passionately believed in Jawaharlal Nehru’s dream of a modern, just India. We were all socialists then. But as the years went by, we found that Nehru’s ‘mixed economy’ was leading to a dead end.
Instead of socialism we had ended with statism, which we sardonically called ‘licence raj’. Reforms in 1991 finally ended that agony. Since then India has risen relentlessly, enabled by two institutions of liberty — democracy and free markets. Nehru laid the foundations for our vibrant democracy but prosperity only began to spread once Nehru’s over-regulating state stepped out of the way.
No one quite understands how our noisy, confused democracy of 1.3 billion people has become one of the world’s fastest-growing economies. After all, 60 countries implemented the same reforms India did. Clearly, suppressed energy burst out after 1991, but did not imagine that our entrepreneurs would respond brilliantly to create innovative, red-blooded firms, who would compete brutally at home and then stomp onto the global stage.
The rise of India is importantly their story. India is a ‘bottom up’ success, unlike China’s ‘top down’ triumph, orchestrated by a technocratic elite in an authoritarian state. The stubborn persistence of democracy over the past 68 years is even more bizarre. Time and again, India has shown itself to be resilient and enduring — giving a lie to the old prejudice that the poor are incapable of the kind of self-discipline and sobriety that make for self-government.
As we come to present moment, i would ask Prime Minister Narendra Modi to remember why he was elected. During his campaign, he mentioned vikas 500 times for each time he mentioned Hindutva. For the aspiring young who elected him, vikas was a code word for opportunity in the competitive market.
Modi promised to create an enabling environment that would allow people to do business without stifling red tape and notorious ‘inspector raj’. So far, he has failed to deliver on that promise. Continuing retrospective taxation, in particular, has undermined his promise to improve the ease of doing business. India remains a hostile place to do business.
My advice to the PM is not to announce any new programme or scheme on Independence Day. Instead, give us a detailed report card on the overabundance of schemes that have been announced since May 2014. In particular, the nation awaits progress on ‘ease of doing business’.
The World Bank Report will soon be out and many people fear that it will not be good. It would be prudent to start managing those fears. An important reason we elected Modi was his stellar track record of implementation in Gujarat.
Great leaders instinctively understand that execution is everything. Hence, they don’t confine themselves to policy-making but get into the nitty-gritty of execution — not to interfere but to motivate and break barriers for their subordinates.
To make India a less hostile place to do business, Modi needs to vigorously ‘sell’ the market as Margaret Thatcher did in Britain and Deng Xiaoping in China. Too many Indians still believe that the market makes ‘the rich richer and the poor poorer’ besides leading to corruption and crony capitalism.
Despite the market having generated broad spread prosperity over two decades, people distrust it and the nation continues to reform by stealth. Mann ki Baat is an ideal forum to explain the difference between being ‘pro-market’ and ‘pro-business’.
Pro-market is to believe in competition, which helps keep prices low, raise the quality of products, and leads to a ‘rules based capitalism’ that serves everyone. To be ‘pro-business’, on the other hand, means to allow politicians and officials to retain power over economic decisions and this leads to crony capitalism.
The rise of India has been the defining event of my life. It is not only good news for us but also for the rest of the world. At a time when the West is agonising over the capitalist system, a large nation is rising in the East based on political and economic liberty, proving once again that open societies, free trade and multiplying connections to the global economy are pathways to lasting prosperity and national success.
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