Wednesday, November 29, 2006

Manufacturing Illegality

Liberalisation - i.e., freedom from license-raj, quota system, state controls on ownership and entrepreneurship, etc. - apparently, is a selective animal. It is partial to some, and provides them with the legal freedom to make choices and live a life as they want. For others, it remains an elusive dream, denies them choices and, in the process, "manufactures illegality" of their status.

Consider, for instance, if you are resident of the Capital of this country.

  • you can buy as many cars, trucks, vans, scooters, mobikes, etc., in Delhi/NCR as you can afford.
  • you can buy only one cycle-rickshaw, by law. Just like other vehicles, you need to have a license to own it. Delhi's municipal law stipulates that "No person will be granted more than one such license."

  • the law also does not bar you from renting out or lending your car, truck, van, scooter, mobike, etc., to anyone who owns a driving license
  • you can legally pull a cycle-rickshaw only if you own it yourself. Delhi Municipal Corporation Act of 1957 stipulates that "No person shall keep or ply or hire a cycle-rickshaw in Delhi unless he himself is the owner thereof and holds a license granted in that behalf by the Commissioner on payment of the fee..." etc.

  • Delhi government is also quite liberal for those who can afford to buy a car, truck, van, scooter, mobike, etc. If you buy one of these, and can afford to pay, you automatically, and legally, get a license to own it.
  • Delhi govt has a limit of sanctioned quota of 99,000 licenses that it will/can grant to the cycle-rickshaw pullers. Given the fact that there are about 500,000 cycle-rickshaw pullers in Delhi (some estimates give a number of 1mn), almost 80% of them "illegal".

    The reasons for these laws for the cycle-rickshaw pullers are apparently out of the most benign intentions. For instance, the May '06 judgement by the Delhi High Court, (which passed an order directing the Municipal Corporation of Delhi "not to grant any licenses in future for plying Cycle Rickshaws on Delhi roads") noted that:

  • "in spite of various orders passed by this court, plying of cycle rickshaws on the main roads, narrow roads and congested roads has become a horrible experience."
  • "that plying of cycle rickshaws on Delhi roads by poor rickshaw puller is against human dignity and its result in exploitation of the poor people who as last resort take upon themselves the work of rickshaw pullers at the mercy of influential people owning such cycle rickshaws."

    Clearly, from the "legal view-point", the above two observations - congestion of traffic, and exploitation by owners - do not apply to owners of cars, truck, van, scooter, mobike, etc...

    The above is only an example. Similar rules and laws exist in other cities about street-hawkers, small-shop owners, vendors, slum-dwellers, etc...

    Wheels of misfortune
    Delhi’s graveyard of rickshaws
    ITDP's Position on Delhi High Court Decision

  • Tuesday, November 14, 2006

    India's "Demographic Dividend": Have we BECOME a "Young" Country?

    For a long time, I used to believe that the demographics of India have radically changed during last decade or so - and that India has "become" a young country, with a majority of its population below 25yrs, or in the 15-35yrs bracket.

    This belief about India's "demographic dividend" was also reinforced by the media hype about the emergence of Genext, and even some serious studies about the changing demographics in 21st century India.

    For instance:

  • a scholarly book, Twenty-first Century India: Population, Economy, Human Development, and the Environment edited by Tim Dyson, Robert Cassen and Leela Visaria, (Oxford University Press), highlighted that a demographically "young India" (median age 22) is, as The Hindu pointed out is "envied".

  • an article in Harvard Public Health Review says:
    "With a median age of 33, China's population is edging toward middle age, while India, with a median age of just 25, is still relatively youthful. The ratio of workers to dependents in China.... will likely peak at 2.6 in 2010, then decline, leaving ever smaller numbers of workers born of the country's one-child policy to support a vast aging population. In India, meanwhile, the demographic transformation will be less sharp but longer lived; the ratio of workers to dependents will peak at 2.2, but not until 2035, suggesting that the potential economic gains from India's demographic dividend are still to come..."

  • the Time Magazine carried an article - India's Real Growth Rate - noting that:
    "Indian politicians at the summit expressed confidence that the country will eventually catch up?not because the government will necessarily get its act together, but because of a long-term trend known as India's "demographic dividend." With 1.3 billion citizens, China is the world's most populous country; India is second with a population of 1.1 billion. But because of Beijing's long-standing one-child policy, China's working-age population will begin to decline in the next 10 years. Meanwhile, India's youthfulness - 350 million of its citizens are under age 15 - ensures its workforce will expand for decades, potentially enabling it to outstrip China's economic pace through sheer weight of numbers. "This is a key thing," said Kamal Nath, India's Minister for Commerce and Industry. "China is aging faster than any other country in history. It is growing old before it has grown rich.""

  • In another article - Incredeible Young India Inside - Arun Maira, the Indian CEO of BCG, noted:
    "There comes a tide in the affairs of nations which taken at the flood can lead to fortune... This pattern is unfolding again. The growth paradigm of western economies requires another kind of fuel - knowledge workers and skilled professionals. In the next two decades developed countries will face a shortfall of fuel (skilled professionals) and will once again have to look towards the developing countries to meet the shortfall.... Development, in almost all countries, has been invariably accompanied by a gradual decline in the proportion of working age people to total population as birth rates decline and life expectancy also goes up. Projections show that by 2020 all developed countries will be short of working age people. Even China, which had forced a decline in its birth rates, will experiencea shortfall in the proportion of working age people by 2020. However, India will have a huge surpluse of 47 million people."

    Etc., etc...

    Indeed, India's "demographic dividends" was such a deceptive and "feel-good" idea that it is not difficult to beleve it.... But...

    Apparently, I was wrong...

    The data (which I have generously borrowed from Dilip D'Souza's blog posting), actually shows that there has been no significant change in the age-profile of Indian population since last 4 census.

    Apparently, demographically, India was always a YOUNG country!!!

    So what has changed - if anything?

  • Think young
  • Frames 2006: What Do They Think Of Young India
  • With median age at 22, India is young and envied
  • India will be 'youngest' nation by '10: Study
    Census Data:
  • Percentage distribution of Population by age-groups 1971 and 1981 Census
  • Distribution of Population by Age and Sex 1991
  • Distribution of Population by Age 2001

  • Friday, November 10, 2006

    Our very own "indigenous apartheid"

    This is a long overdue post... Ever since had I discovered this must-watch video "I am Dalit. How are You" on Shivam Vij's blog a month or two back.

    ("Right click/save" to download the .wmv file of this 11 minute 22mb clip)

    Even though one was "aware"(?) of these 'facts', but its sheer rawness is numbing, and it is difficult not to choke... specially, the last two minutes...

    Dalits - the Broken People - the Untouchables, the Outcastes, or the Harijans, as Gandhi called them. There are some 250mn of them in the world. Out of which 160mn live in India... Or one in every six Indian belongs to this "non-category"... "non-category" because they are not even part of the social classification...

    According to an article in the National Geographic:

    "Embedded in Indian culture for the past 1,500 years, the caste system follows a basic precept: All men are created unequal. The ranks in Hindu society come from a legend in which the main groupings, or varnas, emerge from a primordial being. From the mouth come the Brahmans — the priests and teachers. From the arms come the Kshatriyas — the rulers and soldiers. From the thighs come the Vaisyas — merchants and traders. From the feet come the Sudras — laborers. Each varna in turn contains hundreds of hereditary castes and subcastes with their own pecking orders.

    A fifth group describes the people who are achuta, or untouchable. The primordial being does not claim them. Untouchables are outcasts—people considered too impure, too polluted, to rank as worthy beings... Untouchables are shunned, insulted, banned from temples and higher caste homes, made to eat and drink from separate utensils in public places, and, in extreme but not uncommon cases, are raped, burned, lynched, and gunned down."

    And though the MSM did pick up the "Kherlanji Massacre" - though about a month after it had happened - the discrimination, violence, and exclusion has remained a part of the Indian society.

    Incidences of killing, rape and violence, of course, stand out as isolated happenings. In some ways - or at least technically - they can be checked by the legal system.... The more frightening aspect of this phenomenon are its invisible and subliminal manifestations.

    Here are some examples:

  • 6 weeks after the 2001 Gujarat earthquake that killed about 30,000 people, the Human Rights Watch team visited the some of the most devastated areas. In all places it found that Dalits and upper-caste Hindus were living in separate relief camps.

  • After the Tsunami hit the Indian coast in December 2005, the Dalits and other lower class were shunted into their own camps, separated from the 'exclusive' camp of the more dominant community. Moreover, they even got discriminated in getting the relief aid, shelter, water, etc.

  • In the aftermath of a 2001 earthquake in Gujarat, relief agencies were forced to mark their supplies of blood with the caste of the person it came from, or else people would not use them.

  • A UN report reads: "Untouchability is still very alive, especially in the countryside and can be seen in the segregation of housing, the Dalits having to live at least 1/4 of a mile from the other inhabitants and are forbidden the access to the well which is the common source of water. Moreover, segregation also exists in schools, services and public places (hairdressers, shops, transports; in restaurants, the crockery is sometimes separated between that for Dalits and that for upper casts)."

    Sources & Other Readings:
  • India's Hidden Apartheid
  • Even Govt divides survivors on caste, says it’s practical
  • Tsunami Opens Fault Lines in Old Caste System
  • Broken People, Broken Promises
  • Situation of the Dalits in India
  • India's Shame (Frontline Magazine)

  • Monday, November 06, 2006

    ...the single most important thing to impact business in India!!

    In July '06, Knowledge@Wharton carried an in interview with KV Kamath, CEO ICICI Bank - India's 2nd largest bank, and the largest private-sector bank. The inteview was about ICICI Bank's rural foray...

    The last question & answer in the interview:
    Question: As you look ahead over five years, many things can go wrong. What do you most fear in the Indian economy and the global economy that could derail your plans?

    Kamath: I guess in the Indian context, I would say something that is unforeseen, like social strife, because we are living in a world of haves and have nots. And there is a divide. Now is this going to be something that could bother us? To me, this is the single most important thing which could impact business.

    ... needless to say, this was a hopeful comment - finally someone from this side acknowledged the ground realities of the 'other side'....