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Posts Tagged ‘bureaucracy’

Where Marx comes alive – Pallavi Aiyar

August 9, 2009 1 comment

For greater good of the most many ...

For greater good of the most many ...

perhaps nothing exemplifies European socialism more than the maze of regulations governing the retail trade in Belgium. It took a panel of five young government officials from the Directorate for Regulation and Organisation of the Market, armed with pages of notes, to explain the main highlights of these to me.

This is what I learnt: In Belgium, shops can only legally go on ‘sale’ twice a year, in January and July. It is only during these periods that shops may sell goods at below cost or ‘extremely reduced’ profit. For six weeks before the sales period, shops may not advertise price reductions.

Although offering discounts (as long as these do not amount to a loss) is legal at other times of the year, for a month before the biannual sales, textiles, shoes and leather products may not be discounted at all. Moreover, the sales are reserved for the ‘seasonal renewal’ of stock, so products deemed non-seasonal may not be included in the sale. Sofas, for example, are considered seasonal but antiques are not.

To implement all of this, two hundred-odd inspectors from the Directorate wander around the country inspecting and many complaints regarding non-compliance are also phoned in.

The rationale behind this mountain of red tape is the protection of small and medium enterprises (SMEs) which it is believed would go bankrupt if big retail were to be allowed to dump in an unrestrained manner. (via Pallavi Aiyar: Where Marx comes alive).

Europe has come a full circle!

The State has slowly and surely, completely taken over. The hard-fought liberties, the Magna Cartas, the Liberté, Egalité, Fraternité, have been in vain. The people have just stepped up to the dias and handed over all the power back to the State. The much touted Renaissance and Reformation have all come to nought.

For the Rest of the World, what is truly a cause of anxiety is that the East seems to be embracing Western political ideology and constructs with reckless enthusiasm – in their quest for ‘progress’ and ‘modernity’. And the public sector behemoths may yet cause some damage.

Remember the East India Company – a public sector company.

Internal migration: Oriyas in Gujarat – The Economic Times

April 30, 2009 2 comments
Copying Western models

Copying Western models

Through correspondents in Orissa they deliver remittances (which constitute as much as half of total earnings) to recipients back home within six to 48 hours, at a much lower effective cost than that the 5% charged by the post office on money orders (which can take two weeks). Bank drafts are much cheaper than money orders, and were indeed the preferred option, until the private operators emerged to obviate the need to open a bank account or lose precious earning time queuing up and doing all the paper work.

With the advent of these private operators the formal sectors’ share of the remittance market has shrunk to 10%. Other informal financial institutions that have proliferated are bishis (chit funds) and “committees” (informal credit unions) to cater to savings and credit needs. (via Internal migration: Oriyas in Gujarat- Comments & Analysis-Opinion-The Economic Times).

Western models and colonial mindset

This is where RBI, the IAS and the rest of the Westernized janata miss out on India. Desperate to ‘modernize’ and ‘progress’ on Western models, we miss out on Indian business models which are more cost effective and require less bureaucracy. RBI has (more than the British could) ground the traditional Indian finance sector into obscurity – by blocking access, creating entry and finally procedural barriers.

What India needs are solutions that Indians need for our requirements – and not what some ‘vested’ interests (read as Western nationals /educated) sahibs (Brown or White), who are more keen to preserve their status and power rather than do their job.

What needs to be done is the end of state support for English language higher education. This precisely what Indian power elites do not want to end, as it prepares them and gives tickets for opportunities in the West.

What’s right with Indian bureaucracy

April 29, 2009 1 comment

The bureaucrats shift the blame on the politicians

The bureaucrats shift the blame on the politicians

Bhave resigned from the IAS in 1996, to take up what was then seen as a rather low-profile job — to create India’s first share depository, even though he had the option of going there on deputation. “The job needed full-time commitment from me and from the team I was recruiting. How would I get it, if I did not burn my boats myself?” he says. (via Lunch with BS: C B Bhave).

Colonial institutions

The RBI, the IAS and the IFS are three services which have remained colonial and have a complete choke on Indian policy framework.  There is something about their structures which is not allowing them to shed their colonialism. The Railways have changed – as have many Governement organizations like Public Sector banks, Air India-Indian Airlines, etc.

And this extract confirms the conclusions made by 2ndlook and posted 1 year ago.

RBI, IAS and IFS

On April 1st, 1934, while the ‘Squeeze India’ campaign was under execution – choreographed by Montagu Norman, Neville Chamberlain, Winston Churchill (some sickness … some racism) Lord Willingdon, India’s banking authority was set up.

The objective of setting up RBI – this colonial money authority, was to devise a policy structure for creating a ‘money famine’ needed by colonial British masters. From that April Fool’s day till now, RBI character has not changed. RBI resorts to creating these money famines every few years – even today. The last RBI ‘money famine’ in 1996 saw inter-corporate interest rates shoot to 40% – and a recession that lasted for 4 years.

The IAS (a successor to the colonial ICS) and the Planning Commission are the other two. The IFS has been pre-occupied with diplomatically engaging the West, fixated with Pakistan, while India’s relations in neighbourhood are at a historic low. But the English speaking, Indian bureaucracy is another matter. Having dragged India to the bottom of global corruption pervasiveness ratings, they cover their owns misdeeds, under the ‘umbrella’ of the neta. This is one colonial institution that India has tried digesting, without succes. IAS (ICS during colonial times) a venal, corrupt cadre, has tied up India into knots – which have taken us decades to even start disentangling.

Compare the successful bureaucracies

Compare that with the brilliant track record of modern Indian regulators and organizations like the SEBI, TRAI. Or even the IPS. India has the lowest prison population in the world – and also the lowest police-to-population ratio.

Till 1990-95 Indian stock trading was largely done done through the open outcry system, physical paper settlements, long settlement periods – and rampant manipulation. Indian stock trading systems was a closed club – and did not attract any serious investors.

Between, 1900-1995, SEBI, NSE, BSE and NSDL designed and managed the transition from the physical platform with the open outcry system to a complete electronic trading platform of the NSE and BSE.

BSE Logo

NSE Logo

Today, the BSE/NSE trading system is the most advanced in the world – in terms of trade volumes, transaction volumes and automation.

By 2000, India had less than 4 crore phones. Most of the 100 crore (1billion) Indians were unconnected – and disconnected from the world. Governments monopolies, BSNL and MTNL, ruled the roost. By 2000, India had less than 4 crore phones. Most of the 100 crore (1billion) Indians were unconnected – and disconnected from the world. Governments monopolies, BSNL and MTNL, ruled the roost.

By 2001, the BJP led Government came to power. The telecom regulator in a series of bold moves, changed policies – and equations. Tariffs declined by nearly 5000% – from roughly 50 cents to 1 cent per minute. User base ballooned to 20 crores – from 4 crores. In 7 years more telecom users were added than in the previous 70 years. For the first time, the poor in India are beginning to benefit from technology.

It took a non-Congress Government in 1977 to change the face of Indian Railways. Prof.Madhu Dandavate, the Railway Minister in the 1977 Janata Government started the railway renaissance in India. 3rd class railway travel was abolished. Wooden-slat seats were abolished. Cushioned 2nd class seating system was made minimum and standard. Train time tables were re-configured. Reservation systems improved. Railways started getting profitable.

Smear the neta

Smear the neta

The de-colonization of Indian Railways began effectively in 1977 – 30 years after British departure. Symbolically, that was also the year that the Rail Museum was set up. The progress after that has been remarkable. Today for a US$5, an Indian can travel for a 1000 km.

All this when only 25% of Indians travel by rail at least once a year.

Smear the neta

From colonial times, the Indian neta has been a favorite target of smear campaigns, innuendo and propaganda. Colonial administration in India worked hard to undermine the credibility of the Indian ‘neta’ – for obvious reasons. Colonial bureaucrats (and their successors, the IAS) covered their incompetence and corruption with this lopsided image of the neta. Indians politicians are possibly as corrupt as any others in the world.

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