DKI Foundation Blog

(selections from the writings of Chairman)

Friday, 11 November 2016 08:24

The Tata soap opera: Act 2, scene 1 unfolds

The Tata Sons tragedy is about the slugfest in public domain and the delicacy to disclose corporate information We had seen the possibility of the Tata soap opera unfolding about a fortnight ago. The plot has since then thickened. But this is a bigger tragedy than what appears. The tragedy is about the slugfest in public domain and the delicacy of making public, corporate information. The future alone will establish which way the wind is blowing. What is not a secret is that TCS has been the main stay of Tata Sons for decades. Going back to the times of Faqir Chand Kohli, who nurtured the infant organisation to its adult shape, Subramaniam Ramadorai took forward the tradition brilliantly. I recall his supporting a PhD work in Pittsburg on analysing the cultural aspects of project work in TCS. Chandra (the popular name of TS Chandran) was nurtured by both Kohli and Ramadorai. He proved to be a worthy inheritor. That is another story. However, the impression needs to be resisted that under Cyrus Mistry, all the companies started sinking, save TCS. TCS, for long years, was a division of Tata Sons essentially because Tata Sons wanted exclusive control of the…
Ratan Tata’s return and Cyrus Mistry’s sacking are stories the Indian corporate stuff is made of. We wait with bated breath The removal of Cyrus Pallonji Mistry as the head of Tata Sons is news beyond boundaries. Business, however, in India, has taken a fresh turn with this kind of move. Let us get some fundamentals right. There is no such thing as the Tata family, anymore, in the conventional terms of Indian business. This is not the best place to get into the pedigree and family tree analysis. However, the first significant break in the family tree continuum took place with the succession of Ratan Tata to the chairmanship of the Tata Sons board. JRD did not have a biological successor. Ratan Tata himself never married. This, therefore, was itself a significant departure in the succession pattern of family businesses. Consider the major family houses in India. Without naming the significant ones, the succession has almost always been by blood groups of biological descent, following the law of primogenitor. Sitting on the board of a major business family which had been successful for over 70 years, when I raised the issue of investment and diversification, the octogenarian chairman and…
Friday, 30 September 2016 08:19

Skilling the right one is the real challenge

Jobs often go to candidates who are not qualified either professionally or temperamentally. This leads to chaos The Government must be credited for having brought alive the phrase, ‘skill development’, on an unprecedented scale. It seems to have become the latest bandwagon on which all wish to climb. So be it. However, like in many things in public life, the phrase appears to be akin to ‘old wine in a new bottle’. As the knowledgeable know, this usually creates cracks in the bottle. More to the point, skill has been made synonymous with downstream livelihood, focussing on domains like drivers, plumbers, electricians, and more. There is nothing wrong with this approach. All communities in the country need this kind of skill formation. The trouble is elsewhere, in at least three manners. Talk of skill development in India has been on since independence. ITIs are a chain of institutions across the country, so well-known that many confuse them with IITs. However, the pace of growth and requirements has been so large that not even World Bank grants were able to breed vibrancy into ITIs or polytechnics to either make them world-class institutions or indeed make them the seed-bed of certain types…
Friday, 14 October 2016 08:18

Makings of a working Indian economy

To understand the Indian economic system, one must stop believing in the make-believe world of modernism The general economic outlook across the world, to put it mildly, has consistently been a low key affair over the last six months. Growth in Europe has been like a trickle to say the least. Whether it was the threatened exclusion of the Greeks from the European Union or the exit vote of Britain, not to talk of rumbling in smaller States of Europe, the state of the European Union continues to be mixed. The financial year started with the European commission foreseeing 1.3 per cent growth this year. This was modest by European yard sticks. However, the question of European reform was not much in the air. Notwithstanding the ambitious announcements of the European Central Bank of assets management in January 2015, nothing much has changed on the ground. The structural primary Budget balance continued to be vague. The uneven application of the European Union’s financial rules was not of much help. While Europe was getting heated, a good portion of the breed of economists were at its favorite’s game of wanting to outguess the economy. For one year, China’s economic growth has…
The world economic order is changing in many unprecedented ways. While the economist still fancifully pursues a demand and supply trade off, the critical issues of the day are structural evolution and sound thinking on regulatory dispensation. Many continue to talk of mobilising capital and revenue streams when the ground action is in the domain of drawing talent and working on it with the mission of making the talent feel committed. The environment of perennial, “loose cannon”—transience, attrition and movement is good for no one, certainly not the individual, nor the organisations and the firms. It encourages tendency to hoard cash and to hedge. The emphasis has to be on investment and boosting income to create a higher level of meaningful activity. The tendency to cut down on public spending in the name of economy is as dangerous as over expenditure. At the national level, the question of keeping a balance between public and private investees requires recognition, design and operation of two distinct approaches to enable growth. Few governments have been able to even recognise this, let alone work on it. The fiscal which needs to be designed for this requires an insight into domain, which begins only where…
Saturday, 01 October 2016 22:10

GST : negotiating the bumps

The coming in of GST has been generally hailed, from likely and even unlikely quarters. P. Chidambaram as usual has not disappointed and has predictably threatened to let people know 'what negotiating advantage can be' from the point of view of gaining importance for Congress. So be it. As a person in the domain, there is little cheer that it took 10 years to arrive where we are today in the month of September 2016. One does not want to be a wet blanket but there are many concerns which have not even been flagged for public review - notwithstanding, of course some luminaries' potential at monopolizing the limelight. A quick review will help. GST paid on procurements is to be available as credit against output GST liability. There are separate credit pools for 3 different types of GST - integrated GST, central GST and state GST. These would have to be maintained for each state. A quick number crunch would show that a company operating say in 15 different states would have to maintain 45 different credit pools, and 45 different output tax accounts. Currently the number of credit pools and output tax accounts are by far fewer. Similarly…
Saturday, 26 November 2016 22:05

The nature of the ‘beast’

Earlier attempts at demonetisation as an instrument of economic policy do not seem to matter. There is something unusual about the Indian finance and economic scene which makes it, perhaps, the only one of its type in the world. What makes it unusual is a long list. We can perhaps begin by talking of the banks which are at the centre of all activity of, perhaps, all Indians ever since 8 November. Whether they have measured up to that role or not is a moot point. One recognises that they are there and there is no replacement for them in that role, as of now. Even before one come to that, like in many things Indian, there is a huge debate raging on the results of the current experiments with currency. The debate is a big one but has yet to enter the public psyche. The debate is: whether decommissioning of large currency notes was “demonetization” or “compression”? However, as of now, this will have to take a back seat. This is so because a lot of lives are so twisted out of shape by the present currency situation that conceptual battles appear a luxury. There is no clear cut…
Wednesday, 08 February 2017 21:59

Going beyond the obvious

The Indian media runs at many levels. Without brandishing the numbers of the number of newspapers channels or getting into the breakups of their national reach; regional reach; local reach, it is obvious that their views and selection of fact are often, determined by the interests of the promoters. The government itself has been relegated into the position of a promoter of news. This is sad because whereas the government has the legitimate role of promoting the duly identified policy it need not be a daily player amongst contending points of view. In the present situation government is both a promoter and a regulator of news. Perhaps, among the biggest needs in the running of institutions in this country is the need to quickly and clearly think through the definition of the regulator: its boundary conditions and indeed the teeth which it can be armed with. Freedom of expression, as is widely recognized cannot become a license for expression. Furthermore, no collective can run only on the compliance enforcing capacity of regulatory agency. What moves the wheels is a reasonable understanding of the regulations and the ability, of those affected, to comply willingly. A simple illustration will clarify the situation.…
Wednesday, 19 April 2017 07:22

Negotiating the oceans

A sector which has in last few years acquired significant escalation of governmental attention for reasons ranging from development to defense is the ‘ocean’. Like everything else this process has its good, the bad and the ugly.The good thing about the attention to the oceans is that as a resource, over the years in India, it has been underworked and developed with erratic inconsistency. Even intellectual attention has been paid to it in an erratic manner. As far back as 1995 the DPR of IIM Kojikhode talked of ‘The Indian Ocean Rim’ as a strategic thrust area of the Institute-in-the-offing. When matters stated rolling the then Chairman deemed it ‘premature’. That however, is another story.That there is now the scope of turning things around, this is a good thing. Consistent erratic approach is dangerous, inconsistent erraticism gives a potential and a window for intervention. The intervention between erratic actions requires sober contemplation on how the potential can be harnessed. This applies to ocean resources, also. From deep sea mining and coral preservation to analyzing life at the shallow levels of the sea, there is so much work to do. The filed is literally deep and dramatically wide. The limits are…
Wednesday, 19 April 2017 07:21

Ushering Technology

The media, the government, the market is buzzing with talk of digitization. The preparedness for it seems to have just about begun while expectations continue to soar. Which way the trend will go, will be a testimony which time will provide. In the mean while the insights on management of change may help to chart out a definite path. Clearly this intervention will not be the first, for technological up gradation. It will certainly, also, not be the first for modernization. Yet, as of today, it looks more tentative than is good for evoking a robust confidence in its steady progress. This is so, because it needs to be, adequately registered that there will be limited digitization without being accompanied by adequate change in the culture of the market place and service providers. Advertisements on dealing with the drivers of 3 wheelers, tailors and whatever else do make a point. They are good as far as they go.Modernization is a multi-linear process. Development is a version of modernization which has to be culture specific. It moves best, when it energizes, cashing in on the aspirations of the individual and communities. An illustration will prove the point:There are territorial aristocracies say…
Wednesday, 19 April 2017 07:19

Unfolding Episodes of the Tata Opera

The removal of Cyrus Pallonji Mistry the head of the Tata conglomerate is news beyond boundaries. Business, however, in India has taken a fresh turn with this kind of move. Let us get some fundamentals right. There is no such thing as the Tata family, anymore, in the conventional terms of Indian business. This is not the best place to get into the pedigree and family tree analysis. However the first significant break in the family tree continuum took place with the succession of Ratan Tata to the Chairmanship of the Tata Sons board. JRD did not have a biological successor. Ratan Tata himself never married. This therefore was itself a significant departure in the succession pattern of family businesses.Consider the major family houses in India and without naming the significant ones the succession has almost always been by blood groups of biological descent, following the law of primogenitor. Sitting on the board of a major business family which had been successful for over 70 years when I raised the issue of investment and diversification the octogenarian Chairman and the head of the group had no hesitation in putting his foot down. His argument : “We do not have any…
Wednesday, 19 April 2017 07:00

Tata Soap Opera: Act2 Scene1

We had seen the possibility of the Tata soap opera unfolding, about a fortnight ago. The plot has since thickened. This is a bigger tragedy than what appears. The tragedy is about the slugfest in public domain and the delicacy of making, public, corporate information. The future will alone establish which way the wind is blowing. What is not a secret is that TCS has been the main stay of Tata Sons for decades. Going back to the times of Faqir Kohli who nurtured the infant organization to its adult shape, Ramadorai took forward the tradition brilliantly. I recall his even supporting a PhD work in Pittsburg on analyzing the cultural aspects of project work in TCS. Chandra (The popular name of TS Chandran) was nurtured by both Faqir and Ram. He proved a worthy inheritor. That is another story. However the impression needs to be resisted that under Cyrus all the companies started sinking, save TCS. TCS for long years was a division of Tata Sons, essentially because Tata Sons wanted, exclusive, control of the profits of TCS.Ratan himself has had very clear views on who he would approve as the head of a Tata firm and many will…
Wednesday, 19 April 2017 07:00

SHIFTING FULCRUM ( ? )

The last decade and a half has been seminal in yet one more recasting of the world. There has been major revision of the frame work of reference in interpretation of technological, financial and social events. The first major shift came in the early 1990’s when it was realized that it was possible to measure intellectual assets and the wealth that it would represent. The emergence of Bill Gates was a phenomenon which had revolutionary overtones in the world of work and that of the industry. Knowledge management at one stroke revolutionalized investment patterns and parameters of industry evaluations. Gradual emergence of China and India not to overlook the intrinsic strength of Japan, Singapore and other countries of South East Asia ensured that Asian perspective was more than just a geographical concept. The prosperity of west Asia and the assertion of the power of hydro carbon made sure that the only real conflict in the world was conflict for control of resources.The rest was the problem of branding. I am trying to make sense of it in categories that one is used to.The markets slowly recognized this shift and United States was no longer the growth pole of market economy.…
Wednesday, 19 April 2017 06:35

Managing ‘Risk’

Almost everyone is concerned about ‘managing risks’. In the worth-celebrating movie ‘Wednesday’ there was a reference to how anyone heading out of home in the morning would be worried about whether he would come back safe in the evening. The number of mishap’s which could happen would range from accidents to street rage to terrorist outfall to an unknown catastrophe. The dependent family members are bound to be worried for the person who ventures out. The safety parameter within the household is also under a cloud. The lack of a network to attend to a medical catastrophe is so definitive that various families have a protocol of cross checking through the day.What is said in preceding lines cannot be news to anyone. The difficulty, however, is that in the inability to come to grips with a problem, there is a tendency to circumvent it. Hence the problem doesn’t get sorted out. Indeed, some have exercised the choice of confronting the problem even if it means straining the personal relationships, but then this is not institutionalization. Decoding this to an organizational level is even a bigger task.The bald truth is that the risks which organization run at the level of simple…
Wednesday, 19 April 2017 06:33

Going beyond growth

A differentiation needs to be made between growth and development. Growth consists of an increase in substance, usually manifested by a proliferation of the structures already present. It is essentially continuous and quantitative in character, but can proceed in the absence of new structures only up to a point. Development on the other hand consists of an increase in structure, which is manifested by emergence of new structural forms and very often has a qualitative character. It can be discontinuous in nature marked by a series of jumps from one level of organisation to the next, but essentially is a response by the growing system to an increase in scale. Many would agree that amongst the pervasive problems confronted by present day organisations, are the following elements: increasing complexity, accelerated change, rapid technological advances, high dependence on expert advise, tunnel vision, reliance on standardised strategies. Some organisations deal with this successfully, others crumble. Increasing complexity is difficult to map; accelerated change leaves people breathless; rapid technological advances call for extraordinary resources; dependence on expert advice is seen ,by many, as a weakness; tunnel vision is at the cost of the helicopter vision; and reliance on standardised strategies eliminates contextual imperatives.Clearly…
Wednesday, 19 April 2017 06:32

Whose skills and what development

The government must be credited to have brought alive the phrase ‘skill development’ on an unprecedented scale. It seems to have become the latest bandwagon on which all wish to climb on to. So be it.However, like in many things in public life it appears to be akin to ‘old wine in a new bottle’. As the knowledgeable know, this usually creates cracks in the bottle. More to the point skill has been made synonymous with downstream livelihood focusing on domains like drivers, plumbers, electricians and more. There is nothing wrong with that. All country communities need this kind of skill formation.The trouble is elsewhere in at least 3 manners.Talk of skill development in India has been on since independence. ITIs are a chain of institutions across the country, so well known that many confuse them with IITs. However the pace of growth and requirements have been so large that not even World Bank grants were able to breed vibrancy into ITIs or polytechnics to either make them world class institutions or indeed make them the seed bed of certain type of employment. The more successful of polytechnics e.g. Allahabad Polytechnics or Institute of Rural Technology have their hand so…
Wednesday, 19 April 2017 06:22

A track record of professionalism

Any group, community or for that matter even a nation moves on the basis of collective good sense and a sense of balanced maturity. No set of statutes, rules or regulations can be all pervasive and comprehensive enough to cover all eventualities and possibilities. It is there the quality of response to the problems of the day, issues which need responding to and how the future gets handled, that is critical. The unwritten practices contribute hugely in shaping of things and processes. Taking stock of the national scene, there are areas which evoke confidence and there are areas which clearly need improvement. Free India has shown its capacity to deliver by the successful green revolution; the chain of vibrant industries; the institutions of all India importance in the field of medicine, technology, management, general education and more. It is not only the public sector which has proved its metal but also the enterprise of individuals and the private sector which have blossomed forth. The number of business houses which transited into independent India and the number of Business houses which sprouted in Independent India are a testimony to the talent and enterprise of the nation. The indicative references, selective as…
Wednesday, 19 April 2017 06:20

Shaping Education

The national policy on education, since the day of independence, has gone through various acts of commission and omission.Indeed for anything to be called a ‘policy’ it has to be formally so stated by an agency which is charged with the responsibility of framing the same. No policy can be by default. This is not the best place to get into a chronological narrative of the approach of the Indian parliament or indeed the Indian government to ‘education policy’.However education is something on which a large number of people have some opinion. Therefore it is not surprising, that so many committees and commissions have been appointed on the subject. Further, like in many domains, in the field of education, also, our post-independence institutions have had a huge shadow of British institutions. To begin with we created a University Grants Commission perhaps for no better reason than that Britain had such a Commission. Imitation is the best flattery. However it is dangerous when it happens in the domain of knowledge management.The result of this kind of institutional frame work is not only worrisome but also pernicious. The distribution of funds on education got hugely eschewed.It will be useful to remind ourselves…
Wednesday, 19 April 2017 06:19

Lessons of neighbourhood

The Asian countries have many commonalities. Pan Asia there is a great belief in the values of the family system. It transcends geographies and ethnicity. The list can be long. There are similarly common problems.There is a problem of terrorism in many parts of Asia including China, India, Middle East, South East Asia. Notwithstanding these constraints some countries have their lenses clear and others are still groping their way.One of the common problems of Asia is the population. Consider the following figure. India has approximately 1225 million people. China has approximately 1343 million. It is estimated that India adds 28 million people every year. China is adding only 17 million. Like in many things else India’s population policy predates china. However, by present estimates we will overtake China, in population, by 2045. The crises of monsoon, irrigation and agriculture are not autonomous variables .There are other variables also. The present government is talking much of elimination black money and expanding revenue collection. That is how it should be.The facts of the case are: less than 3% of India’s population actually pays taxes. It is estimated that less than 6% of India’s population are PAN card holders. By another estimate 93%…
2016 of the Gregorian calendar has just concluded. India , officially, as per Nehruvian dictat, follows the Saka era. In my limited interface with the government, over the years, I have never received any letter from the government even mentioning the optional Saka era.A vast majority of the country follows the Vikram era. This era is largely lost upon the political and social elite of the country which is, predominantly, anchored, in the ‘western’ tradition. The corporate world is also, largely, dominated by this class. There too the Gregorian calendar is the popular framework of working.The New Year is celebrated by a large part of the elite of this country as January 1. The immediate preceding week having the celebration of Christmas makes it largely blocked for much serious business activity.This is not a rhetorical observation. It has implications on search for identity and quarantining one’s place in the global system. Consider the period of Ramazan as a factor in the Middle East. The world knows that these are special days and factors in the office timings while dealing with them. Examples can be multiplied. However the bald truth remains that the Gregorian calendar does dominate the business cycle in…
Wednesday, 19 April 2017 05:51

Making Organisations Work: some reflections

This is particularly relevant to software of organizational structures, work ethos and organizational roles.Our cultural variables often determine the extent and mode of communication. Studying them would reveal insights on what makes an organization tic or sink.Interlocking of mutual experiences at the nodal points of organizational action determines the success or otherwise of organization policies. This would touch not just communication pattern but also distribution of work, the methods of performance appraisals, reward and punishment system and gender relations. The list can be made bigger. The task there for, ofadapting global values becomes a challenging one.A word of explanation may help. It has become fashionable to talk of role of values in organization functioning. Consider the example of a family.No one teaches his child to lie, to steal and worse, however people learn how to lie and more. So there is no point in an organization claiming that it believes in truth.Would any organization say otherwise? Yet in operational terms, individually or institutionally, internally or externally organizations are known to fib.To make statements like "people are our biggest assets" is even more silly.It is such a common sensical value that no one could possibly say otherwise. Hence to list 'valuing…
Keep innovating, but routine too needs attention of cleaning of the tooth remains unchanged. Hence it is that the routine must also get the same attention that is given to innovation. The routine of the routine has also its own patterns.If the drudgery of the drudgery also becomes a hugely effortful process then life becomes unlivable. That is the managerial problem of soft infrastructure. Essential attention needs to be paid to essential aspects of human existence.It is important to create an arsenal of technological inventions. It is also important to create better and more developed apparel. However, it is just as important to have a situation which enables life to go on without intolerable jerks and jolts, at the survival level. In a rural environment, one knows, that more often than not electricity and power are inadequately available. Hence one learns to prepare for it. In an urban environment one expects electricity .When the electricity is not available then the ways of coping with it can be demanding.There invariably follows, a clarion call to meet the 'challenge' with'innovation'. In the rural areas to create energy one can burn leaves; branches; wood; coal. In an urban household there is no place…
Wednesday, 19 April 2017 05:39

Business as a holistic manifestation

Chaing Kai Shaik became a huge industrial hub through just making liveries and tents for the allied armed forces. The economic prosperity of the island duly backed up by the armorial might of the USA created a situation of tremendous strength. When China was overtaken by Communism and Chaing Kai Shaik moved over to Taipei , even then, the Red Army dared nottouch the island.Compare this to the gay abandon with which the People's Liberation Army very well does what catches its imagination in the domain of incursions in Arunachal Pradesh or Ladakh. Business has many facets. Several components of business have not even become serious subject matters of research in venerable consultancy and research institutions.At least I don't know any PhD level work on 'black money' or any manual of Sales and Marketing on armaments. If businessis, also, the caption for money making money, areas just noted have a significance of their own.There is much talk of climate change, world peace, exchange parity and even travel to all the planets. All this is understandable. What is not understandable is how such large areas of business as armaments and its related industries are not beensuitably analyzed or understood. Confusions are…
Wednesday, 19 April 2017 05:22

Boundaries of Learning

Boundaries of Learning does not mean disowning what one has acquired through the years but only involves opening oneself up to listening with an open mind and considering with a genuine intention of seeking an understanding.Once somebody else's perspectives have been registered then of course one can consider comparison between what one had learnt and what one has newly learnt.However the process of temporarily unlearning needs effort and guidance.The reasons for this are many. All of us are, the way we are, because of a large set of contributing factors.Not the least of which are genetic factors, early learning takes place at the womb stage, the conditioning of the childhood phase, the knowledgeacquired through the boyhood phase, experiences of the youth stage and the sort of general environment one grew up in.An awareness of these influences is the beginning of the process of reinventing oneself. With the process of unlearning begins the process of acquiring of knowledge and skill with optimal results. Effective learning however is woven around certainparadigms.The first and foremost amongst them is the belief that human beings can learn.This alone makes learning an active process.Active learning helps to internalise and retain learning for a far longer period.In…
No component of the Independence Day’16 speech from the Red Fort has merited so much attention as the reference to Baluchistan .It is characteristics of the way a communication which lasted over an hour, is covered by the media and the commentators. Nearly ten days down the line the reverberations are can still be heard of a debate which, to begin with, had very little to say. However, now, with three Baluchis involved, reportedly, being charged with sedition, for having praised the PM, the matter is not going to fade away soon.No one is denying the significance of the reference to Baluchistan. It was a defined embellishment to an otherwise predictable narrative which is heard year after year. What was said in that reference, was prima facie, quite innocuous, because the Prime Minister was only expressing his reaction to the way people of Baluchistan have referred to him recently. Seemingly, it is innocuous and can hardly be seen as a threat of any sort to anyone. That it has been put to use that way is perhaps, best understood by the kind of critique that a handful of people have made of it. The writer has been in and out…
Wednesday, 19 April 2017 05:20

Makings of a working economy

The general economic outlook across the world -to put it mildly- has been consistently low key, over the last 6 months. Growth in Europe has been like a trickle, to say the least. Whether it was the threatened exclusion of Greek from the EU or exit-vote of Britain, not to talk of rumbling in the smaller states of Europe, the state of European Union continuous to be mixed. The financial year has started with the European commission foreseeing 1.3% growth this year. This was modest by European yard sticks. However the question of European reform was not much in the air. Notwithstanding the ambitious announcements of European Central Bank of Assets Management in January 2015, nothing much changed on the ground. The structural primary budget balance continued to be vague. The uneven application of European Union financial rules was not of much help.While Europe was getting heated a good portion of the breed of economists was at its favorite’s game of wanting to outguess the economy. For one year, China’s economic growth has been at its lowest point since 2009. Whether one is China watcher or not the economic health of that country impacts a very large part of the…
Wednesday, 19 April 2017 05:16

About the digital dream

There is a great push for the digital era. This is perfectly understandable given the lure of a technology driven ambience. It fuels an understandable scramble for modernity. A look at the lay of the land in general and going-ons in the electronics world may be in order. Technology in the consumer electronics domain has its roots in the American / Japanese /English/ German experience. The Economy of these countries is in-a-manner-of-speaking a ‘replacement economy’. The life of the gadget is over not by a natural wear and tear but when the corporate manufacturing brand decides to phase out one set of equipment with the invariable claim of an up scaled version. Very often up scaling is token, if at all. However the specification of the part is suitably altered to make sure maintenance/replacement of parts becomes an outdated concept. This obviously lubricates the wheels of the producer’s investment and a feeling of well-being is generated amongst investors. The backup of this economy has certain financial assumptions. Poverty is not seen as a factor. For another these countries do not rank 98th in the human hunger index of a survey of 113 countries, as does India. There is no premium…
Wednesday, 19 April 2017 05:14

Restructuring Financial Services

The Banks in their modern incarnation have been in India for well over a century. Punjab National Bank; State Bank of India, to name just two, could well spell out the economic history of parts of modern India. They have had also been periodically re-invented. The more subtle changes came which the government walking the path of liberalization from the early 90’s. The changes that were ushered in that period were essentially with reference to the regulatory system, with a definitive quotient of enabling foreign investment. If there was any blue print of the recasting of the mould of the Public Sector Banks, it has been a well-kept secret. The result has been like 2 negatives rolled in one. The rich and the powerful dominated the regulatory system before 1992 and have done so since. The result was evident in the high-jacking of banking financial resources in surrogacy of the socio-politically powerful. This is bad finance. When this was topped up with politically convenient decision, of those in public life, wanting to make it good, with the twin instrumentality of loan melas and writing off of loans, the narrative of disaster was complete.Finance minister after finance minister were all individually…
Wednesday, 19 April 2017 05:13

Living the Budget

Quite understandably the media has been flooded with opinions and commentaries on the budget. As is the pattern, some of them are professional others are political. It is obvious that the budget itself is a product of a political system. Much has been made of the demonetization process and the scrutinies to follow. This is an administrative domain and is best left to the administrators to handle. The administrators will obviously have an opinion but will be guided by the policy direction the political masters give. Be that as it may, certain gross realities are not determined by politics. The real world has to contend with it and is affected by it.It is no secret that the level of clarity in Income Tax and Corporation Tax laws needs to improve many folds. Drafting new Income Tax law cannot be a factor of the street smart individuals with correct foreign antecedents and impressive domestic linkages with the people who matter. What is not often noticed is how the Chairman of some of the important finance related committees have a track record of significant political bias and have not been exactly the models of cleanliness in their financial track records. As we…
Wednesday, 19 April 2017 04:42

Financial Sector Choices

While the average Indian is trying to grapple with shortage of currency notes there are few, busy experimenting with financial entrepreneurship of hood winking the law through crafty transactions There are far more deep changes in the offing .Perhaps some are on the way. Non-banking financial companies (NBFC’s) who have been none too popular are quietly hoping that the changing financial horizons will bring them good.The problem is more fundamental than what public rhetoric can digest. Put simply, the nontraditional lenders also use data points to access credit risks. This domain will be experiencing a boom. As the transactions increase on the digital platform the foundations of financial dealings would have been reconfigured in many ways. If this be the case, the digital lending cannot be far behind. This is going to see the end of many professions and radical redeployment in others. Mercifully, all this will not need the intervention of the Ministry of Skill Development! Organic processes have strange origins and stranger growth points. Preprogrammed interventions in a very structured manner, often, have to stand on a limb. As a large part of the society will become familiar with issues and commands of on-line payments and on ramp…
Page 1 of 3