Sunday, October 30, 2005

Rural India has numerous problems. Don’t make IT the excuse

Silicon versus plain con
Rural India has numerous problems. Don’t make IT the excuse
Indian Express

The ‘‘either-or’’ paradigm that is dominating the headlines in Bangalore is completely off the mark. The correct approach I believe should be ‘‘and-and’’ and not ‘‘either-or’’. It is not one to the exclusion of the other, but in fact the fulfillment of both objectives, which are wrongly positioned as being in conflict.

In simplistic terms it is ‘‘rural versus urban’’ or ‘‘IT versus agriculture’’ or ‘‘India versus Bharat’’ and so on. In actual fact, there is very little to argue about. Nobody denies that we need to invest more in rural education. But to suggest that building a flyover in Bangalore will reduce resources for rural education is a monstrous joke and a lie. Believe it or not, we actually have enough money for both activities!

Merely increasing the ‘‘spending’’ on rural education does not mean that we have ‘‘invested’’ in it. If we double the salaries of unionised teachers who do not turn up in rural schools, we would not have ‘‘invested’’ one extra penny in rural education. We would have simply ‘‘spent’’ money that would make the Rural Absentee/Ghost Teachers Union happy, but done nothing to extend or improve education to the rural poor.

Finance Minister P. Chidambaram understands this very well. That is why he has tried to focus the national debate on ‘‘outcomes’’ and not on ‘‘spending’’.

THE purpose of increased spending on education is not merely to ‘‘spend’’, but to ‘‘educate’’. Even a left-loving economist like Amartya Sen concedes in his book The Argumentative Indian that the unionised teachers in his home state of West Bengal systematically absent themselves from work while drawing salaries (we must call them ‘‘rents’’, not ‘‘wages’’) in excess of market levels and far more than that paid to diligent working teachers in his own NGO.

Similarly merely spending money on urban roads can make contractors richer. It need not and usually does not make roads better. Urban residents suffer not only from overspending which benefits contractors but from delays which benefit no one.

Quite frankly, if about a dozen flyovers were completed in the next three months, Bangaloreans will get disproportionate benefits even if the estimated project costs double. But of course what is likely to happen is that it will take three years and the total project costs will actually treble!

If our traffic nightmare is so bad, why don’t we work night and day? If floodlights can be used for cricket matches they can be used for construction sites. In Thailand they can complete pre-fab flyovers in a couple of weeks. Why should it take us years?

It is our tragedy that our agencies get trapped in litigation, disputes, stay orders and endless delay. The focus is on activity and spending, not on outcomes! This is the reason N.R. Narayana Murthy pleads for a ‘‘better urban governance model’’.

REFERRING to the English poet Shelley, the French biographer Andre Maurois had this to say: ‘‘He was a beautiful and ineffectual angel beating his wings in the void.’’

In India we are certainly ineffectual, if not beautiful and whether we are angelic or not, we do beat our wings in the void. We have endless discussions while the Koreas, Chinas, Malaysias and Thailands talk less and do more.

At the end of the day, both the city-dweller and the rural farmer in these countries are richer, healthier, more educated, more prosperous than their counterparts in India.

We need a strong IT industry. It is the one activity that has given us success and respect on the global arena that we can all be proud of. We also need a strong agriculture. Whoever suggested that there is anything win-lose about their relationship?

IT can help agriculture or it can be neutral. One does not in any way detract from the other. IT is non-polluting, not energy-intensive and is far less land-intensive than manufacturing or mining.

The ‘‘land’’ issue is in particular a completely irrelevant red herring. Obsolete and unimaginative laws regarding land classifications — for example, agricultural versus non-agricultural — and ceilings have rendered the smooth functioning of markets in land impossible.

Anyone, be he or she an Indonesian developer in West Bengal or the Indian Navy in Karwar or an IT company in Bangalore or a charitable hospital in Tamil Nadu or a chemical factory in Maharashtra, is simply unable to buy a large contiguous piece of land in the open market. You have to be dependent on the government acting as a middleman, acquiring it and turning around and selling it to you.

If the government does not wish to perform this function, why not deregulate the market in land? Instead of the government making profits as an intermediary, the owners — the rightful sons and daughters of the soil — will get the benefit of the price that a willing buyer is prepared to pay.

Till the laws are changed, any business that wishes to develop a reasonable-sized civil facility will have to buy from the government and later get pilloried for that.

There is another option. The business can decide to go to Guangzhou or Shanghai, which I am told are welcoming places!

WE are all in this together. Nobody in the IT sector is foolish enough to believe that longterm sustainable prosperity is possible for themselves without other sectors developing in tandem. But instead of getting into the ‘‘either-or’’ game, let’s just for a moment look at the ‘‘win-win’’ features.

The IT industry is responsible for 90 if not 100 per cent of Bangalore’s foreign tourist traffic. And guess what, one out of 10 of them does visit Belur, Halebid and Sravana Belagola. The IT industry is also responsible for the traffic congestion in Bangalore.

We can of course shut down the IT industry (something that would make the mayor of Guangzhou deliriously happy), reduce foreign tourists and solve the traffic problem.

Or we can build flyovers, roads and mass-transit systems (‘‘remember construction is labour-intensive’’), welcome foreign tourists (‘‘tourism is labour-intensive’’) and get on with building a prosperous state and country.

The author is chairman and CEO, MphasiS BFL Ltd, and a past chairman of Nasscom


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