Monday, January 9, 2017

Book Review: Shashi Tharoor--Era of Darkness

Shining light on an Era of Darkness
Shivanand Kanavi

Aleph Book Company 2016

http://www.rediff.com/news/column/shining-the-light-on-an-era-of-darkness/20170109.htm


Shashi Tharoor whose brilliance enchanted over 3 million people on YouTube with his debating skills at an Oxford Union debate continues in the same vein in his new book "An era of darkness".
Essentially the debate was about whether colonialism was good or bad. It may seem anachronistic and even cruel for the victims of Colonialism in Asia, Africa and Latin America that such thing can even be debated. But anything can be debated in public school debating clubs of UK ! In the English tradition all these schools prepare you for a legal or a parliamentary career where you could argue either way on any issue depending on the context. Many of our own parliamentarians are trained in the same tradition and argue brilliantly in Indian courts as well as in the Indian Parliament and we can see them hold forth brilliantly on the pro of a policy and equally brilliantly on the cons of it depending on whether they are in the treasury benches or in the opposition, inducing inevitable cynicism.

However the sincerity of Tharoor in arguing that British colonialism did inestimable all sided harm to India shows through this tome where he marshals literally hundreds of facts (well organised quotes run into nearly 300). His passion for the subject comes through every page, his sardonic tone and twist of the English phrase even while cursing the power that imposed English language with "Tommy jackboots" hits the reader with a genuine force.

Along with accolades from Indians in all walks of life, including PM, Narendra Modi, Tharoor got some feeble criticism as well after his short Oxford Union talk. That has prepared him for much more disdainful and patronising vitriol from apologists of British colonialism. All his arguments and quotes seem to be in preparation of that assault. He does not leave any leaf unturned in his endeavour including the Tea leaves of Assam, Bengal and Oooty.

In fact the topics he chooses to argue include the whole gamut of issues which are normally quoted as "gifts" of two centuries of British rule over India: good governance, English sense of fairplay, Austinian judicial system, Railways, social reform of Hindu society, Cricket, Tea and even the English language. He tears them up one by one with profuse facts and anecdotal quotes from largely British and other Western sources.

Some of the insights he provides are important for colonial studies. He points out that the public finance in pre-colonial India was based on taxing trade where as the British themselves being traders made a drastic change and made agriculture and land revenue the focus, (and even called their chief district level representative: Collector) thereby causing immense hardship to peasantry. He traces the creation of the landless peasant and the increased dependence of large segment of the population on agriculture for livelihood due to the destruction of artisans and manufacture and also large scale man made famines under colonialism.

In these days when corruption, its roots and elimination often becomes a matter of public discussion he narrates its massive rise due to the practices of the East India Company and its officers.

He makes an astute observation that despite historical animosities between England and Scotland a compact was established to include Scotland into the United Kingdom ( though initiated by a fudged parliamentary vote in 1707) by promising plum positions for Scots in colonial India. That explains the unusually large proportion of Scots in the administration and the army in India. Twisting the knife further he adds that perhaps the loss of this income from India into Scottish homes is leading to disenchantment and fueling separatism in Scotland !

His remarks on the creation of a decadent gentry of Rai Bahadurs and Diwan Bahadurs and even the more abhorrent profligate and promiscuous Princes replacing the older far more grounded aristocracy are insightful.

Besides going into the financing of Indian Railways and how gold plating was done by many an English investor assured of guaranteed returns and how Railways during construction and later were used to drain the Indian economy and increase the national debt, Tharoor makes an important point that in the operational finances of Railways it was the third class passengers traveling in sub human conditions that subsidised freight and the first class !

His discussion of British communal divide and rule as well as re-imposition of caste inequalities through the Gentoo Code under Warren Hastings and in the post-1857 construction of colonial state are extremely important but often forgotten in the modern Indian discourse on communalism and casteism.

It is an enjoyable read, passionately written smooth in flow while being richly cross referenced. The blemishes are few. Note worthy ones are his quoting Marx completely out of context to show purportedly that Marx supported British colonialism in India which is contrary to facts; and frequent comparisons of genocidal massacres under British with unsubstantiated figures of deaths caused supposedly by Stalin etc. Perhaps we can ascribe it to his anxiety towards taking a swipe at his leftist political rivals in his parliamentary constituency in Kerala.

Other weakness of the "Era of Darkness" is total neglect of the role of Ghadar revolutionaries, Bhagat Singh and his comrades and even the war of Independence --the Great Ghadar of 1857, chronicled as the biggest war of 19th century world, and the colonial tactics of chicanery and brutality employed by British, while Tharoor does bring out such facets from the rest of colonial history.

I would recommend every young Indian to read this book to get a perspective of our colonial past in the present day mesmerising euphoria of the global village in spite of Trump.
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Saturday, September 17, 2016

Indian Industry 1991-2016

Indian Industry 1991-2016

The face of Indian industry has changed unrecognisably in the last 25 years and none can dispute that.

The growth in various sectors of Indian Industry in the last 25 years is phenomenal. Indian IT industry exported about $100 million in 1991 where as in 2016 it exported $ 100 billion that is a 1000 times growth ! Indian IT companies have become multinationals and are rivaling the biggest and the best in the world. Car production used to be about 1 lakh cars in 1991 which has reached nearly 25 lakhs last year and both Indian and foreign companies are doing their design and development of many new models within India. Today India has the world's largest producers of two wheelers and tractors. Telecom services have grown phenomenally and from 25 million landlines it has increased to about 50 million landlines and about a billion mobile phones. ISRO has now launched over 130 satellites from its own rockets and out of which nearly 50 are foreign satellites. In the nuclear program both for energy and weapons Indian scientists and engineers have demonstrated the ability to design and develop not only natural Uranium based reactors of 220, 540 and 700 MW but also next generation of reactors like Fast Breeders as well as Thermonuclear weapons and nuclear submarines. Indian financial sector consisting of Banks, stock markets, commodity markets etc have all modernised and India has a truly sophisticated financial sector that has surpassed many developed economies in technological superiority. India has a large base in petrochemicals, manmade fibres, plastics, oil refining, pharmaceuticals, urea and agro-chemicals and its companies in these sectors are respected all over the world for their size and sophistication. In fact just as India has become the IT services hub for the world it is also being called the Pharmacy for the world particularly in generic drugs. It is often said that India missed the bus in electronics, in fact India imports almost all of its electronics in finished or component form. However due to new developments in computer applications many of them generated by Indian engineers in Silicon Valley, like Suhas Patil, Prabhu Goel, Raj Singh, Prakash Bhalerao, Rajiv Madhavan etc the process of electronic microchip production has been neatly divided into design & testing and manufacture. Now many cutting edge chips for the world are being designed and tested in Bengaluru, Hyderabad, Pune, Gurugram etc while they are manufactured elsewhere in China, Taiwan, South Korea, US etc. It is to be noted that about 80% of value add in chip industry occurs at design and testing stage and only 20% at the fabrication stage.
While Indian industry was in not of global scale in '91, today in many sectors they are in the top 5 in the world. More over they have spread their wings globally and own telecom, steel, aluminum, automobiles, Oil and Gas, coal mines, consumer goods businesses in other parts of the world including developed economies. They have shown their management skills by turning around successfully many industries which were sick, closed or not very profitable in other countries.

This qualitative and quantitative description of change in Indian industry in the last 25 years can go on and on for which there is not much space here and we can come back to some specific features later but it is important to touch briefly on what factors or new phenomena have driven this qualitative and quantitative growth.

Let us briefly look at what happened in the 25 years before 1991.
Was their growth in the industry in quantity and quality during 1966-91?
Yes of course. Looking at Steel, Automobiles, IT, Pharma, Energy, Textiles, Telecom, Space, Nuclear etc there was considerable growth in both quantity and quality during 1966-91. For example the sophistication of textile industry increased greatly with the new technologies in weaving, spinning, processing etc coming in the 80's. When these sophisticated technologies became accessible to small and medium powerlooms in the 80's most composite mills in Mumbai, Ahmedabad, Kanpur, Delhi etc closed down and became real estate companies. There was also the growth of indigenous polyester fibre production. Similarly while the number of telephones increased to 25 million the quality of telecom network started changing with the introduction of C-DoTs digital exchanges and the coming into being of STD facility and the mushrooming of STD public booths in the late 80's. The hitech and strategic sectors of nuclear and space too had grown from infancy in the 1960's to considerable growth by 1991. From small sounding rockets to launching our own satellite Rohini in our own rocket SLV-3 and from research reactors in Trombay to designing and operating our own 220 MW pressurised heavy water reactors. Till recently the largest digital project in the world was the Indian Railways Passenger Reservation System built by the persistent efforts of CMC. In fact it is the success of this digital project that affected 100s of millions of people that led to acceptance of the new computer technology by ordinary people, trade unions, politicians etc. Indian computer architects had designed the Param super computer in CDAC and IT services industry was growing due to TCS, CMC and later Infosys, WIPRO and HCL reaching an export of about $100 million. Large steel mills had come into being in Durgapur, Rourkela, Bhilai and Bokaro from the initial start in Tata Steel in Jamshedpur. The automobile industry had its own base in two wheelers and had brought in the new Japanese models from Suzuki at Maruti which were far superior to the  existing cars from Premier Automobiles (FIAT), Hindustan Motors.

Clearly the eighties had laid the ground work of modernisation that led to the explosion after liberalisation in 1991.

However what was lacking was competition both global and local and along with it global opportunities. It is this opening up in 1991 that accelerated the industry's growth beyond anybody's expectations.

Briefly we can identify five major features in the current industrial scenario

1) Dynamism caused by global and local competition.
Protection from foreign competition and domestic licensing regime which had led to monopolies which faced neither domestic nor foreign competition had led many industries take a laid back attitude towards innovation, quality, design, production efficiency and management skills. Global and local competition energised many to change and become globally competitive and even become multinationals. In an article "Prowling Tigers" the magazine Economist reported that between 2006 and 2010 Indian companies bought 754 companies abroad and invested 7500 crore dollars. TCS, Infosys, HCL, Wipro, Tech-Mahindra etc earn over 90% of their revenue from their operations abroad. Many groups like Tatas, Aditya Birla, Essar, Vedanta, Videocon, Sun Pharma, Dr Reddy, JSW, ONGC, Reliance Industries etc earn sizable revenue from operations abroad. It is also true that those who could not face the challenges arising out of global and local competition went out of business. Today there are many innovations in manufacturing and services by Indian companies in IT, Financial markets, automobile, pharmaceuticals, petrochemicals and industrial management, which have made a mark in global markets.

2) Access to global capital and markets and the emergence of Indian multinationals
Many large business houses have had easy access to foreign capital in the form of GDRs, ADRs, private equity and hedge funds, as well as through Indian and foreign share listing, issuing bonds in other countries, loans from foreign banks at lower interests etc. Many start ups have had access to global venture capitalists. This has led to their growth in India as well as abroad. For example Tata Group could not have bought Corus or Jaguar-Land Rover or Tetley or many hotels abroad without such access to foreign capital. Kumar Birla could not have bought Novelis one of the largest producers of Aluminum in the world without such funding. Similarly almost all the IT companies bought by TCS, Infosys, Wipro, HCL etc abroad are financed by foreign capital so also other such acquisitions in the Pharma sector by Indian companies and so on. For the last 15 years venture capital from US, Japan etc is funding many start ups in India mainly in the IT sector.
Similarly with a change in the mindset due to globalisation every entrepreneur has to design his enterprise from day one to be ready for global competition and if successful to look for export markets.

3) Quality consciousness in manufacturing and services.
In the last 25 years thousands of Indian businesses have improved their manufacturing and services processes so that a very large number have the highest ratings in CMMI in IT and in other sectors have adopted ISO standards, efficiency and quality improvement methods like Kaizen, Six Sigma, Malcolm Baldridge, Total Preventive Maintenance, Total Quality Maintenance, Quality Circles, Zero Defect Manufacture etc.

4) Smart Manufacturing
The received wisdom after Henry Ford's success in assembly line manufacturing has been that if one has large scale and integrated manufacturing under one roof then one achieves economies of scale. However times have now changed and Japanese have innovated "Just in Time" manufacturing and Distributed Manufacturing and German-American innovations in IT enabled Enterprise Resource Planning have further revolutionised manufacturing efficiencies. Indian companies post 90's have been quick to adopt these and achieve high efficiencies both in large and medium volumes.
Today India may not have reached the manufacturing scales of China but is technically ready for high growth in manufacturing, if not for export markets which are in doldrums but for domestic consumers.

5) Frugal Engineering and solutions for  the Bottom of the Pyramid
India is slowly becoming known for innovating low cost designs in products and services which can serve over 5 billion of world's population. Carlos Ghosn CEO of the French Renault Motors and Japanese Nissan Motors has hailed it as Frugal Engineering and invested in India in a large R&D effort. Tata's Nano, Swachh etc attracted global attention primarily because of the low cost in Research and Development and a new design strategy described by well known American management guru C K Prahlad as aiming at the "Bottom of the income Pyramid"

This is a very brief look down the lane of where Indian industry has reached in the last 25 years. A natural question would be why did not industrial policy change towards liberalisation and globalisation earlier ? The answers to that lie in post-independence Political Economy of India and need another segment even for a brief discussion.