Where are we headed?

Today, I had to stand in a government office in chennai for 4 hours. The whole place was physically stinking of urine and rotting paper, not to mention the other stench from the system itself. Moist walls, dingy furniture, lazy looking people.

We had to get a paper signed by a big shot bureaucrat. Something of enormous economic interest for our company and to some extent in tax revenues for the government. As is usual in India, there was a broker. A sleek, smooth talker, with all the right connections, always dressed like a plain clothed policeman.

The private sector is used to working at better speeds than the government. We want to get things signed and cleared fast. The sole work of the government employees seems to be in slowing down the whole thing to a point, where there are enormous losses and thus to extort more money for a routine process of paper work.

There are two types of kick backs:
1. for doing something wrong or unlawful
2. for doing what is called your job responsibility

The former can exist anywhere, in any country since it is dependent on one man’s moral disposition or depravity or desperation. Anyone can commit such a crime out of simple needs. It need be out of greed, but out of pure necessity.

The number 2 (!) thrives in our country. What do you do when I want my client to pay me money for supplying him this month with N number of trucks, when my only goddam work is to just supply trucks? The person who is my boss then will ask money from me for me to carry on doing this. Then his boss, then his boss….

The system is rotting. India, they say is emerging into a major global power through economic growth, robust fundamentals (no one I am sure knows what that means), and a general euphoria that India is hot and happening. Our nation is growing, yes, economically. India is being invested in because of the following reasons:

1. low manpower costs
2. average to good manpower quality
3. an alternative to the leftist Chinese – more security in the longer term
4. English is popular – a robust educational network and universal content
5. the Indian government is ready to be proactive in policy making to bring in investment
6. a resultant consumer market that is maturing slowly into a buyer’s market – a boon for any company with a lot of products, technology and money
7. to sum it all up “a better cost benefit proposition”

Walmart wants to come in. Nokia is already in. IBM is big. Ford, Hyundai, Toyota, Mitsubishi, a thousand other companies from a hundred different industries have successfully set up shop in India.

What we fail to notice here are the following factors:

1. corporates just choose to work around the red tape and slime
2. the attitude is that “get the work done, whatever it takes”
3. what happens when the advantages stated above are not unique to India anymore?


When Brazil or say Egypt offer the very same advantages as India today, which many nations will in the not too distant future, where will we stand then?

Today, land acquisition costs very less in India, so it makes sense to bribe a politician to get the work done. What happens when it is not the case?

There is always a tipping point. Things will slide after that, no matter how well glued. When will we reach this tipping point? 10 years? 20 years?

India cannot grow in the real sense if it does not address the issue of corruption. This can be done only through transparency, centralization and deregulation. India is growing in terms of factories, software companies and refineries, through a better economic proposition rather than a sustainable set of ethics.

India’s cost of corruption is being built into the costs that customers pay for goods and services. No one notices this.