Pankaj Kumar's Weblog

One of my favorite columnists, Swaminathan S. Anklesaria Aiyar, recently attacked the main proposals of a study led by Nobel laurete Amartya Sen. In summary, the study found that privately run schools are producing better results for less money than government run schools. For this, it blamed the private tuitions and recommendaed that the solution is to ban private tuitions. Mr. Swami disagreed with this view with the reasoning that this will curtail the right of better education for those who can afford it. His solution: empower local communities to punish errant government paid teachers and reward who perform better.

Amrtya Sen responded to this, that he was quoted out of context. In response, Mr. Swami quoted him extensively and toned down his criticism a bit. A later article by Gurcharan Das, former CEO of Procter and Gamble, India and now a columnist, praised the public debate, while denouncing the harsh tone of Swami's first column, stating that a practical solution has to be pragmatic and workable.

My own views are mixed. I must confess that my thinking on economic, political and organisational matters has been greatly influenced by Mr. Swami's columns (I have been an avid reader of his writings since 1990 -- except for a two year gap in 1999 and 2000 when I relocated to US and the columns were not available on the Internet) and I have been an admirer of Gurcharan Das for his pragmatic views.

Here in US the government schools compete for a better ranking, administered by the state. Better ranked schools drive property prices higher in a locality as only residents of that locality are allowed enrollment and parents are willing to pay more for better education. Higher property prices mean more local taxes and hence more money to the school and hence, even better performance. This is indeed a vicious circle, favouring the rich and promoting inequity. In fact, schools who are not able to improve their performance face cut in state funding as well.

This system, certainly not a socialistic one, guarantees that the school administration and techers don't become complacent and ignore their primary duty.

This kind of a system may not be feasible, or even desirable, for India. However, any solution has to account for the fact that competition is required for continued improvement and innovation. Government should regulate the playing field for fair competition but not eliminate competition altogether. The way I read Mr. Sen's conclusions, it appears that he is arguing for removing private tuition as a mechanism to improve government schools. A better solution would be create an instituitional framework where these two compete, with adequate rewards for the winner. As of now, the government schools and teachers have little to lose even if they don't perform.

"Thirty years ago, George Fernandes asked me (SWAMINATHAN S ANKLESARIA AIYAR) irately why India needed Colgate and Lever to make something as rudimentary as toothpaste.
I now know the answer: they made possible the creation of the first Indian company to became No 1 in the world."

Read the full story here.

I was in India when the controversy about pesticides in soft-drinks made headlines. So effective was the media coverage and mass hysteria that the parliament banned cold drinks, schools and colleges had notices advising students against them and most of the eating places stopped serving coke, pepsi and many other well-known brands. With that kind of public reaction, it was hard to imagine it was all about a well-orchestrated marketing campaign.

But as this piece by Swami points out, the Indian public was nothing but the guinea pig of a very successful marketing campaign by CSE to gain name and fortune.

Swami gives an interesting twist to the whole story by making it a case-study of marketing campaign by CSE and counter-campaign by Pepsi & Coke and others. This makes sense, for the facts and findings were quite inconsequential in this case, and perhaps were known to be so by the perpetrators of the campaign. At the end, CSE was remarkably successful and its adversaries, equally unsuccessful. Swami's conclusion: The lesson is clear. Coke and Pepsi should sack their marketing managers and hire replacements from CSE.

Excerpt from TOI news story:

"Veerappan, India's most wanted and most elusive brigand who murdered with impunity, was finally shot dead in his jungle hideout by elite commandos using some of the very tactics he employed for well over two decades to build a vast criminal empire"

Veerappan has been a household name for all those who hail from South India or have stayed there for any length of time. When I had moved to Banagalore in early 1990, I was used to be amazed by news stories on how Veerappan managed to thwart all attempts to capture him for past fifteen years! I just couldn't imagine someone being elusive for those many years. However, with time, I got used to Veerappan stories. At one point in time, army was called-in to catch or shoot him. But to no avail. And all along he continued murdering police men with impunity.

"Veerappan has been caught" used to be standard April 1 news item, causing great consternation among any group of audience, even if momentarily. In fact, once even a leading news paper came out with this news item with a photo of Verrappan in hand cuffs, only to deny next day that the person in photo was a Veerappan look-alike and the news item was a Aprill-fool joke.

Now, after full 30 years of active pursuit, Veerappan has been shot.

I usually find Mr. Aiyar's columns highly sensible, but this suggestion


Simply drop the money by helicopter or gas balloon (or even Diwali rocket) over rural areas. The poor will scramble over ridge and valley to gather every note, but it will not be worth the while of the rich, bureaucrats or contractors to do the same.


in his latest column on reducing poverty is simply absurd. I can understand his frustration with India's inefficient beurocracy which eats up upto 80% of all the money earmarked for poverty reduction programs, but the solution is certainly not to comeup with such absurd ideas.


Why do I think it is ill-devised:

1. The corruption responsible for eating up upto 80% can easily do the same very easily with the money to be air-dropped, by simply not dropping the money.


2. The society usually honors the rightful ownership of the money. If someone claims a note to be his or hers, just because he or she first spotted or grabbed it, the ownership to the money may not be accepted so easily by others, causing rampant fights and general unrest.


3. Even in ancient times, kings have found clever way to distribute money during periods of draught or flood -- mostly by initiating projects that create work, not by giving away notes or coins.

My favorite economics columnist has these predictions for world in year 2035:

• China richer than any European country.


• India surpasses not only every European country but also Japan in GNP


• Gulmarg (a small town in Kashmir) becomes the skiing capital of Asia, with as large an international airport as Zurich


• Kashmir declared an autonomous region in year 2020


• Infosys becomes the world's biggest consulting group after taking over Accenture


• Tata Motors becomes the world's largest auto company after rescuing General Motors from the brink of bankruptcy (and shedding off its medical benefit liabilities!)


• Incomes have doubled or tripled in most developing countries, with China and India becoming high-income countries


• 20 million jobs were outsourced to India in the last three decades

I found all this highly probable, but gave up on this one:

After decades of economic stagnation, the Bihar government decided ten years ago that it could gain a place in the sun only through a complete separation of the legislature, administration and judiciary. So, the legislature voted to outsource the entire administration to a Korean company, and the judiciary to an Australian company. In consequence, Bihar now boasts some of the best governance indicators anywhere, and Transparency International ranks it as the least corrupt state in India.

During my trip last month to Inida, I got the opportunity to attend a presentation by Dr. Jagadish N. Sheth, Charles H. Kellstadt Chair of Marketing in the Goizueta Business School at Emory University, at a networking event organised by Bangalore chapter of TiE on July 17th, 2006. The 67 old professor talked passionately, and at times humoursly, about Emerging Entrepreneurial Opportunities as India Gets Globally Integrated, highlighting areas, both based on activity and geography, which he considered ripe for growth.

Nothing fundamentally different or new, but still quite an insightful presentation. You can find the slides here.

Some of the things not present in the slide set that he talked about (and which I still remember, though I might get some of the details wrong):

1. The growth in coming decades in India is going to be primarily driven by the domestic Aerospace industry. This was somewhat counter-intuitive as most of the current growth is due to IT and ITES.

2. The geographic areas likely to benefit most by this wave of industrialisation are the Bangalore-Mysore and Bangalore-Hyderabad corridor. (No surprise here)

There were quite a few nuggets of insight, which I don't seem to recall at this moment. Should have taken notes.

Watch this YouTube video and scratch your head in wonderment or in praise of Indians dexterity or just discount it as a video running in fast-forward mode. Can traffic be really so bad anywhere?

Traffic usually isn't so bad. Not in big cities like Delhi, Bombay, Bangalore or Chennai, but it could be worse in smaller places like Patna or Kanpur. I just returned from a 3 week trip from India and was actually part of such traffic (no, not behind the wheel) on many occasions.