Post # 200: Imagining India - Breadthwise and Depthwise

It's 200th post on naanushande.com and the what better topic it can be, my views on the book "Imagining India" by Nandan Nilekani, at present chairman of Unique Identfication Authority of India(UIDAI). What really differentiates the book from other business books on India is that breadth and depth of subjects. Be it discussion on India's infrastructure, or Education or Energy Self-sufficiency or Social Security. A must read book every person who's planning to design a strategic road-map for a business in India.

I had posted a few months back about the book in discussion about India's transportation sector. At that time I had read some chapters randomly from a copy borrowed from institute's library. In the same period Nandan Nilekani was appointed as chairman of UIDAI and all of a sudden the book became a hot-cake in the library and it became difficult for an individual keep it issued for long time. So I opted to buy a personal copy from flipkart.com, at 15% discount and free shipping!

Overall a very good narrative, got to appreciate the way the author has integrated all the information on India available in silos in a coherent way. But the flipside of the book is that it is too bulky, not very convenient to read while traveling, a time at which such genre of books will be nice to read.

Some strong points have been discussed in the book on various topics. The following list may not be pretty comprehensive, these are just a few points which really caught my attention.

Infrastructure:

• The books discusses in depth about the root cause for current state and why government had ignored development of infrastructure in India. The top down approach of the government had led to ignorance in one of the lifeline of an economy i.e. Transportation.
  
• Things have changed in recent times when infrastructure became politically fashionable, the entire focus from Roti, Kapada aur Makaan shifted to Bijli, Sadak aur Pani.

Higher Education:

• Right from the establishment of three universities(Bombay, Calcutta & Madras) the author discusses about the ups and downs of Indian education system.
  
• The establishment of IITs one of signature decision the government but unlike institutes in US it missed public funding for research work and instead the funds were tunneled only to central laboratories like CSIR, DRDO, NAL, BARC.
  
• Our public debate on institutes have focused on two issues, privatization and reservation.
  
• The weak regulatory environment has encouraged private investment mainly from people looking to make a fast buck rather than provide effective education.
  
• Steps should be taken to end the scarcity of institions othewise hyper-Darwinian selection process has encouraged 'Kota-mindset' of cramming and creating coaching industry.

School Education:

• Due to regional divides across the country - single, coherent education system is impossible.
  
• Our educational policies have funded school, not schooling.
  
• Some people say "In terms of education, we will have to reach the twentieth century before we think about the twenty-first".
  
• In rural area, landlords protest school reforms with a straight face that effective schooling will create unreasonable expectations among backward castes for jobs are entertainment.
  
• Private schools have not improved the situation. As indicated by British researcher James Tooley in his landmark paper there have been mushrooming for 'mom-and-pop schools', one room enterprises with ambitious names 'Oxford School'.
  
• Nowadays education like infrastructure has also become politically fashionable. It started with the launch of Sarva Shiksha Abhiyan(SSA) by Vajpayee Government. But unfortunately, SSA has only enabled the pumping of more money down a very leaky pipe.

Unique Citizen ID

• There's a need for more strict tracking. Number of BPL ration cards circulating in Karnataka is more than state's entire population.
  
• For Single ID major databases have to be integrated. PAN covers all tax payers, voter IDs all registered citizens above eighteen, birth certificates all new borns and BPL cards the poor.
  
• The national smart ID system would be transformational and can function as a mobile, non transferable passbook, considering the fact that 80 percent of Indians today do not have a bank account!
  
• Linking smart cards to bank accounts will introduce possibility of offering direction services from pension to benefit payments.
  
• There will be transformation in politics, as with national ID system there will be paradigm shift from subsidies to direct benefits.

Land Disputes:

• Land never has been an easy issue. Over 30 per cent of pending court cases concerned with land.
  
• Unlike many countries, India has not recognized the 'right to property' as fundamental one since 1978.
  
• Land boundaries are very complicated within cities also. To file an FIR in India one has to experience complications in police station limits. There's a massive confusion where one station's authority ends and the other begins.

Healthcare:

• Our malnutrition numbers place us among the world's weakest countries, while our diabetes rates vaults us over the United States.
  
• India did not have a health policy till 1982, and the funds the government earmarked for healthcare have budget leftovers. The sector has been drastically under-funded.
  
• Due to dubious public healthcare system, 85% of patients are choosing private health care, even the poorest. Because of this healthcare is the second largest reason that people in rural India are in debt.

Social Security:

• Government and citizens have long agreed on the idea that services and care for the aged 'should be a responsibility of the children'.
  
• There have been efforts for implementing universal social security policy. National Pension Scheme (NPS) and National Commision for Enterprises in the Unorganised Sector(NCEUS).
  
• To reduce burden on the exchequer, the schemes should be 'defined contribution mechanism', unlike 'defined benefits' method approach of US and Europe.
  
• 'Defined benefits' schemes like generous pensions, unemployment insurance and health benefits can have unintended consequences, like people retiring early, taking longer breaks between jobs and focusing too little on preventive healthcare.
  
• Savings and social security has to provide solutions not just for middle class but also for the large of poor. With the implementation for national ID system government would be able to manage the individual account of people who live hand to mouth.

Pension Funds:

• Currently EPFO funds which are stuck in low-yield securities, some part of it should be brought into India's stock market. This should avoid swings in markets due to sudden inflow and outflow of FII funds.
  
• Pension funds of other counties make up almost 13 percent of FII in India. Around 150 global pension funds have all invested in Indian stocks.

Environmental Challenges:

• Development versus Environment is perennial debate - Once Rajiv Gandhi said "Development which destroys the environment destroys development itself".
  
• Some accuse western world shifting their dirtiest industries abroad, first through colonization and later through globalization.
  
• Tropical areas like India have highly complex ecosystems, and are very difficult to recover once destroyed, compared to the temperature of the West.
  
• Coal industry is badly regulated. The industry waste is discarded into open land, creating large areas of barren wasteland. The environment destruction from coal mining has fanned anger around the mine fields in Chattisgarh, Andhra Pradesh, Orissa, Jharkhand West Bengal and aidded rise of Naxalite movement.
  
• 80% of carbon emissions come from sectors in energy and heavy industry whose investments cannot be easily replaced.

Energy Sector:

• Free electricity is the policy cornerstone of every populist politician.
  
• Fossil fuel led industrialization has been replicated around the world. But the further development should continue with renewable sources.
  
• Government subsidies should be more directed towards solar and alternated energy sources to make them more attractive w.r.t price.
  
• Big investments in energy investment are yet to happen, there are emerging possibilities for distributed green power and for IT-enabled grid intelligence we can create a whole new paradigm of energy generation, distribution and consumption.