Tuesday, May 31, 2005

Watching India race to the top

CYBER AGE From The Statesman
India’s strength and ingenuity

India is becoming an integral part of the globalised economy and is clearly thriving on the synergy between multinational corporations and its indigenous strengths, which come from a high quality of education from its top universities, democratic institutions that create transparency, and the ingenuity of its people for innovative solutions to complex problems.

A few years ago, I was paired to play golf with a South Korean businessman, let’s call him Tom Chung, who was visiting the USA for business and to meet his children studying in New England. He was keenly interested in India, where he had established a manufacturing facility for an ancillary product in collaboration with a local industrialist in western India. At the fifth hole my curiosity got the better of me and I asked Chung: How do you compare Indian and Chinese workers? He smiled thoughtfully and said, “Chinese workers are hardworking but they need clear instructions, a blueprint to follow, to complete the work. Indian workers are probably not as self-disciplined and hardworking as the Chinese, but they are resourceful and ingenious. If there is a problem, they won’t sit down and wait for someone to come and help them. They would find creative ways to solve the problem. If something were broken or missing, they would improvise a substitute and fix it.”

Being familiar with American pop culture, Chung called it “the MacGyver positive”: Don’t just sit down. Do something and get out of the trouble. MacGyver was the protagonist of a 1980s TV series in which he showed his uncanny ingenuity at making complicated machines out of ordinary things. In the pilot episode, for example, MacGyver used his remarkable ingenuity by using an unusual tool, chocolate, in sealing a dangerous leak from an underground lab and rescued the trapped scientists. Indian workers, even those who don’t have much education, Chung said, display the same aptitude for innovativeness.

Call it junkyard ingenuity, but it is so widespread in India that it is almost a national trait. Today, India and the USA, for example, talk of strategic partnership, peaceful nuclear technology transfer, and energy cooperation, but there was a time when the USA treated India as a pariah.

In 1991, for example, the US state department banned the sale of computers to India that could do more than 900 million operations per second. How did India respond? In no time, the Centre for Development of Advanced Computing developed a powerful series, Param-1000, which at that time was one of the most powerful computers of its kind, capable of diversity of applications in fields such as engineering, business, industry, space and nuclear technology.

Indian ingenuity served the supercomputing needs of the Indian scientific community and made possible the development and enhancement of India’s nuclear weapons programme, however controversial. The USA’s ubiquitous eye in the sky, the orbiting American satellites, could not detect the preparation of Pokhran because the Indian space scientists had precisely calculated the orbits of the satellites and worked around them to escape notice. But this high-end technological ingenuity grew up on the foundation laid by some of the brightest Indians of the 20th century, men like CV Raman, S Chandrashekhar, Har Gobind Khurana, SN Bose, Homi Bhabha, Vikram Sarabhai, and not the least, Jawaharlal Nehru, whose rational and scientific outlook on life guided him to establish some of the finest science laboratories and institutions of higher learning.

Indian ingenuity is written all over the Silicon Valley from the co-founding of Sun Microsystems to the development of Pentium, PowerPoint, Hotmail, streaming video, digital satellite television, MPEG audio compression standard, and much more, as wonderfully told by Shivanand Kanavi in his book, Sand to Silicon: The Amazing Story of Digital Technology. But Kanavi forgot to discuss the contribution of one of the most brilliant innovative minds in India today, Faqir Chand Kohli, the doyen of Indian software development and outsourcing and the chairman emeritus of Tata Consultancy Services.

Speaking with Manjeet Kriplani of Business Week last year, Kohli echoed what the South Korean businessman Chung had told me at the golf links: “Big companies are geared up for incremental innovation. For us in India, the cost of doing innovative technology is very low.
The capability of India is its people. We can assemble more good and intelligent people than anywhere in the world. I admire China, but our people are better.India has ingenuity. If an ordinary car mechanic is aided by computers and simulation, his productivity leaps.”

At 80 plus, Kohli has given himself a new mission: To harness digital technology for spreading mass education, especially in India’s more than a half million villages.

Ingenuity is another name for what systems experts call as “equifinality,” which means transcending a system’s limitations by finding an alternative route to reach the same goal. A creative and ingenious mind becomes restless when he hits a wall and asserts, there has to be another way; and he improvises by transferring intelligence from one application to another.

But individual entrepreneurial ingenuity has its limitations. Bangalore could transcend the limitations of its poor infrastructure, power and transportation, for example, by building captive power plants and satellite communications to reach its outsourcing clients in the USA and elsewhere. But the shining city on the hill has left rest of the country far behind. Now the question is whether Indian ingenuity and its “swarming intelligence”, to borrow a term from the science of emergence, can be applied to collective action to build 24/7 reliable highways, ports, railroads, power plants and airports to compete with a super-competitive China.

Tuesday, May 24, 2005



India’s infrastructural woes
From The Statesman

In the early 1990s, power generation was thrown open to the private sector but India still suffers from frequent blackouts and brownouts, which makes me wonder whether the goal of electric power for everyone in the country by 2012 would be easily reached. It was thought that if you opened up the economy, investors would come in droves; but foreign investors don’t seem to be attracted to risking their capital in the power sector.

Without eliminating chronic power shortages, India would find it difficult to attract foreign investment in the newly approved special economic zones (SEZs) and continue falling behind China in economic growth. There is just not enough power available but wherever it is available the supply is not reliable. Industrial states like Maharashtra and Karnataka, for example, encounter four-eight hours of power outage in peak months.

Power theft, transmission and distribution losses, and other technical problems drain 40 per cent of power. Half the rural population is still without electricity. According to experts, India needs to add 10,000 megawatts of electricity per year for the next decade, which would require an investment of $180 billion, a great opportunity for the private sector if the investment climate is made attractive.

But how do you rebuild the confidence of the investor after what happened to the $2.9 billion Dabhol power plant, originally backed by Enron Corp, one of the biggest foreign investment projects in the country? The Maharashtra State Electricity Board, which like most other state public utilities, has been run like a public charity, could not afford to pay contractual Dabhol rates, and the plant was closed. It was a monumental embarrassment that this kind of failure in foreign collaboration should have occurred in India’s most industrialised state, which contributes 25 per cent to India’s GDP and has the potential to rival California.

Privatisation of production is meaningless unless producers are allowed to make a fair return on their investment. Multinational corporations invest to make money for their shareholders. They are not interested in giving free or subsidised power to farmers, however socially desirable that may be. But there is light at the end of the tunnel. GE and the construction firm Bechtel Group, which bought Enron’s majority interest in Dabhol after the scandal-struck US company went belly up, are in the final stages of negotiation to sell their majority stakes to a consortium of Indian financial institutions. The consortium would reportedly turn over the management to the National Thermal Power Corp. and Gas Authority of India and the power plant might be working soon.

The revival of the moribund power plant would be a confidence-building measure and would hopefully attract more investment in the power field.

India’s need for investment in electric power is fathomless; and so is the case with harbours, airports, drinking water, railroads and highways in order for an 8-10 per cent economic growth, which is necessary to create employment opportunities for a growing youth population - India’s greatest asset.

Most high-strung nationalists and economic experts think in terms of India’s place in the world economy; for example, where India would be vis-à-vis China, Japan or the USA in the next 10 years. But they are missing the point, as did the Vajpayee government, that: The immediate goal of rapid economic growth and its ultimate measure is poverty reduction by generating opportunities for employment, especially for the rural population, about 600 million, which mostly depend upon agriculture.

An indifferent monsoon casts a grim shadow on the rural landscape. Rural India should not continue to be a hostage to nature’s vagaries.

India’s rural population is too heavily dependent upon agriculture. Most of the rural workers should be absorbed into agro-industries, manufacturing and service industries, and that again would necessitate massive investment in building new infrastructure and modernising the existing one.

A case in point is the Mumbai Trans-Harbour bridge, connecting Mumbai to Navi Mumbai. It should have been completed two decades ago. To suggest that it is party politics or the slowness of democracy that prevents projects of such magnitude to be completed on time is poor thinking.

Retarded political behaviour is not the essence of democracy; otherwise the USA would have been a Third World country. It is freedom with accountability that makes the USA a nation in perpetual motion.

Poor infrastructure adds to the cost of production and that’s one reason why India finds it difficult to compete with Asian countries like Singapore, South Korea, Taiwan and China, for example. At times it seems that India is like a giant stuck in a swamp, struggling to get out.

But if the challenge-response theory has any merit, India has no choice but to get out of the swamp, upgrade its clogged roads and overcrowded airports, eliminate frequent power outages and scuttle the red tape. Growing prosperity in India and rising expectations abroad “that India can do” are creating compelling conditions for the government to put its act together.

India’s software and outsourcing industry has been quite ingenious in transcending the poverty of infrastructure by building its own captive power plants and establishing satellite communications with its clients abroad. But to expand the manufacturing base for domestic employment and for export, India has little choice but to modernise its infrastructure, and the most efficient way is through a combination of public and private investments.

It is no longer a question of survival but building “The New India” about which Prime Minister Manmohan Singh recently wrote in The Wall Street Journal.

Tuesday, May 17, 2005


An India that does
From The Statesman

India has been exciting the world’s imagination for sometime and many investors have begun to have a fresh look at the country and explore its potentials as an alternative to China.

George Evans, the director of international equities at the Oppenheimer Funds, Inc is one of them, who has been “much more enthused about India than China”.

International investors want growth with protection for their shareholders and India seems attractive because its legal system including property and contract law is well developed, Evans was quoted as saying in a Canadian newspaper, the Financial Post.

“India has some fantastic world class companies,” including Infosys Technolgies, Wipro, Tata Consultancy Services, among the software companies for which India has become a world leader, and in the growing field of biotechnology, petrochemicals and pharmaceuticals, where, for example, Dr Reddy’s Laboratories Ltd, Ranbaxy, Reliance and others have become international names.

These companies are creating a global buzz, an image of India that can do. The world has begun to trust India. The sentiment is widespread. Familiarising Israeli business leaders about expanding horizons in India, Simon Wasserman, chairman of AON Global, said at a recent conference on outsourcing, “India has everything that a multinational needs. It is a young country with creative minds and a huge market with almost 27 cities with more than a million population.”

In the next few years, according to a recent study by the Confederation of Indian Industry, India would be entering a new threshold of knowledge economy and could emerge as a global hub for specialised knowledge processing for global corporations.

Knowledge economy de pends upon extracting and creating new knowledge from data bases and is in a sense value-added outsourcing. That is an emerging trend, among other growing fields such as auto, genetic engineering, and high-tech healthcare that would transform India in the next decade. Probably the most exciting field of growth is healthcare, which according to the CII study would add seven-eight per cent to GDP and create nine million jobs by 2012.

Pressured by rising costs at home, the Americans have begun to realise that what a good Indian surgeon can do in the USA, he would do the same quality operation at a quarter of the cost in India. The Apollo Hospitals has become a highly regarded international healthcare brand and is attracting many bright young doctors of Indian origin in the USA back to India. Interestingly, as direct flights between India and the USA become more frequent, health tourism that combines Western medicine with yoga and meditation would become commonplace. Open skies tend to open minds as well as wallets.

Will India disappoint the rising global expectations or will it rise to the challenge? One might say that the Central government’s move for the establishment of export-oriented special economic zones (SEZs), recently approved by Parliament, is a partial response to the challenge of rising expectations. China’s special economic zones, where all labour laws seem to have been suspended to attract direct foreign investment, have played a tremendous role in making China an export-based global manufacturing powerhouse.

But India being a democracy couldn’t have ignored the human factor. Dr Manmohan Singh’s government had to drop a clause from the Bill that would have authorised a state government to enact laws “directing that any Act relating to trade unions, industrial and labour disputes, welfare of labour, including conditions of work, provident fund, employers’ liability, workmen’s compensation, invalidity, old age pension and maternity benefits, shall not apply to SEZs”. The insistence of deleting the clause came from the Leftist parties in the coalition government.

In authoritarian China, the ruling Communist Party can do anything; even suspend its own most cherished principles. Democratic India cannot afford to do that, so India’s SEZs might not become as wondrous manufacturing powerhouses as the Chinese. On the other hand, foreign investors might prefer to invest in a place where working conditions are at par with international standards and labour rights have not been vanquished.

Remember, it was Gandhi who started Majoor Mahajan, the textile labour organisation in Ahmedabad. You can’t ignore the old man, the Father of the Nation. But much more is needed to push India’s growth to eight-nine per cent than giving the industry fiscal incentives by setting up special economic zones. One of the biggest hurdles for rapid economic growth in India, according to impartial observers, is the red tape, which takes myriad forms, from expectations of illegal gratifications to turf war.

Quoting Dr Jayanta Roy of the Confederation of Indian Industry (CII), the Financial Times (London) wrote recently, “(A) typical international trade deal from India involved up to 30 separate parties, 257 signatures and 118 copies of the same document. Imports on average sit in Mumbai’s port for up to three weeks compared to 24 hours in ports elsewhere in the world.”

This is one of the biggest challenges that SEZ authorities would face as they attempt to transform India into a nation that can do. In the digital age, business transactions are expected to be speedy and seamless, without which cost advantage that a country with cheap and smart labour like India has would be lost.

Tuesday, May 10, 2005


CYBER AGE BY ND BATRA From The Statesman

Trustworthy news enables good governance

Reporting news is a hazardous job.

In 2004, 53 journalists were killed, 1,146 were maltreated, and more than 600 news organisations were censured worldwide, according to the UN. Last week (3 May) was the 15th World Press Freedom Day, celebrating the theme, “Media and good governance”. The emphasis is upon accountability of those who exercise power, whether political, corporate, religious or social. Power must be used for the good of society and journalists must act as watchdogs. Free, fearless and responsible media advance human rights and lessen tyranny.

In the USA, they don’t kill journalists; but they do give them hell, using the subpoena power. Recently about 30 American journalists have been subpoenaed or questioned about confidential sources used in their reporting. Journalists cultivate confidential sources to uncover corruption and sometimes they know more about a case than crime investigators.

Jim Taricani, a Rhode Island television reporter, was put under house arrest for four months for his refusal to disclose the source of the videotape showing a state official taking bribes from an undercover law enforcement informant. Sometimes whistle-blowers leak documents or talk on the promise of confidentiality to reporters. Reporters must report if they have information that impacts society. Not to report truth would be not only complicity in crime but also an unethical and unprofessional behaviour.

American society, for more than four decades, has been struggling with how to strike a balance between the news media’s obligation to do investigative reporting by cultivating confidential sources and the needs of the courts and law enforcement for access to crucial information that journalists might possess. Sometimes courts, and even legislatures, demand information including photos and videos that have not even been published. They issue subpoenas to get the necessary information, failing which they exercise the contempt power. Contempt power could chill freedom of the Press because journalists would dread going behind public relations handouts to find out the truth about the misbehaviour of public men. According to the Reporters Committee for Freedom of the Press report, Agents of Discovery, 1,326 subpoenas seeking notes, photos, tapes or testimony, were served on 440 news organisations that responded to the 1999 survey. The situation is no different today. State shield laws that are supposed to protect journalists from unnecessary disclosures are not always helpful.

“In opinion after opinion,” says the report, “judges fail to acknowledge any special role for the media in a democratic society, or any public interest in ensuring that the media remain impartial and disinterested both in perception and reality.”

We have to, however, keep in mind that when a journalist is the only source of information that constitutes a crucial piece of evidence in a legal case, information so compelling that without revealing its source there is a danger of justice being miscarried, in such a circumstance the source must be revealed regardless of the promise of confidentiality.

After all, the right to a fair trial is no less important than freedom of the Press. But where do you strike the balance?

In the course of time, the US Supreme Court began to use “preferred position balance theory” in deciding conflicts between freedom of the Press and other rights.

In numerous rulings, the court held that some freedoms, especially those granted by the First Amendment (freedom of speech and the Press), are fundamental to a free society and consequently deserving of more protection than other constitutional values.

Nonetheless, freedom of the Press does not trump all other rights, especially the constitutionally guaranteed right of a person to a fair trial that may require access to crucial evidence in the possession of a journalist. Thus by giving freedom of the ress a preferred position in balance with other rights, the government bears the burden of proof that forcing a journalist to disclose his news source is absolutely necessary.

Bob Woodward and Carl Bernstein of The Washington Post depended upon a confidential source, Deep Throat, for their path-breaking investigative reporting about Watergate that brought President Nixon down. One day we might know the identity of Deep Throat. Leaks form the office of Independent Council Kenneth Starr enabled reporters to uncover the Clinton-Lewinskey affair. Bill Clinton was the second President in a generation who was humiliated but in the process the nation renewed itself. Corporate whistle-blowers disclose corrupt accounting practices, faulty products and other malfeasances to journalists so that society might benefit.

Reporters are not supposed to act as a handmaid of law enforcement. When the court or the government intrudes into the newsroom and news-gathering processes, consequences can be terrible for the freedom of the Press. What happens if information obtained from confidential sources is revealed? It damages the reporter-source relationship and threatens news organisations’ image of independence.

When sources suspect collusion between law enforcement and news organisations, trust is lost. Free flow of accurate and reliable information is choked, and power begins to corrupt. An independent judiciary and a responsible free Press are the watchdogs of an open, secular, democratic society; and they must be kept apart. But journalists do misbehave sometimes and they should be punished. In 2003, CIA asked diplomat Joseph Wilson to investigate whether Saddam Hussein tried to obtain uranium (yellow cakes) from Niger. Wilson found no evidence and was publicly critical of the Bush administration for making such a claim. Immediately after the critical report, conservative columnist Robert Novak wrote a syndicated column stating that “two senior administration officials” told him that Wilson’s wife, Valerie Plame, was a CIA agent.

Should Novak have published the name of the agent knowing fully well that she might have been killed once her name was known? Journalists should be watchdogs, not mad dogs. Malice is not journalism.

Tuesday, May 3, 2005



Hollywood groans with pain, thanks to new DVD players with built-in editing features that can cut out scenes from a movie that might be deemed obscene and inappropriate for family viewing. Democratisation of digital technology is taking away the artistic control from movie directors and producers. Once again art and letters might become communal, as they were in the age of orality when stories evolved through communal sharing.

Consider Titanic, a great disaster epic and a most riveting love story, which seemed like a family entertainment; but many parents who took their children with them to theatres felt embarrassed to see a nude shot of Kate Winslet and a sexually explicit scene between Leonardo Dicaprio and her. Today many companies such as CleanFlick and CleanFilms sell cleaner versions of movies, without sex, violence and profanities.
As conservative Americans push family values to the forefront, they want to protect their kids from Hollywood’s toxic ideas. They argue that Hollywood, the land of Sodom and Gomorrah, has been responsible for a steep decline in moral values on which the USA was founded. The Hollywood movie rating system from general (G) to restricted (R) was developed by the Motion Picture Association of America in 1968 to regulate itself to avoid outside censorship.

But in the course of time the rating system, meant to provide viewers with informed choices, became porous, and sex, violence and foul language have been creeping into family oriented G-rated movies. It is called category creep. Besides, movie theatres don’t enforce rating restrictions since teenagers are most of the moviegoers and fill their coffers.

Since ratings have become an unreliable indicator of movie contents, conservatives now have the technology to re-edit movies on DVDs and make them suitable for children. In the pre-digital era, parents had no choice but to accept what Hollywood gave them. Empowered by digital technology, they believe that moviemakers and artistes would have to share control with the audience. The tyranny of Hollywood, its cultural hegemony, is over.

The Republican-controlled Congress recently passed the Family Movie Act, which legalises the sale of DVD players that can be programmed to edit obscenities and gory images of violence and rape, and in fact much more. Congressman Lamar Smith, a Texas Republican, who sponsored the Bill in the House, said, “It’s about families and parents and the rights of parents to raise their children the way they see fit.”
A recent documentary “Bleep! Censoring Hollywood?” explored the issue of editing the artistic work of movie producers without their permission versus parents’ right to control what their kids watch at home on DVDs. The movie industry, some say, driven by greed of global profits, has been giving a short shrift to its social and ethical responsibilities. Box office has been pushing the movie rating system down to the gutters, conservative Americans say.

Marshall Herskovitz, a well-known Hollywood film producer and director, whose credits include Troy and Traffic, wrote a piece in the Tallahassee Democrat in which he made a very valid point regarding the integrity of a work of art in a free society. “The great artistic works of our civilisation are littered with objectionable material: the nude sculpture David, the brutal murder in Crime and Punishment, the horrific blinding in King Lear, and on and on and on. And none of those great works would have been produced without their societies’ commitment to the integrity of the artist.Free of censorship. Free of editing. Free of the distortion of the original work. David was not sculpted with a loin cloth, and one can imagine Michelangelo being less than pleased at such a revision of his masterwork.”

That’s true but no one is asking Hollywood to stop making movies like Sin City, The Passion of the Christ, Saving Private Ryan, and other such movies where every fleeting emotion, passion and desire is visualised and nothing is left to viewers’ imagination.

But if a company buys a DVD of The Passion and cuts out long drawn out scenes of masochistic violence and torture, what is the harm done, especially if the sale of original DVDs is not adversely affected? The artistic integrity of the original movie remains untouched. In fact, taking out what is objectionable from a movie makes it more value-added in the economic sense since more people would be able to buy the sanitised version. Those who want to buy the uncut version could still buy it.

In the past too many works of arts were sanitised, and yet no lasting harm came to them. In 1807, Thomas Bowdler published a four-volume expurgated edition of Shakespeare’s work simply by deleting words and phrases that he thought were improper for performance in the presence of women and children; and so we had the expression “bowdlerize”, though now we call it sanitised. In a sanitised version of King Lear, Cordelia survives and marries Kent in the final Act. We go to museums to see original works of art, but a parody of Mona Lisa does not prevent us from admiring the original. Hollywood does make family-friendly versions of movies for primetime network television, movies that were originally made for the box office, but studios cry foul when some companies do it for the home market.

Movie sanitisation, apart from movie sharing over the Internet, is the greatest challenge that is shaping the future of Hollywood. When Hollywood gets into trouble, can Bollywood, the biggest moviemaker in the world, be left far behind?