“The eye of the tiger” takes on new symbolism on the cover of this week’s Economist which asks the question: “What’s Holding India Back?”
Using India’s finance minister P. Chidambaram’s recent statement that the “tiger is under grave threat” as a clever segue, the Economist takes a close look at India’s “tigerish economy,” arguing that it’s 9% a year average growth is under threat “because it has failed to reform its public sector.”
Here’s a quickie roundup of the news package to start off your week.
The lead story “India’s Civil Service: Battling the babu raj” takes a critical look at India’s hardworking “armies of clerks” (IAS officers), concluding that “India’s malfunctioning public sector (and civil service adminstration) is India’s biggest obstacle to growth”:
Indeed, all India’s administration is inefficient. According to the Congress-led government’s own estimate, most development spending fails to reach its intended recipients. Instead it is sponged up, or siphoned off, by a vast, tumorous bureaucracy.
This is not new news. Rajiv Gandhi,, as Prime Minister of India, once lamented helplessly that out of every rupee spent for development only 17 per cent actually reached the poor. But the following explanation about the ineffective reforms of India’s bureaucracy from author of an IAS history, Sanjoy Bagchi, certainly caught my attention:
“Overwhelmed by the constant feed of adulatory ambrosia, the maturing entrant tends to lose his head and balance. The diffident youngster of early idealistic years, in course of time, is transformed into an arrogant senior fond of throwing his weight around; he becomes a conceited prig.â€
I can just imagine the reporters writing this piece, going “Wow, we really have to find a way to use that quote!”
Anyway … another point that I found striking was that although the cover story expresses concern that India’s 9% growth rate is not sustainable, India remains one of the world’s four biggest emerging economies which accounts for two-fifths of global GDP growth last year — and is one of four world nations least dependent on the US: exports to America account for just 4% of India’s GDP. This, I did not know. [see “The decoupling debate”]
The entire package on India is worth checking out (and available online). Other pieces are “India’s budget: Write-offs as high as an elephant’s eye” (what is up with elephant and tiger references throughout this issue?!!) which looks at finance minister P. Chidambaram’s fiscal plans, including writing off farmer’s debts and raising the salaries of government employees.
There’s also a review of Columbia University economics professor Arvind Panagariya’s new book India: The Emerging Giant (OUP) which is described as a “comprehensive single-volume chronicle of the history of economic policy in India since independence in 1947 and its role in shaping the country’s fortunes.” The review brings us full circle to the argument that the Indian government needs to go bullish on structural, administrative reforms or else, risk smothering its growth momentum.
City Planning,
I have never heard anyone hiring a lawyer to get a passport, and Kush is absolutely correct about mobile phones, India has upwards of 150 million mobile phones as of year end 2006, the only two countries according to wkipedia that have more connections than India are China at 408 and US at 170 million. January of 2008 almost 9 million mobile phones were added and 83 million were added in 2007.
No one here is arguing there are problems, but I think effort should be made to correctly point out where problems are rather than making up stories.
Far be it from me to support City Planning aka PG, the notorious troll, and her fabulations about passports, the law, and most everything else about India, but I think the mobile phone data is a bit deceptive: While a lot of people have mobile phones, they all use it primarily (only?) for incoming calls so that they can be contacted when they are on the road, or they call somebody with a missed call so that they can be contacted back from a landline. This is a result of the pricing model that charges only for outgoing minutes on cellphones. So, while mobile phones are mighty convenient as a means to book train tickets, I doubt that they are really that common as a mechanism to book train tickets.
All that said, let me join the chorus in saying that train ticket booking was never such a huge hassle in India, and the ability to buy tickets at short notice has improved substantially in the last five years, what with Laloo’s policy of running the trains at over 90% occupancy, and low-priced airlines taking off in a big way.
Corruption — the semi-official rupees-in-palm payments for government officials simply to do their jobs — is the biggest drain on India’s potential. It contaminates everything.
I should have guessed about PG. Rahul you are absolutely agree with you about the cellphone and their usage in India, although a lot of people use them for text messaging which is very cheap and if the bookings can be done through text messages, it may just take off.
Getting my passport renewed last summer under the tatkaal scheme was one of the most harrowing experiences of my life. What should have taken a maximum of 10 days and 2 visits to the regional passport office in Chennai took 2 months, 10 trips, and over 18 hours spent in the office. I wasn’t the only one. After waiting in line with some people on my initial visit, I’d see them again and again on subsequent visits. It took 3 trips to the office just to find out what their problem was with my application, then the rest to make correction after correction until they were finally satisfied.
There was a middle-aged man there who’d applied for his tatkaal passport 6 months previously, and hadn’t heard anything back from the passport office as to why his passport hadn’t been processed. He’d made countless trips to try and figure out what was going on, and wasn’t getting any answers. He had a visa in his old passport and a round-trip ticket for THAT EVENING and they still wouldn’t give him an answer.
I only found all of this out when in a frenzied panic, he broke down and started weeping in the middle of the office, and then screamed his story for everyone to hear until he was whisked away by one of the officers. It was pathetic.
Sadly, it seems like it’s easier to get an Indian passport anywhere else in the world than it is in India. You don’t need lawyers, and I haven’t heard of anyone using a lawyer, but plenty of people use agents.
i live in india and take the train fairly often. it is hardly as easy as some of you are making it sound to book tickets, particularly if it is last minute, or even the night before. the railway booking counter is not open 24 hrs, nor are travel agencies. if i want to catch the next day mornings 6:00am train, i may have to show up at the station more than an hour early, and still risk not getting on. or i may not have the full credit on my prepaid phone account to cover the cost of the ticket..even then i think you have to give the serial number of your identification and have access to a printer. this is not easy to accomplish after say 9 or 10pm as most businesses close… people over here dont seem to mind all of this so much perhaps because they are comparing it to how things previously operated, and possibly they value their time differently. with the exception of the shatabdi and a few other services, traveling 200-250 miles is an overnight journey on most routes.
rar: thanks for sharing your experience. I think that was what i was getting at earlier.
What strikes me in the European and American journalism on the emergence of India as an economic superpower is the typical sequence of the stories they tell: (1) Yes, India has a growth rate of 9%, a growing middle class, a surplus of highly educated labour force, etc. (2) But, there is still the caste system, poverty, corruption, bureaucracy, religious strife, etc. (3) Therefore, we (Europeans or Americans) really shouldn’t worry all that much about the competition from Indian companies, engineers, students, etc.
Now, imagine someone telling the story of the 19th-century industrial revolution in the West. When one notes the tremendous growth in that period, one can also point out the horrible facts of child labour, labour conditions in general, the situation of the proletarians. But these facts do not negate in any way that there was growth. Why do the western journalists seem to suggest that the growth of the Indian economy somehow becomes less important (or less threatening) because of whatever goes wrong in India?
To me this seems to be an expression of the West’s inability to cope with the changing world relations. Instead of beginning to reflect on the fact that Indian middle class schoolkids will crush their American and European counterparts in any competition, westernes try to console themselves by reproducing the old colonial images of Indian culture and society.
Jakob
I think people are getting sidetracked with train tickets and passports…..they are important but not necessarily relevant to the macroeconomic picture that we are talking about here. 1.India’s problems are manifold, and given where we were in 1947, the country and it’s govt have done reasonably well. The country not only exists but is thriving. Most people gave India a max life span of 15 years at independance. 2.India’s per capital income seems low when compared to the west, but take into account the fact that India was ruled by foreign powers (and plundered by it’s own ‘princely’ rulers) when the west was rapidly industrializing. It took India some time (40 years) to get to the correct economic policies….protectionism, in retrospect, has been beneficial to India in some sense. Look at the companies that benefitted from protectionism, the Tata’s, bajaj’s ….almost all the movers of the Indian stock market of today are beneficiaries of the protectionist policies who have come of age and feel they can compete globally. 3. India will find it extremely difficult to take China’s path due to the democratic system of governance. China has it’s own problems. But it seems to be a favourite past time for the Economist to make this comparison 4. I don’t agree with the idea that IAS officers are a problem. Definitely there are a few bad apples. One thing you have to understand is that all IAS officers are not equal! There are two types of IAS officers: Regular recruits and promotees. The regular recruits are directly recruited based on the UPSC selection process and usually tend to be the bright, young people. This group is generally talented, confident, and usually honest. The promotees are those who have spent a lifetime in State government jobs, starting as section officers (glorified clerks) and working their way up and finally getting empanelled (as IAS officers) almost at the end of their careers. These guys are CORRUPT to the core, almost without exception. The few years they spend as IAS officers, they loot. They are politically well connected, and although many of these people never rise above the post of a District collector, they do enough damage to the IAS image.
Actually, I’m pretty OK with austerity, and very OK with simple living, as that has been my M.O. since the age of 18, so often, the harrowing experiences of getting things done in India, and the slowness of it all, does not really bother me, as it does alot of other people.
I’ve always booked train tickets by standing in line (or whatever that is) at the train stations in India, because it saves you a few hundred rupees that going to a travel agent will cost. I’ve never had a cell phone in India and I don’t have a credit card, anywhere, so that option is out of the question for me.
Who are all these Indians with credit cards booking their train tickets over the net? They certainly aren’t in my home town!
Several of my friends can verify the passport drama.
Hey, City Planning Gori, how come you haven’t shared your extensive experiences of riding the trains daily hanging out of doors and balancing on rooftops while dodging power lines and tunnels? And that one time when you had so much difficulty with immigration when you accidentally crossed into Pakistan while playing cricket near the border?
ok, i’m not sure if you were being sarcastic above, because sandhya’s reply to you (“I think that was what i was getting at earlier”) seems to imply you were not sarcastic.
But yea, absolutely. Its a perfectly valid complaint indeed to say that the railway booking counter in your colony operates by its office hours (though I’m sure you know that the main booking counters in the railway stations are open 24 hrs)….. and another perfectly valid complain that you dont have enough money in your prepaid account to buy for the ticket…. or that you have to give some kind of an identification number to do an electronic booking…… or that you dont have a printer to print you ticket….all perfectly valid complaints indeed 😛
did they start using miles in india? hmmm… makes me wonder abt whether ur really in india 😛
Most reservation counters usually have queues with chairs in rows…. so obviously you never went to a reservation counter. The unreserved tickets are usually very quick because they are bought on the spot, and need no information at all (not even your name).
Someone above was complaining about requiring to give your name, age and gender for reserving a ticket in advance… That process is basically to ensure that the ticket is not transfered, and they dont want to create too much of hassle by requiring strict picture ids, etc for everyone. So, as a proxy the traveling ticket examiner used a rought test of age and gender to make sure the ticket was not transfered to someone else.
What is so personal about giving your sex, name and age (not even date of birth, just the age – this is anyway possible to estimate roughly even if you didnt tell anyone)??? I just hope you guys really aren’t the kind of nags that such kind of a complaint makes you sound like you might be, in real life.
I meant, the TTE visually verifies this during the journey against what their records state. If you now decide to complain that your name and gender are too personal for you to share while reserving a ticket, I would certainly give up.
Sandhya, that write off may not happen according to this article in CSM – India’s farmers doubt Delhi’s big aid pledge
Oh, I think it’s far, far worse than you imagine (at least in my case–you see, I’d call the “nags” the people who are preventing me from “transferring” my ticket–how dare I??!! That should be criminalized!! Can’t have free transfer of tickets, now, can we?!).
I currently am in India and I have been buying tickets online. Can’t help but ask where are the three offices and five forms?
Nope. Its because you might try and buy up all the tickets and then auction them to third parties for a higher price 🙂
62 · marshmilli on March 12, 2008 12:29 AM · Direct link · “Quoteâ€(?)
ok, i’m not sure if you were being sarcastic above, because sandhya’s reply to you (“I think that was what i was getting at earlier”) seems to imply you were not sarcastic. But yea, absolutely. Its a perfectly valid complaint indeed to say that the railway booking counter in your colony operates by its office hours (though I’m sure you know that the main booking counters in the railway stations are open 24 hrs)….. and another perfectly valid complain that you dont have enough money in your prepaid account to buy for the ticket…. or that you have to give some kind of an identification number to do an electronic booking…… or that you dont have a printer to print you ticket….all perfectly valid complaints indeed 😛
no, wasn’t being sarcastic..and i still stand by my claim that railway counters are not open 24hrs, even at the main railway station. i have direct and recent experience of of being told at 11pm to come back at 4am when the ticket counter opens at the main Bangalore city railway station.
traveling 200-250 miles
did they start using miles in india? hmmm… makes me wonder abt whether ur really in india 😛
this is an indian-american blog, i’m an abd living in india, i mentally converted a sample 350-400km distance to make a comparison to US distances easier. i think that the whole example of train booking was brought up to illustrate a symptom of an underlying condition. a bloated officialdom that creates inefficiencies on every level. it is not to officialdom’s credit that IT applications have been developed to book tickets from your mobile, this is incidental to the march of progress of IT globally. there is much commentary about how things in India are getting better and how this sort of vindicates indians for having done things their “own” way all along. their “own” way being tolerating mediocrity if not incompetence in all endeavors as long as it reinforces existing channels of patronage. many different nations in asia, including pakistan, will have appeared to have made huge strides in terms of a consumer boom in the last 15 yrs as well. the difference is that india has a massive population from which its importance derives, and that is the beginning and end of the india “story” at the moment. the billionaire oligarchy forming here are on the verge of being world class, but it is not in the forseeable future that anyone from a moderately developed nation will look upon the average indian and not feel a bit of pity.
44 · portmanteau said
Dear friend I am not joking there are many active anarchist groups in bangalore.. Just the other day I saw a che guevara graffiti in the Software Technology Park , Electronic City… I think an anarchist revolution is inevitable in India…
lots of comments here about corruption, train ticket booking etc.. stay in mumbai currently..have been booking tickets online on the irctc website for the last 6 months ( including suburban railway quarterly passes).. it takes 5 mins to book and tickets are delivered home the next day.. this is true even for long distance train tickets.. as for corruption .. there are multiple problems on that and it is widespread..however, with e processes coming in, opportunities for corruption are coming down.. in the past 8 months, have got a gas connection, got a MTNL telephone installed ( and repaired.. and bills paid online), got my car registration changed and got an ecnr on my passport.. in earlier days, all of this would normally have called for money to change hands .. but now i havent had to pay a single rupee as bribe..
Of course there exists numerous pockets where corruption is rife.. but things are improving .. its not as bad as you make it out to be !!!!!
They are reserved for the financially challenged masses of India.
OK so now I’m being told I never did something that I’ve actually done? Funny.
Anyway, oftentimes when reading SM I get the feeling people are talking about another India than the one I’ve lived in since 1993. But then again, I’ve never lived in Mumbai, so maybe that explains it.
What is UP with Che and parks? The ballpark in NYC is named “Che Stadium”, and now Che is taking over the Software Tech Park.
At this rate, we will soon be singing, “Oh, Che, can you see by the dawn’s early light…”.
Unless Lou Dobbs’s Mexican nightmare comes true first, in which case we’ll just sing “José, can you see…”.
Population isn’t that much of a problem, infact much of Indias growth is because of the young population it is one of Indias main strenght, and unlike China India won’t face the problem of being a poor country but having few young people feeding the grandparents and parents. This is going to be a huge problem for India.
Indians are often too hard on them selves, I’ve worked in both Shanghai and Mumbai. When I came to Shanghai our office was in a huge fancy building nothing less of what you see in the west, when you went in to the office there where hardly any people and even less work being done. Mumbai was the exact opposite, when I came to our companys office I almost started to laugh, it looked like the garage where Bill Gates started Microsoft. But the Office was cramned with people and alot of actual work was being done. If you talk to people that have experienced working in both India andChina they will give you the same picture.
China, every thing is of the highest standard, everything works like a clock, just take their top notch magnetic train that goes from Shanghai to the airport, it is the fastest train in the world. But it’s completely empty, and it’s 50 miles long, thats it! It’s just show, it’s like the Concorde plane, no one wanted it, no one asked for it. India doesn’t work like that, India can’t set away that kind of resources just to make a PR statement to the west, Indian companies grow organically. China today makes me think of when Nehru went to the Soviet Union in the 50’s and admired the industrial growth in the country, which subsequently made us tilt towards Soviet instead of the US. Today we, and the world admires Chinas strenght and industrial growth, but none of it is organically growth, it’s top down investment, some day these investments, like the train from Shanghai to the airport have to pay for them selves, and that is when we the comparison bewteen China and India becomes relevant.
That said, the Economist is spot on about India. That said, the Indian civil service is a tough nut to crack, any government that lays off that many people will be in huge trouble and maybe it’s for the better. Maybe it’s fr the better. Indias private sector has shown that it can grow despite the civil sector, 10 years ago working in the civil sector was everything an Indian graduate would dream about, nowadays the tables are turned. When private alternatives becomes more attractive than the public sector, not only for the customer, but also for the employee things will sort out for them selves and that is much better than creating a huge crisis by privatizing faster than jobs are being created, in the worst case scenario you’ll end upp as some South East Asian countries did in the mid 90’s.
Well, all I have to say is …”Good Morning Saaarr!!”
If you haven’t read this, check it out. http://www.amazon.com/Corruption-Indias-C-P-Srivastava/dp/0333935314/ref=sr_1_16?ie=UTF8&s=books&qid=1205360909&sr=8-16
“Corruption: India’s Enemy Within” is written by an ex-IAS officer who has been Private Secretary to many PMs. He gives a great account of his observations and solutions on how one might go about solving the problem. Most people know what the problems and solutions are with respect to what is stopping India, its the how and who which is the problem.
I haven’t read all the comments so do not know whether this has been answered, “Tiger” is usually used to refer to emerging economies which are growing stronger and are growing at a breakneck speed. E.g. Asian Tigers were Singapore, Thailand, Malaysia, and South Korea in the 90s. In 2000s, China is refered to as a Dragon and India is refered to as an Elephant, a slow growing and big economy. Of late, India has been refered to as an elephant showing the stripes of a tiger due to its high-er growth rate of 9%.
To the person refering to population problem, it is known that demography is everything. No longer India’s population is looked upon as a liability. Everywhere growth usually follows higher population, IF (Big IF) right economic policies are in place along with other institutions, which is followed by lower fertility growth followed by slow down in population followed by lower population followed by lower growth. Japan and Europe has a problem of lower population growth. China is fine but they are getting older faster than they are getting richer. India is the only country which will have the most working age population till 2050.
What else can we expect when we have the largest number of illiterates in the world? The politicians and Babus who RULE over us can only do so as long as we are illiterate.
I’m actually concerned for India’s economy. Will it grow at least 7% for the next 20 years or so? Economist magazine and other analysts predict slower growth in the near future. What’s causing this slow down? NOTE: This is not negative real GDP, but a reduction in the speed of growth. Are Communists to blame? Is the weak dollar to blame – I think not.
:I’m actually concerned for India’s economy. Will it grow at least 7% for the next 20 years or so? Economist magazine and other analysts predict slower growth in the near future. What’s causing this slow down? NOTE: This is not negative real GDP, but a reduction in the speed of growth. Are Communists to blame? Is the weak dollar to blame – I think not. :
quotas are always sub optimal and ultimately hurt the country’s progress….
There was a popular joke at the time of Perestroika in Gorbachev’s Russia .It was said that in the first year of Perestroika ,everybody would have motorbikes,in the second year everybody would have cars,in the third year everybody would have planes.When asked what people would do if everyone had planes,the answer was simple.If you came to know that bread was available in Vladivostok,you could quickly board your plane and join the queue ahead of others.Sometimes ,when you look at the types of policies being made here at the altar of political correctness,sensible indians wonder whether the Gorbachev joke may soon have an Indian counterpart.
commenting from India.
Booking railway tickets have been made quite easy. Looks like I have different experiences with the government agencies than some other commenters. I renewed my passport in Chennai within 4 days on my last trip. No bribery, nothing illegal. The only drawback was that I have to go in the morning once to get into the first of the line and then in the evening to actually apply. They take only limited applications per day. And the waiting room was cramped. I was suffocated for a while.
It is as painful as extending my driver license in the US , being a resident alien I have to drive upto the state capital (40 miles) and have to submit relevant immigration documents. I can’t get it in the local DMV/RMVs.
I agree with the other commenters who have talked about the undue “influence” of the “government officials”. It is an hangover from the British period. We need to get rid of the model where each “senior government official” gets around 20 sidekicks who do nothing but wash / cook / serve / drive for him.
The economy of India will be good shape and the infrastructure projects take shape within few years once all these things take shape the country will be brand new
As a very frustrated scientist trying to start experiments in India, I can give you the answer in one sentence: the blind insistence of Indians on ignoring basic science. We LOVE to reverse-engineer, but NEVER to create. There are no incentives to go into basic science – people like me who try to start anything new are threatened with joblessness.
Seriously, does it take a lot of brain power to realize that no country will ever be truly self-sufficient and happy without basic research (not just in science, but also in humanities)?