Through some random web surfing, I came across an interesting article by Jayant Bhandari comparing / contrasting his experiences doing business in the Desh shortly after 1991’s economic reforms vs. now. Although we frequently talk about how much the Indian economy has changed in the past 15 yrs, Jayant’s article had some solid anecdotes of just how grinding day to day life really was back in the day –

..I moved to Delhi [in 1993]. To my dismay, no one wanted to rent me a decent place to live in. The landlords mostly refused to talk to me, and had blatantly advertised their property as for foreigners only.

..having a phone was not enough. It usually did not work, and when it did, I usually could not use my fax machine because of the “noise” that infested the communications network. For the next three years, I spent, on average, one day a month to keep my phone in operation by making personal visits to the telecommunication department.

..One of the several laws I broke in those days was the law restricting the fax machine itself. I should have sought a license to use it; but getting it would have meant tens of visits to the telephone office, more hefty bribes, and the certainty that if I was refused a license, I would not have been able to communicate. This meant that the government employee responsible for keeping track of my telephone connection got a particularly heavy bribe…I spent the equivalent of one day a month depositing my telephone, electricity, and water payments.

..Getting money from the UK was another bureaucratic nightmare. The money came to the foreign currency department of a public sector bank. Once the bank got the money it would take about two months to give it to me — the check just traveled around and around inside their office.

It’s important to note that every single one of the issues he encounters were premised on good intentions at first. Why did landlords treat foreign vs. native rent money so differently? Because the latter couldn’t be evicted if they were late in their payments. Why the flimsy phone network? Because the telecoms saw their duty to provide jobs first, service a whole bunch of socio-political mandates second, and provide actual phone service perhaps 3rd. Currency controls? The goal was to prevent the twin scourges of capital flight and foreign takeovers. etc. etc. etc.

Of course, much turns around in a scant 5 years…

…In 1998 I moved to a self-sufficient gated community with its own electrical generating plant, water supply system, and private security — probably among the first such communities in India. Telephones had just started becoming private all over the country. A guy wearing a suit in the sweltering heat of Delhi came to install my new telephone. He made no pretensions of looking important and called me “sir” more often than he should have. Efficient private banks had opened everywhere. I could talk to them on the telephone, and they even delivered money to my place without charge.

While upper-middle class folk like Jayant had enormous gains, even at current growth rates, the poor have a LONG way to go –

an average Indian lives on about $1.70 a day. And how does India’s glamorous growth appear from this perspective? Australia’s growth in GDP (which is around 2%) will add about $600 to its per capita GDP, almost as much as India’s total GDP per capita. Its 6.9% growth will give the average Indian about 11 cents extra for use each day, a year from now.

… [Nevertheless] For the average Indian living on $1.70 per day, an extra 11 cents next year will be a windfall.

Helps keep things in perspective, eh?