india: dancing with destiny

7/27/2019 India: Dancing with Destiny

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I N G L O B A L T R A N S I T I O N

INDIADANCING WITH DESTINY

lobetrotters View Issue No 10de the roads, walk the malls, and witness the hubbub of business activity, in any small or large city in India, is toe with destiny and opportunity. From global professional,llagers in oxcarts, 36 languages and 350 dialects, India is aof diversity and extremes. What was, a short 20 years ago

and of snake charmers, yoga hippies, and backwardness,day the hottest economy on the planet growing at aning 9%. Economic liberalization beginning in 1991,completely transformed the Indian economy into thest growing economy on the planet!

As a result, hordes ofIndias 1.3 BILLION peoplebrowse top global brands in upscale malls or places likethe chaotic Nehru place (right)... where one can findevery major brand of computer, software, mobiledevice, ... or clothing. I didnt ask about copyrights forthe vast list of software I was given on the street, and Ididnt see any tags on the clothing. If you want tagschoose the fancy Megacity mall. Indoor food market oroutdoor market (practice your bargaining power). Bothare equally crowded

and strong indicatorsof Indias newfoundpurchasing power

with 400 millionraised from poverty

since 91and 300 million-

strong middle-

class, growing at5-6% per annum.

Thanks largely to the current PrimeMinister, (previously Finance Minister)Manmohan Singh who lifted the iron gripof the state on industry and liberalizedtrade policy,the private sector nowcontributes almost 80% to the countryseconomy. The reduction in import tariffsfrom as high as 400%, reduction of

business licensing permit application fromseveral months to 10 days, and reductionof income tax from 97% to 30%, has come

a long way in attracting foreign investment, redcapital flight, and encouraging small business. Fexchange reserves now stand at $400 Billion... putting India among the top 10 countries holdreserves. Further, the once competition-shy In

corporate sector has come into its own and takeglobal players. Indians who fled to Silicon Vallethe venture capital boom, are now returning to

bringing their investment capital and expertise b


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B O T T L E N E C K S

P R O G R E S Sof the above sounds great, but behind this glorious growth, lurks disruptive

uptive business practices, that are discussed openly at anti-corruption

ferences like this (right) attended by top business leaders. Nowadays even

tical leaders, like Sonia Gandhi, leader of the largest Congress party in India, is

pting corruption as a new platform. Weve come to understand that

ERYTHING is commissionable in India, and when questioned about whether

can do business without it, the answer is Certainly Madame, but how long do you

t to wait? Intelligent observers tell us if India could rid itself of its pandemic

uption it could become a far more developed economy within a few years. Yet,

st of government has no interest in change, they have jobs for life and gain

motion based on tenure. Those who have power to give permits and licenses

vide them to those who pay, some are deep in public scandal, yet none go toon. Police officials cannot survive on their salary and bribes are considered as

t of it. Businesses prefer cash dealings to avoid taxes. Thus, corruption works for

ia, but is a barrier to greater growth as capital flows to private interest vs. greater

d. Add to this the lingering caste system that can put a glass ceiling on any career. Some

m it is gone, some have broken through it, largely with job opportunity via out-migration.

refore, we witnessed it lingering.As bad as corruption is, the bigger problem is INFRASTRUCTURE, wh

drive even the highest Hindu Priest to insanity. We struggled for 7 hour

100 miles from rural India to Bhopal airport to meet our 20:30 flight. The

had successfully blocked every major road to protest lack of electricity ...

wonder, their wives walk miles to gather firewood for cooking and light.

with potholes as big as volcanic craters are filled by barefoot women in sa

carrying gravel on their heads. At this rate the road construction will tak

than their lifetime. No bobcats or caterpillars here! Villages seem endless

going through small town rural North Dakota with the entire town popu

gathered on main street for the town parade every few miles. Similar b

different, village parades are the stuff of life .... awash with shops sellin

everything from mobile phones, to tailoring, to car and bike repair, to hai

shave ... all are out of doors beside the bustling markets, encroaching upo

lane main street... with another main difference ... lending new meaning

word Sacred Cow, COWS RULE the ROADS in India.

Their staring glare daresall that want to share

their path .... buses, bikes,

baby carriages, semis,tractors, taxis, tuk-tuks,

all-terrain vehicles ....to defy them... As if to say,

Go ahead, hit me. Hit

one and pay the farmera handsome price, then

return to the holy GangesRiver to cleanse yourself/

gain repentance, in respect

to Hindu law. One does noteat cows in India, they exist

for milk, manure (fertilizer)dowry, and natural speed

bumps.... thus I suspect their life expectancy is longer than mine and promost probably surpasses prairie dogs. We long for I-94. (River Ganges Belo

tionally, India may have 700 MILLION mobile phones --far more phones than

s - but keeping your cell, camera, and computer powered is an absolute

al ... the power literally goes out every hour or several hours, and if youre

ng in a high-end place you may be lucky enough to hear the whir of a back-up

rator kicking in... its a wonder I have a hard disk left, its been shocked into

tude several times. As for the mobile phone service, the only way to get a signal

ral India is to climb to the top of the water tower. Our Guide was seen calling his

way mother from this tower every few days as a dutiful son. When powered, cell

ces offer everything from latest produce prices for farmers, to INSTANT

ness process outsourcing, to bank transfers, (leapfrogging long lines at banks)

for the ATM that resembles the lineup at Best Buy the day after Thanksgiving --

know that one has cash


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ther bottleneck to future growth is a CRITICAL

K OF SKILLED LABOR,both management and

kers, which impacts quality and productivity,and

major roadblock to development. This was evident

number of areas like construction and hotel/motel

agement. Essentially,you can take the boy out of the

ge, but taking the village out of the boy is not

ething that happens overnight. Plans for future

lopment include higher ed enrollment expansion

million by 2020, from present 14 million. This

ns India badly needs teachers and cannot import

m because the infrastructure and salaries are rather

vs. other countries. The construction industry is

as biggest employer, after agriculture, with aboutillion workers --- 83% are unskilled. Construction

pected to employ 83 million people by 2022

esenting a great opportunity for construction

agement training - particularly for masons,

enters, and road construction. Construction

panies are setting up their own training schools and

could consider tapping into this market.

, The prestigious Faculty of Management School

elhi University is highly involved in the plan to

o 40 million, and plays an integral part in

loping management talent. Meeting the demand is

ge challenge given the lack of skilled teachers, lack

ofessional managers to meet the need as part time

hers, and lack of infrastructure. Faculty at right all

overseas experience and we found graduate

ents (below) to be highly engaged, disciplined, and

cated to improving future education as alumni.

ay, India sends more students to U.S. colleges than

other country in the world. In 2008, over 94,563

an students ENROLLED IN U.S. COLLEGES and

VERSITIES. Given the above, it could be lots

e.

ADDING FUEL TO THE FIRE, over half the

population is rural and relies largely on subsistence

farming. There is no way to identify these individuals

as part of the economy, which leads to a difficult

phenomena ... only 20% of the population pays taxes

of any kind. Of course, in a rapidly expanding

economy, there is a huge migration from the rural areas

into the cities. 300 million urban population going to

400 million or 50% of population. Consequently,

infrastructure, pollution , traffic, housing are in a dire

state and with 40% of the population under 25 there is

a crying need for adequate k-12 education . School

dropout rates remain high at 43%. In over -crowdedplaces like Delhi, they continue to issue 1000 car

licenses per day. Fuel to the fire.

LATION: Indias banks are conservative and well

aged, and coupled with the cash economy, the

ntry barreled through the financial crisis with 6%

wth! Inflation is thus inevitable given the growth ina. Salaries are not keeping up with inflation and

e are street protests about the price of onions and

toes - a staple in the Indian diet. Onions on January

010 were 11 rupees per kilo, now, in December 2010

are 60 to 70 rupees per kilo! Additionally, real

e is out of sight because land for apartments is

ce. The feeling is that investors buy up the real

e and flip it .... sound familiar? Central Bank of

a has reversed its monetary policy to control

tion - they are providing no stimulus package and

est rates are rising to control inflation.

itionally, back to infrastructure, food is rotting in

warehouses by the thousands of kilos, if rotting,

ple believe it is theirs to forcibly take, but law willfere, only contributing to unrest, and underlining

nfrastructure issue.

Success Despite the Gods: Having said a

Indias entrepreneurs can seemingly mana

any obstacle. They have the WORLDS LA

STOCK MARKET, second only to NYSE;

WORLDS LARGEST MILK PRODUCER,

SECOND LARGEST PRODUCER OF FOO

including fruits and vegetables. and the W

SECOND LARGEST PHARMACEUTICAL

INDUSTRY( after China).

BPO: Their services sector is STELLAR and

global at a rapid pace. As an example, need

financials within 24 hours to show to inves

called SSRA, a financial and business pro

outsourcing firm on a Sunday morning. T

answered on his mobile phone. He said ,

handed me over to a 40 year banking and fi

veteran who developed a beautiful set of fi

presentation purposes overnight. Turns ou

many global clients and advised me on a n

tax holidays as well. I am forever grateful

Suresh Goyal (pictured on page 1 with Sus

use his company: SSRAONLINE.com .

In India, you will find rich and poor, chao

upscale to lowscale, and everything in bet

with opportunity in every corner.

You may not know it, but you are destined

with India .
http://ssraonline.com/http://ssraonline.com/

india: dancing with destiny

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