Imagining India

Nandan Nilekani’s new book, Imagining India.

I just finished reading Nandan Nilekani’s new book, Imagining India. It is a wonderful look at the state of India, and how it got here, but more importantly it is an optimistic look forward at where India can go. 

Nilekani is most famous as the co-founder of Infosys, the IT juggernaut that arguably led India’s outsourcing boom.  He is also known as the man who inspired Tom Friedman with the idea that the World is Flat. I was honored to meet him at a conference in January, and was able to get my copy of the book autographed. Read on for a summary.

It’s awfully hard to summarize an entire book, especially one as broad as this one. He looks at everything from energy to education, population to agriculture, transportation to healthcare, politics to poverty, and many of the topics at the intersection.

Here are a few of my favorite observations:

  • “India now stands evenly balanced, between our reluctance to change in the face of immense challenges and the possibilities we do have if we do tackle these issues head-on. The consequences of these two choices are in extremes– in the long term we will either become a country that greatly disappoints when compared to our potential or one that beats all expectations.”
  • “India is a country so young that 50 per cent of the population is still not eligible to vote, and this means that the voice of an entire, large generation is now ignored in India’s policy making and public debates.
  • “As Tom Friedman notes, these days rather than tell his children to finish their dinner because people are going hungry, ‘I tell my daughters to finish their homework because people and China and India are starving for their jobs.’”
  • India has a youth dividend; “… we have started to experience a demographic dividend since 1980, and it will take until 2035 to peak.  By this time India will have added over 270 million people to the working population.”
  • “This opens up interesting new opportunities for the country, as the challenge of maintaining wealth in ageing societies means that developed markets will have to increasingly outsource their labour requirements. In 2020 India is projected to have an additional forty-seven million workers, almost equal to the total world shortfall. The average Indian will be only twenty-nine years old, compared with he average age of thirty-seven in China and the United States, forty-five in Western Europe and forty-eight in Japan.”  Thus, he posits, India is poised for tremendous growth and economic opportunity if it can leverage the strength of that large working-age population.
  • “There was an old wag of a saying that ‘India has potential, and it will always have potential.’ It is as Indian attitudes towards entrepreneurs have transformed … that this potential is finally being realized.”
  • “Nearly one-third of all rural schoolchildren are now enrolled in private schools, and close to 50 per cent of these schools are English-medium.”
  • “In the slums of Hyderabad, the number of private schools teaching in English now exceeds the number of government schools by two to one.”
  • “It is estimated that India has over 300 million English users, which surpasses even the United States and makes us the country with the largest number of English speakers.”
  • “In 2004 all elections across the country had electronic voting, with one million machines deployed across over 700,000 polling booths.”  It went smoothly again in the elections this year.
  • “One fourth of Indian villages do not have a road leading out of them.”
  • “‘When you take the middleman out of services, you take away discrimination of the customer and differential service,’” he quotes one banker saying.  He cites many examples about how IT has helped to more directly connect producers with consumers – e.g., farmers with markets – thus giving them more market power and less abuse by middlemen.
  • “As the funds for our various initiatives have appeared, it has quickly become obvious that the delivery mechanisms for converting our goals into concrete results are badly damaged.”
  • “India produces the second largest number of engineers in the world every year, as well as the largest number of school dropouts. Even as India is building a name for itself in intellectual capital, a third of its population remains illiterate.”
  • “India’s government schools [are] education of the last resort, the final desperate measure for the children of the poor and the illiterate.”
  • “Today, 90 per cent of the public expenditure in Indian schools is on the salaries of the teachers and the administration. And yet we have the highest rates of teacher truancy in the world.”
  • “Two-thirds of Bombay’s population lives in [slums]. … It is not uncommon for a thousand houses to share one working toilet.” And yet, “vacant spaces here go for Rs100,000 [$2000] and more.” Indeed, “The richer classes of Bombay’s slums earn as much as Rs14,000 a month, which means a substantial part of Bombay’s middle class lives here.”
  • “Our 170 million slum dwellers alone surpass the populations of all but five countries in the world.”
  • “The surge of the IT/BPO industries [in Bangalore] and elsewhere has put immense pressures on India’s infrastructure… [creating] a new class of relatively rich, ‘high-impact’ urban residents… who needed effective infrastructure.”
  • “It has taken some time, but I think we can confidently say that India is no longer imagined as an essentially rural country.”
  • “Yashwant Sinha … has remarked that all centuries co-exist in India.”
  • “Investments in infrastructure were anyway a lose-lose option: the often zero tariffs in power and incredibly low user charges for road transport and railways meant that when it came to such projects the more the state built the more it lost.”
  • “The explosion of private [telecom] players has led to what has become the most rapid and sustained expansion in teledensity in the world, and we have a network that now covers close to half of India’s population.”
  • As a consequence of poor public-transport systems, “Infosys spends $5 million a year on transporting our 18,000 employees [in Bangalore alone].”
  • “Until our infrastructure is good enough for people to prize them over subsidies, governments will not feel the pressure to get ride of subsidy programmes.”
  • “We are a country that is now fast growing yet constricted, with entrepreneurs who eye the global market, yet find the infrastructure and regulatory barriers to expanding their business into [the neighboring state] difficult to overcome.”
  • “India, unlike China, executes with crisis…. This… has not been a good model for growth.”
  • “The Dalits in rural India have long been landless and were paid for their labour in food, which virtually chained them to the farms they worked in.”
  • “Reformers argue that rising food costs can be far better addressed by improving the efficiency of the supply chain between farmer and customer. … Right now spoilage during transportation causes Indian farmers to lose one-third of their produce.”
  • He advocates a direct-benefits approach, providing eligible poor with a “non-cash voucher that can only be used for specific purchases– food, education, health, fertilizer, fuel– with the vouchers valid among both public and private companies.” He imagines an IT-based solution, in which such payments are made directly to a sort of bank account, and allowing charges using a plastic card or similar.
  • “By leaning heavily on the vast pool of casual workers– who have little rights, no welfare and no guaranteed income beyond the ongoing project– our labour rigidities have protected some workers at the cost of many.”
  • “Instead of creating opportunity, our regulations have placed a glass ceiling on both the economic potential of these workers and India’s overall rise.”
  • “Our higher education system has become inert and incapable of adapting to a rapidly evolving economy.”
  • “The degeneration of the universities … with money hard to come by, departments and labs in disrepair, faculty with little incentive to do research, a gathering of dust on everything, layer after layer.”
  • “One study claimed that 75 per cent of our graduates were unemployable for the work they were ostensibly trained to do.”
  • “If we are to move up from an enrolment rate of 15 per cent in higher education in 2015, we need at least 1500 universities as against the 350 we now have.”
  • “It is primarily the expansion of … private sector colleges that supported the growth of the IT industry. The industry emerged mainly in the states which had allowed private engineering colleges before 1992.”  Also, “the elite in India found foreign education accessible.”
  • “Instead of debating the difficult but necessary reforms we need to improve access, expansion and quality in our universities, Indian politicians have stuck to the issue of reservations.” [by which he means quotas for certain ‘backward’ castes.] “Need-blind admissions .. have not received the same attention.”
  • “The government must focus on balance, taking care not to tilt power too much towards markets or allow market players to capture regulatory policy.”
  • “Mobile phones are set to pass the 50 per cent penetration mark [today it is less than 40%] and many mobile operators hope to cover 95 per cent of the population in a few years.”
  • “The combination of ubiquitous communication, cheap devices and unlimited computing and storage means that everyone will have a way of communicating with each other, and of storing vast amounts of such information, accessing knowledge and entertainment and being connected to a ‘national grid’.”
  • He is very hopeful about e-government opportunities, but “we cannot build new systems over a creaky base– we have to first reinvent our state processes.”
  • “Such a ‘national grid’ would require… a unique and universal ID for each citizen.” He sees this as not just a matter of efficiency and interoperability, but as “a basic right, the right to ‘an acknowledged existence’” of citizens who are all too invisible today.
  • “Right now the greatest danger we face is of creating a divide in IT access that parallels the other divides in accessing infrastructure, capital and information that exist between India’s rich and poor, educated and illiterate, and urban and rural people.”
  • Rahul Gandhi estimates that “a mere 5 paise of every rupee [5%] spent reaches the poor in some districts,” due to inefficiencies, graft, and theft.  So Nilekani argues for direct benefits, i.e., a direct transfer of government funds into a special bank account for each citizen, each accessible through m-commerce technologies.
  • Changes in diet and lifestyle are bringing western health problems to add to the existing problems of poor, rural, and tropical. “We are now increasingly caught between the realities of the developing and the developed worlds– witnessing epidemics of hypertension and diabetes alongside that of malaria.” 
  • “Over one million Indian women die in childbirth every year.”
  • “People across urban and rural India have voted against public health services with their feet, with more than 85 per cent of patients choosing private health care,” even if they cannot afford it.
  • “Already, badly planned cities have made India the country with the largest number of road fatalities in the world– even with our low penetration of automobile ownership.”
  • He notes the potential for IT, e.g., for telemedicine, “remote medical diagnostics”, “handheld diagnostic tools”.
  • Many times, “elderly retirees cannot get their pension disbursements started unless they pay the officers a large bribe.” Another instance where he thinks direct benefits would help cut out the middleman.
  • “India is growing quickly, guzzling coal, gas and oil in large quantities as it plays catch-up with the developed world.”  He notes that India should grab the opportunity to build around green technologies, before things become too settled in the legacy ways of doing things, and perhaps becoming a leader in the green-tech revolution.
  • “Every major city in India now fails emission standards.”
  • The West grew in part by exporting their dirty industries to the developing world.  The developing world has no such option, particularly now that the forests and rivers and resources are already under intense environmental pressure.
  • “Even as our per capita income grows by sixteen times by 2050 at our present growth rate, India can only let its per capita emissions grow by two times in the same period.”
  • “The large-scale wastage in [the energy sector] has also been quite appalling– some mine fires in Bihar have been burning since 1916.”
  • The state of “Karnataka has 1.6 million irrigation pumpsets mainly used by farmers, which account for over one-fourth of the state’s electricity consumption. [And, they get power for free.] This is a big chunk of lost revenues for the state’s electricity companies which are already, owing to subsidized power, Rs 20 billion in the red.”
  • India needs “$766 billion in investment to meet energy demands over the next twenty-five years.”
  • Because of inefficiencies, loss, and theft, “power in India costs 40 per cent more than global averages.”
  • Biofuel and solar thermal are promising opportunities for future power.
  • He promotes a national electric grid, “a network of energy sources that is democratically decentralized, and where entrepreneurs using their own energy sources can sell surplus energy back to the grid.”
  • “We have an opportunity here to transform from an energy approach dominated by handouts and shortages to a post-carbon, energy-rich economy.”
  • He is a firm believer in the market, albeit a regulated market to avoid corruption and disparities. “Since the time people were allowed to make the majority of decisions on investment and enterprise, India’s markets have followed economic demand quite naturally, encouraging innovation and diversity and limiting the kind of bad decisions that dominated our first forty years and led to chronic shortages and emergency aid.”
  • “It is not enough to enact reforms; we must implement them well.’
  • “The single reform that will change [the perception of the state as the caretaker] is bringing direct benefits into our welfare system. With health and education vouchers, citizens can choose between private and public sector alternatives. These and similar vouchers for essential commodities will free the poor of the middleman….”
  • “Our entrepreneurs too have to realize that their role in nation-building and public welfare is critical.” He cites examples of the Rockefeller Foundation, the Ford Foundation, and the Gates Foundation.
  • “Even as the world is acknowledging India’s new promise, the opportunity of the global economy has highlighted our internal differences– between the educated and the illiterate, the public and private sectors, between the well and the poorly governed, and between those who have access and those who do not. In this sense, even as we Indians define ourselves in the context of our home and the world, we face incredible contradictions, Never has the external circumstance for India been so fortunate. And never has the need for resolving the internal conflicts been so urgent. The challenge for India is really within– in the decisions that will emerge out of our political struggles, our debates and our tempestuous democracy.”

This post was transferred from MobileMe to WordPress in 2020, with an effort to retain the content as close to the original as possible; I recognize that some comments may now seem dated or some links may now be broken.

Author: dfkotz

David Kotz is an outdoor enthusiast, traveller, husband, and father of three. He is also a Professor of Computer Science at Dartmouth College.

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