Archive for the ‘Innovation’ Category

The Congress Needs A New Raga

As an IAS probationer in the Foundation Course at the Mussoorie Academy, I participated in a debate on the topic “This house awaits the coming of another Gandhi”. Most of the speakers, including yours truly, bored the audience with references to the need for another Mahatma Gandhi. Till an intelligent batchmate from the Foreign Service electrified the audience by asserting that the time had come for Rajiv Gandhi to don the mantle of leader of the Indian National Congress (Congress). This was just after Sanjay Gandhi’s unexpected demise, at a time when Indira Gandhi, having demolished a fractious post-Emergency opposition, looked set to rule for another fifteen years at least. All of us probationers were unanimous in our opinion that he deserved to win. Alas, the hoary eminences comprising the judges (drawn from the faculty) took a dim view of his brilliant exposition, probably because of his biting satire on dynastic politics and how the Congress party could not survive without it.

The above incident came to mind after the bombshell of the 2019 election results which swept the Bharatiya Janata Party (BJP) to power. Since then, we have been witness to the Grand Old Party of India’s independence, the Congress, going through agonising paroxysms of introspection on its dismal performance. As expected, Rahul Gandhi (RaGa to friend and foe) decided to quit as party president. After the tamasha of weeping courtiers asking him to stay put and wild speculation on possible successors, the garland fell once again around the neck of his mother, Sonia Gandhi, an affine if not an agnate of the Nehru-Gandhi lineage. Meanwhile, the Congress is hemorrhaging rapidly, aided by a liberal supply of anticoagulants from the BJP. Its performance in the Maharashtra and Bihar Vidhan Sabha elections and the recent Hyderabad municipal elections indicate a party in terminal decline. The revolt that is yet to be of 23 prominent party functionaries is a pointer to the agonies of many loyal Congressis of a directionless drift of the party and the complete absence of a charismatic leader. Clearly, a new Raga has to be added to the Congress’ repertoire to replace the old RaGa. I venture to offer certain suggestions for ensuring India does not become a single national party polity.

  • Go back a century and enroll committed party members

It is interesting to note that the Congress, a party of the elite, propertied and professional class, broad based its membership in the early 1920s, thanks to that master organiser, Mohandas Karamchand Gandhi. A party which had an almost nonexistent mass base was, in the course of a few years, able to draw a large mass of women and men into the freedom struggle. I am not aware of any concerted effort by the Congress party of today to actively draw citizens, especially youth, into its fold. The 1920s Congress encouraged two types of members: (a) persons over 18 years of age who accepted the objects and methods of the party; (b) those who, in addition, paid an annual subscription of four annas. The paid-up members alone could become members of primary organisations controlled by the Provincial Congress Committees. A similar strategy could be envisaged in the present day, rendered simpler and far more wide-ranging through use of modern technology. Those wishing to play a role in the organisations functioning under the Congress may pay an annual fee of, say, ₹500. The aim should be to build up a cadre of committed party workers, both paid-up members and otherwise, wedded to the party ethos and culture.

  • Develop a strong organisational structure

The Constitution adopted by the Congress in 1920 had provisions for Committees right from the All India Congress Committee at the apex level to Town and Village Committees at the cutting edge of interface with the populace. Given today’s electoral politics, party cadres need to be involved right from the polling booth level, during elections, of course, but, more importantly, in the interregnum between elections. Party workers must interact with the public to understand and redress their problems, especially with the local bureaucracy. The ideology and values of the party must be conveyed to voters to win their support. An area where party workers can play a significant role is in checking voter lists and ensuring that all eligible voters are included in the electoral rolls: there have been innumerable complaints of names missing from electoral rolls.

  • Build inner party democracy and create stakes in the party

            The flight of talented political workers from the Congress party has been occasioned in no small measure by the widespread feeling that “dynasts” have an edge in getting nominated for elections and that merit has little role to play in candidate selection and in important organisational posts. The 1920s Congress had elections at every level to organisation posts: thus, town and taluka Committee members elected the Provincial Congress Committee members, who, in turn, elected members of the All India Congress Committee. Care was also taken to maintain a balance between provinces. While local economic and caste/religion considerations will still influence elections to organisational bodies, there should at least be a feeling that a level playing field is available to all contestants, giving them full scope to exercise their powers to sway their electors on the basis of their personalities and programmes.

  • Empower regional leaders

            Ever since the Indira Gandhi years, powerful state leaders have repeatedly been cut to size and hounded out of the party. The recent legislative assembly elections in states like Punjab, Chhattisgarh and Rajasthan show that giving a free hand to powerful local leaders pays handsome dividends. Leadership changes during the five year tenure of a government should be eschewed, save exceptional reasons. In states where the Congress plays a secondary role to regional parties, strong ties should be sought to be built up with these parties, with the Congress willing to accept the role of junior partner till such time as it strengthens its political base in those states. Maharashtra is an example of the Congress playing third fiddle, a role it has to accept with grace, given its limited options.

  • Keep Aaya Rams-Gaya Rams and cynical power brokers at arm’s length

            Rajiv Gandhi had this objective in mind in 1985, but failed because he surrounded himself with a coterie completely out of touch with the mood of the masses. The recent example of Madhya Pradesh is a sobering reminder to the Congress of how vaulting personal ambitions of a single, disaffected party man can bring down an elected government. Given the “saam-daam-dand-bheda” tactics in Indian politics today, it would be the height of naivety to hope for undying loyalty to a party. A beginning can, however, be made to cleanse the Augean stables by investing the party with a new sense of purpose linked firmly to the principles enunciated in the Constitution of India and forswearing the use of money and muscle power to achieve narrow, short-sighted political ends. Eschewing the use of power brokers could render the party less liable to arm-twisting of its finance gatherers by an opponent who has no qualms about the opportunistic use of investigative agencies to hound political rivals. A rule should also be enforced that no recently admitted former Congressperson-turned-defector-turned Congressperson or her/his near relatives will be eligible for tickets at any level of elections, both party and legislative, for a period of ten years after readmission to the Congress.

  • Convey to the people the priorities of the party and keep the incumbent government(s) on its/their toes all the time

            Elections are now being viewed by all political parties as a mere instrumentality for them to gain power, with no further engagement with the people in the intervening five year period between elections. The recent ramming through of ordinances and legislation without any public consultation or debate, whether it be the CAA, triple talaq, labour laws or farm bills, is indicative of a mindset that treats the people as sheep, faithfully moving wherever the shepherd takes them. It is here that a party like the Congress must clearly state its position on various issues related to the economy, polity and society and enunciate its vision of where it sees the country in twenty years’ time and what it seeks to offer different groups in society. Above all, the party needs to combat the spread of hatred, bigotry and divisiveness that is strangling increasingly larger sections of the Hindu community through exposing the falsehoods conveyed to them to feed on their sense of victimhood. As a responsible opposition, the Congress has to take up the cause of those who face the brunt of misuse and abuse of legislation and arbitrary state actions, through continued political and judicial interventions and through a vigorous media campaign. It should also not shy away from espousing the causes of groups which have legitimate grievances about the adverse impact of government policies and legislation on their livelihoods and the fundamental rights guaranteed to them under the Constitution.

            For initiating the steps indicated above, the Congress needs, above all, a leadership imbued with a sense of purpose and a determination to come to power in the next general elections. The current scenario for the party is, to say the least, pessimistic. Its not so young leader, RaGa, was apparently away from India at a time when thousands of agitated farmers were braving the bitter cold to voice their opposition to the recently passed farm legislation. The Congress or, for that matter, all opposition parties are conspicuous by their absence at the Singhu and Tikri borders with Delhi. The party has not taken a resolute stand on matters like the “love jihad” ordinances in Uttar Pradesh and Madhya Pradesh or the misuse of draconian legislation like the UAPA and sedition provisions to stifle legitimate dissent.

            Most noticeably, the Congress does not seem to have any strategy in place to contest the crucial polls in West Bengal, due in a few months. When all political pundits are forecasting a grim tussle between the incumbent Trinamool Congress (TMC) and an aggressive BJP, the Congress seems bent on hara kiri by allying in West Bengal with a vanishing left front, when common sense dictates that it tie up with the TMC to keep its principal national opponent from grabbing power. The same Congress seems to develop cold feet in contemplating an alliance with the left in Kerala, a state that is on the BJP’s radar in the near future, if not immediately.

            All these developments indicate a party with no sense of direction. The Congress needs to find a new leader: the Gandhi magic has outlived its utility. A new Raga (definitely not the toady (Todi?) raga in vogue so far) is needed to reinvigorate the party. State units need to be revamped, not through nominated office-bearers, but through elected politicians. A new national front needs to be contemplated, where the Congress takes the lead in roping in strong regional parties. The Congress needs to realise that, for the foreseeable future, it needs to play second fiddle in many states, keeping its sights on attaining power at the centre and leaving its regional allies to come to power in the states. Federal democracy, which has been buffeted in recent years, will thereby receive a fillip. The hour needs to find the (wo)man now.

 

 

 

Farm Laws: Good Economics, Bad Politics

The road to hell is paved with good intentions”. This saying sprang to my mind once the three Farm Bills were rammed through Parliament, with the opposition not even being given the parliamentary freedom to have its say in the Rajya Sabha. The absence of collegial decision making seems to be the signature tune of the present central government, as I have had occasion to bring out in an earlier blog (see here). Starting with the enactment of anti-beef laws in different states and moving on through demonetization, triple talaq, Kashmir, CAA, COVID lockdown, labour laws, farm laws and now ‘love jihad’ laws, the governments of the ruling party at the centre and in states ruled by them have relied on legislative majority, Prime Ministerial 8 PM pronouncements and the Ordinance Factory route to push policy down the throats of the citizenry.

The three bills focus on (a) freeing private entities from the oversight and jurisdiction of the Agriculture Produce Marketing Committee (APMC) in respect of transactions outside the APMC market yard area, with no licences being required from and no fees being payable to the APMC; (b) easing up the Essential Commodities Act to allow for far greater price variation in commodities before state restrictions on prices kick in; (c) providing for direct contractual arrangements between farmers and private entities. On the face of it, these measures seem to be exactly what are required to free the agricultural sector from the clutches of exploitative middlemen, ensure a fairer deal for the farmer in terms of better prices for his produce and encourage the growth of entrepreneurship to promote innovation and investment in the farm sector. Why then have these “reforms” attracted so much ire from the farming community, leading to a virtual blockade of the national capital?

It would be easy (and the lazy option) to dismiss the present turmoil as a political gimmick, sponsored by vested interests who stand to lose from the reforms process. Deeper reflection would, however, reveal the inadequate homework done by the authors of these three bills on critical issues, with the lack of clarity sowing major doubts in the minds of farmers. Though it might appear on the face of it that the agitation is largely driven by the interests of the better-off farmers, the issues that remain unresolved need to be squarely faced as they will raise their heads in the years to come and continue to act as flash points for farmers’ discontent.

The future of Minimum Support Price (MSP)

The first issue that has reverberated over the past couple of months has been the future of the MSP. While this has largely been operative only in respect of the two major cereals, paddy and wheat (and, to a far lesser extent, in respect of some other crops), the farmer is apprehensive that the move to a “free trade area” outside the APMC and the entry of contract farming on a large scale in the days to come will sound the death knell of the MSP. While the Government of India has been at pains to stress its commitment to retain the MSP in the future, it has not spelt out its strategy in respect of the MSP in an environment where there is extensive private entity-farmer trade, with prices being determined by direct negotiations between the farmer and the private party. This issue assumes importance especially in a set up where there is an unequal relationship between the farmer and the purchaser of his produce. If there are just two or three big oligopsonistic buyers, there would be grounds for apprehension that, sooner or later, the few buyers could start dictating prices to the farmers. In the absence of a trading licence system and the lack of institutional oversight by the APMC or any other regulatory body, the field would be open for the entry of any oligopsonistic private entity to attempt to dominate the market on its terms. The dilution of the stocking limits in the Essential Commodities Act can also justifiably give rise to fears in the farmers’ minds that end-buyers (read large corporates) will build up stocks to drive down agricultural product prices. At that point, the farmer would expect the government to step in and guarantee purchase of his produce at the APMC at a price that meets the cost of production plus a markup for profit. The legislation, as it stands at present, is silent on this eventuality.

The MSP system needs to be remodelled over time to achieve a much greater diversity in the crops procured, from millets and maize to pulses, oilseeds, horticulture and cash crops. This is essential if the huge surplus stocks of rice and wheat in Food Corporation of India (FCI) godowns are to be reduced. Not only does this increase the financial burden on the Government of India of paying the FCI for these stocks, it also increases wastage percentages. Reducing the incentive to grow water-guzzling, input intensive paddy in states like Punjab and Haryana is also crucial to checking environmental degradation, reflected in the deteriorating soil quality and depleting groundwater levels in these states. It should also not be forgotten that the MSP will have an important role to play as long as government has to guarantee the supply of foodgrains through the public distribution system (PDS), with the FCI as the prime supplier to the PDS.

Marketing issues (including price discovery)

Mandi/APMC related prices play an important role today in fixation of the price at which trade takes place outside mandi/APMC areas between farmers and traders. There is little clarity on how price discovery will take place in future in direct contracts between traders/sponsors and farmers, where there may be few buyers and a vast body of sellers. Realisation of a price that is fair to the farmer presupposes availability of price information and the ability to source the buyer who can offer the most favourable price. This requires the presence of a well-developed electronic marketing network, as envisaged by the announcement of the e-National Agricultural Market (e-NAM) system in the Budget of 2016-17. The e-NAM drew on the Rashtriya e-Market Services Private Limited (ReMS) initiative launched in Karnataka in 2014, which has been analysed in a November 2016 paper by researchers of the Indira Gandhi Institute of Development Research, Mumbai. Their study reveals three major areas where reforms are essential if a thriving national e-market for agricultural products is to flourish: (a) a legal framework which supports a platform for agricultural transactions across the country; (b) incentives to all stakeholders — farmers, traders, commission agents, mandi/APMC officials and others who are part of the agricultural marketing ecosystem — to participate in the new electronic platform at locations across the country; and (c) development of physical and financial payments infrastructure to facilitate seamless real-time trading across multiple locations.

Unless APMCs/mandis act as countervailing centres to forestall efforts to dictate prices of agricultural commodities through the more powerful bargaining position of a few buyers, farmers would be placed in a position where they are compelled to accept not so favourable prices. But this requires vibrant APMC/mandi centres fully linked to e-NAM, so that farmers have a ready alternative site to sell their produce in the event they are not happy with the terms offered by private buyers. Governments, especially at the state level, will need to invest in physical and financial infrastructure in terms of many more APMCs/mandis, facilities to grade produce, accurate weighing, quick delivery and easy online payment to attract farmers to the APMCs/mandis. Winding up APMCs does not promote a flourishing trade in agricultural products, as the experience of Bihar, which abolished APMCs in 2006, amply shows. Opposition from traders and commission agents, who stand to benefit from opaque transaction systems, will need to be effectively countered by assimilating them into the new marketing process.

Regulation and dispute resolution

The provisions for regulation and dispute resolution in the new laws are woefully inadequate. Conciliation and adjudication of disputes between seller-farmers and buyers have been brought solely within the jurisdiction of the executive magistracy. As one who has functioned as an Executive Magistrate during his career in the civil service, I can safely assert that the Executive Magistracy does not have the requisite knowledge skills to adjudicate on commercial disputes. More disturbingly, this responsibility comes on top of multifarious responsibilities already cast on the executive magistracy. Even with the best of intentions, cases are going to pile up in their courts. The absence of alternative avenues to redress grievances through the judicial system will not only adversely impact the rights of farmers but is also, in my view, a violation of the fundamental rights guaranteed to every citizen under part III of the Constitution of India.

The absence of a regulatory framework to oversee the proper conduct of transactions between buyer and seller will also, without doubt, affect the weaker side, clearly, in this case, the farmer. The uncertainty caused by prolonged litigation will have its deleterious impact on agricultural investments and will contribute to significantly weakening the bargaining position of the farmer.

What should the Government of India do to restore farmer confidence?

The quotation with which I began this blog in effect means“…promises and plans must be put into action, otherwise they are useless”. The Government of India (GoI) needs to:

first, repeal the two Farm Acts and the amendments to the Essential Commodities Act;

second, come out with a White Paper listing the issues that are crucial to the success of farm reforms, especially the backward and forward linkages that will enable the farmer to access the marketplace as an equal. These include availability of credit and insurance, easy access to efficient markets and a legal framework that honours contracts promptly;

third, give a guarantee that the APMC/mandi system will continue on the same basis as before the enactment of the Farm Laws;

fourth, involve all stakeholders in discussions on the future directions that the MSP and procurement should take, especially in relation to changing cropping patterns to both meet nutrition needs of the population as well as to tackle the growing ecological degradation caused by rampant overuse of fertilisers, water and power, with its attendant implications for high-cost agriculture;

fifth, while meeting the food requirements of the population, notably its vulnerable sections, through the PDS, work out mechanisms to ensure a fair deal for the farmer as well, without taxing the government budget to breaking point;

sixth, consult with state governments on a subject that falls squarely within the State List in Schedule VII of the Constitution of India. The GoI could possibly incentivise the adoption of these reforms in different states, starting with those states where its party is in power. The demonstration effect of successful reforms can then percolate to other states.

In the final analysis, I have to come back to where I started this blog. The present government at the centre has, in the recent past, pushed through too many measures without adequately consulting stakeholders or taking the advice of those who have the benefit of years of experience of working in those areas. The damaging effects of such unitary approaches not only sow distrust about the intentions of the central government in the states ruled by opposition parties and in the population at large, they also adversely affect the lives of millions of people. It may be good politics in the short run (from the viewpoint of the ruling party) but it leads to disastrous economic, political and social consequences, in the short, medium and long term, for the country. The government at the centre now needs to talk the walk (i.e., discuss before framing policy) since its approach hitherto has been to walk through without talking.

Secession of the urban Indian

Amidst all the recent furore over “seditious” behaviour on one of India’s premier university campuses, my mind went to the steady secession of sections of Indian society from the larger populace around them. Now, secession is no laughing matter; any talk of it in the context of a region seeking to separate itself from the republic constitutes a serious crime. And yet, through its actions (or rather inaction), the Indian state itself has been guilty of creating a secessionist mindset in certain groups residing within its frontiers. Before I am hauled up before the guardians of law (one never knows in these hyper-excitable times), let me expand on my theme to set all apprehensions at rest.

I still remember a childhood when those of us living in cities like Delhi, Bombay and Madras received, and enjoyed, the benefits of public services. Electricity came from the local power undertaking and water from the local water board. Those living in Bombay and Madras were fortunate to enjoy good public transport (local train and bus) facilities. We Delhiwallahs were not so lucky; a six kilometre journey from school to home could take anywhere up to two hours, earning the Delhi Transport Undertaking (DTU) the sobriquet Don’t Trust Us. Public health facilities were extensively used: the Central Government Health Scheme (CGHS) for minor illnesses and (in Delhi) public hospitals like Safdarjung and Willingdon (later christened Ram Manohar Lohia) for major ones. The doctors were reputed and trusted by their patients, the nursing staff was dedicated and competent and many of our friends went there for minor and major surgeries. While I don’t even remember seeing a uniformed policeman in our government colony, the friendly Gurkha watchman on his nightly vigil made us feel secure. The seeds of secession were already then being sown in primary and secondary education, though not in higher education: many of us went to private (euphemistically termed public) and missionary schools (with parental confidence in municipal and government schools at a fairly low level) but subsequently to publicly funded universities.

The last quarter of the twentieth century marked the watershed for the transition to a dual society. As the pressure of population grew, with large migrations to urban areas, shortfalls in public services and the unwillingness of better-off sections of the citizenry to live with these infrastructural deficiencies led to the Great Secession. The success of the Indian diaspora and their affluence created envy in their humble country cousins, who had to look forward to the casually tossed out gift on the annual pilgrimage home of the non-resident Indian. 1991 was the first window of opportunity for the great Indian middle class. Easier and cheaper imports, the opening up of the consumer sector to private investment and the information technology boom saw an explosion in the availability of hitherto forbidden fruit, which the Indian consumer was only too eager to acquire and consume. Money is the medium for the transfer of goods and services from the hitherto totally public domain to private enclaves of wealth and prosperity. As living standards improve for a growing middle class with aspirations to the “good life”, it would be instructive to examine how this stratification has worked in different sectors of services and how it has had its impact not just on the wealthier classes but also on the common woman/man living in urban settings in India.

Electric power supply has always been the country’s Achilles heel. Rural areas, especially in the more backward northern and eastern regions of the country, have long been inured to the absence of electricity. But urban areas, inhabited by industries and by the relatively wealthier segments of society, would not accept such a scenario. Industries went in for diesel generator sets and, where possible, captive power generation. Households followed suit very soon; as disposable incomes went up, generator sets made their appearance in private residences and housing societies. Even after the initiation of power sector reforms in the early 2000s, the scenario is yet to change, with problems persisting in all the three sectors of electricity generation, transmission and distribution. A nuclear deal was concluded, but power from nuclear plants still seems a distant dream. Oh, of course, there has been a lot of talk but, as yet, only limited progress on the renewable energy front, the inspiring example of countries like Germany notwithstanding. Bengaluru, India’s IT capital, sees its citizens stoically settling down to power cuts of three to five hours daily, while its energy policy makers scramble for excuses like low water supply positions in reservoirs.

Drinking water supply poses a major issue everywhere, and not just in years of scanty rainfall. Politicians and bureaucrats have failed to anticipate the demand for this crucial, life-giving resource, not just in rapidly growing urban centres, but also in rural areas, where water supply is fast depleting. There are a variety of reasons for this critical situation, best summed up as “the triumph of private greed over public need.” What is glaringly evident is the absence of any long-term planning for urban water management. No efforts have been made to recycle wastewater for use for non-drinking purposes, nor is there any coherent policy in place to desalinate seawater, on the lines of countries like Israel, Saudi Arabia and the United States. The only ones laughing all the way to the bank are the bottled water companies, which are the major drinking water supply source to populations in cities like Chennai and Bengaluru. With a steadily worsening groundwater scenario, water tankers are the order of the day in every metropolitan area. The urban poor have to make do with the trickle that comes from their public taps or fight for access to the tankers that service their areas.

The steady deterioration of public health services has, over the years, put an enormous financial burden on the aam aurat/aadmi. Money is again the feature that distinguishes the quality of services for the rich and the poor. Corporate, multi-specialty hospitals with state of the art technology are available to those who can pay, while the poor flock to already overloaded public hospitals. The average citizen has come to distrust the medical attention she can expect to get in public health institutions, forcing her to get into debt to meet the costs of private medical care. A moribund public health care system functions (??) under the benign gaze of governments (both central and state) and a controversial Medical Council of India.

Public transport, almost the only commuting option a couple of generations ago, is probably the most striking example of the widening chasm between the rich and the poor. City transport systems have come under immense strain, even as private car registration figures shoot up. Mumbai’s famed local trains are groaning under the sheer weight of numbers and even the Mumbai bus system (BEST) is not quite what it used to be. Indian city roads have, of course, proved to be somewhat of a social leveler — the potholes on the roads are no respecter of private or public transport modes and congested thoroughfares allow for no distinctions in time spent on travel, regardless of whether you are in a BMW or on a city bus. The Delhi Metro has been the only bright spot in an otherwise abysmal tale of stalled public rail transport and Bus Rapid Transit systems in nearly all Indian cities.

Most unfortunate has been the privatisation of security systems as inadequate police forces battle with multiple responsibilities in the diverse areas of criminal investigation, law and order maintenance and VIP security. It is bad enough when housing becomes segregated (although the coexistence of prosperity and squalor serve as reminders that “no man is an island”). It is worse when these residential islands also shut off the rest of humanity (including visitors’ vehicles) and seek protection behind high walls and iron gates. As the perception of individual insecurity grows, those who are well-off but not fortunate enough to be provided taxpayer-funded security go in for their private armies of security guards. The aam aurat is left to manage on her own against antisocial elements, with no beat patrolling by constables in even crowded localities.

The final act in this secession drama is the scramble for job opportunities overseas. The earlier flight to the Gulf at least saw many of the migrants return home to better living standards in states like Kerala. The subsequent exodus to the West, especially the United Kingdom and the United States, and other areas in South-East Asia and Australia, has been rather more one-way traffic. While there is the feeling in expatriates of a homeland lost, there is also the realistic recognition that India still cannot offer the same opportunities for innovative thinking and risk taking that many other countries both to the east and west of us offer. If you don’t believe me, ask a budding research scholar in any university or an entrepreneur starting a new venture. It should occasion no surprise that India’s only Nobel award in the basic sciences came during British rule (C. V. Raman, 1930). Indians have since won Nobel awards in the basic sciences, but their research has been conducted in foreign institutions.

Ultimately, the issue boils down to the pursuit of excellence. Islands of excellence in the country still float in a sea of mediocrity, a consequence of unimaginative education systems, blatant patronage based on ethnic and other considerations and an acceptance of sloppy, disinterested performance. Perhaps we should heed the prescient words of John Gardner, Secretary of Health, Education and Welfare in the Lyndon Johnson administration “The society which scorns excellence in plumbing as a humble activity and tolerates shoddiness in philosophy because it is an exalted activity will have neither good plumbing nor good philosophy: neither its pipes nor its theories will hold water.

 

 

 

 

 

 

JAM for the Indian

The rule is, jam tomorrow and jam yesterday – but never jam today

(Lewis Carroll: Through the Looking Glass and What Alice Found There)

 

Alice was faced with a peculiar dilemma when offered jam by the White Queen; she could never have it today, but only tomorrow or yesterday. You guessed her problem: when tomorrow came, it would be today, so, as per the White Queen’s edict, she could never have her jam “today” or any other day, for that matter. The aam aurat/aadmi in India are in danger of being caught in a similar trap involving JAM, unless a lot of thought is given to how to operationalise JAM, popularise it, enable it to gain wide acceptance and surmount the innumerable obstacles posed by those who are better off (and don’t need JAM) but nevertheless are haunted by imaginary fears. I refer, of course, to the path breaking initiative of the Government of India to marry technology and finance to improve the living standards of millions of Indians. JAM has three components — the Jan Dhan Yojana (J), aimed at financial inclusion for the population as a whole, Aadhar (A), the issue of biometric identification cards to all Indians and the Mobile (M), the instrument that can be found in the hands of about 700 million Indians today. J, the first corner of this trinity, will reach banking and other financial services to millions who are currently unserved or underserved by existing banking systems. This will obviate the need for often understaffed/unstaffed “brick and mortar” bank branches. The recently licensed payment banks, with their focus on technology, are better placed to service remote populations with the skilful use of mobile technology, M, the second part of the trinity. The triangle is completed by Aadhar, A, the individual unique identification number that ensures that financial services and benefits flow to the person for whom they are earmarked.

The three essential conditions to be fulfilled if JAM is to operate smoothly are: (a) access of every Indian to banking channels where her money can be parked; (b) ease and efficiency of transactions; and (c) secure, accurate identification of the account holder to check diversion of benefits. An inadequate understanding of these requirements in transferring government benefits to intended beneficiaries has bedeviled implementation of schemes involving newly created bank accounts and has provided fodder to those Luddites who see red at the very mention of the word “cash transfers”. For example, the Government of Puducherry rushed through a scheme to overcome supply side constraints in the form of a dysfunctional public distribution system by transferring money directly to individual bank accounts. This ill-conceived measure ran into three issues which hastened its early demise: (a) inconvenient access to banks meant that people had to incur the double cost of visiting banks to draw cash and then going to the ration shop to purchase rice; (b) arbitrary deductions by the bank of apparently outstanding dues denied the beneficiaries access to the full amount of the cash transfer; (c) the money could be used to purchase anything, which meant women, children and the old might not get rice were the amount to be spent by the men of the family on items like alcohol. Hasty moves to pay MNREGA wages through existing inefficient banking channels have also come a cropper.

“Cash transfers” is a term that has been widely misunderstood and, I suspect, often deliberately misinterpreted to serve partisan ideological ends. For a start, we need to be clear about unconditional versus conditional cash transfers. In the former, no specific behaviour is sought from the recipient in exchange for availing of the cash transfer benefit, such as, for example, availing of the services of a public health facility or educational institution or fulfilling specific conditions like registering for antenatal care. This is in contrast to conditional cash transfers where availing of a specific, generally public, service provision entitles the beneficiary to the cash transfer. One problem with conditional cash transfers is the failure to provide satisfactory public services: for instance, if there is no doctor or nurse at a primary health facility, the failure to register for antenatal care would deprive the beneficiary of the cash transfer conditional on antenatal care registration. Going in blindly for unconditional cash transfers in such cases is fraught with its own dangers, like the apprehension in Puducherry that the male household head would spend the cash on liquor, thereby denying his vulnerable family members access to sorely needed nutrition, health or education benefits.

It is here that the government needs to use its imagination in devising a workable, effective solution covering schemes in different sectors. Unconditional and conditional cash transfers should be linked to a mobile wallet created for each beneficiary/consumer. This mobile wallet will be linked to the bank account and Aadhar number of the individual consumer. Cash transfers (whether unconditional or conditional) under different heads — health, food, education — will flow into the individual’s mobile wallet. Choice should be given to the consumer to access the service from a public or private provider, to reduce the inefficiencies of state/private monopolies/oligopolies. Goods/service providers will be paid through the mobile wallet for goods/services delivered, using point of sale machines that identify the customer through Aadhar identification procedures.

There is also the important issue of identifying the eligibility of the beneficiary for specific types of assistance. The government has scrapped the Below Poverty Line (BPL) lists. These suffered from two infirmities: first, the lists often left out the poorest and most marginalised sections of society and secondly, they were not dynamic, in that there was no provision for updation as families exited or newly entered the ranks of the poor. The 2011 Socio Economic and Caste Census (SECC) has attempted to use household data (based on an intensive nationwide survey conducted in rural and urban areas) to identify households which could be defined as suffering from deprivations of different degrees, using income and assets as criteria. While this is better than the old BPL classification, the SECC also has some grey areas which could affect the identification of those households genuinely in need of various social protection programmes. The authenticity of the data gathered during the survey can be open to question. There is also the issue of, over time, including households that, because of various factors, move afresh into the deprived category. Most importantly, there is no basis to ascertain income earnings, especially in case of households that are not covered by the Income Tax Department records and which, as in the case of agricultural households, are not liable to pay income tax. The possibility of families subdividing themselves to avail of benefits cannot be ruled out: one is reminded of the efforts made by sections of the agricultural elite, in the two decades after land reforms were introduced in the 1950s, to show land ownership in the name of servants and even animals to avoid parting with agricultural land.

One possible method of checking misuse of benefits would be to insist on bank accounts being linked to the Permanent Account Number (PAN) cards issued by the Income Tax Department and to the Aadhar identity. Over time, as this writer has often advocated, this should be accompanied by a move to a cashless economy. Currency notes of over Rs. 50 denomination should be withdrawn from circulation and mobile wallets should become the norm for cashless transactions. Moreover, transactions of a monetary value of over, say, Rs. 500, should be mandatorily through a cashless system. This would provide, through the income tax network, full details of the receipts and expenditures of every household, automatically thereby excluding from the ambit of government benefits those who are not entitled to them. If there is doubt about the feasibility of a country moving to a largely cashless economy, we need see no further than the example of Sweden. Cash represents just 2% of Sweden’s economy and only 20% of consumer payments are made in cash in Sweden as compared to 75% in the rest of the world (this figure would be well over 90% in India). Nor does the oft-parroted argument about the illiteracy of India’s citizens hold water: one just has to see how Indian men and women have taken to mobile phones to realise that lack of education is no hindrance to the enthusiastic adoption of “liberating technology”.

However, this would be possible only when there is a broad consensus on the applicability of Aadhar for all types of transactions. Sections of the intelligentsia have voiced apprehensions about the misuse of private data of individuals, despite the fact that the Aadhar card has the same information as the identity card issued by the Election Commission of India, except for the additional incorporation of biometric information. These groups have been actively agitating in the country’s highest judicial forum against the widespread adoption of this technology. Forgotten is the harsh fact that for a person deprived of so many economic and social rights, a hypothetical loss of so-called “privacy” is hardly the most important consideration. Forgive the atrocious pun, but without JAM, India’s poor and disadvantaged run the risk of being denied their bread and butter.

 

 

 

Beware of Greeks accepting gifts

 

 

When the war between the Trojans and the Greeks entered its tenth weary year, the desperate Greeks, on the advice of their seer, offered the Trojans a huge wooden horse while seemingly withdrawing from the battlefield. The overjoyed Trojans brought the horse within their fortress, ignoring the prophetic warning of their priest not to accept the gift. His words, rendered in Latin in Virgil’s Aeneid, were “Timeo Danaos et dona ferentes” which, literally translated, reads “I fear the Greeks, even when bringing gifts”. The consequences of this folly are now history: the Greek warriors hiding in the horse emerged at night and decimated the Trojans. Cut to the present day and the shoe is on the other foot: it is the Greeks, who have taken financial assistance from the troika – the European Central Bank, the European Commission and the International Monetary Fund (IMF) – who are faced with the Scylla of an exit from the European Union or the Charybdis of enforcement of unpleasant austerity measures at home. And it is the Europeans who now fear the Greeks accepting rather than giving gifts.

The Greek drama has its share of villains, depending on your ideological sympathies. The free marketer will blame the profligate approach of the Greek government while the left of centre statist will hold “evil” international capital and its institutional handmaidens responsible for the unthinkable situation where a developed country has, for the first time, defaulted on its debt obligations.  As with everything in life, the truth lies somewhere in between. The Greek people, and their governments, spent as though there was no tomorrow.   More importantly, they forgot the prudent maxim of any thrifty householder: don’t spend beyond your means. Running up budget deficits, they resorted to external borrowings to cover their expenses. It also appears that successive governments cooked budget figures to hide the true budget deficits. Enter the IMF, with its usual “slash and burn” policy. Undeterred by the experience of its disastrous handling of the East Asian crisis in  the late 1990s, the IMF prescribed the usual austerity measures, including drastic spending cuts. The carrot for these harsh measures was in the form of financial assistance from the troika. The problem was that far too much of this assistance went to pay private creditors of the Greek government or was spent in unproductive areas like military spending. With the option of currency devaluation foreclosed by its membership of the Eurozone, Greece could not think of spurring export growth to promote industrial growth; nor could it employ monetary policy to kick start the economy and ease the budget deficit. The obvious result of reduced public spending was the adverse impact on welfare  payments like pensions, a sharp deceleration in growth and a rapid increase in unemployment, noticeably among the youth. The resulting anger in these sections saw Greece getting its first leftist government towards the end of 2014. It was only to be expected that a government with a reddish tint would forswear “anti-people” austerity measures. At the same time, the new government knew that it could get no further credit without belt-tightening measures. It, therefore, went in for the masterstroke of a referendum on the austerity measures sought by the troika. This was a win-win situation for the new government; by asking for a vote against austerity measures, it took a populist stand which it thought would go down well with its voters. Expectedly, the people (from whom you can hardly expect a deep understanding of either  economics  or realpolitik) voted against austerity measures. As things turned out, the government has had to subsequently accept even more onerous conditions from its creditors; only, it can now tell its voters “See, we were on your side, but these big, bad Europeans left us with no other option”. The problem, post-referendum, is that Greek citizens, especially pensioners, insecure public sector workers and the growing tribe of the unemployed, are likely to be bitter about their “betrayal”, leading to lack of public support for the unpleasant measures that are to follow.  So the Greek drama ends for the present, with neither the dire predictions of Greece exiting the Eurozone nor the collapse of the Euro currency becoming a reality, at least in the near future.

As a former practitioner and a present student of public policy in India, I am interested in the lessons the Greek episode throws up for India. We went through similar harrowing times twenty five years ago, when the family gold had to be pledged abroad to save our national honour. There are four clear messages emanating from the present brouhaha for our politicians and policy makers:

1. Stay away from chronic debt:

What applies to families and companies applies to countries as well. You have to be able to service your debt obligations at least to some extent from surplus revenues to avoid falling into a debt trap. An essentially requirement for this is to keep budget deficits down to a reasonable limit. On the one hand, this means that tax collection systems (both direct and indirect) have to be robust and reasonably leak-proof. On the other hand, it also involves adjusting budget expenditures to avoid serious revenue deficits. This is an area where governments generally rush in where wiser men would fear to tread. Governments in India, both at the national and state levels, display a penchant for ill-thought out social schemes. The previous United Progressive Alliance (UPA) government enacted legislation providing entitlements to a broad spectrum of the population in the areas of rural employment, education and food security. The goals are certainly praiseworthy; the schemes, however, involve expenditure estimates that are hazy at best and will go up once implementation across the country is in full swing. There is also the very real danger of well-intentioned schemes being implemented by a disinterested, corrupt bureaucracy, the end result of which would be unproductive use of valuable public finances. This phenomenon of wastage of public money is already evident in the across-the-board subsidies in the power, cooking gas, water and fertiliser sectors, where public resources are being wasted on the well-off sections of society. The touching faith in bureaucratic solutions to every problem has spawned a bloated, inefficient bureaucracy, with guaranteed tenures and no performance compulsions, which constitutes a burden on government finances, especially with decennial wage hikes. There is also the matter of the touching faith of the government (and influential sections of the intelligentsia) in the public sector, which, in the absence of managerial reform, is bleeding government finances. All of which point to the precarious nature of public finances — a sharp economic downturn can derail these and put pressure on the economy. Start borrowing to finance the deficit and you are headed in the same direction as Greece; a number of states in India already live mostly on the largesse of the national government.

2. Be and remain competitive:

Healthy tax revenues and a booming market require competitive industries which can create domestic jobs. In the globalised era, this also means being internationally competitive to avoid being swamped by cheaper competitors. Alas, this is one area where the Indian economy continues to limp along, “Make in India” exhortations notwithstanding. Recent land acquisition legislation makes getting land for any public purpose a Herculean enterprise. Apart from the astronomical compensation cost, there are the bureaucratic hurdles to be surmounted, including getting an Environmental Impact Assessment, a Social Impact Assessment and a Resettlement and Rehabilitation package (this last applies even to land privately acquired) approved by the authorities. At the best of times, land acquisition has been an excruciatingly slow process: add the requirements of public consultation and owners’ consent and you have a process that could drag along to eternity. Archaic labour laws cannot be reformed unless the government is ready to take the unions head on a la Thatcher. The longer this takes, the less the incentive to start new industrial ventures in the country. The cost of borrowings is also much higher in India than in many of its present and potential competitors. The icing on this rather unappetising cake is the lack of ease of doing business, where the World Bank ranks India 142nd in a list of 189 countries. Little wonder, then, that recent years have seen even Indian companies fleeing to safer, more productive investment pastures abroad. With Indian companies already on the lookout for investment opportunities abroad, it would hardly be surprising if foreign private investors too are tempted to try their luck in environments friendlier than India. Indian politicians and policy makes must hear the wakeup call before India gets left behind in this competitive race.

3. The world doesn’t owe you a living:

Indians have been lecturing other countries since the days of Nehru and Krishna Menon. The bubble was punctured by the Chinese invasion of 1962 and finally burst in the mid-1960s when food aid had to be secured from the USA, a country loftily scorned by the Indian powers-that-be during the first fifteen years of Indian independence. Nearly all politicians and most bureaucrats, as well as large sections of the intelligentsia, comprising the media, academia and judiciary, seemed to think (and still think) they were (are) doing private investors a favour by allowing them to bring their money into the country. From my personal experience, I can testify to the reactions of investors around the globe when our team from the Indian Petroleum Ministry was marketing investment opportunities in the oil and gas exploration sector in India in late 1991. Responses ranged from cautious in Houston to sceptical in Singapore and downright hostile in London. Things improved somewhat in the late 1990s and the early years of this century. But the environment has again turned anti-private investment in the last seven to eight years, thanks largely to a lack of conviction at the level of the national government. Whether it is whimsical interpretation of contractual commitments (petroleum sector), ex post facto tax levies (financial sector) or simply reluctance to allow entry (retail FDI/mining), public policy is hostage to domestic vested interests and to a “command and control” mentality that harbours a nostalgic fondness for development through public investment alone, blithely ignoring private-investment driven success stories in the information technology and telecommunications sectors. When push comes to shove, not too many tears will be shed internationally for India’s travails (notwithstanding its position as the “world’s largest democracy”, “promising emerging economy” and “country with large market potential”) if it runs into economic difficulties on account of its inability to provide an environment conducive to private, especially foreign direct investment.

4. Use referendums as a political tool but don’t take them seriously:

Whether Greece or India, democracies the world over are representative democracies, which means that the voters select the women and men who will articulate their interests through legislation and policy making. It is generally a bad idea to decide policy through a referendum. The abortive Greek experience is there before us. Nearer home, the Aam Aadmi Party (AAP) has as much of a fascination for referendums as does the Syriza ruling party in Greece. It conducted one in 2013 to ask citizens to decide whether it should form a government in Delhi with outside support. It plans to hold one more now on the issue of statehood for Delhi. In both cases, AAP lands on the right side of public opinion. In 2014, it could blame the Indian National Congress Party for the collapse of the government; this certainly paid dividends, with AAP sweeping to power with an overwhelming majority in the 2015 elections. It can now again lay the blame for failure to confer statehood on Delhi on the ruling Bharatiya Janata Party dispensation in Delhi. All this makes for politics that Machiavelli and Kautilya would be proud of. However, the mechanism of asking the people at large to take a view on specific issues has two major flaws: firstly, it uses people’s emotions to decide an issue, certainly not the best way to take a dispassionate view and, secondly, it presumes an understanding by voters of the specific issues at hand. Even given their high levels of literacy, it would be ambitious to presume that the people of Delhi understand the implications of statehood, with the increased responsibilities of fiscal management. The lesson for those in power and for those in society who harbour idealistic thoughts about referendums is: by all means conduct them, but don’t think their results can be used to guide policy actions. The unfolding Greek tragedy has lessons for the present day, just as the classic Greek tragedies highlighted the foibles and follies of humankind.

 

 

 

 

 

 

The God That Failed

The God That Failed” is a book that describes the association of six prominent Western intellectuals of the twentieth century, from Andre Gide to Arthur Koestler and Stephen Spender, with communism and their subsequent disillusionment with and repudiation of the communist philosophy. While I am not analysing their motivations in first ardently espousing and then just as emphatically rejecting the charms of communism, the subject set me thinking on the very human need for a greater force (or purpose) to give meaning to human lives and how this impacts and has had particularly earth-shaking effects on human life and conduct, especially in the last one hundred years or so.

What has set off this train of thought has been my own experience of encountering individuals in the course of my life who have moved from the extreme left of supporting a people’s war movement to the extreme right of religious conservatism in the span of a few decades. I entered Delhi University in the fourth year of the 1970s when the pro-Naxalite movement in its elite colleges had run its course and those who had forsaken their college education to work for the cause of the oppressed were returning to the routine existence of university life. There were enough ideologues spouting Marxist philosophy in Delhi University itself; one did not need to turn to the other major university in South Delhi to encounter those who were spellbound by Marxist economics and Communist politics. What has since caused me immense surprise is to find many of those in the vanguard of left revolution in the 1970s ensconced in the camp of staunchly rightist parties with a strong religious ideology by the start of the twenty first century. Now I am not for a moment suggesting that we should be fixed in our ideological views over a lifetime; what I do find interesting and worthy of more detailed analysis are the possible reasons for this dramatic change in worldview.

I will only mention in passing the possibility that the shift in loyalty to a different ideology is occasioned by a cynical calculation of where one’s interests lie. In today’s amoral, consumerist age, the desire for fame and social position may lead one to make conscious choices to espouse an ideology which offers social and economic advancement. Such a person will switch sides with alacrity once he senses that the boat he is on is sinking: just study the recent instances of candidates for elections to the Indian Parliament and state legislatures nimbly party-hopping to secure their electoral futures. Setting aside the cases of those falling in this category, I am more concerned with those who blindly adhere to a specific ideology. What motivates such people and what implications does this have for the evolution of human society, given that this phenomenon pervades all countries and societies?

The basic urge for holding to an ideology is the fear of loneliness of the individual. As a social animal, man seeks to conform to accepted social norms to acquire a sense of belonging. Established religions have shrewdly recognised this urge and created a culture of myths and legends to attract followers and hold them in thrall. Deviations from the accepted wisdom have been severely punished. Many ‘heretics’ perished in the Inquisitions of the Middle Ages. Galileo escaped by the skin of his teeth by recanting on his view that the earth revolves around the sun, though he is supposed to have defiantly muttered under his breath “Eppur si muove” (and yet it moves). Even today, followers of organised religions severely punish what they see as transgressions from the laid-down laws, sometimes with the full concurrence of the government of the day and often in flagrant breach of the rule of law. The victims range from ordinary citizens of different countries to air travellers to, as we saw recently, schoolchildren and cartoonists. In India, religion has fed on a sense of lack of identity and a feeling of victimisation in the majority community, to generate historical grievances which are apparently to be corrected in the present day.

The Industrial Revolution and its aftermath saw a weakening of the hold of religion on the populace. As education spread and the Age of Reason extended its influence, a new prophet appeared on the scene in the shape of Karl Marx. As the old order collapsed with the onset of the first World War, Communism entrenched itself, first in Soviet Russia and then, in stages, in Eastern Europe and, most significantly, China. The promise of equality and a classless society came as a whiff of fresh air to a host of Western intellectuals, disillusioned by the operation of the capitalist system. Not surprisingly, the infection also caught up with restless youth in countries like India, especially when the Nehruvian experiment started unravelling from the mid-1960s onwards. However, the senseless violence of the Naxalite movement and the severe state repression it invited led to rapid disenchantment with ‘armed revolution’ and the idealistic youth were soon engaged in making their way up in middle-class India, in the bureaucracy, academia or journalism.

With ideology in the form of a classless state having lost its charm, more so as the horrors of China’s Cultural Revolution have come to light and as that country itself has abandoned the socialist path, the Indian middle class has now latched on to a heady mixture of the desire for a strong man, coupled with a yearning for an idealised, mythical past. Central to this development is the loss of individual identity in an economy and society buffeted by the storms of globalisation and liberalisation. Weak governance systems have failed to provide the citizen with the comforts that would be taken for granted in a developed country. At such times, there is inevitably the longing for a political messiah who will cut through the slough of despondency and hopelessness and lead the nation to a brighter future.

And so we move from the ideology of religion to ideology in the form of a philosophy, epitomised by a strong party/state and the omnipotent individual.  The twentieth century moved through the absolute domination over large parts of the world, from Soviet Russia to China, North Korea, Kampuchea and Libya, by powerful dictators, whether they espoused a left or right of centre philosophy, or indeed no philosophy at all. But what is it that impels the individual to associate himself so totally with a dominant ideology, party, state or individual? It arises out of the sense of personal insignificance of the individual and his fear of the finiteness of his existence. Religion at least gave the individual solace that there was an afterlife, that wretchedness in this life would be compensated by rebirth, hopefully in happier surroundings. The rudderless individual, confronted by a world that he is unable to deal with, desperately seeks to merge his identity in a larger than life entity to get a feeling of security and belonging. It is here that the tragedy of the Indian intellectual can be clearly observed. The scholar/sociologist Dipankar Gupta in a prescient article last year in the Times of India drew a sharp distinction between intellectuals and ideologues. While the former maintain impartiality and independence in their analysis of affairs of the world, the latter are co-opted into a dispensation which uses their skills of “intellectual” jugglery to bolster its position and gain legitimacy. Some of these ideologues do benefit in terms of social or official positions but the greater benefit lies in the secure cocoon of a political formation that gives meaning to their lives.

Where does all this leave us circa 2015? The continued existence of a democracy is crucially dependent on independent, sceptical commentators who are wedded to the concept of a liberal, open society. They are not against any person or political formation — rather they recognise the truth of Lord Acton’s dictum “Power tends to corrupt and absolute power corrupts absolutely.” The twentieth century has seen enough instances of systems and individuals promising utopia to their masses, only to bring them rudely down to earth. The second portion of Lord Acton’s statement, which is never quoted, is relevant in this context “Great men are almost always bad men.” Lest this be interpreted as a sweeping indictment of statesmen and political leaders, let me hasten to add that the inexorable operations of social and political systems invariably cause even leaders who start with noble intentions to adopt the path of curbing political freedoms to remain in power, ostensibly to attain their lofty goals. The need of the hour, not only in India but elsewhere as well, is for thinking individuals who seek to influence public opinion to critically examine trends in social and political life and ask searching questions of those in power. Ultimately, we should all echo that little child as he beheld the emperor’s new clothes “But he hasn’t got anything on!”

 

What the oil companies can learn from flipkart.com

It’s been literally ages since I stepped into a bookstore…No, I haven’t given up reading, it’s the entry into my life of that phenomenon called flipkart.com. Tom Sellers talks in his book “Liberation Management” of the WOW experience. We in India experienced that feeling with the introduction of ATMs and the railway online reservation. But one of the most recent enthralling experiences has been the online purchase of books, which, in the Flipkart case covers the purchase in addition of a wide variety of products, ranging from books to mobiles, computers, etc. Right from the point where one selects a book (or any of the other products marketed by Flipkart), a series of clicks and some minimal typing completes the entire purchase process. Enter your mailing address and the product is in most cases ready for shipping. The “Cash On Delivery” (COD) system enables the customer to pay the courier on delivery of the product; where this facility is not available, online credit card payment facility is provided. An SMS/e-mail from Flipkart informs the customer of the number of days within which the product will reach her. What is more interesting is that in the event of any delay in the shipment by the courier, a representative of Flipkart contacts the customer on mobile phone to ascertain whether the shipment has reached. If it has not, Flipkart pursues the delivery with the courier company (I can personally vouch for this in the case of one delayed delivery by the courier).
But this article is not intended to be a eulogy to Flipkart, though I humbly doff my (non-existent) hat to them for their fantastic marketing strategy. It is rather aimed at oil marketing companies which sell cooking gas to the vast Indian market. Rare is the location where the public does not have grievances against the irregular and unpredictable supply of gas. The oil companies, IOC, HP & BP, need to take not a leaf but the whole book from the Flipkart method of marketing their products. They have a spread of retailers over numerous locations in India, each with their set of customers, each of whom has their unique voucher numbers. Why not visualise a future scenario like this? The customer phones, sends a sms message from a pre-approved mobile or landline number or goes online to register for a gas refill from an email address registered with the company. The order goes to the concerned company, which then passes on the order to any one of the dealers within easy proximity of the customer. The order will go to that dealer who has the most comfortable stock position at that point of time. Based on the delivery schedule of that dealer, a sms message/e-mail will be sent to the customer giving a identification number and intimating the likely date of delivery. In the case of an order placed on phone, a token number will be given to the customer: enquiries regarding the delivery date can be done on phone or through interactive voice response systems. The Cash on Delivery system will provide for payment by the customer at the time of delivery of the gas cylinder. Once the cylinder has been delivered, the delivery person will record the fact of delivery and credit the amount realised from the customer once he returns to the dealer.
What are the likely attempts to tamper with this system and how are these to be tackled? The obvious one is the practice of a gas agency to sell gas cylinders at a premium to either non-gas owning household customers or to industrial consumers, while showing the sale as having been made to a bona-fide household customer. The linkage of the supply with a unique token number should reduce the chances of a bogus delivery. A random daily verification of a certain proportion of deliveries by a third-party agency (to which the company outsources this function) should act as a further check on underhand dealings. The company can also monitor the frequency of refills being ordered by a particular household to check any unusual pattern of repeated refills at periods more frequent than would normally be expected and carry out actual on-site investigation where there are grounds for suspicion. Most importantly, the gas agency will not be able to exercise any discretion regarding when it will supply the cylinder since its delivery schedule in relation to its stock will be subject to online monitoring by the company. Agencies which show tendencies to cheat the customer should have their licences cancelled.
Of course, the above measure is being suggested in a scenario where there is still no genuine competition in retail gas supply. Should the winds of change sweep through the oil and gas marketing sector, as they have through the aviation and telecom sectors, the customer will find that it is the companies supplying the gas which are chasing him for their custom rather than the other way around. Till that happy day arrives, I commend the above solution to the oil companies for easing the woes of the ordinary housewife. She will even be willing to pay more for a cylinder (though that may change in an environment of greater competition).