Sunday, January 22, 2012

Infrastructure and Human Resource Development: Next Gen Growth Engines of Indian Economy

'Money makes the mare go' the old adage is relevant to everything in human life and applies equally to India's growth story. Ample finances can be made available in the government's kitty through meaningful concerted efforts in the areas of corruption mitigation and good governance to progress and sustain Infrastructure development and human resource development, the next gen growth engines of Indian Economy. India is destined to achieve much bigger things in world's economy rather than the 7-8 % growth rates which have been given to us on a platter by the compulsions of developed world. If India fails to accord topmost priority to these two extremely important growth engines to bring them at par with the developed world in a short span of about a decade or so it will miss the ominous dream of being a prosperous nation as also the world leaders on the economic and technology front. Such opportunity slots normally last for about a decade or so for in the meanwhile the advanced countries  recover and newer third world countries present more lucrative options.
Infrastructure development comprising of Roads, Construction, Rail, Airports, Ports, Power generation and transmission, Irrigation, Telecom etc. is one of the keys to development of a country because it

  •  is manpower intensive and a big job creator directly and indirectly through other allied industries.
  •  generates a huge demand of steel, cement, capital goods, machinery, trucks, wagons etc..
  •  improves upon logistics of men, materials, agricultural produce so very essential to any country's growth story.
Human Resource  is equally important growth engine of the Indian economy and until and unless nurtured with an immediate hugely intense national effort will convert into a national drain on the Indian growth potential. The favourable demography picture of human resource in India is going to last for a decade and a half at the most as the ratio of available working  hands to non working stomachs with claims on retirement pensionery benefits will keep on dwindling from now onwards. This will result out of a likely decrease in birth rates as the education and prosperity levels rise and accompanied increase in average life span. India has to make best use of this favourable human resource demography opportunity window.The developed countries became rich before they aged where as India and Indian polity has to strive very very hard and meticulously to get out of this catch 22 situation of getting old before getting rich. 
Human resource development of all segments of manpower  has to be accorded topmost priority because it will

  •  result in massive industrial productivity increase through efforts to convert all unskilled workers to semi skilled ones and improving the capabilities of skilled, technical, administrative and managerial workforce of the country.
  • result in enormous up gradation of the country's  education system through value additions to the capabilities of educationalists and teachers which will enable individuals to think for the betterment of their own families and country and will be a great help in having a responsible and responsive democracy in the country.

Monday, January 16, 2012

Corruption Mitigation and Good Governance - The Biggest Growth Engines for Indian Economy

The Indian dream of becoming an economic superpower and a prosperous nation appears to be a distinct reality in the light of government's compulsion to address the expectations of the masses and the compulsions of the advanced industrial nations of the world to move manufacturing bases to low wage economies with strengths of a broad based human resource and large captive markets. The resulting Indian growth story is here to stay for the next three decades provided the Indian governance can take care of the stumbling blocks in the path of this growth trajectory with correct policies, financial and administrative reforms, human resource development, massive up gradation of infrastructure and above all good governance.Out of this large wish list, Corruption Mitigation is perhaps potentially the biggest growth engine with a large weightage and can contribute 50% extra towards annual Indian budgets in the following manner.Corruption Mitigation and good governance are interdependent and measures like strict policing, quick judicial disposal of economic offences backed by corruption mitigating administrative reforms are the very backbone of this fight against corruption and black money.

  • The direct and indirect tax collections will increase by a minimum of 25% annually for the next twenty years.
  • The overall subsidy budget comprising of gas, oil, food etc can reduce by 50%.
  • Through the same annual budgetary allocations for infrastructure, an extra 25% infrastructure development can take place.
  • The annual maintenance cost allocations for infrastructural assets of the nation could be reduced by 90%.
  • The annual savings on petrol, diesel and repairs of vehicles could be as high as 25%.
This effort alone can catapult the Indian growth story potential into growth rates of low teens.We can only hope, wait and watch how the Indian polity puts into action corruption mitigation programs for which a lot of rhetoric has been raised by one and all of the Indian polity. On top of it India can manage to recover a substantial amount of black money stashed in foreign countries as well as in Indian households and businesses, the miracle of propelling India into the developed nations' club will be realised much sooner.

Sunday, January 8, 2012

Indian Growth Story-A True Perspective

The Indian polity, planning commission, economists and intelligentsia keep on harping on 7-9% GDP growth of the country during the last few years. This has come about as a result of global opportunity provided as a result of very large low wage human resource with an excellent demographic mix, good education and intelligence quotient, a huge captive market for even the basic human existence elements of food, medical health, hygiene, drinking water, means of transport, electricity etc. etc.. Coupled with this is  the fact that the polity was left with no option but to provide these amenities after 64 years of deep slumber, inaction and fooling around of Indian masses with high sounding vote catching words and phrases.They rightly saw the danger to their political existence and survivability. The developed nations seized this opportunity with open hands and had no inhibitions in selling their low level products and technologies mainly in the consumption theme along with near obsolescence technologies in the fields of power, logistics, manufacturing and allied industry. With this they have initiated the Indian masses to the taste of fruits of prosperity which will act as a nucleate to keep pressure on Indian polity for more and more of it.In the bargain these developed nations have ensured steady returns for themselves for maintaining their own high standards for long times to come.
There has not been any value addition to this phenomenon of GDP growth by any of the governments of the country. The three main engines of Indian Growth Story, namely human resource development, infrastructure  development, corruption  and black money mitigation are lying dormant and precious little has been done to make them  vibrant. Country has not made any significant effort to improve upon the unskilled, semi skilled and skilled worker pool or  the technical, administrative and managerial pool of the country. During some moments of sanity  in some of the government elements, some wonderful programs and initiatives like thrust on infrastructure, UID project etc. have been initiated but have taken a back seat because of cheap and  economically destructive political agenda of providing subsidies, doles and freebies and motivated corrupt governance.
The developed economies are really happy about such policies and priorities of Indian government for these will ensure perpetual dependence of a country of 1 billion plus for next generations of consumer goods, capital goods and manufacturing technologies. The basic questions India's polity needs to answer are.

  • How long we will keep contributing to maintaining the technology and financial leadership of the developed world? 
  • How long we will be denied the chance of becoming world leaders which is our right because we have abundance of natural resources and other wherewithal, namely a huge human resource which is bound to have one of the largest banks of geniuses on this globe and a fairly large budget along with the massive scale of our needs and requirements?
The wait may not be very long. All that is needed is sincerity, honesty of purpose and long term vision in formulating economic policies and providing reasonably good governance.The governance must change to nation centric from the present self and party centric if a growth rate of 9-10% is to be a reality for next 20 years as is being touted by various government spokespersons.

Friday, January 6, 2012

India and Solar Energy:The inexhaustible Source

Solar and wind energy, the two major inexhaustible and eternal sources of energy are most precious nature's gifts to this world and the futuristic energy security concepts of this globe must totally evolve from them. Mankind has already woken to this realisation  and a lot of effort is being made towards harnessing them to provide permanent energy security, not withstanding the short term vested interests of some powerful industry cartels, countries and their leaders in favour of temporary, costly and havoc rendering obsolete concepts of energy security.
It has been a long and circuitous journey for the mankind to realise the true potential of these inexhaustible sources. It is mandatory and wise for the developing countries not to repeat this historical journey of providing energy to their citizens. They must straight away jump on to the technologies and sources which are eternal, for this will be the statesmanship and wisdom of their leaders.
While the present developed world countries are geographically placed north of the tropic of cancer and do not enjoy the same quantum of bliss of solar energy as countries like India,Egypt, Algeria, Libya, Morocco, Saudi Arabia, UAE, Mexico etc., in the northern hemisphere and Australia, South Africa, Namibia, Chile, Paraguay, Argentina etc. in the southern hemisphere. Sahara desert and Thar desert are the two major sites on this globe (with a 5-7 kWh/m^2 of radiation energy  for about 3000 hrs in a year) which have the potential of becoming the futuristic energy hubs, the former for Europe and north African countries and the latter for India because of shear vastness of scarcely inhabited areas with energy potential of more than 100 times of present world production.
The Indian energy security programs need to be tweaked primarily around solar energy and augmented by other renewable energies like wind, hydro power and futuristic sources like tidal and geothermal energy.
Advantages of Solar Energy  

  • Absolutely clean energy source
  • Available for total life of earth and civilisation and absolutely free of cost.
  • In situ availability at most locations on this globe that means no logistics cost for producing power
  • Suitability for all sizes of non grid requirements starting from smallest solar  cells for watch, torch, lantern etc to remote homes, remote villages and finally mega power plants for national grids.
  • Amenable to use in houses, row of houses,large buildings,hospitals,school buildings  etc. particularly in modern planned cities with effective skyline controls. In fact all new localities and townships can have architectural controls to make effective use of standalone solar power potential of each building. In fact a small middle class home with a roof area of about 130 sq. mtrs. can produce electricity to the tune of 500-700 kWh/day in a typical central India locale.
  •  In a small town of 15-16 sq. km area through a 100 metre wide integrated corridor along the periphery for installing solar panels, the requirements of the whole town can be met with a distribution network only. The high cost of transmission lines and allied losses can be totally done away with.
Drawbacks/shortcomings of solar energy

  • Available only for limited time during a day and that too only on sunny days. So either we have adopt a solar thermal power station (with 30% conversion efficiency) with cost effective thermal storage or tweak the solar panel power (photo voltaic with 15% conversion efficiency) with energy storage batteries and an instantaneously switchable electricity generator.
  • Large tracts of land are required for setting up of solar farms. The land resource is so very scarce in most countries. However it is not a problem in Indian Thar desert and African Sahara desert as both have very little population and are more or less barren. Additionally the land employed in the form of corridors along rail and highway network and irrigation canal system running into thousands of kilometres can be gainfully utilised with no extra burden on land resources. Incidentally the rail and highway corridors emanating from Delhi in all directions total upto 1200 Kms and if a 50 metre width can be used for collection of solar energy, a potential of about 1000 MW is available which can easily meet the requirements of area covered by200 kms radius around Delhi.
If humanity starts working in this direction with all its might, huge cost cutting in the capital outlay could be achieved in a short time. Simultaneously technologies for storing energy to cater for black out periods and cutting down transmission losses to almost zero with super conducting cables can be the harbinger of a new era. For developed nations, reasons for putting in all their resources and might behind this effort may not be that compelling immediately, but it is not understood why Indian politicians in particular and leaders of other energy starved nations are dillydallying on this front.