India Unbound: The Social and Economic Revolution from Independence to the Global Information Age

Good intentions are useless in the absence of common sense. —JAMI, BAHARISTAN

When individuals blunder, it is unfortuante and their families go down. When rulers fail, it is a national tragedy

When ordinary human beings err, it is sad, but when leaders do, it haunts us for generations.

Although Manmohan Singh, the helmsman, got the credit, it was Rao who took the tough and aggressive decisions and provided the energy and political support. He was shrewd and knew how to deal with dissent. The manner in which he pushed through the industrial policy in the cabinet is an example. At the same time, the reforms would not have happened without Manmohan Singh. To the extent that there was one, he created the road map. In a brilliant move, he set up a set of committees—bank reform under Narsimhan, tax reform under Chelliah, and insurance reform under Malhotra—and they provided crucial intellectual sustenance and legitimacy for reform measures in these areas. It needed Manmohan Singh to come and change the nation’s mind-set to growth. But Manmohan Singh is a reticent man and cautious by nature. On his own, without Rao’s constant support, he would not have done it. The new trade policy would not have come about as speedily without Chidambaram. Varma was a terror as the head of the steering committee and he provided the momentum for the implementation of the reforms for two years. He knew the system well, and he played it in favor of the reforms. Varma’s crucial contributions, I believe, have not been understood or appreciated. In the end, all three—Manmohan Singh, Chidambaram, and Varma—derived their strength from Narasimha Rao.

Sleeping in the park in a city is a form of civilization. First, you need a city with enough bustle and clatter to make a person yearn for a calm, green spot. Then you need a first-class park,

Modern India is a product of Hindu tradition, the religion of Islam, and Western civilization.

Commerce they say, encourages the bourgeois virtues of thrift, hard work,self -reliance,and self discipline.

The principle of competition is, as Hesiod pointed out long ago, built in the very roots of the world; there is something in the nature of things that calls for a real victory and real defeat. —IRVING BABBITT

Becoming rich has also become acceptable. Whereas a government job was the route to success in the previous generation, now the thing to do is to go into business. Money has replaced power and privilege. Older, traditional people are quick to condemn the changing attitudes. They call it “greed.” They are upset and see it as a threat to Indian culture. But the younger people defend themselves, saying that it is not greed but a desire for achievement. They want to “get things done,” to “produce results,” and business offers to them a stage to do so.

Aditya told me that he produced staple fiber in Thailand from pulp that he bought in Canada. He sent the fiber to his factory in Indonesia for converting to yarn. He exported the yarn to Belgium, where it was made into carpets, and finally, the carpet was exported to Canada. “Here is Aditya Birla,” I thought, “an Indian, and yet India does not figure in this global value-added chain.” It did not because India had closed its economy. By closing it, it denied its citizens the chance to participate in the enormous expansion in global trade in the second half of the twentieth century. It denied its people jobs, technology, knowledge, and new ways of organizing. Thus, it deliberately suppressed economic growth.

Poor teamwork is pervasive in India. Take any institution, scratch its surface, and one finds factionalism. Whether it is a company, a university, a hospital, a village panchayat, or a municipal board, it is beset with dissension, and it affects national competitiveness.

We grew up in the smug belief that although the mixed economy was inefficient, it was better than capitalism because it preserved democratic freedoms.

The greater benefits earned by a few could be justified, I realized, if the inequality improved the situation of the worst-off.

The Indian intelligentsia was mesmerized by the apparent success of the USSR. It wanted big steel plants and not small factories which made clothes, shoes, toys, and bicycles—the sort of things that the masses could use. In those days, anyone in India who advocated greater investment in agriculture was branded an American agent.

Merchants understand from birth the power of compound interest; they know how to accumulate capital. The Internet has also leveled the playing field, so that it seems sometimes that any mad, passionate Indian entrepreneur can write his own future.

Indian companies also had clear and numerous weaknesses. The most important ones were the inability to separate ownership from management; a lack of focus and business strategy; a short-term approach to business, leading to an absence of investment in employees and in product development; insensitivity to the customer, largely because of uncompetitive markets, but resulting in weak marketing skills; an indifference to technology; and, lastly, poor teamwork. Many of these weaknesses were the result of a closed economy.