Politics, Governance & Enterpreneurship

Politics, Governance and Entrepreneurship Shantanu Bhagwat IIM-Indore, 1st Sept ‘11Satyameva-Jayate.org

Not to be distributed without prior consent © Shantanu Bhagwat Why Good Governance matters Starting up in India… Costs more Cumbersome laws and regulations Poor infrastructure …and takes up more time… In most advanced economies, the process takes less than a week and costs less than $100 Guess how long does it take in India…Satyameva-Jayate.org 2

Not to be distributed without prior consent © Shantanu Bhagwat Why Good Governance mattersSatyameva-Jayate.org Source: http://blogs.vccircle.com/500/start-ups-in-india-must-tackle-hidden-costs/ 3

Not to be distributed without prior consent © Shantanu Bhagwat The Politics of Poverty… Digging Holes vs. Imparting Skills How about helping entrepreneurs set up businesses to create jobs instead of guaranteeing employment? How about investing in productive assets rather than digging the same spot again and again? How about setting up a chain of vocational schools instead?Satyameva-Jayate.org 4

Not to be distributed without prior consent © Shantanu Bhagwat The Politics of Poverty… NREGA provided employment to 2.57 crore people in ‘10-’11 But…as many as 1 crore people have been pushed below the poverty line as a result of food price inflation* in the six months from Jun-Dec ‘10Satyameva-Jayate.org Source: http://www.firstpost.com/business/why-nrega-is-turning-out-to-be-an-expensive-boondoggle-28155.html 5

Not to be distributed without prior consent © Shantanu Bhagwat The Politics of Poverty… Expectations of continued hand-outs A Mai-Baap Sarkar …and people who tend to depend rather than become self-reliant BUT… No country ever become great by encouraging & glorifying a culture of hand- outs & entitlementsSatyameva-Jayate.org 6

Not to be distributed without prior consent © Shantanu Bhagwat The License-Quota Raj First, you get a "No Objection" certificate from the Fire Department …followed by a Health license from the Municipal Corporation Then you need three different police clearances one from the police station in the area where the restaurant is located next from the police station in the area where the restaurant manager lives ..then another one from the police licensing department Next, you apply for Tourism & Excise licenses The Excise license is issued only after approval from the Tourism department Inspectors check out the premises and paste a notice at the restaurant inviting objections from the neighborhood This is accompanied by the beating of drums – literally …and the process can only start once the restaurant is ready to openSatyameva-Jayate.org Source: http://online.wsj.com/article/SB123451653488482115.html 7

Not to be distributed without prior consent © Shantanu Bhagwat The License-Quota Raj ..the opening of the Four Seasons (in Mumbai) was delayed by at least 2 years The hotel needed 165 government permits including a special licence for the vegetable weighing scale in the kitchen and one for each of the bathroom scales put in guest roomsSatyameva-Jayate.org Source: http://www.rediff.com/money/2008/may/07mumbai.htm 8

Not to be distributed without prior consent © Shantanu Bhagwat The License-Quota Raj “Entrepreneurs can expect to go through 11 steps to launch a business …over 89 days on average …at a cost equal to 49.5% of gross national income per capita” This process takes 2 days in Australia.. ..and 8 days in SingaporeSatyameva-Jayate.org Source: http://indiauncut.com/iublog/article/mommy-daddy-go-away/ 9

Not to be distributed without prior consent © Shantanu Bhagwat Systemic Corruption… Framing of bidding rules such that only a very small number of firms - sometimes only one - is eligible One way is to tweak the eligibility criteria by defining the norms in suspiciously precise terms… …or by being bafflingly vague*Satyameva-Jayate.org * Source: http://economictimes.indiatimes.com/quickiearticleshow/8002952.cms 11

Not to be distributed without prior consent © Shantanu Bhagwat Systemic Corruption… Change of cut-off dates at a whim After all the bids were in, the government retrospectively advanced the cutoff dates… …to ensure that only its eight favoured companies were ultimately eligible, since they were the ones to put in their bids before the real, rather than the official closing date*Satyameva-Jayate.org Source: http://economictimes.indiatimes.com/quickiearticleshow/8002952.cms 12

Not to be distributed without prior consent © Shantanu BhagwatQuestions, Comments... Jai Hind, Jai Bharat! Satyameva-Jayate.orgSatyameva-Jayate.org 13

http://satyameva-jayate.org	25
http://sabhlokcity.com	9
http://www.twylah.com	3
http://webcache.googleusercontent.com	1

Politics, Governance & Enterpreneurship

by B Shantanu on Oct 27, 2011

Accessibility

Categories

Tags

Upload Details

Usage Rights

4 Embeds 38

Statistics

Politics, Governance & Enterpreneurship — Presentation Transcript