Tuesday, February 28, 2006

Economic survey 2005-06 India

Highlights from Business Standard :

While these are rosy....
Growth projection 8.1% GDP
Savings rate up at 29.1% of GDP
Investment rate up at 31% of GDP
Industrial growth at 7.8% (April-December)
Tele-density increases to 11.32%

These need money
Rs 1,72,000 cr investment required for national highways
Rs 40,000 crore required for airports
Rs 50,000 cr investment needed for ports

From Businessline...

"The growth trends for the last three years appears to indicate the beginning of a new phase of cyclical upswing in the economy from 2003-04... In contrast to the sharp fluctuations in agriculture, industry and services have continued to expand steadily and have acted as the twin engines propelling the overall growth of the economy.''

Possible risks: Crude prices, interest rates and fiscal risk

"With increasing dependence on imported crude and growing openness, India is no longer insulated from the rest of the world. This inflation uncertainty, together with the unresolved global macroeconomic imbalances, casts it shadow on the interest rate scenario. A continued firming up of global interest rates beyond a point poses the risk of dampening the domestic investment boom"

...As for the fiscal risk, both at the Central and State levels, the survey says it arises from the argument that the fiscal adjustment process has led to expenditure compression of the wrong kind. "It is important to safeguard against this argument as the solution lies in not increasing the deficits, but in meeting squarely the challenge of improving the quality of expenditure,'' it said, hinting at pressures to enlarge expenditure without corrective measures of stopping leakages in the expenditure stream....

For more, read the entire piece

Other items on the watchlist: Power shortages, Social indicators, Farm pricing policies

Click here for the full coverage at Business Standard.

Monday, February 27, 2006

Independence within a system

This story in timesonline UK, has a provocative heading that says, The President is a dolt – so how can America be such a success story? (The article is dated and this post has been in draft for a while)

...But now comes the paradox. While America has been run by one of the most doltishly ineffectual governments in history, it has forged ever further ahead of Europe in terms of wealth, science, technology, artistic creativity and cultural dominance...

In the piece, the author, argues on why the American system today is independent of whoever rules it (in a sense).

...Why does America’s prosperity and self-confidence seem to bear so little relationship to the competence of its government? The obvious answer is that America, founded on a libertarian theory of minimal government, has always had low expectations of politicians...

...The American approach has a powerful advantage rooted in human nature: private sector activity is powered by economic incentives, while the State must operate by rules and sanctions. Since incentives, as Adam Smith observed, are much more likely to stimulate creativity and effort than sanctions, private enterprise tends to achieve ambitious objectives, while government often fails...

Read the full piece for some good observations.

Coming to India, this is something we have seen.On the one hand there is a Golden Quadrilateral project, which is a good project with achievable targets and yet has fallen short of some really simple expectations. Indeed it is neither golden neither a quadrilateral today. The current coverage by the Indian express on the slow progress on India's Golden Quadrilateral shows that in India, development works are held hostage by politicians. On the contrary, powered by private entrepreneurs (companies), we have the golden web of telecommunications across the country. Very soon, the web will also expand in its myriad ways, while we continue to gasp for roads and water and electricity.

In a couple of places in India, notably Bombay (and perhaps Delhi and Chennai), the cities move ahead regardless of who rules them (almost). Politicians have realised that development is the way forward; it also helps that most of Bombay politicians have lived the Bombay life with all its problems.

The tipping point to making progress independent of whoever rules will happen when private interest in the country is more than the government (and outside supporters and inside opposition) interest.

On the eve of the Indian budget

On the eve of the budget, no doubt there are going to be a slew of analyses, predictions, predelictions with the financial minister trying to do a fine balancing act on all accounts.

But spare a thought for the small number of income tax payers who end up financing the finance ministers coffers and then some.

...There is a flourishing illegal economy in India that remains out of the tax dragnet with only 20 million out of a population of more than a billion paying taxes. Other estimates put the level of economic activity determined by black money to the tune of 30-50%.

Self-employed lawyers, businessmen, doctors, designers, property agents and traders get away with paying a pittance as compared to the perpetually harassed salaried employees who have no choice but to pay up. Agricultural income, often higher than salaries, remains untaxed, given the politics of keeping farm incomes untouched.

Heres hoping then:

  • That the finance minister broadens the tax base to include some more 'poor' people like traders, real estate brokes, doctors and other 'poor' people as well.
  • That the finance minister taxes atleast rich farmers. Today not so rich salaried workers are taxed, but rich farmers are not.
  • That he ensures that all politicians pay their taxes, even if they are poor farmers.
  • That the honest tax payers are rewarded (with something) for their honesty, like roads, electricity, water and infrastructure.
  • That the salaried individual is not hit from all sides. After all he pays the VAT, the service tax and every other cess that the FM can think of and loses out on some subsidies as well. (Of course he earns 8 odd percent in the EPF which can be cut further down)
  • That, the not so vocal salaried tax payer is spared of some harrassment in getting his tax returns to the income tax office and there is some way of doing it other than having to stand in a maddening queue.
  • That the refund which I expect to get is actually delivered to me and not lost in the system.
  • That for all the tax exemptions, concessions, sops and subsidies offered all over, something is passed onto the salaried individual.
  • That for all the grandiose schemes into which crores and crores of money will be pumped in, better infrastructure is passed back and not empty rhetoric.

Heres a wonderful analysis by Sucheta Dalal on the disproportionate noise generated by big businesses that ensures that they get a good budget while the man on the street is left, where he is, on the street.

Thursday, February 23, 2006

Road to nowhere

. . Heres a heart rending piece on the state of Indias National highways (its a travesty to call them that for the most part) in The Indian Express by B C Khanduri, who was the surface transport minister in the previous government. The Indian Express has, over the last few weeks covered the "Golden Quadrilateral that is now a series of disjointed segments"

In the piece, BC Khanduri writes about how the previous government had gone about acquiring land before awarding contracts, while at present contracts are given out without acquiring land.

... by May 2004, out of 8276 hectares of land required for the entire length of the Golden Quadrilateral, as much as 7180 hectares had been acquired, the bulk of it in 2002 and 2003. The UPA government, on the other hand, just for the sake of “statistical” achievement, has awarded a large number of contracts for NHDP II without acquisition of land in most cases, as is evident from these figures:

• Assam: with less than 20 per cent land acquired, 21 contracts have been awarded covering about 550 km.

• Andhra Pradesh: with only 0.25 per cent land acquired, four contracts have been awarded for about 250 km.

• Bihar: with just 4 per cent land acquired, 12 contracts have been awarded covering about 450 km.

• Maharashtra, Kerala, Haryana & Punjab: contracts have been awarded without acquisition of any land.

Thats the shape the project (NHDP I, NHDP II) envisaged by the former Prime Minister to connect the country is in today. The GQ was supposed to connect the four cities, Bombay, Delhi, Calcutta, Chennai and two diagonals were supposed to connect North-South (Srinagar to Kanyakumari with a spur from Salem to Cochin) and East-West (Silchar to Porbander). The sad state of our roads are known to all.

A backgrounder on the programme would highlight its importance. Out of 3.32 million km of the Indian road network, only 65,569 km is part of the National Highways. In spite of being only 2 per cent of the road network, the National Highways, which are the responsibility of the Centre under the Constitution, carry 40 per cent of the total transport traffic.

Long neglect of the National Highways was apparent from the fact that in 2000 almost 18,000 km of the National Highways was single-laned and about 80 per cent had weak pavement to carry the axle load. Reconstruction of highways suffered from lack of funding and an inefficient institutional framework. In addition, gross misuse of roads by overloading trucks was causing immense damage.

Yet, the new government has chosen to spend tons of taxpayers money on Employment Guarantee Schemes and other "castle in the air" schemes instead of getting the roads in better shape.

Heres how the whole scheme looks today...

Of 3.32 m km of roads 65,569 km (2%) are National Highways, carry 40% of transport. So the plan was:
NHDP Phase-I and II (14000 km)
• Involved 4-6 laning of 6,295 km, estimated cost Rs 30,300 cr, GQ project connecting four metros
Bharat Jodo Pariyojana (10,000 km)
• Strengthening 41,000 km on BOT (Annuity Basis) Express Way or 6 laning of high density sections

• Dec 2000: CCEA approved Phase-I of NHDP
• 2002-end: 110 contracts awarded at a cost of Rs 25,000 cr covering the entire length of GQ (except 134 Km)
• May 2004: Of required 8276 hectares, 7,180 hectares land acquired; Of 5,846 km roads, 2,801 km opened for traffic, rest was expected to be open by 2005-end
• North-South (Srinagar-Kanyakumari
with spur from Salem-Cochin) and East-West (Silchar-Porbander) corridors,
overall 7,300 km
Behind schedule by two years

• Low priority given to land acquisition
• May 2004-Nov 2005: Around 632 hectares land acquired between May 2004 to Nov 2005
• 7 projects, where bids were invited by the NDA, delayed

BC Khanduri ends his piece with a pithy...Creating world-class infrastructure requires continuation of policies, sustained commitment and a degree of national consensus.

Apparently, the new government thinks that the highways will get built on their own without land acquisition. Right now it is a road to nowhere and isnt leading to anywhere in a hurry. We have to wait for another 50 years perhaps to get anywhere near world class highways.

Heres a history of the US highway system and heres how that page ends.

...The history of US highways is a reflection of the history of 20th Century America...

The history of our highways could well turn out to be a reflection of the history 21st century India and missed/delayed/frittered opportunities.

Wednesday, February 22, 2006

Functional automation

Bangalore Electricity (BESCOM) has launched its any time payment (see picture on this page) machines in many parts of Bangalore over the last year or so. (Bescom is not the only one, there are others too.) For those who cannot use the online option, these machines free you from having to stand in a winding queue (11 am to 5 pm types) to pay the bill. (More on crowd management some other time)

The machine is a 24X7 machine like an ATM, but it is not as high tech as an ATM. It has a touch screen, a bar code reader that reads your electricity bill and a MICR scanner that reads your cheque. After following the instructions on the touch screen, one has to first scan the bill, enter cheque details and then finally slide the cheque in (the last part is difficult and one needs some high level skills to get the cheque in such a way that the reader reads your cheque number information - an attendant is usually available to help you out).

The point is that this machine does not do anything spectacular. It takes the cheque and dumps it into a drop box. It is way better than a manual drop box because, with the above information it gives you a provisional receipt. Somebody collects these cheques and takes them a bank and it all gets done the usual way. Only, the collection mode is automated and customer friendly.

The customer is freed from the hassles of the electricity departments working hours, the hassle of standing in a queue - there is a machine to receive the payments. The added convenience of 24X7 helps bringing down the number of defaulters who turn up to pay the bill at the last minute and also brings down the number of those who stand in a queue to pay up at the counter.

This is what I call functional automation (let me know if there is a real term for it)- automation that is just enough. Ideally, this machine could be the equivalent of a battle tank. Collect the payment, debit the customer account, credit BESCOM account and what not. But automating a single step in the entire payment process does wonders.

Tuesday, February 21, 2006

The truth about jobs

The call center job has attracted the ire of many. There are those who say it is a dead end job. There are others who say that there are cultural ramifications, health hazards, moral hazards and what not. Some are very charitable to it and just say it is a McJob.

The truth is that the call center job is a choice. It is the choice of this era. Ideally, every man in India would be a Shah Rukh Khan and every woman would perhaps be a Preeti Zinta? If thats not possible, every man should be a Sunil Mittal and every woman perhaps a Sucheta Dalal? Or how about Sehwag and Sania? But somewhere between Shah Rukh, Sehwag and Sunil lies reality. The reality that one has to do a job to earn a living. Make ends meet. So what do you do if nobody comes forward to you with film offers or cricket bat or an industry to run? You take the job that is available. Mind well that I am not talking about someone who has a degree in marketing and has the choice of two jobs - one which pays well but offers no work life balance and the other which is a low paying job with greater responsibility - the standard choice trotted by well heeled MBAs. I am talking about the average Ramu on the street - the graduate (less than that, some other time).

I never tire of saying this, but a job is a job is a job. It is a means to earn a living. There are a chosen few who derive their livelihood from their passion, for many others, it is a means to earn their living. For them their passion is their hobby.

Look at the past to learn about the future. In the 60s and 70s, the trains which brought people to Bombay, Delhi from the South of India were known as "Stenographers Express". Today we know and read about IT jobs today and the mushrooming of NIIT-like computer training institutes. Then, every gully had a typing institute that taught you speed typing and shorthand. To standardise it the government introduced a typing and shorthand test. (It exists even today). Who in their right frame of mind will argue that a typists job can have any passion? And much more than the call center job, a typists job was a dead end job.

Cut to the 80s, when it was the Gulf job boom. That was about 25 years back. So, many Indians went there. How many are CEOs today, since 25 years in service is a reasonably long time to rise to a CEO position? Incredibly - none (or three). You can cry hoarse to argue that many of them went there as low level position - I know that nobody went to the "Gulf" as a CEO, but 25 years is a long time. Truth is that the Gulf jobs were all about labour arbitrage and zero progress. You joined as an accounts clerk you died as one. Dead end job anyone?

The 90s saw the bodyshopper job. The Gulf job replaced by the contractor (consultants - if you wanted to elevate your position) in the American firm. Many of these programmers have seen one (or two or three) applications in their entire job profile. (Indian programmers of IT companies by contrast know "all there is to know" because they work in multiple projects across a year or so. ) Apart from the handful who graduated big time to company founders (and many of them were US educated) during the dot com boom, the rest of minions are just sitting there capitalizing on labour arbitrage and cultivating an accent (something you did not get in the gulf). Isnt this a dead end job too?

Take any other job. Clerk? Salesman? Accounts officer? Receptionist? Office boy? Challenging or Dead end? Jobs can be dead end, as long as they help the employee earn his living and live comfortably. It is better to be a successful television artist earning money than it is to stand in front of a big banner film company office and wait until you are "discovered". Likewise, if I cannot become Sachin, Sunil or Shahrukh, I need a job to survive. Once my bread and butter is taken care of, I will look to do something else. Like blog, perhaps.

So,is the call center a dead end job or not? The call center job is way way better than any of the above. Because except for the typists, the other job booms sucked out qualified engineers (for the most part) out of the country. The call center takes the jobs to graduates. Those who, as we have seen in many of the art films of the 80s, are umemployed and would have seen themselves at the end of a line in an "employment exchange". Many of these call center execs work in swank offices, are paid well, are trained in a whole host of things, get to travel abroad,gain multicultural experience (either through travel or by interacting with visitors).

The job of the 00s is the call center job. It will soon pass and somewhere in the next few years we will see another boom in a work of a different sort. Then we will all come together and rant and say how the "future job" is a dead end job.

Monday, February 20, 2006

How to get users to pay for your ad?

But thats whats been happening for a while in India. Of course, people dont realise it or perhaps dont think about it that way.

Heres how you do it. (Caveat: It may or may not work.)

Create a nice jingle for your product. Airtel, Maruti Alto (for instance).
You are lucky if people begin to like it. (otherwise your plan is gone kaput.) One way of doing it, like Airtel did, is to use an uber composer like AR Rehman to compose their tune. The tune, needless to say, is a household tune even a couple of years after it was composed. Titan (with their now household tune) is a good candidate.

Now, on your ads (print or tv or anywhere), just write, SMS XYZC (or something) to download the ringtone of your product.

Users pay anything between 4 rupees to 6 rupees to download a ringtone, that is actually your advertisement!

The user can receive a call in a crowded train, bus, party anywhere and IT IS YOUR AD thats playing (and the user has paid for it)!

The moped, mobile phone and the micro entrepreneur

The moped is a much derided vehicle, atleast on Indian roads. It is slow on the highways, a pain in traffic because it runs circles around other vehicles far more than a bike or a scooter and an irritation when it breaks down at signals. Some of these contraptions also have a pedal option, which is used by its owners to get out a signal at 3 km/h, when their contraption fails to start. But, it also has a role to play in our economy. Down South, where TVS motor rules the roost, the moped is popular. It is not popular with college students (guys prefer bikes, girls prefer variomatics), but it popular with another segment. The milk delivery man, postmen, the newspaper delivery men, even the scrap traders (as pictured above) who I call micro entrepreneurs. These were the guys who used a bicycle once upon a time and have now upgraded to mopeds.

Mopeds are dirt cheap and give amazing value for money for a litre of petrol. (A 100 cc bike gives upwards of 80 km to a litre, these 50 and 70 something cc vehicles can give much more. It is not uncommon some of these things being filled with petrol for 25 rupees (half a litre) or less. I have seen a moped being filled for 10 rupees. These things are not fast, but they are rugged and remove the dependence on public transport for their owners. The moped is as functional a vehicle as it can get, since their owners really dont care for how a moped looks.

Be that as it may, the much derided moped is a big multiplier for the small time trader. With the mobile phone, and their recently launched life time free recharges the moped probably serves the lower middle class the most in their needs.

When I asked the waste newspaper man to come home to collect the newspapers, he did so on a moped (and gave me a ride back home, weaving through some routes only he knows). And then as he left, he flashed his mobile phone and told me, the next time you need me give me a call and I will be there.

Now imagine this. In the place where I stay, someone or other needs a junk newspaper guy every once in a while. We post this phone number on our notice board and it is as good as an advertisement for him. Ever heard of a scrap dealer advertise? The mobile serves this purpose. This is not an isolated example. Vegetable sellers, hawkers and many other service providers expand their area of operation using mobile phones.

The moped has, for long, been a loyal servant of these small time entrepreneurs. With micro re charge and free incoming calls adding to the mopeds frugal cost of ownership and maintenance, these twin accessories are a leap for the micro trader who aspires to be big some day.

(What is shown above is a moped that is lightly loaded. The mopeds one sees on roads are loaded on all possible sides. )

Saturday, February 18, 2006

Indias labour shortage and how to beat it

A lot has been written about the talent shortage in India. In a nation of a billion, for an industry that is estimated to provide about 13 lakh (1.3 million) jobs, further talent is hampered due to supply. Or so they say.

The theme that goes around is that recruits are not plug and play. The other is that the quality of recruits is suspect. The truth, as usual, is in between.

In India, things work differently, to use a cliche. The education system (and I mean engineering colleges) in India is a fairly theory oriented system with very little rigor. (Yes, students have to slog, but that is mostly to beat the system). With the result that they are not industry ready. This is true for any industry, start from mining and end in aeronautics. For the computer branches, a fair amount of coding knowledge is required. Most Computer engineering students have these, but the best fit is a new branch known as Information technology (IT). Other than this most of the other branches have fleeting glimpses of coding. And the number of IT engineers are not enough to fill the gap. So, the IT companies hire non IT engineers, indeed even non engineers and train them.

Between Infosys (and its Global Education center in Mysore), one of the biggest IT companies in India or TCS, the biggest - the number of students they train would rival a mid sized university. Add up the numbers of Satyam, Wipro academy and the number doubles. Wipro for instance has a program (WASE) that enables fresh recruits to get a degree as well as work (and earn) at the same time. From the Wipro site,

... Wipro was the first company to get BSc graduates to work on live projects and get trained over the weekends. Wipro ties up with BITS Pilani so that WASE students could receive a post graduation degree at the end of 4 years. This model helped us to reduce costs for the client and service their need for legacy systems. It also helped in increasing the talent pool...

It is a smart way of scaling up.

At another level are the private training institutes like NIIT, Aptech and many others. Companies that do not have the scale of an Infosys or a Wipro can partner with these institutes and recruit graduates from here.

Yes, theres raw talent as Ramalinga Raju says, but it has to be polished (which is fair enough). Lets go over some numbers. McKinsey states that India has 14 million young graduates (those with 7 years work experience or less). With a projected estimate of 1.3 million jobs, thats 10 percent of the pool that has been tapped so far. From the Nasscom site, heres a few more numbers. The total number of engineering seats (IT can absorb any engineers of any field with some training) in 04-05 was 4.6 lakhs (0.4 million). So we churn out about half a million engineers per year.

In the Strengths section of the Nasscom site is this:

... Every year, approximately 19 million students are enrolled in high schools and 10 million students in pre-graduate degree courses across India. Moreover, 2.1 million graduates and 0.3 million post-graduates pass out of India's non-engineering colleges. While 2.5-3 percent of them find jobs in other fields or pursue further studies abroad, the rest opt for employment in the IT industry. If the flow from high schools to graduate courses increases even marginally, there will be a massive increase in the number of skilled workers available to the industry. Even at current rates, there will approximately be 17 million people available to the IT industry by 2008...

Will we meet the growing projections each year? With an estimate of 1.3 million for the next year and seeing the above, it is a walk in the park. The big companies like Infosys still hire only Master of computer applications graduates or engineers for most positions and hire science graduates for some functions only. Most of the others hire graduates and train them. How will these requirements be met? There will be innovative training solutions (after all how many companies can churn out trained freshers in 90 days flat like Infosys or how many companies allow employees to get a degree like WASE?) there too.

A closer look at the number reveals that it is not the talent (or the numbers) that is lacking in the market, it is the training (or the will to invest in training).

SOFT - railways

I found this in my mailbox today, a soft launch of SOFT, Indian railways frequent flier (roller?) programme

...We are happy to inform you that we will shortly be launching a Loyalty Program - A Scheme for Frequent Travelers (SOFT), wherein members will earn loyalty points for buying AC Class (except 3AC) tickets & will be able to redeem these points for FREE railway tickets...

There were no details in the mail, but I think, they can extend it to all net bookings rather than restrict it to only II AC (is there anything above that?). A scheme that encourages regulars to stick to the train, but more than anything else, the railways need to speed up their services, clock better on punctuality and improve the "comfort" factor for the average traveller. An average speed of 50 km/h does no good when faced with high speed point to point competition (in the shape of low cost airlines) frequent points or no frequent points. How about high speed corridors? Business class trains with slumberettes?

How about some more real superfast trains? A train like this could cut down 24 hour journeys to 12 hour overnight journeys and then some.

Friday, February 17, 2006

SEZ Reliance...

Reliance is in the news over the past few weeks with its SEZ plan. So, whats an SEZ? Heres some simple information about what constitutes an SEZ. In India an SEZ could be like SEEPZ. Apart from SEEPZ, there are STPs (Software Technology Parks), EPZ (Export Processing Zones) Gems export Zones and other variants.

Very simply put, A Special Economic Zone (SEZ) is a geographical region that has economic laws different from a country's typical economic laws. Usually the goal is an increase in foreign investment. (wikipedia). One obvious benefit is the tax. SEZ offer tax holidays to companies housed in them. The other, less obvious benefit is that of captive infrastructure within an SEZ. In China, for instance, SEZs have been used to create an environment that is different from the rest of the country. Shenzen, which is Chinas most successful SEZ is a case in point.

Reliance itself has grand plans with its SEZs. Its new refinery at Jamnagar will be in an SEZ. But that apart, Reliance, being Reliance is not content with the SEZ being just an EZ. The way Reliance looks at it, their SEZ may actually be as big as a small city. The advantages are obvious. Better infrastructure, better power, transport and what not. What the software campuses did in a small scale, Reliance will probably do it over an entire city. Given the local talent pool in India and the daily commute, many would move to a Reliance SEZ (or any other SEZ) to live and work, given a good option. And for companies too, they neednt decide between Bangalore and no Bangalore or some broken down town that passes off as a city; they can move straight into Reliance city.

Here are some excerpts from a story (The Reliance redux) I found in the The Indian Express:

...Reliance entry will ensure that our 15-year plan to develop Maha Mumbai and Navi Mumbai SEZ will now shrink into a 4-year development programme,’’ says the original promoter of the project, Nikhil Gandhi...

...Reliance Haryana SEZ (Pvt) Ltd is looking at an investment of Rs 40,000 crore, and a site would be selected soon. Mukesh will set up some industries in the SEZ which includes his ‘baby’ bio-technology.

In Hyderabad too, Reliance has asked the state government to allot 25,000 acres of land near Shamshabad airport for developing an SEZ exclusively for petrochemicals...

The plans are ambitious, no doubt and I see no reason why they cannot do it. With RIL India could have its first "private city" pretty soon.

Thursday, February 16, 2006

36 billion USD and 13 lakh jobs

I am not a great fan of Nasscom reports, but this one made me sit up. The technology sector (give or take a few) accounts for 36 billion dollars in revenue and just about 13 lakh jobs. The Hindu Businessline reports on the ITES/BPO part of it.

...INDIAN ITES-BPO exports are estimated to grow to $6.3 billion by the end of fiscal 2005-2006.

Exports from the sector had grown 48 per cent in 2004-2005, to $4.6 billion, up from $3.1 billion the year before, according to an analysis done by Nasscom. ( National Association of Software and Services Companies).

Net employment in the sector is estimated to have grown by approximately 1 lakh in 2004-2005, the total direct employment having risen to 3.16 lakh.

Based on the hiring trends over the year, this segment is likely end the current fiscal with total employment at 4.09 lakh...

Net employment in this sector is only about 3-4 lakhs? Umm, I was under the impression that it is much more than that. As it turns out from the Nasscom link, that figure is only the ITES/BPO total. IT services are estimated to employ about 3.98 lakh in comparison. If you count engineering services and R&D, you can add another 1.15 lakh estimate. The domestic market caters to around 3.65 lakh jobs. In any case, the entire tech sector seems to employ only about 13 lakh people.

To put that in perspective, Indias small scale industries employ about 282.9 lakh employees and account for 249,064 crores (approx 55 bn USD), as per an RBI report quoted in ET a few days back.

This is definitely worth a thought...

(cross posted on The Indian Economy blog)

Retail - battlelines are being drawn

There were two articles today, one in ET and one in The Hindu Businessline. The one in ET says (its not online, could be there tomorrow), more than Wal-Mart, it is Reliance and its big plans that worry the existing players. The one in Businessline tells how the big ticket Reliance is slowly drawing battlelines across the country. The timing of the articles couldnt be better.

...It (Reliance) has started over 100 company-owned fast food joints along various stretches of the 5,846-km Golden Quadrilateral and north-south/east-west corridor, where it has over 1,000 pumps up and running...

...Reliance is said to be pushing this model of value-added retailing in a bid to corner what it believes will be the next sector after railway and air travel to hit the growth trajectory - road travel...

...It is not that such eateries do not exist in the near vicinity of petrol pumps across the country, but there is no guarantee on the quality of food served at these dhabas. Reliance has put a foot forward in this space by owning up responsibility for this service...

As seen from its telecom experience, Reliance does understand the customer, the tricky Indian customer with all his quirks. Food at highways can be fairly tricky, so why not a petrol pump with quality food. Smart move.

...Given the penchant of the Indian to have a wash before sitting down before the `thali', the A1 Plazas are also offering a quick bath at Rs 5 and a more posh one at Rs 15...

Reliance has always been a big thinker. Ever since the refinery in Jamnagar, Reliance makes a splash and not a small dive. Reliance is known to use its size and muscle to get the best deals out of any company. I personally know of some who were at the receiving end of their ability to whack out amazing discounts out of companies.

I like the way the piece ends in Businessline, since it says...Clearly, retail business for Reliance, has already started.

As we are focussed on the malls and the shopping outlets in the cities, Reliance seems to be busy conquering territory where there is nobody (or no concerted effort) lying in wait for the boom. And then it will enter the cities, slowly but surely. The other players are getting ready in scale and service for the inevitable entry of the big daddy (which is what the piece in ET talks about), but this is one area where there is no single big player across the country. Reliance might just fill this void. FDI or no FDI, there is bound to be action in this space.

Accredited pumps and the rest

Over the last few years, oil companies in India have sought to distinguish their pumps. From the deserted airfield pumping station look, pumps have become swankier and swankier. Hindustan Petroleum for instance has Club HP petrol pumps, which are essentially upgraded versions of its pumps. Here the service is noticeably different. All of HPs pumps are not Club HP, some are still in the old mould. The same holds true for the rest of the companies too, except the newer ones.

From my observations and measurements, I think that behind this select upgradation is a story. My observations show that petrol at these upgraded pumps gives more mileage than other pumps. The story is perhaps about adulteration. I think that this is also one of the factors that goes into the "select" upgradation. Next time, fill 'er up only at accredited pumps. And feel the difference.

Monday, February 13, 2006

Now showing at...

I will soon be blogging at The Indian Economy too, as a guest contributor. I think its great to have received an invite to blog there. Its one of the few Indian blogs mentioned in Fast Company's Blog Masala.

I will get around to posting there, once I overcome the initial writers block.

Peace and violence - global

A few weeks back, I had blogged about Peace and violence at a micro level, about how the threat of violence (and sometimes, its actual happening) brought about "action". As I thought about it and the recent controversy surrounding Danish cartoons, I cant help but think that nation states are succumbing to the threat of violence.

A few months (or was it years, nobody remembers) back, as Ankita points out, the Buddhas of Bamiyan were destroyed by radical Islamists in Afghanistan. Then, Buddhists did not go on the rampage destroying embassies of Muslim countries or sending death threats or taking our processions that ended in violence. Were any apologies demanded? or issued? I think not. Sadness and anger was "expressed" in official comminiques.

To me (and I am sure to most of those with a positive IQ), such an act hurts a thousand times more than publishing a few cartoons in one corner of the world in a newspaper whose circulation was at best limited to a few million. Yet, it has resulted in protests all over the globe, death threats, deaths, burning embassies, burning flags, throwing eggs and what not. Danish goods have been boycotted (by Saudi of all countries which outlaws all religions other than that of Islam, much less tolerates them) for the action of a newspaper in Denmark. Other countries are busy trying to pacify the religion of peace and have reacted with apologies, "deep concern" and what not.

This is what the so called religion of peace has achieved. For every slight, real or imagined, the followers react with violence. Violence of this nature is rarely spontaneous. Especially for cartoons published in October, violence in January cannot be spontaneous, it is organized crime and should be tackled as such.

But I digress. Speak softly and carry a big stick, is a quote attributed to Teddy Roosevelt. But if what has happened in the example of the cartoons has shown (and shown many times before that in many countries) Speaking very loudly and beating people with a big stick works. All it shows is that, violence, sadly, is rewarding at many levels.

So, how to counter this? I offer this as an example.

Saturday, February 11, 2006

Reality show on call centers

Now there is a reality show on TV on the call center. This one, is from the Hindu (Metro plus, Bangalore edition). From the piece,

...Now a BBC reality show on the industry — simply called Call Centre — might help view the beleaguered service sector in a different light. The seven-part "observational business reality show" tracks two call centre employees, and through their personalised perspectives, hopes to offer a more humane view of the industry itself...

I havent seen this "reality show", but this is what the newspaper further goes on to say.

...The first episode of Call Centre seems to offer a rather rosy picture of the sunrise industry: of a newfound confidence and a dream coming true. But the "dispassionate" camera, through a series of juxtapositions, does manage to offer an interesting contrast between the somewhat naïve aspirations of a middle-class youngster and the clinical and calculative ways of his workplace...

I compare the call center employment today to the 70s that offered employment in huge numbers to typists, stenographers and so on. Those who migrated to Bombay, Delhi in those days will tell you about their life in those days. Their life revolved around South Indian meals, anti outsider campaigns, living 5 to a room, of a life behind the noisy clatter of typing keys. Werent typists caught in as much of a McJob as the call center jobs today, indeed more so? Many of them had tyrannical bosses. In those days "respectful workplaces" was still jargon, not what is seen today. Todays workplaces are so much more professional.

What would have happened if there were a reality show or a media explosion in those days? Pretty much the same thing. Typists would be derided for their McJobs and they would have been asked to return to farming. Very much like todays call center guys are asked to return to typing data into a computer in a cubbyhole firm or stand in the line in front of the employment exchange or be exploited by some unprofessional company for a low pay.

Reality shows are ultimately, a money making tool. So, reality shows will continue to happen, call centers or no call centers.

Isnt any industry clinical and calculative? After all they are a business. In IT, Indias
much hyped sector, does anybody read between the lines in annual reports of companies on how many employees are fired for low performance? Do people realise that despite the best intentions of the commies (and the AAI example) today work is not something you go to, but something you do? And do well? If you dont perform, you will be chucked out. It is true in every workplace, right from the hotel cook to the IT honcho.

...Niret and Manira promised that the coming episodes will offer a nuanced perspective, bringing into focus all the debates that the industry has provoked even within India: unearthly work hours, contentious modes and terms of employment and cultural ramifications of a profession that forces a foreign accent on an employee... These, said Niret, will come in the form of expert interviews with people such as Kiran Karnik and Brinda Karat...

Brinda Karat, of Baba Ramdev fame, will talk on call centers (I am somehow holding onto my
chair to keep me from falling off)?

Unearthly work hours, cultural ramifications - well why not. If I get paid for it, sure. They are far better than the "entrepreneur who ran a big factory" who after my engineering offered me a job paying me some 2000 rupees a month (I pay my maid more these days) saying "I cannot pay you much, but you can learn". My foot. Pay me well and the learning will take care of itself. These graduates who work in call centers would find themselves working for such "entrepreneurs" if it were not for the call centers.

Contentious modes and terms of employment. What terms of employment? Are they chained to their desks like the Roman oarsmen? Are they even kept on bond? (Very few call centers do).
They leave when they feel like it. Attrition rates are much as a freedom of choice, as they are about employee satisfaction or dissatisfaction.Call centers really, are, far far better than any form of employment we have had.

Reality shows or no reality shows, call centers are a reality. Much like typing jobs were a reality a few decades back. In things like jobs, there are certain jobs that are "big" in certain eras. Long ago it was typing, then it was the Gulf boom, then the MBA. Now it is IT and call centers, tomorrow it will be something else. For the millions who cannot become the hotshot pilot or a designer, it is the chance to make their livelihood. These jobs let youngsters make money, they let India make money. Youngsters make their money and get on with their lives (and higher education and prosperity), knowing fully well that the call center job is not the only thing in their lives. They will pass their prosperity on to the next generation, which, hopefully, will take India to the next level at which point, we can make another reality show.

No blog like Seths

Truly, there is no blog (for me atleast) that makes me think as much as Seths does. Today it is a post about hearing.

I had taken my car for service, same Maruti service center as before (estimate was 300 rupees), which ultimately turned out to be a "no job". The job sheet that was created for my car was no longer needed. I also wanted them to check a loose tube in the bonnet (the service engineer opened it, but did not see the tube), but they did not hear it. After the job sheet was junked, I told them to to take a look at the loose tube in the bonnet. The loose tube was caused by a broken coolant storage cap, which had to be changed. This cap cost all of INR 7 (1 USD = 45 INR).

Now the dilemma, they couldnt open a job sheet for 7 rupees especially after the first one was junked. So, I could bill it directly they said. The biller (why is this the least efficient in every place ruled by dinosaurs) said, he doesnt bill individual items (so, do I buy a thousand caps?). They bickered until someone came in and said,"Until this is a directive from XYZ, it can be billed" and the biller meekly complied. The mechanics are a good lot, but the billers suck.

If they had heard their customers instead of painting fancy Japanese slogans on their walls, billing would be far far simplified, bureaucracy would be lesser and customer satisfaction would improve.

One bottleneck

This was a few days back, but my visit today brought back memories of this visit. I had been to the Maruti Suzuki automobile dealer/ service center to get a pollution certificate. The reception was friendly, quick and the pollution certificate ready in exactly 5 minutes. But I spent an hour over there. Why? First the billing counter was busy. "Busy" adjusting paper in the dot matrix printer (philistines!). Then he was busy with other "urgent" stuff. He finally printed my bill and then I had to wait at the cash counter. The cashier spent some time subtracting 342 from 500 and then a few minutes searching for 2 rupee coins. Then there was another chap who had to make a big payment and he spent time counting cash. Finally, I had to pay 65 rupees and it took me a total of exactly 65 minutes.

Surely the billing counter could have been more efficient? Faster printers could be installed? The biller and cashier can do both billing and cash (atleast for small, trivial amounts)? Empower (to use a cliche) the service engineers. Let them bill what they service.

When you as a company strive to make your service experience worthwhile, remember that all it takes to get a disgruntled customer can be one bottleneck.

Thursday, February 09, 2006

BRICks ground to dust...

From Financial Express:

-Just two years ago, Brazil was basking in the glow of 5 percent economic growth, convinced it had a rightful place in the elite group of emerging market giants known as BRIC.

But now doubts about Brazil's place in BRIC - for Brazil, Russia, India and China - abound. Lackluster, start-and-stop growth has returned, while the economies of China and India have surged ahead to expand about 10 percent a year...

...At the World Economic Forum in Davos last month, Brazilians complained of being snubbed by the global elite. Brazil and Russia seemingly fell out of BRIC to leave only "Chindia...

Serves to remind us that this India passion of global industries may yet be a stormy affair while the going is good. If we dont make the most of it now (and we are missing opportunities galore thanks to our fighting leftists), we are likely to be the Brazil of tomorrow.

...Inflation also tends to spike with growth much beyond 4 percent. A tax burden north of 35 percent of GDP restrains growth, while a debt load of some 1 trillion reais and a pension system that runs deficits of up to 5 percent of GDP hurt output and contribute to a high benchmark interest rate, now at 17.25 percent a year...

...Growth under Lula, who is likely to run for reelection this year, is forecast at an average 2.86 percent, even though he promised a "growth spectacle" early in his term.

That is better than the 2.34 percent that Fernando Henrique Cardoso, Lula's predecessor, averaged over eight years.

Still, it is well below what Lula promised voters and the 5 percent that analysts say Brazil needs to alleviate poverty afflicting a third of its citizens.

"Brazil can and could do better," World Bank President Paul Wolfowitz said in December...

If Brazil fails to pass reforms and improve education, it might fall out of BRIC forever and be stuck in another, less respected group called BIIC, said Gesner Oliveira, the anti-trust czar under President Cardoso.

That Portuguese acronym BIIC stands for bureaucracy, taxes, informal markets and corruption.

"The world is growing more and we've never had such a great opportunity to grow. Yet we are wasting it," he (Gesner Oliviera, the anti trust czar under Brazils previous president Cardozo) said.

Conventional TVs losing popularity

in a day or two.Heres a story from Financial express that says so.

...With poor demand for conventional (round picture tube) colour television (CCTVs), the segment is reeling under 18-20% dip in market growth in January 2006. CCTV accounts for Rs 7,500 of the Rs 20,000 TV market.

As a result, durable companies have begun slashing CCTV production at their factories. India’s largest consumer electronics compnay LG Electronics India is cutting production of CCTV models from 16 to 9 in the first quarter of 2006 at its Noida factory...

So did Videocon get it wrong? (Not that they expected a surge in popularity for conventional TVs, but did they expect it this soon? And then again maybe they do have a line for flat TVs)

Tuesday, February 07, 2006

Cities and attitude

What is it that determines the attitude of a city? Why is a particular city, cool or welcoming, while some other cities are cold or downright hostile? Indeed what is it that makes some cities more professional than others?

Needless to say, I am referring to Bombay in comparison with many other cities in India. I have lived in a few cities in India, yet not found a single city to be as professional as Bombay. Unless you are at some shady location at an odd time, the service that you get across the city does not change because you look different or wear different clothes. As long as both the well dressed arm and the not so well dressed arm extends the same denomination of the rupee, the service they get is the same. I have found Bombay to offer value for money in most aspects. I refer to services. If I have a housemaid, she does her job for the money she is paid. The rickshaw driver or taxi driver does his job wonderfully well and rarely takes you for a city tour. The office boy of my first ever employer, had the guts to tell the vice president that his delay of a few minutes, was "making him lose precious minutes", and more importantly, the vice president understood where he was coming from. Most agencies that offer you a service, be it a car rental or a bus ticketing service or a caterer or a pundit, more often than not you are left with the feeling that you got service worth the amount you paid.

This is a feeling that I have missed ever since I left Bombay. Pune and Hyderabad to a slightly lesser extent, but Bangalore to me has been a big let down. Each time, I get someone for a task, I have been left with a feeling that I have been short changed. Start with the builder (who has cut corners at every extent possible), to the auto rickshaw drivers (need I say more), to the RTO (money talks here), to the Registrars office (well, the gold there will make your eyes water). There are very few places, agencies or service providers in Bangalore (in fact, so few, that I dont remember any of them now) that offer (or have offered) value for money.

Why is the Bombay habit of respecting the other mans time and money so difficult to replicate in other cities of India? Is it really too much to ask? What do we do as citizens? I have taken a hardline approach. I pay the money, but I am ruthless and ensure that my money goes out only if the service is done well and completely to my satisfaction. But yet, the feeling remains, why cant the city be more professional?

Monday, February 06, 2006

Religion and economic activity

Religion is the opium of the masses, said Karl Marx. I am not sure in what context he said that, but when are people drive (addicted is more like it) to religion? If you look around yourself, regardless of religion, people who are the most religious are those who have nothing else to do. It sometimes means the old, sometimes the rich, sometimes the newly retired...

The rich and those who are gainfully employed rarely find time to indulge in religion. When I say indulge in religion, I dont mean a prayer here and a prayer there or a pilgrimage here and there. I also dont mean those who follow a certain dietary habit or a fast here and there; I mean, those who play police within (occasionally without) a religion imposing customs (on others) and spend their life trying to bring the "glory back to their religion".

The antidote to religious extremism is, very simply, money and work. Many rich turn to religion once they have made too much money (which is when they have nothing to do) or when they suddenly feel that their money must, as I mentioned above, "bring glory back to their religion". Surplus money finds it way into these religious causes. There are surely other reasons too like at times money finds its way to "charities" that are fronts. Many of the poor turn to religion because they too do not have too much to do (and they dont have money in the first place) and their basic needs are provided for (there is an economic benefit in being religious). If these "poor" were gainfully employed in other areas, they would be better served as would the world. Like the mid-day meals which we use to lure children to education, very often it is the fact that basic necessities are provided for by religion which lures people to religious causes. What motivates the rich to donate to religion and often to related terror causes?

I mean, otherwise, who has the time to stand and protest (and then riot and burn and arson) for days on end when one is busy earning ones daily bread.

Sunday, February 05, 2006

Xerox gully

Fashion street is a known place in Bombay as is Khau galli, but Xerox gully is a little lesser known of all these gullies, yet very well known too. Xerox gully (which is what we used to call it, it has a thousand other names perhaps) is a small narrow line of photocopy/DTP shops set up on the west (geographically it is something else, but Bombay knows it as east) of Chembur railway station.

Almost anybody who has passed out of any engineering or medical or business school of Bombay will know this place (and owes many an exam result to this place). Among its portals have passed perhaps Indias best and brightest. If these xerox (for this post, please excuse the incorrect definition, unless I say xerox, it would lose the impact) shop owners photographed the students who came and took their services they would perhaps have the photographs of the high and mighty in Indias corporate rollcall.

So, why is this place so indispensable for students? Because, they have commoditized the business of photocopying and how. At a time when copies would cost a rupee or three in various parts of Bombay, these smart businessmen began offering copies at 25 paise (one fourth of a rupee, 45 INR = 1 USD approx). For students, this was a godsend. Soon notes began to be photocopied, and need I say more, everything that could be photocopied began to be photocopied. When we were studying, people who stayed around that area had the extra responsibility in our class of the "Xerox in charge" (and they were paid auto rickshaw fare) to photocopy notes for the entire class.

Just how did they manage to bring the cost so low? Typical Indian jugaad, I think. The photocopiers are old, perhaps second hand or heirlooms or hand me downs. They are operated without the top light protection cover, among other things. The operator keeps the book (yes, yes, I know, but this is the truth) face down and flips his hand continuously so that the need for the top cover to protect is obliterated. Never has a page been missed! If company executives saw how these machines are operated and how much they withstand, they would give themselves a pat on their back.

In the early morning, when they start their busy day, the machines are started. The panel on the side facing the operator is removed ( it usually doesnt exist) and a lighted match is used to heat a coil on the side. Voila! the machine is warmed up before you can say photocopier. The trick they use to lower the cost of the copy is to dilute the toner (with kerosene presumably). Of course, like the American car example, these copies last exactly the duration of life they are required to (one semester). The utility of the copy for the buyer drops, once after the exams and then again after the results and it serves its purpose well for the duration it is intended to. They are amazingly efficient and despite busy schedules, turn around huge numbers of copies in good time (usually a day or less).

These smart guys also prepare final year project copies and do excellent DTP on (other) good (canon, as they say) machines. They have smartly expanded their market too, not stopping at just "xerox". They also know the "notes" for each semester for most branches of engineering. So, if you cant locate the notes, just ask them. They keep an extra copy for this purpose that they cheerfully xerox and give you when you ask for the "3rd semester electronics notes, whose name I forgot". During this visit, I saw they have diversified into colour xeroxes and whatnot.

Wish I could post a photgraph. I missed taking a snap of it this time.

Saturday, February 04, 2006

Small scale industries

Somewhere in the 90s, when liberalization began to happen, there was a big worry over what would happen to SSI (small scale industries). Small scale industry is defined as any industry with a capital base of less than 1 or 5 crores.

From the RBI site (incidentally, a very good site with good statistical info on the Indian economy) ...Small Scale Industrial units are those engaged in the manufacture, processing or preservation of goods and whose investment in plant and machinery (original cost) does not exceed Rs. 1 Crore. These would, inter alia, include units engaged in mining or quarrying, servicing and repairing of machinery. In the case of ancillary units, the investment in plant and machinery (original cost) should also not exceed Rs. 1 Crore to be classified under small-scale industry.
The investment limit of Rs.1 Crore for classification as SSI has been enhanced to Rs.5 Crore in respect of certain specified items under hosiery and hand tools by the Government of India...

Small scale industries were deemed to have been set up by individuals rather than companies and enable a somewhat level playing field and hence were rewarded with tax breaks and other incentives. Other than that, there was a particular set of items that were restricted (manufactured only by SSIs) and the railways and central government organizations had to procure a certain set of items only from SSIs.

This, in theory was a good idea to promote entrepreneurship and employment at the grassroots level. Unfortunately, many big companies began to set up many SSIs or when the SSI reached its limit they would start another SSI so that they continued to remain SSIs or continued to gain the incentives or use the quota. They had no incentive to grow (more on this some other time).

Coming back to the SSI story, it was argued that liberalization would spell the doom of these small units and result in large scale unemployment. (Very much like the theory floated by the benefeciaries of globalization that liberalization has not resulted in overnight upliftment of the poor). But what has happened? The number of SSIs has gone up in the face of dereservation of many of the items hitherto restricted to the SSI sector.

The picture isnt great, it is from ET dated 2nd Feb. The figure of SSIs in India as per RBI stats compiled by ETIG has gone up from (101 lakh) 10 million to (118 lakh) 11.8 million. This flies in the face of those who say that liberalization has killed our industries. Remember that these are the net numbers. I am sure many inefficient SSIs did close due to dereservation, Chinese competition and lack of patronate. Therefore, many new SSIs have been set up. And then again, remember that these are perhaps the "authorised" industries. Given Indias track record, there are a larger number of "hidden" small scale units.

Indeed if our labour reforms happened, these units would surely employ more than what they do presently.

Thursday, February 02, 2006

Hero Honda and Pleasure

Hero honda, the motorcycle manufacturer who incidentally manufactures the single largest selling model (the Splendor) of motorbike has launched a 100 cc scooter targeted at women. It goes by the name Pleasure.

Hero Honda was the baap of the market with its CD-100 and its now famous "Fill it, shut it, forget it" campaign. Those were the times when the country was recovering from Bajajs scooters. With the window opened to foreign colloboration, the 4 stroke Hero Honda CD100, 2 stroke TVS Suzuki AX100 and the (legendary) Yamaha Rx100 were the new horses in every bikers stable. Times changed over the next 15 years.

Bajaj changed itself from a fuddy duddy scooter company known for its Chetak to the company known for the Pulsar. TVS moved away from Suzuki and launched its Fiero and now plan to move to Indonesia. Hero Honda launched its CBZ, but it was beaten to a pulp by the nimbler, powerful and fuel efficient Fiero and Pulsar. Bajaj and TVS in the meantime expanded their portfolio to include better and more efficient bikes, but Hero Honda went back to the drawing board and could come up with no better than CD100 SS and Splendor something (rehashes as you can imagine from the name). They launched Passion and Ambition, two other bikes both of which lacked the idea that their names conveyed. Honda too launched its operations in India with the superb Activa and Unicorn that comes with Honda reliability. Kinetic motors, the original variomatic company, too launched its Nova, which if not as smooth as the Activa is a pretty good machine.

Hero Honda is not really known for innovation as much as sitting on its laurels. With the base of its bread and butter models the stage was set for the company to do something spectacular. Both Bajaj and TVS have done so on their own right, but HH to me, is a fuddy duddy. The launch of Pleasure does nothing to change this perception. Note that I write this without riding Pleasure. Whats the big idea in marketing a scooter to women? Especially when there is nothing "different" about it? The variomatic segment has a solid performer in Activa, stylish Dio, good looking Nova, youthful Scooty and now a women only Pleasure?

I think Pleasure has got its strategy wrong. By saying women (and only women), they are losing a good part of the market. Now, no young college lad will ever buy it (they do buy variomatics, it is not only women who drive variomatics). I am not saying marketing to women is wrong, but I would go the Scooty way with a Preity Zinta, subtle yet leaving the positioning as "youth". Scooty does have some smart features too. Why will a girl buy Pleasure? Whats the compelling feature in it? There are many things that can be designed to appeal to women in a bike like this, but this is just hollow marketing.

Wednesday, February 01, 2006

Legalize hawkers?

A journey in Indian Railways sleeper class ( the people moverclass) can be at once depressing and invigorating. There are masses of hawkers, beggars, urchins and forms of humanity one encounters on the train.

This time was no different. There were beggars who pretended to clean the bogie (and some actually did) and then proceeded to ask for money from the passengers. There were transexuals (hijras) who harassed a few passengers. There were, sadly, small children, who begged by touching the feet of the passengers.

Then there were the hawkers. Hawkers who sold everything from earbuds and mouth organs to hawkers who sold food of many types. Bhelpuri, idli, wada, tea, coffee, lassi and the like. There was a blind hawker who could talk English and who did so (The government is as blind as I am, but you arent, so please help me by buying agarbattis from me). There were hawkers who sold small books. Hawkers who sold chikki. Hawkers who sold locks and keys and chains to fasten luggage. Thankfully, the number of hawkers outnumber the number of beggars by atleast 10 to 1.

Trains are a small indication of the microcosm of society and they remain so in India. Trains mirror the ebb and flow of society. This time, there was more security in the sleeper class, continuous presence at night by these guards. They drove out the ticketless as they should and it was a pretty good journey. But I digress. What would happen to so many of these hawkers if hawking was made illegal? On the contrary, why not make hawking legal? charge them a fee or a hawkers ticket but let them hawk. Treat it as a legitimate business opportunity.

Unfortunately many see hawkers and beggars in the same light. They are not. One section is trying to live a legitimate life by selling and buying while an other section does not want to work since beggin is the easy way out. (There are disabled beggars, but thats a different point altogether). In the cities too there are hawkers who hawk street food (Bombay being the best example), utensils, sell stuff at road signals. I believe, many of them manage to eke out a living. Some hawkers of street food have a great brand equity among locals.

While no hawking zones are a good idea, hawking zones are an equally good idea. Perhaps hawking should be made legitimate all over with perhaps a simpler daily fee process that legitimises the lives of millions of hawkers and frees them from the routine torture of municipality raids and flying squads.