A Cry for Help
A Cry for Help
By Aravind Sitaraman
Aravind is editor of web-based think tank The Indian Analyst. He can be reached at firstname.lastname@example.org
The recent comments by former Prime Minister Deve Gowda on a proposal for infrastructure change from Mr. Narayana Murthy, Chief Mentor of Indian IT major Infosys Technologies has brought the focus back on the state of IT infrastructure in Indiaâ€™s so-called IT capital Bangalore. The latest volley is best termed indifferent and even markedly disrespectful of Mr. Murthyâ€™s comments. Instead of debating the merits of the proposal, Mr. Gowda questioned the promoterâ€™s qualifications on the subject of governance as also his knowledge of rural India that his party allegedly represents.
To understand the issue, it is important to delve into the history of this spat between industry and the State Government.
OF THE PROBLEM
It is for the second year in a row that Bangalore is agog with angry emotions between the State Government and the Bangalore Chamber of Commerce and Industry (BCIC). The context is that several Informational Technology (IT) companies, including many multi-national companies (MNCs), with large engineering base and population in Bangalore have threatened to boycott the IT.in (formerly IT.com) yearly event that showcases and brands Bangalore as the â€œIT capitalâ€ of India. The business leaders threatened to walk out last year too, but a combination of back-room deals, threats, and promises brought relief to the standoff. This year, business leaders say that the State Government has not fulfilled any of its earlier promises and the infrastructure continues to crumble under the weight of newer companies and burgeoning business.
the State Government ranges from a conspiracy theory to a
demand for a quota for Kannadigas in these companies. Business
leaders are quick to point out that this is not about IT but
about the state of the city itself. They have provided the
state with a set of demands that need fixing on a war footing
if they are expected to participate. Top of the lists are
better roads, a traffic management plan, water drainage,
garbage disposal, and better amenities. They say that business
will flee Bangalore if the State Government does not invest in
the cityâ€™s infrastructure. The State Governmentâ€™s claim is
that there is no real problem since the number of businesses
continues to grow. They point out that, year on year, there is
a 10% rise in investments, 26% rise in foreign investments,
and 48% rise in investments in small and medium enterprises,
and export revenues from IT companies employing over 285,000
engineers have grown six-fold since 2000. Armed with such
statistics, they do not see any problem with infrastructure
becoming a bottle-neck or being the cause for a flight of
capital. In addition, the Congress-led Government is facing
immense pressure from its coalition partner to de-emphasize IT
and instead invest in the rural Agricultural sector. The State
Industry Minister, belonging to the Janata Dal (S) coalition
partner, pointed out that Rs. 6,000 crores have been allocated
for improving drinking water supply, building a new
international airport, roads in and around the city, and a new
Metro Rail project.
leaders and analysts point out that the problem is not in the
large allocation of funds or grand-scale plans. The issue is
implementation of these plans. Many say that the
implementation is short-term focused like pot-holes being
covered with mud only to be washed away with new rains.
Garbage being taken out of the city is being dumped on
National Highways including the Old Madras Road, from K.R.
Puram to Hoskote. The lack of meaningful restrictions on
politically-powerful automotive users such as auto rickshaws,
freight trucks, and agriculture half-tracks plying in areas at
peak times in busy locales often with no regard to traffic
rules or safety. Finally, there is a lack of transparency into
how their tax money is being spent.
case in point is Whitefield where most of the expatriates and
IT community live and perhaps collectively contribute the most
taxes in Bangalore. It is also the location of the
much-showcased information technology park and many MNCs and
large Indian software houses. Roads, like the Old Madras Road
to Whitefield road built just over a year ago, coincidentally
right before the previous elections, have large craters
because heavy vehicles often with several tonnage over the
limit ply on this important artery. They often get through
check posts and police stations by paying them a nominal Rs.
10 so the cops would turn the other way. Just a month ago, the
road connecting the Outer Ring Road to the Varthur Lake was
built through generous financial contribution by software
companies. These roads have also developed large craters
essentially rendering the road and the investment useless. The
road from Varthur to Sarjapur, housing three international
schools and ferrying the children of IT workers have two foot
drops on either side making the commute risky for children.
When corruption has turned more into an institutionalized
entitlement scheme, questions raise as to who is benefiting
with the Rs.6,000 crore allocations? Echoing this sentiment, a
national study held Karnataka as one of the most corrupt
states in India!
the way to look at this problem is not through the political
glass. This is a cry for help from the public at large. The
Chief Minister was gharroed by crowds that faced the ire of
what is turning out to be a 100 year rain. Bangalore is
already no longer the IT Capital of India; it has now been
overtaken by Gurgaon. The Federal Minister for Information
Technology has warned Chennai not to fall in the Bangalore
trap but to proactively invest in infrastructure.
is not at all about IT. This is about the citizens of
Bangalore demanding basic rightsâ€ said the country chief of
Support Soft. Actually, this is the larger issue.
tax-paying people of India, read employed citizens in the
organized sector, are dying to find a forum where their voice
will be heard. In all other democratic societies, such unified
protests from influential individuals and institutions will
bring about change. Instead in India, what happens is that the
Government goes over-drive into official harassment
manifesting the form of customs restrictions, mobility of
resources, and increased taxation. As seen from recent World
Bank sponsored reports, doing business in India is very
difficult. Moving businesses from one state to another is
excruciating. Archaic anti-industry labor laws, lease
agreements, gestation time to restart operations, political
uncertainties, etc. make it impossible for businesses to move
capital and resources to greener pastures within India. Since
high technology industries depend on available labor force,
they continue to seek areas where they will find them. Since
Bangalore has the highest populations of this sort of labor,
newer companies continue to start operations in that city
making the problem worse.
is required is a stable policy from the Government. The former
State Government from the Congress party promised many things
to the industry and relentlessly wooed IT and Biotech
industries. The good weather, access to labor, friendly
Government policy attracted many MNCs. Now with a change of
Government although from the same party but with support from
a regressive political partner has essentially destroyed all
that the previous Government had done. And, it is not just at
the State level.
Even at the national level, the continued intransigence of the Communist parties that supports the Congress Federal Government has arrested all progress in fiscal, monetary, and economic reforms. By frightening people into thinking that economic reforms means benefits only for the wealthy, bringing down administrations of the Government through illegal strikes, inciting labor groups to rebel against MNCs, the Communist parties are creating an environment that will have long-term debilitating effect on Indiaâ€™s economic progress.
NEED A LARGER SUCCESS
despite all these negative factors, the countryâ€™s economy
counties to grow at a breath-taking pace. The stock market,
perhaps in an irrationally exuberant manner, is reaching new
heights. Foreign Institution Investors are increasing their
stake in Indian companies. Indian corporations are buying
foreign companies to expand markets, to buy production
capacity, and expand their skilled workforce. More MNCs are
moving large business process operations to India than
evermore. There are more inward remittances from overseas
all these good economic news, India is still a pale second to
China which sees an annual inflow of US $50 billion compared
to Indiaâ€™s US $5 billion. Our political leaders may be
rejoicing with the new found success as they result in
increased revenues for the Government and they can show some
success in governance in time for the next election. It will
also translate to more opportunities for corruption and
should all demand that the political leaders turn this golden
opportunity into an environment where there are increased
jobs, social spending, infrastructural upgrades, and poverty
alleviation. Instead of setting the stage for a global
expansion of Indian businesses, interests, and commerce we are
seeing a curtailment of everything that is good or working for
the Indian nation. These unprecedented advances by Indian
companies and foreign investments will raise the Net National
Product (NNP), reduce poverty, and create national wealth.
However, all labor, cost, location, and built-in advantages of
India are being frittered by politicians with limited
imagination or capabilities.
The protest by the business groups in Bangalore must be seen from this perspective.