India has embarked on a consumption journey. The internal demand based growth has put the country in prosperous cycle of investment-production-consumption and we can witness it across the country. It goes without saying that this growth has left behind many millions of Indians who are or were dependent on agriculture. We can see a slum in the neighbourhood of a large housing society or apartment complex irrespective of a big-ticket growth city which reveals the ground reality. How to include these Indians in this growth cycle has and will remain a challenge for the governments until the government takes revolutionary steps with the delivery mechanism which needs a huge facelift.
Let’s start from here. We are seeing a lot of companies which are serving customers on a day-to-day basis. These include mainly telecom, consumer goods and banking. These companies are very good at marketing and brand creation/maintenance and the data in their results show it. However, I see customer service suffering regularly.
These companies are good at providing service on a regular basis though they play with words with customers. If you pick telephone bill of any company, I am not sure if you can explain all the charges or get an explanation from your telecom company.
If you look at a new product offerings from these companies, you may need a lawyer or a consultant to understand what the product means and how it will create holes in your pocket. Yes, the first thing is complexity. Sometimes I feel that these companies are thriving on complexity. Probably this is what inspired Airtel to launch a simple INR 1/- plan and this was a timely step in right direction. The same holds true for your credit card.
The telecom regulator doesn’t help customers either. I find TRAI standing with telecom companies against the customers. Let’s talk about number portability. Anybody who has worked in telecom domain will tell you that it is the simplest thing to implement. Why? You need a switch which can route your call from existing service provider to new service provider without any change in the number. The cost of the switch is $5 (approximately INR 200/-). I don’t think people would not like to pay INR 200/- to change the service operator if service operator is not able to serve properly.
The second is customer communication. I find it both ways. Many times if the customer is not urban or not educated enough, he finds it very difficult to communicate his problem and suffers indefinitely. The point I am trying to make it everybody wants these customers to change but nobody wants to change for these customers. I haven’t yet seen a customer care centre which can talk to people in their own language or help them to resolve their queries/questions. I will quote one example. One prominent private sector bank goes to villages in Rajasthan and requests villagers to have bank account with them. The villagers are charmed by the brand and open account with minimum balance of INR 5000/-. Nobody from the bank explains the customer or customer tries to understand what ‘minimum balance’ means and how it may affect them. The villager doesn’t use this account on a day-to-day basis and just checks his balance after 6 months or so. Now he finds that bank has deducted money from his account because he could not maintain minimum balance and why? Because the bank first deducted INR 200/- for debit card which made bank account having less than INR 5000/- and then penalized the account because the customer couldn’t maintain INR 5000/-. If we think about this issue, it is no less than cheating. Now the poor villager runs from pillar to post to get his remaining money back and to close the account.
The third issue is service as per the customer not the other way around. I will also take the opportunity to congratulate these companies which have made an attempt to include many people in their service domain by making their services affordable. The service has become affordable but the degree of customer service doesn’t match this affordability.
I think concerned regulator should devise a customer service index which should be published in media on a monthly basis. It will help us to set a standard level for customer service. TRAI does this exercise and evaluate telecom operators on a predefined parameter however it never publishes it in customer friendly manner.
Another aspect is do Indians have customer service attitude? I think serving customers is more of an attitude rather a skill. Off course, one need to get basic training, however, not everybody can serve the customers with same energy and enthusiasm on a daily basis. When it comes to serving customers through a faceless medium, it becomes difficult and makes this job mundane. The idea is to select the right set of people through a different process. A lot of companies are finding hard to manage attrition which adds to woes for the customers. One more thing these companies need to understand is that they need to have a different perspective on customer service. It must been seen more an investment rather than an expenditure. Sometimes I get a feeling that Indian bosses try to cut costs for this department and try to employ minimum number of people to serve maximum number of customers. Additionally, these customer service representatives are not backed by best of systems and infrastructure which adds to regular struggle with performance pressure resulting in attrition.
In addition, we are in the initial years of consumption and the companies are concentrated on capacity expansion, new customer acquisition and winning new territories. As customers become experienced and educated about these services, these companies will respond to the customer’s needs. As I think, India Inc. will witness an era when customer service will be the major competitive advantage rather than cost advantage at present.
Sunday, January 27, 2008
Tuesday, March 27, 2007
What India should do?
So, what BCCI will do now? That’s one question crossing every Indian cricket fan. That’s a positive sign for corporate!!! Indian can’t quit thinking about cricket. Right now we have 50 million opinions in India. I am also one of them.
I will again go back to my old point that I discussed after Indian debacle in South Africa. BCCI goes for a short term solution or a long term solution.
India is not short of talent in Cricket but our cricketers lack character. A character is built in adversity and competitive environment. Our institution of domestic cricket is ordinary. It may create good players who look good on Indian pitches but it can’t give you a strong character unit like Australia.
Would you like to see an organization run by people who are part time members and the organization generates close to $1 billion revenue per year? I don’t think any management thinking or any sensible individual will endorse to the view the way our sports organizations are operating on a day-to-day basis. Probably this attitude explains number of Olympic medals won by this 1 billion population country in last 60 years.
The reforms must start from BCCI. Government should stop recognizing BCCI as an autonomous body. It was created to promote Cricket in India which has been accomplished. Now, this body should be dismantled.
Instead government should create a corporate body responsible for cricket. If possible, this corporation should be listed in Share market but government should not become the owner. I guess many corporate will be interested in acquiring the ownership and it can be decided by a fair and comprehensive process.
The corporation should be responsible for overall development and administration of cricket. As I believe this corporation will be governed by able professionals and India have plenty of excellent leaders and managers who will be interested to work for this organization. Listing it on share market will boost people’s interest in share market and at least one crore more investors will join share market which will be definitely better for our bourses. India has currently approximately 4 crore people out of 100 crore who invest in equities either directly or through other various financial instruments.
The domestic cricket structure needs a major boost. I watch Ranji trophy and other domestic tournaments on Neo sports and it tells the true level of cricket competitiveness and standard. BCCI has least bothered to attract people to watch these games. The key lies here. Once you attract people to these games, the competition and character will start coming to teams.
The number of teams should be limited. Not more than 4 or 5. The new corporation should ensure a time period when this tournament will be held and participation of top cricketers must be mandatory.
This also calls for pitch reforms. The pitches for these matches should be fast and varying in nature. Then you have a domestic infrastructure in place to select top 15 players.
The team selection process should be changed as well. You have 3 selectors who decide the team and then the captain…not other way round. Had this been the case, Ganguly would have been out of the team after 2003 world cup and many individuals who cried after Srilanka game would have been playing either domestic cricket or county cricket in England.
These are sweeping reforms. People at top hate reforms in this country. This reform may take time to settle and produce results but it will ensure that we don’t feel ashamed after each tour of South Africa and Australia.
Listing the corporation on share market will ensure accountability to the public and public will feel a part of Indian cricket. At present, fans (the customers of BCCI) are last consideration for BCCI. If you don’t believe it, buy a one day international ticket and enjoy your experience in the stadium. It is pathetic right from ticket purchase to last ball bowled.
Now, let’s look at our current team. This team has performed pathetically in every foreign tour from West Indies to South Africa to Malaysia (except Pakistan). It has performed badly in champion trophy. That performance should have been enough to draw attention but we start reacting when water goes above the head and breathing becomes impossible. We wait and wait till the situation becomes worst.
The game at top level is played by character and attitude, talent becomes secondary because every team has plenty of it. The tough character comes through difficult experiences…at least not when you hit knee-roll high balls to boundary 40 times a day in a Ranji trophy game against a weak opposition. You may be given opportunity to open Indian innings in test match in Australia after scoring triple century against Tripura but nobody remembers your name thereafter. I was talking about Devang Gandhi.
One typical case is Mr. Agarkar who even after 183 one day matches looks mediocre on many days. He performs once in a while and claims his place back? Why? Because we simply don’t have enough players or we don’t believe them good enough to replace Pathans and Agarkars. Murali Kartik is gone… he could have been definitely a good replacement for Anil Kumble and Ramesh Powar for Harbhajan Singh! Alas! We are so obsessed with brands that when it comes to crunch tournaments, we go by brand names rather than current form. Pathan selection is a typical example…he was selected and not selected…both are true. These men at BCCI are so confused!!!
India needs fresh blood and confident men who believe in destroying opposition and in hanging on 50 overs on any pitch. My next captain is Yuvraj; he has played more than 150 one dayers and has enough experience. Rahul Dravid may be retained in the team as a batsman, but not Ganguly, Shehwag and Tendulkar. Mohd Kaif should be back as vice captain.
BCCI has more data and information to select rest of the team. Munaf Patel and Sreesaanth should be retained. Rest of the lot should decide what they want to do next in life.
You may disagree with my team but my emphasis is on reforms and selecting 11 men who believe in themselves to beat any team on any pitch and they do it day-in and day-out. Even if, everybody in this country agrees to my reform agenda, we will take at least 5-6 years to produce results. Australians were patient…they invested close to 10 years to become number 1.
You may also take a deep breath after reading and say “come on – it is just a game!” You are also right.
I will again go back to my old point that I discussed after Indian debacle in South Africa. BCCI goes for a short term solution or a long term solution.
India is not short of talent in Cricket but our cricketers lack character. A character is built in adversity and competitive environment. Our institution of domestic cricket is ordinary. It may create good players who look good on Indian pitches but it can’t give you a strong character unit like Australia.
Would you like to see an organization run by people who are part time members and the organization generates close to $1 billion revenue per year? I don’t think any management thinking or any sensible individual will endorse to the view the way our sports organizations are operating on a day-to-day basis. Probably this attitude explains number of Olympic medals won by this 1 billion population country in last 60 years.
The reforms must start from BCCI. Government should stop recognizing BCCI as an autonomous body. It was created to promote Cricket in India which has been accomplished. Now, this body should be dismantled.
Instead government should create a corporate body responsible for cricket. If possible, this corporation should be listed in Share market but government should not become the owner. I guess many corporate will be interested in acquiring the ownership and it can be decided by a fair and comprehensive process.
The corporation should be responsible for overall development and administration of cricket. As I believe this corporation will be governed by able professionals and India have plenty of excellent leaders and managers who will be interested to work for this organization. Listing it on share market will boost people’s interest in share market and at least one crore more investors will join share market which will be definitely better for our bourses. India has currently approximately 4 crore people out of 100 crore who invest in equities either directly or through other various financial instruments.
The domestic cricket structure needs a major boost. I watch Ranji trophy and other domestic tournaments on Neo sports and it tells the true level of cricket competitiveness and standard. BCCI has least bothered to attract people to watch these games. The key lies here. Once you attract people to these games, the competition and character will start coming to teams.
The number of teams should be limited. Not more than 4 or 5. The new corporation should ensure a time period when this tournament will be held and participation of top cricketers must be mandatory.
This also calls for pitch reforms. The pitches for these matches should be fast and varying in nature. Then you have a domestic infrastructure in place to select top 15 players.
The team selection process should be changed as well. You have 3 selectors who decide the team and then the captain…not other way round. Had this been the case, Ganguly would have been out of the team after 2003 world cup and many individuals who cried after Srilanka game would have been playing either domestic cricket or county cricket in England.
These are sweeping reforms. People at top hate reforms in this country. This reform may take time to settle and produce results but it will ensure that we don’t feel ashamed after each tour of South Africa and Australia.
Listing the corporation on share market will ensure accountability to the public and public will feel a part of Indian cricket. At present, fans (the customers of BCCI) are last consideration for BCCI. If you don’t believe it, buy a one day international ticket and enjoy your experience in the stadium. It is pathetic right from ticket purchase to last ball bowled.
Now, let’s look at our current team. This team has performed pathetically in every foreign tour from West Indies to South Africa to Malaysia (except Pakistan). It has performed badly in champion trophy. That performance should have been enough to draw attention but we start reacting when water goes above the head and breathing becomes impossible. We wait and wait till the situation becomes worst.
The game at top level is played by character and attitude, talent becomes secondary because every team has plenty of it. The tough character comes through difficult experiences…at least not when you hit knee-roll high balls to boundary 40 times a day in a Ranji trophy game against a weak opposition. You may be given opportunity to open Indian innings in test match in Australia after scoring triple century against Tripura but nobody remembers your name thereafter. I was talking about Devang Gandhi.
One typical case is Mr. Agarkar who even after 183 one day matches looks mediocre on many days. He performs once in a while and claims his place back? Why? Because we simply don’t have enough players or we don’t believe them good enough to replace Pathans and Agarkars. Murali Kartik is gone… he could have been definitely a good replacement for Anil Kumble and Ramesh Powar for Harbhajan Singh! Alas! We are so obsessed with brands that when it comes to crunch tournaments, we go by brand names rather than current form. Pathan selection is a typical example…he was selected and not selected…both are true. These men at BCCI are so confused!!!
India needs fresh blood and confident men who believe in destroying opposition and in hanging on 50 overs on any pitch. My next captain is Yuvraj; he has played more than 150 one dayers and has enough experience. Rahul Dravid may be retained in the team as a batsman, but not Ganguly, Shehwag and Tendulkar. Mohd Kaif should be back as vice captain.
BCCI has more data and information to select rest of the team. Munaf Patel and Sreesaanth should be retained. Rest of the lot should decide what they want to do next in life.
You may disagree with my team but my emphasis is on reforms and selecting 11 men who believe in themselves to beat any team on any pitch and they do it day-in and day-out. Even if, everybody in this country agrees to my reform agenda, we will take at least 5-6 years to produce results. Australians were patient…they invested close to 10 years to become number 1.
You may also take a deep breath after reading and say “come on – it is just a game!” You are also right.
Saturday, March 24, 2007
Inflation, Infrastructure and Defeat
1) Inflation refuses to die. It is becoming a structural or systematic problem rather than a one-off issue. The Indian economy is growing over more than 8% annually but our infrastructure growth is not able to keep pace. Our capacity is restrained with respect to demand leading to price rises.
RBI should not keep squeezing liquidity in the system. The top policy makers should device a law for lending money but they should not suck liquidity across the board. This will kill the growth. I think RBI governor should be convinced by now that merely squeezing the liquidity will not control inflation. Let Agriculture and other ministries wake up and take appropriate measures to control inflation.
Controlling inflation through short-term methods will aggravate the problem in the long run and remember, we are paying a cost for it or our future generations will pay an even higher cost for these short-term methods.
Indian needs to take rapid steps to boost infrastructure and promote it through private-public partnership otherwise inflation devil may totally go out of control. We need cheaper and 24 hour power. The power generation capacity is woefully short what was projected in last 5 year plan. We have not been able to bring enough private participation in power projects. Our SEBs are in financial mess, T&D losses highest in the world and collections for electricity bill are pathetic.
The golden quadrilateral road project is running out-of-schedule and will shortly start running in cost-overruns. Our irrigation network has not expanded enough and demands more money. The government is going to invest in irrigation network which is a good idea.
The solution is to bring telecom type private players in the market and carry the reforms in these sectors through government regulation. But one difference is that for infrastructure projects, the main input is land and it changes the whole picture. Land acquisition brings politics and rehabilitation issues and halts these projects. The government needs to be fast on rehabilitation laws and needs to finalize it with long-term vision. It is easier said than done.
2) One issue is our top institution doesn’t work. Our honorary members of parliament are involved in bitter politics on different issues and try to resolve the issues by power rather than fruitful discussion in the parliament. It is detrimental to very basic fabric of democracy. Our politicians or members of parliaments lack basic values and are involved in cheap vote bank politics all the time. This politics is thrived through bitterness, unfair practices and ‘might is right’ rules rather than driven by efficiency and honesty. Our top institution has diluted its values and integrity by successful and unwanted marriage of politics and criminals which goes back to slow judiciary processes. A person can fight elections till his guilt is proved in a court of law. The criminals are very well educated that how they can slow down these processes even further through their might.
Remember: Each minute of parliament session costs INR 20,000.
Coming to slow judicial processes, India is still very much a jungle raj. If your near relative is a politician or top bureaucrat, the whole country has to come together to get punishment for you for any gross wrong doing. Priyadarshan Matto case and many other pending cases are glaring examples.
I am very much convinced if income tax department starts its work honestly and efficiently against top politicians and bureaucrats, India doesn’t need to charge tax to its citizens for at least one year. This country can be a total-tax-free-country for one whole year. It is one more example.
We are a very inefficient country when it comes to implementation of law. This country needs discipline and it has to start from each segment of the society.
3) Cricket: The time has come when Indian public has to look for other sources of entertainment rather than hurting their emotions for these 15 useless fellows and a BCCI which runs Cricket in this country.
These 15 men are not accountable to this country and its people. BCCI made this point amply clear in the court. So, why should they should be answerable to the public and care for the 1 billion people who wake and sleep following cricket. These men are accountable to BCCI and have done more than enough to bring revenues to their employers. BCCI is growing faster than top companies of India.
This team doesn’t have zeal to win. They want other team to loose the game rather than they win it. They hardly show fight. They can’t bat on fast pitches (look what happened in South Africa) and they can’t bat on slow pitches. So, the real question is whether they can bat on any surface to win matches?
The fundamental question is if they want to work hard? Why will I work hard if I have earned enough for my grandsons and achieved a GOD like status among 1 billion people? Why I should listen to my coach and remove the weakness in my batting? The whole world knows how Mr. Tendulkar is susceptible to incoming delivery. My mind goes back to Lahore test match in 2004 where Umar Gul claimed Sachin out through an incoming delivery and their coach, Javed Miandad revealed this fact in media. I have seen Sachin getting out in the similar fashion on many occasions. Has he done anything about it? And if Mr. Tendulkar can’t win crucial games for India, he is not good enough to be in the team. Scoring runs against depleted attacks is one thing and scoring a marvelous century in world cup final match (like Ponting and Arvinda Desilva) is a separate thing all together.
Why things don’t happen for team India in field? Is there a co-relation between non performance on the field and the attitude? Rahul Dravid doesn’t need a McKinsey like consultancy to put fielders in short cover and short mid wicket to stop singles. Mahela Jaywardhane applied the same fielding from the very first over and put pressure on Indian batsmen on an easing pitch. Rahul Dravid fails to impress that his thinking cap is on all the time. He looks helpless in the field and totally out of control of the proceedings. He looks searching for answers rather than asking the tough questions to the opposition. My soul was screaming when Lankans were taking singles on each delivery and our fielders in 30-yard circle were mute spectators. These singles and 'Hang on, We can do it' attitude were the difference in the end.
There are many questions which will go unanswered. India will go to Bangladesh in May and win all the matches. The ho-ho spirit will be back and a new coach will be making strategy for 2011 world cup probably with a new captain.
On a comical note: Our reforms in fielding department are on for last ten years now. I had heard Azharuddin talking about it and we still talk about improvements. Well! We still can't hit stumps directly as Aussies do. I don't know what it takes to do - apart from dedicated training sessions and offcource, an willingness to do so.
RBI should not keep squeezing liquidity in the system. The top policy makers should device a law for lending money but they should not suck liquidity across the board. This will kill the growth. I think RBI governor should be convinced by now that merely squeezing the liquidity will not control inflation. Let Agriculture and other ministries wake up and take appropriate measures to control inflation.
Controlling inflation through short-term methods will aggravate the problem in the long run and remember, we are paying a cost for it or our future generations will pay an even higher cost for these short-term methods.
Indian needs to take rapid steps to boost infrastructure and promote it through private-public partnership otherwise inflation devil may totally go out of control. We need cheaper and 24 hour power. The power generation capacity is woefully short what was projected in last 5 year plan. We have not been able to bring enough private participation in power projects. Our SEBs are in financial mess, T&D losses highest in the world and collections for electricity bill are pathetic.
The golden quadrilateral road project is running out-of-schedule and will shortly start running in cost-overruns. Our irrigation network has not expanded enough and demands more money. The government is going to invest in irrigation network which is a good idea.
The solution is to bring telecom type private players in the market and carry the reforms in these sectors through government regulation. But one difference is that for infrastructure projects, the main input is land and it changes the whole picture. Land acquisition brings politics and rehabilitation issues and halts these projects. The government needs to be fast on rehabilitation laws and needs to finalize it with long-term vision. It is easier said than done.
2) One issue is our top institution doesn’t work. Our honorary members of parliament are involved in bitter politics on different issues and try to resolve the issues by power rather than fruitful discussion in the parliament. It is detrimental to very basic fabric of democracy. Our politicians or members of parliaments lack basic values and are involved in cheap vote bank politics all the time. This politics is thrived through bitterness, unfair practices and ‘might is right’ rules rather than driven by efficiency and honesty. Our top institution has diluted its values and integrity by successful and unwanted marriage of politics and criminals which goes back to slow judiciary processes. A person can fight elections till his guilt is proved in a court of law. The criminals are very well educated that how they can slow down these processes even further through their might.
Remember: Each minute of parliament session costs INR 20,000.
Coming to slow judicial processes, India is still very much a jungle raj. If your near relative is a politician or top bureaucrat, the whole country has to come together to get punishment for you for any gross wrong doing. Priyadarshan Matto case and many other pending cases are glaring examples.
I am very much convinced if income tax department starts its work honestly and efficiently against top politicians and bureaucrats, India doesn’t need to charge tax to its citizens for at least one year. This country can be a total-tax-free-country for one whole year. It is one more example.
We are a very inefficient country when it comes to implementation of law. This country needs discipline and it has to start from each segment of the society.
3) Cricket: The time has come when Indian public has to look for other sources of entertainment rather than hurting their emotions for these 15 useless fellows and a BCCI which runs Cricket in this country.
These 15 men are not accountable to this country and its people. BCCI made this point amply clear in the court. So, why should they should be answerable to the public and care for the 1 billion people who wake and sleep following cricket. These men are accountable to BCCI and have done more than enough to bring revenues to their employers. BCCI is growing faster than top companies of India.
This team doesn’t have zeal to win. They want other team to loose the game rather than they win it. They hardly show fight. They can’t bat on fast pitches (look what happened in South Africa) and they can’t bat on slow pitches. So, the real question is whether they can bat on any surface to win matches?
The fundamental question is if they want to work hard? Why will I work hard if I have earned enough for my grandsons and achieved a GOD like status among 1 billion people? Why I should listen to my coach and remove the weakness in my batting? The whole world knows how Mr. Tendulkar is susceptible to incoming delivery. My mind goes back to Lahore test match in 2004 where Umar Gul claimed Sachin out through an incoming delivery and their coach, Javed Miandad revealed this fact in media. I have seen Sachin getting out in the similar fashion on many occasions. Has he done anything about it? And if Mr. Tendulkar can’t win crucial games for India, he is not good enough to be in the team. Scoring runs against depleted attacks is one thing and scoring a marvelous century in world cup final match (like Ponting and Arvinda Desilva) is a separate thing all together.
Why things don’t happen for team India in field? Is there a co-relation between non performance on the field and the attitude? Rahul Dravid doesn’t need a McKinsey like consultancy to put fielders in short cover and short mid wicket to stop singles. Mahela Jaywardhane applied the same fielding from the very first over and put pressure on Indian batsmen on an easing pitch. Rahul Dravid fails to impress that his thinking cap is on all the time. He looks helpless in the field and totally out of control of the proceedings. He looks searching for answers rather than asking the tough questions to the opposition. My soul was screaming when Lankans were taking singles on each delivery and our fielders in 30-yard circle were mute spectators. These singles and 'Hang on, We can do it' attitude were the difference in the end.
There are many questions which will go unanswered. India will go to Bangladesh in May and win all the matches. The ho-ho spirit will be back and a new coach will be making strategy for 2011 world cup probably with a new captain.
On a comical note: Our reforms in fielding department are on for last ten years now. I had heard Azharuddin talking about it and we still talk about improvements. Well! We still can't hit stumps directly as Aussies do. I don't know what it takes to do - apart from dedicated training sessions and offcource, an willingness to do so.
Monday, March 05, 2007
A perspective on current affairs
If I look at budget and stock market, the government just did the right thing. It would have been better had the govt. offered one or two leeways to the corporate world. Though it was good to have these 'goodies', it was not essential.
It is time to correct the most fundamental problem: Agriculture. Allocating money will not suffice, it is time to correct the implementation part otherwise inflation will go out of control and RBI can't do anything about it. Agriculture reforms are two folds: 1) Increase farm productivity and get better with supply-demand projections. 2) Decrease human capital involved in Agriculture and put them to manufacturing. Tata Motor 'Singhur' project is the first step in this direction.
It will benefit in more than one way: 1) The country is creating more people whose consumption will increase because their statndard of living will go high due to an unofrom cash flow through out the year. 2) Political reforms will start happening because the fundamental vote bank will be transformed.
My conclusions on benefits may be far fetched but it is what India needs now and we have to go in this direction.
'How these reforms are carried out' will be interesting to see but investment in Agriculture and rural infrastructure will take India forward here on.
Share Market: I don't see any point why you should not invest if you are committed for 2-3 years. I am investing right now because stock prices are at mouth watering level. As I beleive, the bull is in Indian economy and not in the Indian stock market, therefore, I am investing in Indian economy. One concern is Real State. Real state will go into consolidation phase where small entities will not survive because cost of money has gone up. It may take a toll on Bank's NPAs but strong regulatory control of RBI should take us through.
We need to be vigilant on Current Account Deficit and ensure that foreign currency keeps flowing in India. Mrs. Sonia Gandhi has given a decisive blow by holding Bharti-Walmart retail initiative. It will send a wrong message to the world. FIIs are sceptical of government moves after Congress defeat in two states. Here, we have to see what Dr. Singh does...Does he act like a typical congress leader (what Sonia will force him to do) or behave like a reformist economist who will emphasis more on agriculture and rural infrstructure. Dr. Singh can balance economy and politics only in this way and that is what this year budget told us too.
I am still bullish on Indian market and economy.
Let me have your views.
It is time to correct the most fundamental problem: Agriculture. Allocating money will not suffice, it is time to correct the implementation part otherwise inflation will go out of control and RBI can't do anything about it. Agriculture reforms are two folds: 1) Increase farm productivity and get better with supply-demand projections. 2) Decrease human capital involved in Agriculture and put them to manufacturing. Tata Motor 'Singhur' project is the first step in this direction.
It will benefit in more than one way: 1) The country is creating more people whose consumption will increase because their statndard of living will go high due to an unofrom cash flow through out the year. 2) Political reforms will start happening because the fundamental vote bank will be transformed.
My conclusions on benefits may be far fetched but it is what India needs now and we have to go in this direction.
'How these reforms are carried out' will be interesting to see but investment in Agriculture and rural infrastructure will take India forward here on.
Share Market: I don't see any point why you should not invest if you are committed for 2-3 years. I am investing right now because stock prices are at mouth watering level. As I beleive, the bull is in Indian economy and not in the Indian stock market, therefore, I am investing in Indian economy. One concern is Real State. Real state will go into consolidation phase where small entities will not survive because cost of money has gone up. It may take a toll on Bank's NPAs but strong regulatory control of RBI should take us through.
We need to be vigilant on Current Account Deficit and ensure that foreign currency keeps flowing in India. Mrs. Sonia Gandhi has given a decisive blow by holding Bharti-Walmart retail initiative. It will send a wrong message to the world. FIIs are sceptical of government moves after Congress defeat in two states. Here, we have to see what Dr. Singh does...Does he act like a typical congress leader (what Sonia will force him to do) or behave like a reformist economist who will emphasis more on agriculture and rural infrstructure. Dr. Singh can balance economy and politics only in this way and that is what this year budget told us too.
I am still bullish on Indian market and economy.
Let me have your views.
Saturday, February 17, 2007
Weekend Musings
1)The RBI governor came out with quarterly review of monetary policy and did a mild correction. The bankers and markets were betting on another hike in CRR and squeezing the money supply, but RBI governor took a toned out measured step which will do no harm to anybody.
RBI governor declared in a way that we can’t tackle inflation by monetary policy alone. What we need to realize that Agriculture has stricken back. The supply-demand mismatch for food grains is responsible for price hike and hence, increasing inflation.
However, RBI surprised all of us when it declared another 1% (in a phased manner) hike in CRR which will suck out INR 27,000 Crore from the system. I have a question here and I want a logical answer. Our big ticket companies (Large and Mid Cap) are taking ECB (external commercial borrowing) route and borrowing from foreign countries. The RBI has not put any restriction on ECB yet. It means that money is coming into country through ECB. Then why RBI is making money costlier for common man and small scale industries? Why the small and medium businesses, retail consumers and all the chaps clubbed under “priority sector” category (farmers, truck owners, traders, petty shopkeepers etc) should pay more cost to get money? This is a ridiculous decision. Why RBI and government are out on a killing spree to murder small and budding business enterprises? Can Mr. Reddy or Mr. Chidambaram or Dr. Singh or Mrs. Gandhi explain it?
2)Let’s discuss about what government did about food grains supply demand. The agriculture sector is paying for its negligence and its status shows the true picture of India. Why True Picture? Because 50% Indians are still 100% dependent on agriculture income and the picture has not changed much for these Indians though the time has changed, the governments have changed, the policies have changed. These 50% Indians are ‘Aam Aadmi’ of India. What has not changed is poor implementation of policies, rampant corruption, and low level of education, public investment and absence of efficient corporations in the agriculture sector.
From Nehru to Shastri to Indira Gandhi to Sonia Gandhi, the message is clear – concern for the Aam Aadmi. It is a different matter that in last six decades, most of these politicians have upgraded their status to palatial bungalows in national and state capitals, replete with Jacuzzis and round-the-clock commandos for themselves and their relatives. Their personal choice of vehicles has now changed to Bentleys cars for self use and for gifts to their near and dear ones, while the preferred health destination is London or New York.
Let’s talk about our favorite Aam Aadmi. What has changed for him in last six decades? His children have no access to basic education, he has 100% dependency on Agriculture, He doesn’t had any health care centre but a broken building where dogs don’t take shelter until the outside weather is very harsh. His preferred mode of transportation is Bus (if he is lucky and his village is near to a road) or his barren foot.
Now do we have a court or any mechanism to punish all the politicians and bureaucrats responsible for sorry state of Aam Aadmi and filthy rich status of politicians and bureaucrats? First of all, will Congress take majority of responsibility for the sorry state of Aam Aadmi and come out to explain how much wealth their politicians have? Our bureaucrats have been involved in this party which is not yet over and probably will be never over. Let us remember that our bureaucrats are most intelligent (supposedly) men of the country and most corrupt as well. Our country gives enormous protection to civil servants which no other country in the world does!! Let me explain how. Article 311 in our constitution says no civil servant can be dismissed except after an enquiry. It sounds fair except that such enquiries rarely lead to dismissal. The net effect is once you join a government, central or state; you are there for the life, never mind whether you work or not and are corrupt to the bone.
The origin of this provision lies in the Montagu-Chelmsford reforms of 1919, when under diarchy; Indians were given a minor share in power. The British wanted to protect Indian Civil Servants from the natives, and hence this protection.
Sometimes, I wonder if Ms. Sonia Gandhi takes a casual walk in the streets of present day modern and rural India. She will realize what India is all about. I don’t think this lady has slight idea about India but she is taking rather forcing decisions on Government. Wal-Mart is not allowed (or FDI in Retail is not allowed) but our government allows Reliance to sell vegetables and fruits (I have nothing against Reliance)? Why? Don’t give me logic that Reliance is Indian company…This is golden crap or elegant stupidity. Can I expect a logical answer from our super Prime Minister Lady? The same goes true for SEZ. She makes super elegant stupid comments and judgments which come from her coterie of leaders who are nothing but pimps of businessmen.
Our political parties, in particular, big national parties are not democratic. Look at Congress; it dances to the tune of Ms. Sonia Gandhi. She is number one, number two and number three in Congress leadership. Where is democracy in Congress? BJP is commanded by RSS…BJP leaders will not accept it but it is as true as the son is commanded by his father who still can’t take his own decisions to run home.
3)Let me bring something else to our notice. It is very sad, in fact pathetic to know that standards of deciding poverty are not same for different ministries of Central Governments even after 60 years of independence. Why our ministers and IAS officers could not get time in last 60 years to sit down and define the uniform standards to measure poverty? The Union Ministry of Rural Development and the Union Ministry of Food and Civil Supplies have different sets of BPL figures in Bihar due to different parameters to measure poverty. After several rounds of discussion with rural development ministry, 65 lakh families in Bihar have been declared BPL. But the food and civil supplies ministry has just 50 lakh BPL families on its list and has made arrangements to supply food grains accordingly. Because there is no agreement on figures, 35 lakh desperately poor families in Bihar have been deprived of BPL status and the concurrent benefits.
4)Aussies have been beaten by 10 wickets. It has been the best news from Cricket world to me in last 2-3 years. This team needs to bring down on ground and should be sent to primary schools to learn politeness and behave like a man. Hayden was very happy with the comment that ‘Aussies attack like a bunch of hounded dogs’. Now they have become poor dogs who can’t bark till they win their next match. I had read about Clive Lloyd team who was better (that’s my view) than this Australian team but never behaved against the spirit of gentleman behavior. They were bunch of elegant men who never attacked their opponent’s dignity on or off the field. Leave attack; they never uttered bad words for their opponents and respected them. I will like to bring history in picture. Australians don’t like to talk about their history but I see their hounded dog’s like behavior emanating from their history.
Anyway, Australians were bound to start downward journey but it has came at the worst time for them. I hope they continue their bad run so that entertainment value of Australia matches go high.
RBI governor declared in a way that we can’t tackle inflation by monetary policy alone. What we need to realize that Agriculture has stricken back. The supply-demand mismatch for food grains is responsible for price hike and hence, increasing inflation.
However, RBI surprised all of us when it declared another 1% (in a phased manner) hike in CRR which will suck out INR 27,000 Crore from the system. I have a question here and I want a logical answer. Our big ticket companies (Large and Mid Cap) are taking ECB (external commercial borrowing) route and borrowing from foreign countries. The RBI has not put any restriction on ECB yet. It means that money is coming into country through ECB. Then why RBI is making money costlier for common man and small scale industries? Why the small and medium businesses, retail consumers and all the chaps clubbed under “priority sector” category (farmers, truck owners, traders, petty shopkeepers etc) should pay more cost to get money? This is a ridiculous decision. Why RBI and government are out on a killing spree to murder small and budding business enterprises? Can Mr. Reddy or Mr. Chidambaram or Dr. Singh or Mrs. Gandhi explain it?
2)Let’s discuss about what government did about food grains supply demand. The agriculture sector is paying for its negligence and its status shows the true picture of India. Why True Picture? Because 50% Indians are still 100% dependent on agriculture income and the picture has not changed much for these Indians though the time has changed, the governments have changed, the policies have changed. These 50% Indians are ‘Aam Aadmi’ of India. What has not changed is poor implementation of policies, rampant corruption, and low level of education, public investment and absence of efficient corporations in the agriculture sector.
From Nehru to Shastri to Indira Gandhi to Sonia Gandhi, the message is clear – concern for the Aam Aadmi. It is a different matter that in last six decades, most of these politicians have upgraded their status to palatial bungalows in national and state capitals, replete with Jacuzzis and round-the-clock commandos for themselves and their relatives. Their personal choice of vehicles has now changed to Bentleys cars for self use and for gifts to their near and dear ones, while the preferred health destination is London or New York.
Let’s talk about our favorite Aam Aadmi. What has changed for him in last six decades? His children have no access to basic education, he has 100% dependency on Agriculture, He doesn’t had any health care centre but a broken building where dogs don’t take shelter until the outside weather is very harsh. His preferred mode of transportation is Bus (if he is lucky and his village is near to a road) or his barren foot.
Now do we have a court or any mechanism to punish all the politicians and bureaucrats responsible for sorry state of Aam Aadmi and filthy rich status of politicians and bureaucrats? First of all, will Congress take majority of responsibility for the sorry state of Aam Aadmi and come out to explain how much wealth their politicians have? Our bureaucrats have been involved in this party which is not yet over and probably will be never over. Let us remember that our bureaucrats are most intelligent (supposedly) men of the country and most corrupt as well. Our country gives enormous protection to civil servants which no other country in the world does!! Let me explain how. Article 311 in our constitution says no civil servant can be dismissed except after an enquiry. It sounds fair except that such enquiries rarely lead to dismissal. The net effect is once you join a government, central or state; you are there for the life, never mind whether you work or not and are corrupt to the bone.
The origin of this provision lies in the Montagu-Chelmsford reforms of 1919, when under diarchy; Indians were given a minor share in power. The British wanted to protect Indian Civil Servants from the natives, and hence this protection.
Sometimes, I wonder if Ms. Sonia Gandhi takes a casual walk in the streets of present day modern and rural India. She will realize what India is all about. I don’t think this lady has slight idea about India but she is taking rather forcing decisions on Government. Wal-Mart is not allowed (or FDI in Retail is not allowed) but our government allows Reliance to sell vegetables and fruits (I have nothing against Reliance)? Why? Don’t give me logic that Reliance is Indian company…This is golden crap or elegant stupidity. Can I expect a logical answer from our super Prime Minister Lady? The same goes true for SEZ. She makes super elegant stupid comments and judgments which come from her coterie of leaders who are nothing but pimps of businessmen.
Our political parties, in particular, big national parties are not democratic. Look at Congress; it dances to the tune of Ms. Sonia Gandhi. She is number one, number two and number three in Congress leadership. Where is democracy in Congress? BJP is commanded by RSS…BJP leaders will not accept it but it is as true as the son is commanded by his father who still can’t take his own decisions to run home.
3)Let me bring something else to our notice. It is very sad, in fact pathetic to know that standards of deciding poverty are not same for different ministries of Central Governments even after 60 years of independence. Why our ministers and IAS officers could not get time in last 60 years to sit down and define the uniform standards to measure poverty? The Union Ministry of Rural Development and the Union Ministry of Food and Civil Supplies have different sets of BPL figures in Bihar due to different parameters to measure poverty. After several rounds of discussion with rural development ministry, 65 lakh families in Bihar have been declared BPL. But the food and civil supplies ministry has just 50 lakh BPL families on its list and has made arrangements to supply food grains accordingly. Because there is no agreement on figures, 35 lakh desperately poor families in Bihar have been deprived of BPL status and the concurrent benefits.
4)Aussies have been beaten by 10 wickets. It has been the best news from Cricket world to me in last 2-3 years. This team needs to bring down on ground and should be sent to primary schools to learn politeness and behave like a man. Hayden was very happy with the comment that ‘Aussies attack like a bunch of hounded dogs’. Now they have become poor dogs who can’t bark till they win their next match. I had read about Clive Lloyd team who was better (that’s my view) than this Australian team but never behaved against the spirit of gentleman behavior. They were bunch of elegant men who never attacked their opponent’s dignity on or off the field. Leave attack; they never uttered bad words for their opponents and respected them. I will like to bring history in picture. Australians don’t like to talk about their history but I see their hounded dog’s like behavior emanating from their history.
Anyway, Australians were bound to start downward journey but it has came at the worst time for them. I hope they continue their bad run so that entertainment value of Australia matches go high.
Sunday, January 07, 2007
Test Series Win in Africa...Still a mirage!
Yesterday when India started a wild goose chase to defend 210 runs, two things came to my mind and I was pretty much convinced that India will face defeat:
1)Rahul Dravid contribution was missing as a batsman
2)Graeme Smith played an expansive drive in the very first over of Zaheer Khan on the fifth day morning. Ravi Shastri commented, ”Had Zaheer Khan plucked one hair from his head and attached to the ball, the ball would have clipped the off stump bail.” I too witnessed it. My point is : fortune was favoring the brave on the fifth day morning.
If we look at the broader level, Indians didn’t have the stomach to fight when South Africans challenged them. It happened in second innings of all the tests. Indians were touch lucky in first test match where South Africa slumped to 84 in first innings before they noticed what was going wrong.
I missed Rahul Dravid contribution as a batsman in the whole series. Rahul Dravid is the only fighter in this team, who has the attitude and stomach to play an innings which can (and has) put India in winning position overseas. He kills the sting in the match in his own way. He frustrates the opposition, works out multiple hundred partnerships, spends the time in the middle and ensures that India will not loose the game. Yes, if bowlers can claim ten wickets in time, India can win the match. He is a true leader to win the overseas matches. I don’t recall if our other batsmen have led the way.
I can remember many instances where India has won test matches. Rahul Dravid has led the way as a batsman:
1) 115 against England on first day morning in Headingley.
2) 270 against Pakistan in Rawalpindi
3) 233 and 72 against Australia in Adelaide
4) Two half centuries against West Indies where India won the test match and series. You may like to have a relook at the scorecard; Rahul Dravid played more number of balls than whole West Indies team in the first innings!!!
As I mentioned before, Rahul Dravid didn’t play a single innings in whole test series which can outplay the opposition and I very well know, no other Indian batsman can play a match winning innings. VVS Laxman played one against Aussies in Kolkata; however, it will be unreasonable to expect him to reproduce that magic each time he takes guard. Sachin Tendulkar will definitely feel that he created two opportunities but he got out (or thrown away his wicket?) and this is what Rahul Dravid never does. Once he creates an opportunity, he never let it slip and builds the innings brick by brick for the team. It has never been the case with Tendulkar. He always looks edgy or likely to get out even when he has crossed 50 runs. It is happening more often now. He has gone to shell in the fourth innings on a number of times and failed to lead the way. Sometimes, I feel he is too afraid of the bowlers or too submissive to the fate that he even refuses to put a brave fight. He comes out with a timid show and eventually looses his wicket in an embarrassing way after a more embarrassed batting display.
How you should bat in fourth innings: Indian batsmen can learn from South African batsmen who chased 210 with caution and yet they were aggressive. They never went into their shell but played each ball on merit. At the end of day, they didn’t forget the basic fundamental: A batsman stands on a pitch to score runs. Whatever he does, save or win the match, he has to score runs and this is what our middle order fails to understand. Indian middle order pulls pressure on themselves by not rotating the strike, not putting bad balls to boundaries and not attacking the weak link in the bowling. One has to compete all the time against the top team if you have to win against them. One can’t slip into no-action zone with a false premise that it will save the match. A team may choose to be aggressive with varying intensity based on the match situation but being submissive is like accepting the defeat and giving the winning edge to opposition. I feel our middle order succumbs to same phenomena in a do-or-die situation. This is how I would like to explain myself many defeats that India conceded after taking lead in overseas test series.
Rahul Dravid will definitely feel that he lost the test series more than South Africa won it. Faulty team selection, bearing the repeated failures and throwing the wickets away at the crucial junctures proved too much and you can’t make so many mistakes against a formidable opposition.
I am happy with one decision of BCCI (at last!!). Mr. Dilip Vengasarkar has asked every player to participate in ongoing Ranji Trophy season. It will benefit our current players who have forgotten to build innings on a fifth day pitch and increase the level of competition in the matches.
1)Rahul Dravid contribution was missing as a batsman
2)Graeme Smith played an expansive drive in the very first over of Zaheer Khan on the fifth day morning. Ravi Shastri commented, ”Had Zaheer Khan plucked one hair from his head and attached to the ball, the ball would have clipped the off stump bail.” I too witnessed it. My point is : fortune was favoring the brave on the fifth day morning.
If we look at the broader level, Indians didn’t have the stomach to fight when South Africans challenged them. It happened in second innings of all the tests. Indians were touch lucky in first test match where South Africa slumped to 84 in first innings before they noticed what was going wrong.
I missed Rahul Dravid contribution as a batsman in the whole series. Rahul Dravid is the only fighter in this team, who has the attitude and stomach to play an innings which can (and has) put India in winning position overseas. He kills the sting in the match in his own way. He frustrates the opposition, works out multiple hundred partnerships, spends the time in the middle and ensures that India will not loose the game. Yes, if bowlers can claim ten wickets in time, India can win the match. He is a true leader to win the overseas matches. I don’t recall if our other batsmen have led the way.
I can remember many instances where India has won test matches. Rahul Dravid has led the way as a batsman:
1) 115 against England on first day morning in Headingley.
2) 270 against Pakistan in Rawalpindi
3) 233 and 72 against Australia in Adelaide
4) Two half centuries against West Indies where India won the test match and series. You may like to have a relook at the scorecard; Rahul Dravid played more number of balls than whole West Indies team in the first innings!!!
As I mentioned before, Rahul Dravid didn’t play a single innings in whole test series which can outplay the opposition and I very well know, no other Indian batsman can play a match winning innings. VVS Laxman played one against Aussies in Kolkata; however, it will be unreasonable to expect him to reproduce that magic each time he takes guard. Sachin Tendulkar will definitely feel that he created two opportunities but he got out (or thrown away his wicket?) and this is what Rahul Dravid never does. Once he creates an opportunity, he never let it slip and builds the innings brick by brick for the team. It has never been the case with Tendulkar. He always looks edgy or likely to get out even when he has crossed 50 runs. It is happening more often now. He has gone to shell in the fourth innings on a number of times and failed to lead the way. Sometimes, I feel he is too afraid of the bowlers or too submissive to the fate that he even refuses to put a brave fight. He comes out with a timid show and eventually looses his wicket in an embarrassing way after a more embarrassed batting display.
How you should bat in fourth innings: Indian batsmen can learn from South African batsmen who chased 210 with caution and yet they were aggressive. They never went into their shell but played each ball on merit. At the end of day, they didn’t forget the basic fundamental: A batsman stands on a pitch to score runs. Whatever he does, save or win the match, he has to score runs and this is what our middle order fails to understand. Indian middle order pulls pressure on themselves by not rotating the strike, not putting bad balls to boundaries and not attacking the weak link in the bowling. One has to compete all the time against the top team if you have to win against them. One can’t slip into no-action zone with a false premise that it will save the match. A team may choose to be aggressive with varying intensity based on the match situation but being submissive is like accepting the defeat and giving the winning edge to opposition. I feel our middle order succumbs to same phenomena in a do-or-die situation. This is how I would like to explain myself many defeats that India conceded after taking lead in overseas test series.
Rahul Dravid will definitely feel that he lost the test series more than South Africa won it. Faulty team selection, bearing the repeated failures and throwing the wickets away at the crucial junctures proved too much and you can’t make so many mistakes against a formidable opposition.
I am happy with one decision of BCCI (at last!!). Mr. Dilip Vengasarkar has asked every player to participate in ongoing Ranji Trophy season. It will benefit our current players who have forgotten to build innings on a fifth day pitch and increase the level of competition in the matches.
Sunday, November 26, 2006
Is our economy over heated?
Indian economy is overheating…I hear this statement almost daily. When I think and analyze, I realize that we are over reacting. We Indians don’t have appetite to digest more than 8% growth probably we haven’t witnessed this type of growth before and therefore, we are trying to find out what is wrong.
Why Indian economy is overheating? Because Credit growth is more than 30% or real state value has more than doubled in metro cities in last two years or sensex’s P/E ratio is 20.
I would have agreed to the argument that India is overheating if we had more house than the number of families or if an overwhelming connection of roads or more than 2-3 airports in each city. As far as I know this condition doesn’t exist as of now. Our middle class families are searching for flats/homes; we don’t have enough good quality roads; our airports are clogged and flights are regularly delayed…so why we are making so much noise.
As I understand, credit risk, particularly real estate lending leads to widespread a banking problem which percolates to a nation economy. We have witnessed this unfortunate sequence of events in Switzerland, Spain, UK, Norway, Japan and US. A period of financial deregulation resulted in rapid growth in lending, particularly in real state related lending. Rapidly rising real state prices encouraged more lending, abetted by lax regulatory systems in many cases. When economic recession occurred, inflated real estate prices collapsed, leading directly to the failures, which affect banking system and economy adversely.
I don’t foresee it happening in India because we have excellent banking regulations in place and RBI modifies and puts a ceiling on different type of lending based on need. Second, 30% credit growth rate is being sustained by manufacturing, capital goods, real state and retail customer loans. Also, we all agree that India is short on demand side and needs to build capacity in each sector. Therefore, I don’t find anything fundamentally wrong with our economy and disagree about over heating.
We have to avoid being paranoid and stop behaving if there is something wrong. We have to look at things in right perspective. India needs 50 cities with world class infrastructure to cater to need and demand of 1 billion people. We need airports, both to carry passengers and cargo, we need to add to our existing railway Network and Road network to carry goods and promote tourism, we need power generation stations, we need car manufacturing units, etc. It all takes money and that’s why we have 30% sustained growth in lending.
Therefore, I agree to Mr. Reddy and he took a balanced approach on last credit policy review. However, he sent a mild warning signal and suggested not to go overboard although there were enough signals to make him wary. One of those signals was that 5 million mobile handsets were sold on Deepawali this year. It was the largest sale of handsets on a single day. His message is loud and clear to banks – Manage your deposits for loans. If you (Banks) come to me (RBI) for money, I will charge you 25 basis points more.
Let’s be confident. India is doing well and all these signals suggest and reinforce that India is going to sustain more than 8% GDP growth.
Why Indian economy is overheating? Because Credit growth is more than 30% or real state value has more than doubled in metro cities in last two years or sensex’s P/E ratio is 20.
I would have agreed to the argument that India is overheating if we had more house than the number of families or if an overwhelming connection of roads or more than 2-3 airports in each city. As far as I know this condition doesn’t exist as of now. Our middle class families are searching for flats/homes; we don’t have enough good quality roads; our airports are clogged and flights are regularly delayed…so why we are making so much noise.
As I understand, credit risk, particularly real estate lending leads to widespread a banking problem which percolates to a nation economy. We have witnessed this unfortunate sequence of events in Switzerland, Spain, UK, Norway, Japan and US. A period of financial deregulation resulted in rapid growth in lending, particularly in real state related lending. Rapidly rising real state prices encouraged more lending, abetted by lax regulatory systems in many cases. When economic recession occurred, inflated real estate prices collapsed, leading directly to the failures, which affect banking system and economy adversely.
I don’t foresee it happening in India because we have excellent banking regulations in place and RBI modifies and puts a ceiling on different type of lending based on need. Second, 30% credit growth rate is being sustained by manufacturing, capital goods, real state and retail customer loans. Also, we all agree that India is short on demand side and needs to build capacity in each sector. Therefore, I don’t find anything fundamentally wrong with our economy and disagree about over heating.
We have to avoid being paranoid and stop behaving if there is something wrong. We have to look at things in right perspective. India needs 50 cities with world class infrastructure to cater to need and demand of 1 billion people. We need airports, both to carry passengers and cargo, we need to add to our existing railway Network and Road network to carry goods and promote tourism, we need power generation stations, we need car manufacturing units, etc. It all takes money and that’s why we have 30% sustained growth in lending.
Therefore, I agree to Mr. Reddy and he took a balanced approach on last credit policy review. However, he sent a mild warning signal and suggested not to go overboard although there were enough signals to make him wary. One of those signals was that 5 million mobile handsets were sold on Deepawali this year. It was the largest sale of handsets on a single day. His message is loud and clear to banks – Manage your deposits for loans. If you (Banks) come to me (RBI) for money, I will charge you 25 basis points more.
Let’s be confident. India is doing well and all these signals suggest and reinforce that India is going to sustain more than 8% GDP growth.
Thursday, November 23, 2006
New Tour...Old Pains and BCCI
I want to write my blog on some other topic like macro economic or latest credit review policy by RBI, however, Indian team and my everlasting love with cricket compelled the writer in me to share my thoughts with you.
Indians were once again humiliated against a quality pace attack on a bouncy pitch. It didn’t happen first time and I am sure it has not happened last time either. Now what will happen? Rahul Dravid and Greg Chappell will change the team for next one day game. The team management will drop one and two players and probably we will have a respectable defeat. Our batsmen will be acclimatized till the last one day game and probably we will win last game as well.
This is the short term solution and we Indians inherently love this approach. We do not have enough vision to think about resolving the problem and avoid this humiliation again. When Clive Lloyd’s team used to drub Aussies in late 70s and early 80s, the Aussies cricket board thought about a long term vision and implemented it. We all are witnessing the result.
Now, the first question comes – does BCCI care to solve this problem? Is BCCI ready to inculcate a professional and visionary approach to future of Cricket in India? My answer to both these questions lies in negativity. People may have difference of opinion here. However, BCCI is smart enough to make its balance sheet stronger on a year on year basis. I read a study which suggested that BCCI grows faster than Infosys! God knows where all the money goes…One more thing – Indian team represents BCCI and not India. It was clarified by BCCI when a die-hard cricket fan lodged a case against them in court.
There was a need to promote cricket in India when BCCI was set-up. Now, BCCI can leave this job to Indian Companies who will be more than happy to do this job for BCCI free of cost! We know what kind of people has been running BCCI at present and in the past. They want to command BCCI not to make a stronger Indian team but to make money in their own way because nobody can question how BCCI is run, courtesy to its autonomous nature.
The seasoned professionals should run this organization like a listed company. You will ask why? The simple reason is Indian Team may be representing BCCI on paper but practically it represents honor and pride of one billion people. It represents India. Sachin Tendulkar and Rahul Dravid are national icons and not BCCI icons! The strength of BCCI balance sheet is driven by Indian people passion in Cricket. Therefore, BCCI must be made transparent and accountable to Indian public. The passionate Indians must be given a chance to run this organization professionally based on their merit, educational qualification and other criteria.
We need professionals like Harsha Bhogles and Sunil Gavaskars to run this organization. I don’t know how good these men will be as administrators but they will enjoy it doing more than commenting on Indian matches.
There is a dire need to create an institution within BCCI which educates and trains our young batsmen on fast and bouncy pitches. This institution may provide India what we are looking for last 74 years – a genuine fast bowler. MRF pace foundation and Cricket Academy are delivering but we need a focused and planned approach to win one-day and test series in Australia, England or South Africa in coming years.
Sometimes I thank God that only 10-12 nations play cricket otherwise our ranking in Cricket would have been same as that of Football, courtesy to BCCI. BCCI is not different than other sports governing bodies in India. Then what is the difference? The only difference is “we”.
Indians were once again humiliated against a quality pace attack on a bouncy pitch. It didn’t happen first time and I am sure it has not happened last time either. Now what will happen? Rahul Dravid and Greg Chappell will change the team for next one day game. The team management will drop one and two players and probably we will have a respectable defeat. Our batsmen will be acclimatized till the last one day game and probably we will win last game as well.
This is the short term solution and we Indians inherently love this approach. We do not have enough vision to think about resolving the problem and avoid this humiliation again. When Clive Lloyd’s team used to drub Aussies in late 70s and early 80s, the Aussies cricket board thought about a long term vision and implemented it. We all are witnessing the result.
Now, the first question comes – does BCCI care to solve this problem? Is BCCI ready to inculcate a professional and visionary approach to future of Cricket in India? My answer to both these questions lies in negativity. People may have difference of opinion here. However, BCCI is smart enough to make its balance sheet stronger on a year on year basis. I read a study which suggested that BCCI grows faster than Infosys! God knows where all the money goes…One more thing – Indian team represents BCCI and not India. It was clarified by BCCI when a die-hard cricket fan lodged a case against them in court.
There was a need to promote cricket in India when BCCI was set-up. Now, BCCI can leave this job to Indian Companies who will be more than happy to do this job for BCCI free of cost! We know what kind of people has been running BCCI at present and in the past. They want to command BCCI not to make a stronger Indian team but to make money in their own way because nobody can question how BCCI is run, courtesy to its autonomous nature.
The seasoned professionals should run this organization like a listed company. You will ask why? The simple reason is Indian Team may be representing BCCI on paper but practically it represents honor and pride of one billion people. It represents India. Sachin Tendulkar and Rahul Dravid are national icons and not BCCI icons! The strength of BCCI balance sheet is driven by Indian people passion in Cricket. Therefore, BCCI must be made transparent and accountable to Indian public. The passionate Indians must be given a chance to run this organization professionally based on their merit, educational qualification and other criteria.
We need professionals like Harsha Bhogles and Sunil Gavaskars to run this organization. I don’t know how good these men will be as administrators but they will enjoy it doing more than commenting on Indian matches.
There is a dire need to create an institution within BCCI which educates and trains our young batsmen on fast and bouncy pitches. This institution may provide India what we are looking for last 74 years – a genuine fast bowler. MRF pace foundation and Cricket Academy are delivering but we need a focused and planned approach to win one-day and test series in Australia, England or South Africa in coming years.
Sometimes I thank God that only 10-12 nations play cricket otherwise our ranking in Cricket would have been same as that of Football, courtesy to BCCI. BCCI is not different than other sports governing bodies in India. Then what is the difference? The only difference is “we”.
Sunday, November 05, 2006
My comments on Cricket
Let me take a dig at Mr. Speed. Malcom Speed has once again tried his best to stir the Indian nation. He can’t digest Indians as economic superpower of cricket. But, Mr. Malcom Speed should also read business pages of his tabloid and learn that India, as a nation is emerging as a superpower. Tata Steel has bought Corus, the UK national pride. Mr. Speed also talked about Indian performance in recent matches; he must look at his own team which has been reduced to nothing except that they won Ashes 2005. I am ready to discuss about his team performance before and after Ashes 2005 and Mr. Speed will not find the discussion interesting. Mr. Speed, if we Indians want, we can have our own world cups and we don’t want ICC as a governing body of cricket which does nothing but provoking racism on and off the cricket field. Mr. Speed, please wake up and accept Indian superiority or mind your own business.
Indians were humbled in the current ICC Champions Trophy in its own den. It doesn’t happen frequently with our lions. The Indians look tough to beat in India but anything is possible with this team in its current form.
The problem starts from the beginning, be it bowling or batting. Virender Shehwag is not firing in the ODIs and it is taking a toll on Indian Team. The question is why we are giving him too many chances? Just because he is vice captain of the team or Greg Chappel and Rahul Dravid are more than happy to bet on this endless gamble?
Virender Shehwag needs to emulate Chris Gayle who is responsible for West Indies performance in ICC Champions Trophy. Chris Gayle is improving day-by-day as a cricketer and contributing more than handful in all departments of the game.
The number three position is being rotated ridiculously as a music chair in Indian Team. Any team must ensure in One day Cricket that its best batsmen plays maximum number of overs. Going by this logic, Mr. Dependable should come at number three and play an anchor sheet role to provide smooth and robust platform for our aggressive batsmen. What business Irfan Pathan has to do here? Let’s play cricket in a simple and no-nonsense way. Innovation is an important ingredient of strategy; however, it should not come at the cost of compromising with the basic fundamentals and start resulting in losses. If India needs to chase more than 300 score, I can understand the logic of Irfan Pathan walking at number 3 and showing intentions to blast 50 on 40 balls. But if India is batting first, a grafter should play at number three.
Irfan Pathan must concentrate on his bowling and his job is to get India early breakthroughs. When Irfan Pathan doesn’t get early wickets, Indian bowling looks pathetic and toothless. If Irfan Pathan doesn’t get back to his bowling rhythm, he will go Zaheer Khan’s way and it will be cruel for the youngster. Irfan Pathan is only good as a bowler, he should aim to be great and join the league of Walsh, McGrath etc.
The team India has lost confidence after West Indies debacle. The body language of players shows it. Their body language had conveyed the match result against Aussies. The team was looking awfully short on match preparation part. When we were batting, we could not hit boundaries, feeling as if 22 players were fielding in the ground. When we were bowling, we had forgotten that Ponting was in bad form but we bowled him on his strength and helped him immensely to gain form.
We have to look forward now. Indian team is going to face South Africa where we have not won for last 14 years. Dravid and Chapel should select 11 appropriate men on the match day and win all the matches. I have seen Dravid doing blunders when it comes to last 11. The recent example is match against West Indies. The liftman of the hotel, where the Indian team stayed, will tell you that West Indians are weak against spin bowling. I could not understand playing R. P. Singh against West Indies when Ramesh Powar was need of the hour.
I think Dilip Vengasarkar is right where he commented about talent available in India. It calls for the reforms in Indian Domestic tournaments. There must be a prime tournament where only 6-7 teams should participate. We have more than 20 teams playing in Ranji Trophy where there is yawning gap in talent across teams. It reduces the intensity of the matches and batting or bowling performances can’t and should not be compared. The tournament must ensure matches on variety of pitches and there we can find talent which will match to international standard or will be closer to international standard. Greg Chapel should understand the difference between Indian Domestic Cricket Structure and Aussies Domestic Cricket Structure. I have heard Dennis Lilee saying,”I enjoyed playing for Shield tournament more than Test Matches some times.” Therefore, when it comes to selection, Domestic as well as International experience and performance, both should be taken into consideration. I believe V. V. S. Laxman is better bet than Raina. I heard somebody talking about fielding. Okay, if you don’t have enough runs on board in the first place, what will you achieve by saving 10 odd runs in the field??? I don’t find our batting line up convincing on the South African pitches against their pace battery.
Indians were humbled in the current ICC Champions Trophy in its own den. It doesn’t happen frequently with our lions. The Indians look tough to beat in India but anything is possible with this team in its current form.
The problem starts from the beginning, be it bowling or batting. Virender Shehwag is not firing in the ODIs and it is taking a toll on Indian Team. The question is why we are giving him too many chances? Just because he is vice captain of the team or Greg Chappel and Rahul Dravid are more than happy to bet on this endless gamble?
Virender Shehwag needs to emulate Chris Gayle who is responsible for West Indies performance in ICC Champions Trophy. Chris Gayle is improving day-by-day as a cricketer and contributing more than handful in all departments of the game.
The number three position is being rotated ridiculously as a music chair in Indian Team. Any team must ensure in One day Cricket that its best batsmen plays maximum number of overs. Going by this logic, Mr. Dependable should come at number three and play an anchor sheet role to provide smooth and robust platform for our aggressive batsmen. What business Irfan Pathan has to do here? Let’s play cricket in a simple and no-nonsense way. Innovation is an important ingredient of strategy; however, it should not come at the cost of compromising with the basic fundamentals and start resulting in losses. If India needs to chase more than 300 score, I can understand the logic of Irfan Pathan walking at number 3 and showing intentions to blast 50 on 40 balls. But if India is batting first, a grafter should play at number three.
Irfan Pathan must concentrate on his bowling and his job is to get India early breakthroughs. When Irfan Pathan doesn’t get early wickets, Indian bowling looks pathetic and toothless. If Irfan Pathan doesn’t get back to his bowling rhythm, he will go Zaheer Khan’s way and it will be cruel for the youngster. Irfan Pathan is only good as a bowler, he should aim to be great and join the league of Walsh, McGrath etc.
The team India has lost confidence after West Indies debacle. The body language of players shows it. Their body language had conveyed the match result against Aussies. The team was looking awfully short on match preparation part. When we were batting, we could not hit boundaries, feeling as if 22 players were fielding in the ground. When we were bowling, we had forgotten that Ponting was in bad form but we bowled him on his strength and helped him immensely to gain form.
We have to look forward now. Indian team is going to face South Africa where we have not won for last 14 years. Dravid and Chapel should select 11 appropriate men on the match day and win all the matches. I have seen Dravid doing blunders when it comes to last 11. The recent example is match against West Indies. The liftman of the hotel, where the Indian team stayed, will tell you that West Indians are weak against spin bowling. I could not understand playing R. P. Singh against West Indies when Ramesh Powar was need of the hour.
I think Dilip Vengasarkar is right where he commented about talent available in India. It calls for the reforms in Indian Domestic tournaments. There must be a prime tournament where only 6-7 teams should participate. We have more than 20 teams playing in Ranji Trophy where there is yawning gap in talent across teams. It reduces the intensity of the matches and batting or bowling performances can’t and should not be compared. The tournament must ensure matches on variety of pitches and there we can find talent which will match to international standard or will be closer to international standard. Greg Chapel should understand the difference between Indian Domestic Cricket Structure and Aussies Domestic Cricket Structure. I have heard Dennis Lilee saying,”I enjoyed playing for Shield tournament more than Test Matches some times.” Therefore, when it comes to selection, Domestic as well as International experience and performance, both should be taken into consideration. I believe V. V. S. Laxman is better bet than Raina. I heard somebody talking about fielding. Okay, if you don’t have enough runs on board in the first place, what will you achieve by saving 10 odd runs in the field??? I don’t find our batting line up convincing on the South African pitches against their pace battery.
Sunday, September 17, 2006
The left parties and reforms
There is one story that does the rounds in north block. Mr. P Chitambaram was listening to ideas from left party MPs when one of the MPs asked," Mr. Minister, Are you going to tax rich farmers? Please start it from this budget onwards." Mr. P. Chitambaram gave him a smile and asked,"How long left party has been ruling in West Bengal?" The MP replied,"It has been quite a long time." Mr. P. Chitambaram said,"Please lead the way from West Bengal and whole India will follow sooner or later."
Yes, double speak comes to my mind when I think about left parties. These sixty men have virtually blocked every right movement of the government. It is really sad for India Inc. when it badly needs second generation of reforms. I don't know why these men are so much afraid of job losses. The labour reforms is need of the hour and it must be startedsooner rather than later. The same goes with consolidation of banks, the same resistance when the government decides to offload its stakes in a PSU...What the government should do?
India is not a political laboratory where these left parties want to try those experiments which have failed almost in every country. The government is not meant to do business, the government is meant to manage the business as a regulator. In my opinion, if a sector has strong government companies, the private or public companies in those sectors suffer due to undue preferences to government companies and it goes without saying. (There is another debate going on that why only retired Indian officers should manage all the regulatory bodies...It is a very valid point.)
I don't understand why left parties are so much averse to reforms. If they really mean what they say, why West Bengal chief Minister is visiting foreign countries to bring FDI in West Bengal. Has West Bengal been so sick that it can't be cured without bringing FDI and left party support it because they are wholly responsible to de-industralize West Bengal? Why only West Bengal needs FDI and why not 28 other states of India?
I never heard left parties trying to bring nation's attention to other neglected areas like, health sector reforms. These left parties never have inclination nor the time to work on these issues. India is a country where some district headquarters doesn't have a full fledged hospital even after 60 years of independence. Can Left parties make a 5 year raodmap to achieve this goal and publish it in public domain.
India Inc. is receiving attention from the whole world and everybody wants to do business here. This year onwards, emerging economies (India is a part of it) are producing more than half the world's GDP. It is a very significant shift ( Earlier in 1820s, India and China were responsible for producing over 80% of world's GDP). India Inc. must take every right step to grab this opportunity with both hands. I have no doubts in able leadership of Dr. Singh. India should start second set of reforms and march its way to become global leader in manufacturing and consolidate its number position in IT and ITES sector (The 11th plan proposes to open 30 IIITs to address the gap in supply-demand of software professionals which is a very welcome step).
Lets hope the left allows Dr. Manmohan Singh(India Inc.) to do what it allows Mr. Budhdhadev Bhattacharya (West Bengal) to do. The left party must not hold India Inc. hostage because of the number games in Indian parliament and always remember that history will not leave any stone unturned to eliminate "left" from the political arena if India Inc. misses this golden opportunity now.
Yes, double speak comes to my mind when I think about left parties. These sixty men have virtually blocked every right movement of the government. It is really sad for India Inc. when it badly needs second generation of reforms. I don't know why these men are so much afraid of job losses. The labour reforms is need of the hour and it must be startedsooner rather than later. The same goes with consolidation of banks, the same resistance when the government decides to offload its stakes in a PSU...What the government should do?
India is not a political laboratory where these left parties want to try those experiments which have failed almost in every country. The government is not meant to do business, the government is meant to manage the business as a regulator. In my opinion, if a sector has strong government companies, the private or public companies in those sectors suffer due to undue preferences to government companies and it goes without saying. (There is another debate going on that why only retired Indian officers should manage all the regulatory bodies...It is a very valid point.)
I don't understand why left parties are so much averse to reforms. If they really mean what they say, why West Bengal chief Minister is visiting foreign countries to bring FDI in West Bengal. Has West Bengal been so sick that it can't be cured without bringing FDI and left party support it because they are wholly responsible to de-industralize West Bengal? Why only West Bengal needs FDI and why not 28 other states of India?
I never heard left parties trying to bring nation's attention to other neglected areas like, health sector reforms. These left parties never have inclination nor the time to work on these issues. India is a country where some district headquarters doesn't have a full fledged hospital even after 60 years of independence. Can Left parties make a 5 year raodmap to achieve this goal and publish it in public domain.
India Inc. is receiving attention from the whole world and everybody wants to do business here. This year onwards, emerging economies (India is a part of it) are producing more than half the world's GDP. It is a very significant shift ( Earlier in 1820s, India and China were responsible for producing over 80% of world's GDP). India Inc. must take every right step to grab this opportunity with both hands. I have no doubts in able leadership of Dr. Singh. India should start second set of reforms and march its way to become global leader in manufacturing and consolidate its number position in IT and ITES sector (The 11th plan proposes to open 30 IIITs to address the gap in supply-demand of software professionals which is a very welcome step).
Lets hope the left allows Dr. Manmohan Singh(India Inc.) to do what it allows Mr. Budhdhadev Bhattacharya (West Bengal) to do. The left party must not hold India Inc. hostage because of the number games in Indian parliament and always remember that history will not leave any stone unturned to eliminate "left" from the political arena if India Inc. misses this golden opportunity now.
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