Tuesday, 27 February 2018

Sridevi's life recap by RGV

Ram Gopal Varma (RGV)’s Facebook message


YES like millions of you, I too believed that she was the most beautiful and desirable woman ever and we all know that she was the biggest super star of the country and ruled the silver screen as a main heroine for more than 20 years. 

But that’s just a part of the story. However shocked and sad I feel about Sridevi's death, it’s finally once again a rude reminder about how unpredictable, cruel,fragile and mysterious that both life and death are.

After her death, more than you all there is definitely much more for me to say than what most people are saying now about, how beautiful she was, what a great actress she was, how her death affected them, " RIP"s etc etc 

That’s because I had an opportunity to be close to her in the course of my two Films with her Kshanakshanam and Govinda Govinda. Sridevi's life is a classic case of how a celebrity’s persons actual life is completely different from how the rest of the outside world perceives it. 

Sridevi's life is a classic case of how each person's actual life is completely different from how the rest of the  outside world perceives it. For many, Sridevi's life was perfect. Beautiful face, great talent, seemingly stable family with two beautiful daughters -- From outside  everything looked so enviable and desirable. But was Sridevi a very happy person and did she lead a very happy life?

I know her life from the time I met her. I saw with my own eyes how her life was like a bird in the sky till her father’s death and then became like a bird in a cage due to her overprotective mother.

In those days actors used to be only paid in mostly black money and due to fear of tax raids her father used to trust friends and relatives and everyone of them betrayed her the moment her father died. Coupled with this the ignorant mother made many wrong investments in litigated properties and all those mistakes combined made her almost penny less by the time Boney came into her life.

Boney himself was in huge debts and all he could afford to give her was a fat shoulder to cry on.

Her mother became a mental patient because of a  wrong surgery on her brain in USA and somewhere along the way her younger sister Srilatha eloped and got married to their neighbours son. The mother before dying put all properties in Sridevi's name but her sister put a case on Sridevi claiming that her mother was insane and not in her senses when she signed the will.

So in effect the woman desired by millions in the world was all alone and almost penny less in the world except for one Boney. Boney ‘s mother portrayed her as a home breaker and publically punched her in the stomach in a five star hotel lobby for what she did to Boney’s first wife Mona.

Except for the short glimmer of English Vinglish, Sridevi has been pretty much an extremely unhappy woman. The uncertainty of the future, the ugly turns and twists in her private life left deep scars in the super stars sensitive mind and there after  she was never at peace. 

She went through so much in her life and due to her early career entry as a child artiste, life never gave her time to grow up at a normal pace. More than the external peace, her internal mental state was of a high degree of concern and this forced her to look at her own self. 

She was the most beautiful woman for so many people. But did she think she was beautiful ? Yes she did, but every actresses nightmare is age and she was no exception. For years she was doing ocassional cosmetic surgeries the effects of which can be clearly seen.

She always came across as a little uptight but that’s because she built a psychological wall around her as she was scared of anybody to really see what's going on within her. She was panicky about anybody knowing what her insecurities were.

Not because of her fault, but because she was thrust with fame from a very young age it never gave her a chance to be independent and be what she could really be and what she really wanted to be.

She had to put on the make up and be somebody else not just in front of the camera, but also to put a psychological make up to hide her real self behind the camera. 

She was being constantly directed by the motives of her parents, her relatives, her husband and to an extent even her own children. She was scared whether her daughters would be accepted or not like most star parents do.

Sridevi is actually a child trapped in a woman’s body. She is naive as a person, but suspicious because of her bitter experiences which is not a very good combination. Keeping the speculations on her death aside I generally don't say "Rest In Peace" after people die, but in her case I want to really say this because I very strongly believe that she would finally and truly rest in peace now for the first time in her life because she died. 

From my personal experience with her, the only time I ever saw her in peace was in front of the camera that too only between Action and Cut. That’s because she could cut off the harsh reality and escape into her own fantasy world.

That’s why now I am sure she will be at peace forever because she’s finally far far away from what gave her and was giving her so much pain. 

RIP Sridevi, but I assure you that the world won’t rest in peace for doing this to you.

We the fans and your near ones have given you only suffering by making you slog in every which way ever since you were a child but you gave us only joy and happiness. Yes it’s not a fair deal but it’s too late to do anything now.

I now have visions of you flying like a free bird across heavenly landscapes with true peace and happiness in your eyes.

I don’t believe in reincarnation but I truly want to believe in it now because we fans in our next birth deserve to experience you once again and this time we will try our best to make  amendments and make ourselves worthy enough to deserve you.

Please give us that one chance Sridevi because we all truly love you.

I can go on writing like this but I can’t stop my tears any more... RGV

Sridevi was a child who had no clue what she was doing when she first faced the camera as Lord Muruga in the Tamil film Thunaivan (released in 1969). Thirteen years, and still clueless, was also too tender an age to doll up in a sari and look grown-up as the leading lady of Moondru Mudichu (1976), a Tamil film directed by K. Balachander. The young actors of that Tamil film went on to become huge, mega stars, are in the news today for different reasons - Rajinikanth and Kamal Haasan as two aspiring netas of 2018. The trait of simplicity stayed with Sridevi through all the vicissitudes of life and she saw too many unpleasant ones at too young an age. Sridevi was someone who lived much of her life before time. While she gained respect as a professional actress, her personal life crumbled. Her mother died in a freak surgery in the US where the wrong side of her brain was operated. She sued, Boney Kapoor by her side. When she won, her sister Srilatha legally sought her share of the "inheritance". Sridevi won't be around to see her daughter Jahnvi's debut this July when her first film Dhadak is released. Whichever way you look at it, the death of Sridevi on February 24, 2018, was untimely and tragic. RIP to a simple girl and an incredible actress.

Saturday, 24 February 2018

Avoid being judgmental

  • We are all judgmental. It’s human nature. 
  • While it is in our nature to be judgmental, it’s not always useful to us. We look down on others, as if we are so much better and that creates division between people. 
  • You are not the only one with betchy opinions. We see someone, and based on their looks or actions, we pass judgment on them. Not good judgment, either. Usually without even knowing the person. In most cases, we don’t really have any idea what’s behind other people’s actions. We don’t make an effort to get to know the person, or understand them, or see whether our judgment was right or not. 
  • We judge, without understanding. We don’t try to find out more, and through communication begin to understand, and through understanding begin to build a bridge between two human beings.
  • It might be hard to avoid gossip completely, but make an effort to change the conversation when your friends start sounding judgmental. Try bringing up another perspective, or sneak some of that person’s good qualities into the discussion. If you can’t help but get caught up in the negativity of your usual social group, find a more positive friend who you can spend time with too.
  • Everyone makes mistakes, so make a point of framing it as a bad action, not a sign of bad character. 
  • As you feel a negative thought enter your brain, accept it as a thought only and then redirect your mind to think about something else. Detaching yourself from your thoughts will keep you from getting caught up in criticizing others.
  • An onslaught of scary events (political upheaval, apocalyptic weather) has made us all feel unstable, amplifying our instinctual urge to call out those who threaten the norm. Because things seem less predictable we're assessing more, looking to shut down threats everywhere. 
  • It is easy to dismiss these savage instincts as harmless. But constantly judging others can create an addictive cycle. We judge, then judge ourselves for judging, then feel bad, then judge others again, ultimately losing way too much mental energy to process that makes us feel foolish. 
  • The solution is noticing the critical thoughts and then replacing them with kindness. 
  • When you begin your day with self-judgment, you end up projecting those insecurities onto others. Instead try to notice your judgment without judgment. When you realize that you are critiquing yourself, congratulate yourself for noticing. Positive reinforcement neutralizes negative feelings, squashing the urge to transfer them onto someone else.
  • After recognizing what triggers your judginess and using positive mantras, try cultivating compassion. Looking for people's good qualities helps you feel more love for them. So close your eyes for a second, breathe deep, and reflect on how hardworking this guy is.
  • Evening is great time to take inventory of your and forgive yourself for all the times you have judged. This is the last step in your detox. No matter how many negative thoughts slipped through, tell yourself that you did the best you could. And be proud of all the critical thoughts you did catch. 
  • In order to let other people off the hook, you first have to let yourself off the hook.

Be curious, not judgmental ... Walt Whitman

Friday, 23 February 2018

Dissenting Diagnosis: private medical sector's hard truths

Dr Arun Gadre and Dr Abhay Shukla, authors of the book
  • Traditionally, doctors have enjoyed great social prestige and the gratitude of their patients, but this has not spread to higher personal or professional standards or to the highest ethical standards.
  • Complaints about the state of medical care are increasing in today’ India: whether it’s unnecessary investigations, botched operations or expensive—sometimes even harmful—medication. But while the unease is widespread, few outside the profession understand the extent to which the medical system is being distorted. 
  • Dr Arun Gadre and Dr Abhay Shukla have gathered evidence from seventy-eight practising doctors, in both the private and public medical sectors, to expose the ways in which vulnerable patients are exploited by a system that promotes unscrupulous medical practices. At a time when the medical sector is growing rapidly, especially in urban areas, with the proliferation of multi-specialty hospitals and the adoption of ever-more sophisticated technologies, rational and ethical medical care is becoming increasingly rare. 
  • Honest doctors feel under siege, professional bodies meant to regulate the medical sector fail to do so, and the influence of the powerful pharmaceutical industry becomes even more pervasive. Drawing on the frank and courageous statements of these seventy-eight doctors dismayed at the state of their profession, Dissenting Diagnosis lays bare the corruption afflicting the medical sector in India and sets out solutions for a healthier future.
  • With testimonials from 78 doctors practicing in six states and across 23 fields of medicine (including traditional), the book spares no one. From big "hospital malls" right down to autorickshaw drivers (paid to direct patients to specific clinic), it claims, everyone is on the take.
  • According to  WHO about 3.5 crores of Indians are pushed below poverty line each year just on account of expenditure on private medical services since they can not access good quality public health care services. 
  • Regulatory bodies that exist today are inward-looking, closed committees, incestuous groups that lack openness and hence fail to check their own members. 
  • Doctors who were grounded in the idea of service have felt ground swept away under their feet, their traditions of 'keep the patient foremost' rapidly buried under the ruthless logic of 'keep profits foremost'. There has been decline of transparency in medical sector and over all position of  many doctors and their associations has been complicit silence or active support of the guilty.
  • Many private doctors often send patients with complicated illness or terminal diseases to government hospitals or AIIMS as dumping ground. And poor patients who can't afford expenses of private medical care also come to these institutions. That is why doctors from these institutions have significant knowledge. 
  • The rot is deepening with the increasing onslaught of big corporate hospitals, growing pressure from the pharmaceutical industry and massively expanding clout of medical equipment agencies.

  • When a teenager’s family approached me for a second opinion about terminating an unwanted pregnancy, I discovered that the girl was not pregnant to begin with. The family was shown someone else’s blood work to convince them of the need for an abortion, says Pune-based gynaecologist, Dr Arun Gadre.
  • There’s a code of honour among doctors and while they may compete, publicly, one doctor will not criticise another. It is extremely hard for the families of patients to fight medical malpractices and get justice because they would simply not find a doctor to come forward and testify in court, as would be required.
  • Just as shopping malls have come up to sell groceries and consumer goods, corporate and large multi-specialty private hospitals have come up to sell medical services. Majority of these corporate hospitals are not owned by doctors. Seeing the large profits to be made in private medical sector, non-medical investors are pouring money into these private medical businesses to maximise returns on their investment.
  • While there do exist doctors practising ethically, they are far-far less compared to those who have fallen prey to unethical activities for whatever reasons; and the former are constantly being threatened and frightened into making way for the latter.
  • A senior pathologist explained to the authors: ‘Even my MBBS friends — who have now become consultants — do not refer patients to me because I don’t give them cuts.’
  • Learning from the lives of those among us who still practise rational and ethical medicine, and taking guidance from them, is one great way to start.
  • We have sunk to such depths that I have come to the conclusion that things will (now) improve simply because there is no way they can become any worse says a general surgeon.
  • The 'packages' offered by multispeciality corporate hospitals, incorporating a range of tests under 'master checkup', not only drains an individual of his hard-earned money but the collected samples go down the 'sink' as well. The sink tests essentially means samples collected from patients are just thrown into the wash basin without testing as doctors prescribe such tests, which by mutual understanding, are "not actually carried out" by the pathologist.
  • These corporate hospitals run on a perverted concept. Their only purpose is to satisfy the interests of their shareholders. The more profit the better. They go on prescribing needless investigations and surgeries.
  • The initial chapters contain information about things that most educated people have an inkling of: the nexus between pharmaceutical companies and corporate hospitals; the pressure on doctors to prescribe as many costly investigations and tests as possible, to earn a pre-specified revenue for their hospitals; the lack of transparency and the emotional exploitation of patients’ families in situations where every second counts and composed reflection isn’t possible.
  • It has become a common practice to bring expensive new medicines to market in place of useful cheaper medicines just to increase profits.
  • Many elderly persons who only need proper spectacles have been told to get operated for cataract (which they don’t even have), and they are told the charges are Rs.30,000-40,000. Those who have insurance fall into the trap and go in for the surgery. Those who don’t have insurance, if go for a second honest opinion, they might get saved!
  • Some hospitals where they don’t actually admit patients, but merely prepare the paperwork for insurance claim. The hospital, the patient and the TPA share the proceeds.
  • A senior super-specialist urologist had to leave a corporate hospital because its young MBBS CEO castigated him for not performing a particular operation for removal of a kidney stone where there was no need for any such procedure.
  • A person had to sell his apartment after a major corporate hospital came up with a bill of an astounding Rs 42 lakh for the treatment of his wife. "The actual expenditure cannot possibly even come close to this."
  • Medical Council of India (MCI), has turned a blind eye to the systemic assualt on ethics in the medical profession. Whatever actions the MCI ethics committee take in Delhi, the state councils defy.
  • With onslaught of technology, doctors lost their clinical sense. They increasingly depend on investigations rather on their experience and skills. Doing full body investigations routinely without any indications.
  • When the patient is young, and the disease is reversible - certainly doctor should use ventilator. But what is the point in pushing forward for a short while an old man's death with ICU and ventilator that too while doctor ruin him financially and increase his sufferings?
  • Modern medicine is not personalized medicine as it used to be but became an evident based medicine. Most diseases get cured with idiopathic treatment. If not then investigations were ordered on fifth day but in these modern days they are ordered on day one. 
  • If prescriptions of generic medicines is made mandatory, cost of medicines would become very low. It is a rare patient who gets away with one or two investigations. Most patients hold a list of unnecessary investigations.
  • Among other shocking revelations, the book describes how in the absence of serious ailments, a "pretense" of surgery is performed, a patient is given anesthesia and some stitches are put on the skin, to show that an operation has been done.
  • Dr Vijay Ajgaonkar, a senior Mumbai-based diabetologist, says “If you look at the issue objectively, it is not our role to make money by taking advantage of another person’s illness. But this is exactly what is happening. They put terminally ill 70 to 80-year-olds on ventilators, keeping the hospital meter running by unnecessarily using the ICU and ventilator.”
  • Doctors do not even record the patient's history properly, said Dr Punyabrata Goon, a General Practitioner in Kolkata. They just write out a list of investigations as they get a commission for doing that, he says. "Almost all the laboratories in our area give 50% commission and almost all the doctors accept these commissions. For many doctors, the money earned through commissions is much more than that earned from fees. In our area, the commission rates are: X-rays 25%, and 33% for MRIs and CT scans," he says.
  • Even a normal fever is shown as dengue or in worst case scenario.
  • A young doctor's lament, on him being pulled up by the CEO of a corporate hospital for "low conversion rate" of 15% as opposed to 40% fixed by the management is also recorded in the book. Conversion rate means out of the total number of patients seen by the doctor, the percentage which are advised to undergo surgery or procedures.
  • That malpractices in healthcare exist will come as no surprise to anyone who has dealt firsthand with the beast.
  • A young man says - I remember my dadi’s exasperated cackle when she was being sent home following a stint in Max Saket in late 2014: after five days in the hospital where a doctor would drop by once or twice a day, give a curt instruction and swish out in 30 seconds (having added Rs 900 to our already-sizable bill for each such “consultation”), she was discharged with a diagnosis of piles when, even in her groggy state, she knew it was no such thing; that her gastric problems were an effect of the blood-thinners she had been taking since her angioplasty. How she rolled her eyes and muttered as we put her on the stretcher for the ambulance. Sure enough, after she spent a very uncomfortable month at home, we were back in the hospital explaining her case all over again to a new set of smiling doctors who made the correct diagnosis this time – not so much because of competence, I suspect, but because there were only so many available possibilities.
  • The story about a speed-obsessed senior surgeon, for instance, who accidentally cut a major artery during a routine kidney operation, consequently had to remove the entire organ instead of just the stones – and later told the patient’s family that he had executed a heroic last-minute turnaround because the kidney was damaged beforehand. Another story is about a hospital that hid a deceased patient’s body to put pressure on the family since they hadn’t been able to pay the full bill.
Asia’s third-largest economy spends about 1% of its GDP on public health, compared with China’s 3% and the United States’ 8.3%. In European countries, the figure is even higher. Indian states manage their health budgets separately, but the overall direction in which the sector is moving is alarming. In 2015, India was ranked 112 in healthcare globally by WHO, which is tragic for an economy of this size. India has to step up expenditure on public health to at least to 5% and needs to regulate the sector.

It is better to deserve honors and not have them 
than to have them and not deserve them ... Mark Twain

Tagore Telugu Movie (2003) - Hospital Very Funny Scene

During mid 1970's, a colleague of mine visited an ophthalmologist who has sent him to a neurologist at KEM Hospital in Mumbai (then Bombay). He was diagnosed brain tumor and was admitted and emergency surgery was done within hours. He was a bachelor and had neither money nor a companion with him. His uninformed absence was noted in the office. After two weeks he walked into office and explained colleagues what has happened to him that made everyone dumbfounded. Gone are those days, where anyone could undergo brain surgery with zero expenditure and no one to attend him! 

The root causes of all these maladies are greed in all walks of life, capitation fees in private medical colleges and total disregard for ethics and values. Ethical & Moral education must be imparted right from childhood in addition to the western school syllabus. These days most doctors are non-merit & capitation fees paid students and their competence is hardly excellent

These days most doctors & hospitals are predators in the guise of saviors. Since we don't have choice, we should take care of ourselves.

Hetty Green, the world's greatest miser

Hetty Green 1834-1916

A miser is a person who hoards money and wealth and spends as little money as possible, and that is exactly what Hetty Green was. Though a wealthy lady, she did all the grocery shopping to save money. She bought crushed cookies because they are cheaper. She ate mostly pies that only cost fifteen cents. She was also said to bring with her dried oatmeal and will just cook it over the radiator. She refused to use hot water and the water heater during winter. One time, she spent the whole night looking for her lost 2-cent stamp only to find out that it was in her pocket all along. She was a female tycoon of the Wall Street. She reportedly amassed a fortune of $200 million ($4 billion in terms of current purchasing power). When she died, she left one of the largest inheritance packages in the history of the US. Her investment strategy consisted of conservative buying backed by substantial cash reserves to cover any movements in her positions. She invested in railroads, mines and real estate and lent money while acquiring mortgages. The Guinness Book of World Records awarded her the distinction of being the world’s “greatest miser.” 
  • She was such a familiar sight, with her grim face and strange dress, everyone called her “The Witch of Wall Street.”
  • Hetty’s audacity was apparent when her aunt, Sylvia Howland, died in 1868 and left $2 million to charity, Hetty was incensed. She challenged the will in court, presenting a will that left everything to Hetty. The courts determined that Sylvia’s signature were a complete forgery, and Hetty lost the case. 
  • Hetty Green refused to use hot water or heating. 
  • Her son Ned was a teenager when he was struck by a child driving dog cart. Hetty took her son to a free clinic in the city. But the doctors demanded payment as they suspected of faking poverty. So Hetty decided the leg would likely knit itself if given time and home treatment of “oil of squills” etc. Ned’s leg worsened and was amputated, with Ned’s father using his own dwindling money to pay for it, rather than haggle with Hetty.
  • When she developed hernia, she refused to treat it, as its treatment was a pricey $150.
  • Green conducted much of her business at the offices of the Seaboard National Bank in New York, surrounded by trunks and suitcases full of her papers. She did not want to pay rent for her own office.
  • She changed residence with a skulking frequency, moving from one small, unheated apartment to another. This was her attempt to hide from both the press and tax collectors. She believed that this, combined with taking confusing and varied routes to work (at an office provided free by her bank, of course) also kept kidnappers and robbers at bay. 
  • There is no great secret in fortune-making.  All you do is buy cheap and sell dear, act with thrift and shrewdness and be persistent - she said.
  • She was an innovator in the field of value investing, which has made billionaires out of people such as Warren Buffett. Green was eccentric, but in her own special way, she was also a genius.
  • Her advice to women on investing: “I regard real estate investments as the safest means of using idle money. Let a woman watch and see in which direction a city is going to develop and buy there.”
  • In an interview with a reporter at the Brooklyn Daily Eagle, she said: "The poor have no chance in this country. No wonder Anarchists and Socialists are so numerous. The law must be upheld, must it? Then why don’t they begin at the right end? Who begins to break the law? The great railroad magnates. Let the poor man break the law and see how soon he gets into jail.
  • Hetty Green divided her estate evenly among her children. Ned, squandered much of his fortune, leaving the rest to his sister Sylvia. Sylvia donated his Round Hill, Massachusetts estate in 1948 to the Massachusetts Institute of Technology (MIT). Sylvia had married a man who agreed to forgo her money. She died childless in 1951 and left her money an estimated $200 million to 64 colleges, churches, hospitals, and other charities. 

For the love of money is a root of all kinds of evils. 
It is through this craving that some have wandered away from the faith 
and pierced themselves with many pangs.

Don't love money: Money itself is not evil. What’s evil is the love of money. Lot of suffering and pain in this world can be traced back to greed and selfishness. World has enough resources to feed every human. However, because of the love of money, most people starve and suffer from pestilence and famine. Money can be very seductive. If we let it control us, it will eventually lead us away from our faith and eventually suffer the many consequences of our decision. Life can become miserable if we love money more than our relationship with God and each other. It is only by having a loving relationship with others that we can have a more fulfilling life.

Wednesday, 21 February 2018

Corporate hospitals killing small hospitals and exploiting patients

No matter how compelling the reasons, governments cannot be guided by emotions of moral outrage and of right and wrong. A democratic society is founded on the basis of the rule of law that must guide government actions. This is so in order to avoid governments misusing their power, resorting to arbitrary action and ensuring fair play and natural justice. This then implies casting a special responsibility on the governments who are charged with the duty of providing good governance to its people. 
  • Having declared health as an industry working on the principle of return on investment and making profits over the welfare and well being of the patients, governments have a special duty to lay down laws, rules and regulations to stop providers and hospital establishments from getting away with predatory behavior or malpractice.
  • During the past twenty years, following liberalisation policies, the growth of the IT industry and other factors, as well as disposable incomes among certain classes, have increased – though this is not the case across the social spectrum. 
  • As one doctor has said, Pune city, which should have fifty Sassoon Hospitals (public hospitals), has only one, although new corporate and multi-speciality hospitals are coming up daily.
  • These corpotrate hospitals are bright and glittering. In some ways, they are like shopping malls. Some have even been registered as charity hospitals, but their only objective is profit. Partly because of their state-of-the-art equipment, but also because of a growing lack of choice, as older hospitals run by trusts or individuals close down, people are going to these hospitals. Such hospitals foster the impression that they provide high-quality services, which justifies their high costs of care.
  • There is another important aspect of such “hospital-malls”. New technology costs lakhs and crores of rupees. If these machines are now indispensable for diagnosis, hospitals run by individual doctors are less able to compete. If the medical sector is left to the mercy of the market, and if the foundation of the whole business is profit, where will this take us?
  • Government health services have been weakened due to government indifference, and that is why there is scope for corporate hospitals to prosper. Due to the entry of corporates, the order of priorities has changed. Now the doctors’ priority is no longer the best interests of the patients, but the profit earned by the shareholders of the company.
  • In corporate hospitals, each patient may be seen by multiple specialists. An orthopaedic is called because the hands and feet are aching; a neurologist for numbness in the hands. They come and look at the patient and their charges are added to the bill. Is it useful for multiple specialists to examine a patient? This question is never even asked. Investigations are not based on what the patient’s illness is, and whether there is a need for specific investigations. Given any complaint, they produce a list of investigations that must be done. 
  • Totally unnecessary surgeries are being performed in corporate hospitals. During investigations, they may see a small stone in the gall bladder. It is not causing the patient any problems. But they scare the patient into going in for a surgery.
  • Public relations officers of many corporate hospitals keep roaming around to visit doctors; they entice doctors to send patients (to their hospitals) by tempting them with cuts. Nearly everybody indulges in this practice. It must be legally banned.
  • These corporate hospitals charge bills of Rs 1 lakh and more, while the surgeon gets only Rs 4000 to 5000.
  • Some corporate and large hospitals admit bogus patients under the Rajiv Gandhi Health Scheme (a publicly funded health insurance scheme). They give the admitted person money, and plenty to eat and drink. They prepare records showing that an angioplasty or angiography has been done on that person, when actually nothing has been done. How the government comes out with such schemes, without first regulating private hospitals is a mystery? Without regulation, the basic objectives of such schemes are lost, and they become mechanisms for corporate hospitals to loot public funds.
  • There is no humanism to be found in corporate hospitals. Small hospitals are being destroyed due to these corporates. In small hospitals, there is at least the possibility that the doctor has not lost his basic sense of humanism. They wait for the patient to make the payment. They give concessions. None of this happens in corporate hospitals. This must stop.
  • A corporate ophthalmology hospital maintain everything five-star style, but forget about the patient. When the patient comes, they give him lemonade or tea. They advertise that they have the latest hi-tech optics shop. The patient melts because of the free lemonade, and he buys a pair of spectacles that have an actual value of Rs 200 or so, for Rs 3000–5000! The in-house optician is the main income avenue of corporate hospitals. Sometimes they offer a free check-up. The scheme has a 20-per-cent-off offer, just like in a mall. The whole atmosphere is designed to tempt.
  • Corporates can implement government schemes and insurance schemes. For small private hospitals when reimbursements are delayed they don’t have the time to keep making trips back and forth to get payment from the insurance company.
  • Corporate hospitals vie for tie-ups with large public sector companies. These public enterprises give exorbitant reimbursement to their employees. The big corporates draw in cases from all over the state. But junior trainee doctors operate on those cases! Further, often the quality of these corporate hospitals is not as good as they claim in their advertisements. When they do a cataract operation, they even charge a high amount of money for an expensive lens, but implant an average-quality lens.
  • If a patient goes with my referral note, he gets 30 to 40 per cent off on an MRI (because I do not take any commission). One patient forgot to take my note. He was charged the full amount, and a cut went to some third party - says a practising paediatrician.
  • Nowadays people want glamour and marketing. They have become used to the mall culture. The concept of ‘master check- up’ (packages of large number of tests, of which many may be unnecessary) has gotten into their heads. Now doctors who practise ethically and scientifically are looked upon with contempt, because they obviously can’t afford this glitter. But people often don’t know what they are getting into by going to corporate hospitals.
The current obsession to privatise health, as if it is a commercial enterprise like Air India or a ITDC hotel, is not founded on the belief that patients will gain access to good quality of health care. Instead it smacks more of an admission of governments’ inability to govern and enforce laws in order to ensure that in the name of quality, private hospitals do not play havoc with the vulnerable patients. If truly committed to patients well being, then it is incumbent on the government to come up with stringent laws that will not provide any scope to private players to be negligent, callous or exploitative.

Fighting the rot in India's private healthcare feat. 
Dr Arun Gadre & Dr. Abhay Shukla

The corporate hospitals provide employment to almost 90% of graduate doctors, 95% of PG doctors .These corporate hospitals have numbed people’s sensitivities. These hospitals are like malls. Our society does not need them. Instead, all tertiary health care should be provided by the government. And corporate hospitals must also be compelled to provide mandatory treatment of emergency cases, whether paid or otherwise. This would enable people go to any of the nearest hospitals for emergency treatment, even if they don't have money or coverage.

Law is the answer to corruption

In India, politicians in power are the richest in that category anywhere in the world. The reason is enormous power and discretion they wield without any accountability. Next comes bureaucrats with lots of power in their hands with very less accountability. Combined, they just loot the nation.  Corruption undermines merit, that results in economic under performance of India as a nation. Corruption today is a high profit and low risk activity. This must be reversed.
  • In a vibrant society everything is provided for by law and only a few things are left to the discretion of politicians.
  • The law should govern the nation where the judiciary, the police and the civil servants dispense justice and services to the citizens in merit order, with no discretion whatsoever. The discretionary powers must be with autonomous institutions never with politicians. The politicians must be confined to making laws and enforcing them properly.
  • But in Indian civil society it is 90% politics and 10% law whereas in American civil society it is 90% law and 10% politics.
  • Prosperity evolves by the laws of nature, particularly the entrepreneurial character of the people.
  • Redundant institutions like President, Vice President, Rajya Sabha, Governors, Legislative councils etc consume the tax-payer's money without giving anything tangible in return. These must be wound up.
  • All public institutions must be headed by well qualified, experienced, meritorious professionals in that field, rather than politicians or IAS officers who know nothing about that organisation.
  • Justice delayed is justice denied. There is no justification for courts piling up millions of cases and making litigants wait for their life time to get justice. The procedures could be streamlined and expedited to dispose of cases with in six months time.
  • Government must be small so that rule of law is implemented by the judiciary, police and the  civil servants.
  • Only mass literacy will make the voter cast his vote to the right candidate. Progress is indigenous. It cannot be imported.
  • The main reason for India’s pervasive corruption is material greed. Some 20 million Indians have left India to seek monetary gains abroad. These people were intelligent people and were educated at national expense and they serve foreign countries. This much of talent migration would not have occurred had there been matching opportunities in India. This basic moral defect has to be kept under leash only by law. 
  • Indian politics, instead of standing on the legal high ground, opted for huge state power. All powerful ministers, MPs, MLAs and IAS officers amass wealth without any let or hindrance. A tall leader is required to put on the pedestal the majesty of law. Then only corruption will disappear from India. India has to take a U-turn from politics to law, from money to moral rectitude. Political change has always been difficult to effect. Only an ethical society can achieve this arduous task. 
  • Economic progress must have a firm legal and democratic foundation. The West too is suffering because of the excessive pursuit of wealth and many are predicting even the demise of liberalism. If the West cannot afford immoral affluence, how can India afford it? 
  • To seek to pursue growth on a shaky legal foundation is dangerous. Economic growth in the absence of law has created the present corruption levels. India must strengthen its judiciary. Then judiciary, police and the civil servants will put an end to black money.
  • In India, the job of a minister is glamorous with power and pomp, whereas a judge, police and civil servant have to do their jobs in relative obscurity. A minister should realize that her or his job is largely decorative and that the job of the judge, police and civil servant is constructive. True politician must be humble. By a political awakening, a legal illumination and honesty in civil service, corruption can be put to an end. 
  • Citizens must become alert and create the right atmosphere for a lofty political leadership to emerge. A highly politicised society has to become a highly legalised society. Politics is partisan, law is unitary. Moving from politics to law is evolutionary progress.
  • As politics is deep-rooted in the moral character of a society. An MP who is willing to live on bread and water will not need any bribe. His heart and stomach should be filled by patriotism. Also, economics is a zero-sum came. When the rich live in palaces the poor have to live on the streets. A voluntary tendency to lead a simple life by all will create the right atmosphere for economic probity.
  • We cannot create a draconian state to end corruption. The moral transformation of civil society must be natural and based on persuasive leadership. Money should become meaningful, moral and deeply satisfying. If true wealth is found in a rich heart, no one will want to touch money even with a barge pole.
  • Law is the fulcrum of democracy and democracy is what holds the people together without force. Law and democracy can combine to form the life of politics to cleanse the country of corruption. Cheap politics has done enough damage to India. India needs Newtons and Einsteins in its politics to make it clean, pure and inspiring. Then the best and the brightest will come to politics to make it a haven of virtue and science.

In a democracy, winning election doesn't confer on winner 
autocratic powers to do nonsense things. He must confine to rule of law.
People may or may not have respect for the law; but they must fear the law.

In India, politicians life style is more vulgar than erst while kings, nizams and zamindars. Even an MLA's monthly expenditure is more than Rs.10 lakhs! Their spending is outright ludicrous. Political parties and their massive election expenditure is a point of concern. Election reforms must change this by providing level playing platform for all contestants with least expenditure. Political contributions from other than individuals must be prohibited, which is the big source of corruption, crony capitalism, nepotism and quid-pro-quo. Even individual donations must be by bank transfer and all donations received and expenditure accounts of political parties are properly maintained and must be audited.

Tuesday, 20 February 2018

PNB fraud: Unanswered questions

The duration (6+ years) and magnitude (Rs.11,400 crores) of the fraud raises too many questions to rule out wider collusion. Some bankers believe that the exposure of Indian banks in this fraud involving jeweller Nirav Modi, his relatives and associated companies may touch Rs 20,000 crore. 
  • The accused are retired PNB Deputy Manager Gokulnath Shetty, PNB's Single Window Operator Manoj Kharat and authorized signatory of the Nirav Modi's group companies, Hemant Bhatt. These two junior employees in a bank branch allegedly helped Nirav Modi all along for more than six years. 
  • The PNB became suspicious only on Jan 16, 2018 when the accused companies approached it with import documents and a request to issue LoUs for raising buyers' credit for making payments to the overseas suppliers, after the retirement of Shetty. An alarmed bank dug out all such LoUs and LCs showing a mammoth liability towards other banks. 
  • Months ahead of retirement of Gokulnath Shetty, at least 143 LoUs were issued in 63 days, starting March 1, 2017, compared to around 150 issued since 2011, when the alleged fraud began. The frenetic pace may appear like frenzy if one were to exclude weekends and bank holidays during the period. In terms of the amount involved, however, the first 150 LoUs that relate to PNB’s case against Nirav Modi involved around Rs 6,500 crore, while the 143 accounted for a tad over Rs 3,000 crore. 
  • These two employees avoided employee transfer norms of three years. They circumvented rules crafted to prevent borrower-lender cosy collusion. 
  • It also indicates collapse of risk mitigation across the banking system.
  • Gokulnath Shetty, for the last seven years, was bypassing core banking system of the bank and issuing LoUs fraudulently.
  • The conniving officer also issued Foreign LoU's by entering a smaller amount in trade finance module of Core Banking Solutions (CBS) system and generating the reference number and a SWIFT message was sent for the amount. Subsequently without making any changes in the module of the CBS, the conniving officer sent modified SWIFT message for enhanced amount under the same reference to the beneficiary bank. 
  • Why these branch employees were authorised to issue LoUs well above what their pay grade would suggest, running into hundreds of crores? 
  • These letters were then accepted by several other banks who never cross verified anything for years. 
  • These LoUs, with validity of 6 months to 12 months, flagrantly violated RBI’s limit of 90 days of credit. Yet, none of the 30 overseas lending bank noticed this.  
  • An LoU is a bank guarantee. It’s something that should be accounted for somewhere, even if it is a non-funded item. Strangely, the mandatory audit that matches transactions never picked up any irregularities.
  • The mandatory 100% cash guarantee for issuance of LoU's was never insisted for Nirav Modi's companies by the PNB all along.
  • Not a single external auditor, four at any given point in time, found anything amiss while reconciling transactions and LoU's.
  • Only a few years ago, PNB lost Rs.1,800 crores in the Winsome Diamond Group's Rs.6,800 crore LoC scam but still reckless.
  • It seems that at PNB, no one from vigilance, bank regulator, board of directors, senior management never focused on tightening up the criteria for issuing LoCs or LoUs, especially to the jeweller community.
  • It seems PNB's branch employees received Rs.823 crores as kickbacks from Nirav Modi for the scandalous LoUs in these 6+ years.
  • It is impossible to believe that the fraud was pulled off by just two employees with all the business intelligence technology, online updating of computerized accounts and dashboards our banks use.
  • PNB’s repeated misadventures is a failure of not just of risk management processes, but also of the banking manager's, regulator’s role and the indifference of the custodians of public money. 
  • The Nirav Modi episode, including his undetected departure from India like several other alleged fraudsters before him, sends out a damning message that cuts across political parties about laws and systems that govern the poor and the rich, are not the same.
  • PNB is avoiding taking the entire responsibility for the scam. In a letter dated Feb 12, 2018,  PNB CEO Sunil Mehta explained the modus operandi to 30 banks affected by the Nirav Modi scam. The letter said that an LoU was opened in favour of overseas branches of Indian banks for import of pearls for a one-year period against the RBI guidelines that stipulate only a 90-day timeline. “This 90-day timeline stipulated has been overlooked by overseas branches of Indian banks,” the letter says. The letter further says that “there was a clear criminal connivance of group companies of Nirav Modi and Gitanjali Gems with PNB branch officials and officials of overseas branches of India banks”. This shows that there is a veiled attempt to share the blame by PNB. 
  • Why PM and FM are maintaining stoic silence on this scandal and unconnected Raksha Mantri is briefing press conferences with unconnected details?
  • The banking software provided by Infosys - Finacle needs to be upgraded with more robust one which would block this kind of frauds by junior officers and alerts sent to higher authorities. 
  • Whistle blower systems must be encouraged. 
  • It is impossible to believe that a few junior employees are behind this himalayan fraud. It is the responsibility the investigating agencies to bring out the truth and catch the big rats within and outside banking system. Higher management must be booked and jailed for this fraud. They can't escape their responsibility by fixing juniors.
  • Diamonds as a security are susceptible to fraud. It's almost intangible. Bankers have no expertise in estimating the value of either rough stones or polished jewels and are not trained to differentiate between synthetic diamonds and natural ones either. As a moveable asset class, where lots of precious stones can look very similar, there is more chance of fraud and duplication. Bankers in India have learnt not to trust the diamond trade.
  • For many diamond traders, the banks often turn down their credit demand even after submitting documents. For many demands for loans ranging between Rs 1 crore to Rs 20 crore are scrapped. Now PNB has given Rs 11,300 crore to Modi without checking any details. On one hand, the government is vociferous about compliance, and on the other hand banks are lending money without checking any documents. What a dichotomy? 
  • If our political system can't manage our banking system properly giving rise to demand for privatization, how can they are competent to run Govt of India? Will they privatize GoI in preference to efficiency?
  • The entire PNB Board and Top Management must resign owing responsibility for fraud and consequent losses. This will  facilitate investigating agencies to findout whether they are are involved in the fraud or not without coercion.
  • India's government has said the fraud at PNB was a "manifestation of supervisory failure" at the country's central bank. In a letter to the RBI, the government said the failure to detect the biggest ever banking fraud, raised questions about the central bank's "Efficacy of supervision to detect and check systemic failure. Either the framework designed by RBI to prevent and detect such frauds is inadequate or RBI is unable to ensure its effective implementation." RBI is yet to respond.
PNB received the Vigilance Excellence Award, a year ago 

Laws grind the poor, and rich men rule the law.

Such a Himalayan Fraud involving massive amounts, undetected for 6+ years could not have been by few junior bank employees without active support from higher levels in political, bureaucratic and banking circles. Investigating agencies must unearth all these abettors creating such a gigantic  national loss. Every person violating the procedures must be booked and made answerable and accountable in PNB, other banks and every where. While the scam started in 2011 during UPA regime, all the loss causing LoUs dates to past one year, 3 years after NDA & Modi came into power and can't escape responsibility and accountability. While RBI's supervisory failure is a certainty, Govt of India blaming RBI squarely is untenable. Being owner of the bank, GoI, FM are answerable and accountable for not complying the procedures prescribed by RBI.

Monday, 19 February 2018

Laws grind the poor, and rich men rule the law

The significant achievement of human civilization during past 300 years is the evolution of law in a structured manner and conceptualization and enforcement of 'equality before law'. It is the fact that the poor suffers in the hands of law, and the rich men enjoys the life without much botheration about law. A poor man getting into any problem cannot come out of the police station or court easily and jailed easily with no means to get a bail. Whereas a rich politician or businessman, in most situations, come out of the station very easily with the influence of money and muscle power avoiding jail with simple bail. Accused poor is always always convicted and the accused rich are mostly acquitted. This is what happening in our country. 

  • A law is made with the express intent to help people in getting justice through a legal system, thereby aiming to achieve the ‘greatest happiness of the greatest number’. But very often the law fails to serve this purpose.
  • There just cannot be one law for the rich and connected, and another for the poor and unconnected. Everyone is entitled to be treated equally in his dealings with the public authorities.
  • The innocent, simple, illiterate and the poor cannot access legal procedure because it is highly expensive, complicated and time-consuming to them. So they look upon law from a distance as a frightening scarecrow.
  • On the other hand, some people in society like those strong, greedy birds, tame, twist or tarnish a law and use it for their own benefits. Some others follow suit and seize the opportunity, too. Thus the law is made into a no-more frightening, rather a tattered scarecrow.
  • It is this second group that is mainly responsible for making many laws ineffective. Not only that, they make law an accomplice in fulfilling their greed for power and possessions.
  • Our laws are adequate for the purposes intended. Our weak point is the enforcement part. We have a system, but we do not seem to be able to work the system according to the Rule of Law which posits three things: (1) that everyone is deemed equal before the law; (2) that the law is applied in its generality; and, (3) that the law is applied neutrally.
  • Generality of laws, the Equality of everyone before the law, and the Neutrality of the law means that if any law is used to target a person, a group or a class of persons, then the Rule of Law is breached.
  • The Commercial Division of High Courts Bill, 2009 has as its foundation a special provision with the objective of achieving quicker disposal by expert tribunals that involve a sum of Rs.5 crore or more. The idea is to facilitate their early disposal so that the rich who are involved in such disputes do not have to wait for too long for a final adjudication. 
  • Meanwhile, the poor person whose litigation mostly involves a value that is below Rs.5 crore has to wait for the outcome at the Munsiff’s Court, the District Court, the High Court, and the Supreme Court that take decades before a final judgment comes. Often it takes more than a generation. 
  • Obviously the rich are favoured by helping them achieve early finality while the poor and the middle classes have to hang on often for a life-time for an outcome. 
  • Democracy is fundamentally equality of the judicial process. To make the monetary value of a commercial dispute the basis of classification is undemocratic. Indian socialism and democracy are the victims of feudalism, capitalism and corporate control, even as the courts enjoy longevity without accountability. 
  • The legislation classifies litigation into two categories. The poor litigant will wait for the somnolescent process and leisurely pronouncement and the wealthy litigant will have his case speedily terminated. If this be the differentiation, it is horrendous and outrageous in a socialist democracy. Perhaps Oliver Goldsmith was right when he said “Laws grind the poor, and rich men rule the law.”

Let justice be done, though the heavens fall.
Be ye ever so high, still the law is above you ... Thomas Fuller

Sunday, 18 February 2018

Riskless capitalism leads to NPAs, in India

"Riskless capitalism" is a term first used by Raghuram Rajan in November 2014. The Indian growth story cannot be over-simplistically explained as a result of "market-oriented" reforms. Public sector bank credit-financed investments, particularly in the infrastructure sector, played a significant role in sustaining growth, most crucially after the global economic crisis. Such a growth trajectory, however, proved to be unsustainable with the expansionary phase coming to an end in 2011-12 and bad loans piling up in the banking system.

  • The Indian economy saw a boom between 2003-08 and a bust in 2008-09 whereas the second boom was for two years between 2009-11 followed by a decline.
  • Private corporate investment grew faster than public investment during the booms increased from 6.5% to 10.3%.
  • Credit from the public sector banks reached high levels during both the boom periods and a decline in between the two booms during 2008-09. Credit flow from the private sector banks did not follow this trend.
  • By the time of the second boom, the banks were recklessly lending to already highly indebted companies.
  • In the first boom, the real interest rates fell from 12% to 2.5%. In the second boom real rate of interest was increased.
  • The fiscal deficit was reduced drastically during the first boom period. A “pause” button was pushed following the global recession and the fiscal deficit expanded from 2008-09.
  • Import intensity of the Indian economy has been steadily rising in the high growth phase and continues to rise today.

  • The internal constraint is the rate of profit should at least be equal to the interest accrued on the debt taken in the past. The external constraint is the Gross External Financing Requirements (GEFR) should be equal to net capital inflows and change in foreign exchange reserves.
  • These two constraints are the boundaries for the economic system to function well where neither the domestic financial sector comes under severe strain nor the economy is faced with a balance of payment crisis.
  • A developing country faces a foreign exchange constraint arising out of the current account needs as well as the international debt servicing payments accrued in the past.
  • Investment decision of a private firm is aggregated to  - first, how much of investment is to be undertaken? Second, how is this investment going to be financed?
  • The state-owned banks were made to relax their risk function. And the risk-taking of private investment, was passed on to the public sector banks. High profits of successful investment projects were not shared with the lenders. The losses incurred in failed investments was passed on to the state to clean up. This is being witnessed in India today as increasing NPAs and the clamour for debt write-offs. 
  • This is the process of "riskless capitalism” , the former RBI  Governor Raghuram Rajan was alluding.

  • The promoter enjoys riskless capitalism even in these times of very slow growth, how many large promoters have lost their homes or have had to curb their lifestyles despite offering personal guarantees to lenders? Who pays for this one way bet large promoters enjoy? Clearly, the hard working savers and taxpayers of this country! As just one measure, the total write-offs of loans made by the commercial banks in the last five years is Rs. 1,61,018 crore, which is 1.27% of GDP ... Raghuram Rajan in 1994
  • The first boom was triggered by export surge accompanied by public sector bank lending, debt inflows and low real interest rates. The second boom was a result of a more reckless lending by the public sector banks in the face of interest rate hikes by the RBI. Such a “riskless capitalism” could not have thrived without the support, active or otherwise, of the state.
  • The second boom was short-lived because of the unstable nature of this growth rate as well as a rise in the domestic real rate of interest from 2010-11 due to RBI’s efforts towards inflation targeting. The effect of this increase in the domestic interest rate was muted because international borrowing costs got lowered due to monetary easing in the US in the aftermath of the global economic crisis.
  • While the cost of domestic credit increased, its international counterpart declined causing a change in the composition of corporate credit in favour of higher external commercial borrowings. With increase in domestic interest rates, the growth rate fell on the unstable path. The economy eventually hit the lower constraint implies debt defaults, which manifested in the large-scale accumulation of NPAs of the PSBs.
  • Faced with an asymmetry of power, banks are tempted to cave in and take the unfair deal the borrower offers with massive haircuts. The banks debt becomes junior debt and the promoters equity becomes super equity. 

'Pakorawallah' and Modi's mind game for elections 2019


On Nov 21, 2013 while addressing election rally in Agra, BJP's Prime Ministerial candidate Narendra Modi promised to provide one crore jobs to the youth of the country, if voted to power at the Centre. He became PM in 2014 and at the end of his 4 of 5 year tenure, Modi stares at elusive jobs against the backdrop of debacle of his disruptive reforms like demonetisation, GST etc and growing realization that the government will not be able to create formal jobs for over 6-7 million joining the country’s workforce annually. In 2016-17, actual jobs created were just 4.1 lakh as against the BJP’s electoral promise of creating one crore jobs annually. Unable to destroy non-tax paying informal sector and expanding tax paying formal sector, Modi is now embracing informal sector for his 2019 electoral campaign. 'Pakorawallah' is an indication of his newest mind game.
  • Creating jobs is India’s biggest worry and it will only get worse. 
  • India is expected to have 100 crore people aged between 15 and 64 years of age by 2027, which means the world’s largest and youngest workforce. As the economy progresses, millions of people employed in low productivity farm sector will have to be moved to higher-productivity non-farm jobs. Barring China, this scale of migration has no precedent in history.
  • India’s self-employed is and will remain humungous. Self-employment is common in India. Sometimes, it is out of choice but more often it is out of compulsion. 
  • They represent 47% of India’s 470 million workforce. They include street vendors, rickshaw pullers, carpenters, plumbers, chaiwallahs, grocers, taxi drivers, doctors, accountants, pakorawallahs etc. Most of the self-employed are below the economic radar. 
  • The scope of tax evasion makes informal sector even more attractive. 
  • They are homeless, office-less and unbanked. They are vulnerable and footloose and live on the fringes. They rarely figure in government policies or statistics, or even statements. 
  • Self-employed is not a homogeneous group. Income instability is their biggest problem. One serious illness can set them back by several years.
  • With economic growth regular and casual workers have risen while the number of self-employed has dipped. ILO says 77% of Indian workers will be engaged in vulnerable employment by 2019.
  • Last month, self employed pakoda sellers made headlines when Modi said, “Youth selling pakora outside… and earning Rs.200 a day also means creation of jobs.” 
  • The Economic Survey 2018 defines formal employment as, one, where the employers are providing some kind of social security (like EPF and health or life insurance) to their employees, and, two, where firms are part of the tax net. According to the first definition based on social security, 31% of India’s non-agricultural workforce, 75 million out of an estimated at 240 million, have formal employment. According to the employers-in-the-tax-net second definition, 54% (or 127 million) of the non-agricultural workforce is in the formal sector. What is it Modi is trying to convey by redefining 'employment' with his own way?
  • Mudra loans are disbursed for non-agricultural activities, including dairy, poultry and beekeeping. 90% of the loans to over 10 crore beneficiaries in last three years were under the ‘Shishu’ category averaging Rs 43,000. Labour ministry might be working out a formula under which 40-50% of the 104 million beneficiaries of the Pradhan Mantri Mudra Yojana could be bracketed as employed.
  • If India has to progress, mainstreaming its 470 million self-employed will be an important stepping stone. Modi knows that confronting unemployment head-on rather than sidestepping it may be a smarter strategy.
  • India’s IT industry is in a crisis, with technological changes forcing them to pivot or perish. Almost 65% of its 4 million IT workers are not retrainable and runs the risk of losing jobs.
  • The degree of disruption technology will cause, with the automation wave is certain to cull jobs. 
  • If we want growth with jobs, the push has to be on small industries, and not on the middle or the top. But the biggest beneficiary of initiatives like 'ease of doing business' will be the MSMEs who also bear the biggest brunt of the inefficiencies in the system.
  • India's employment elasticity – number of jobs created per percentage of GDP growth — has been among the lowest. It is now declining – from 0.3% between 1991 to 2007 has halved today. This is mainly because India’s growth, dominated by the services sector and not labour-intensive manufacturing, has a bias for skilled workers. 
  • The majority of India’s workforce is engaged in informal, unorganised, low-income, low-productivity jobs. This is not self-employment. This is self-exploitation. They need to be moved up from 'subsistence-based livelihood' to 'good self-employment'. Policy makers should focus on increasing formal wage employment and good self-employment. 
The Modi government, in its last year, is short on time. And India’s job seekers short on patience. In politics, perception management is as important as the change on the ground. Modi government likely to lean 'more on perception management' with narratives, publicities and media management rather than any change on the ground to face general elections in 2019. 

Political language makes lies sound truthful and murder respectable but Modi must remember that he can't fool all the people all the times despite his oratory skills and media management. Voters have their own way of understanding what is good for them and whom they should vote. Narratives and money power works some times only. Rajasthan bye poll results has already sent spine chilling message to Modi which is reflected by Amit Shah's lackluster postmortem analysis. Surfacing scandals is another cause for worry for Modi. Above all rising graph Rahul Gandhi gives him sleepless nights.

Friday, 16 February 2018

Why do we need economic growth?

Most things don’t grow forever. If a person grew at the same rate for his whole life, he’d become gigantic. Yet most economists are united around the idea that the economy needs to grow, always. And at a high rate, for the good of the country and its people.
  • Economic growth is the increase in the goods and services produced by an economy, typically a nation, over a long period of time. It is measured as percentage increase in real gross domestic product (GDP) which is gross domestic product (GDP) adjusted for inflation. The economic growth every year is essential to a country’s stability and prosperity. But some economists argue that it makes more sense to focus on measures of well-being than growth.
  • Maximizing growth doesn’t necessarily help people, but also that rapid growth can itself come at a cost, such as when the pursuit of growth is used to push through policies that are expected increase the GDP but may have negative consequences for millions.The pursuit of growth can be quite dangerous. The welfare of a nation can scarcely be inferred from a measurement of national income.
  • For a developing economy where the basic need isn’t met and growth is necessary for more food. Economic growth in a developing economy can go a long way to improving living standards. When people are living in poverty, they experience a deprivation of basic human needs, such as food, shelter, education, basic health care. Economic growth can enable many of these basic needs to be met and this economic growth can radically increase living standards among those countries.
  • It's an election winner. Politicians see growth as very important. Elections are won or lost on the state of the economy. Look what happens if growth disappears and recession looms. People get very concerned about falling incomes and rising unemployment. 
  • If poverty is to be relieved and the rich are not to be made poorer, then growth is necessary. Making the poor richer is not easy and there are many political obstacles in the way. But at least growth makes it easier.
  • When real incomes are already quite high, economic growth can have a marginal impact on living standards. There is a strong diminishing marginal utility to extra income. 
  • Economic growth is driven by technological improvements, which reduce the costs of production and enable more to be produced. This technological progress in many ways feels an inevitability. How could you stop this technological progress? Technological improvements have particularly improved the productivity of agriculture and manufacturing. This means we can support ourselves with a smaller % of the workforce on agriculture and manufacturing. Many of new jobs are in service sector.
  • In theory, economic growth should enable people to work less, enjoy more leisure time and would enable to retire earlier, if they are able and willing.
  • Increased GDP offers the potential for higher living standards but certainly doesn’t guarantee it because of uneven distribution and how it is used. GDP measures activity in the economy, but there’s no way to know whether that activity is actually good for society. The BP oil-rig explosion, which killed 11, and the subsequent spill, which leaked 3 million barrels of oil into the Gulf, actually lifted GDP because of the amount of money spent cleaning it up.
  • Economists often say that without growth it will be impossible to address income inequality. But even with growth, there’s no guarantee that inequality will decrease. The economy’s current trajectory is of increasing inequality. Economic growth leads to the depletion of resources - a problem that's likely to get worse as world population and world consumption grows.
  • One of the biggest sources of rising expenditure in western economies is health care. There are simply more things that can be treated. Also, there is the irony of having to treat diseases of affluence (such as obesity, heart attacks, cancer etc).
  • Economic growth will not solve the fundamental problems of human psychology / behaviour. It can increase sense of inequality. Growth will not reduce the incentives to cheat and steal. It does not make people more charitable and good-natured.
  • Environmental problems facing humanity, economic growth could exacerbate these issues and reduce living standards.
  • Some of the most content people in the history of the world got by on a lot less. Some saints have argued they were much happier when they forsook their wealth.
  • Rather than worrying about increasing real GDP, we could spend time promoting greater social harmony.
  • The point is that life is a struggle for most people in developed economies, and technology and increased efficiency has not done much to fix that over the last 40 years. No doubt there are a few that have enjoyed increased leisure time, but at the expense of the masses.
Do we need economic growth? Not really. But, if managed well, it doesn’t have to do any harm and gives the potential to make improvements in our material well-being. Needless to say, economic growth is far from the panacea to make society better. It is a neutral component of human well-being. There’s nothing wrong with targeting economic growth as long as you are aware of its imitations. Governments and society need to be judged on so much more than simply whether their economies are growing.

We have to find a way to make the aspects of capitalism that serve 
wealthier people serve poorer people as well.

If money is your hope for independence you will never have it. 
The only real security that a man can have in this world is a reserve of 
knowledge, experience, and ability ... Henry Ford

Money has no utility to me beyond a certain point ... Bill Gates

For India with large number of unemployed youth, economic growth is the only way to create enough jobs and security. The present phenomenon of jobless growth is unsustainable. The current trends of economic growth are also associated with increased pollution, over exploitation of non-replenishable natural resources, destruction of ecology etc is a destructive growth. Additional wealth created is grabbed by top 10% wealthiest people. The disparity between rich and poor is widening. This kind of growth is absurd. In an ideally developed world all people should be equal, even though perfection is unachievable. We need to grow to accommodate ever rising population.