Smart and Clean Cities For India

This article is about the state of our cities and how we can improve. As nation's people what changes we need to adapt to make it happen. There is a bit of sacrifice, there is a bit of service, there is a bit of fighting spirit required from all of us to make it happen.

Filthy Cities of Today

Transportation is the backbone of city. Our cities have become filthy by perennial traffic jams. The average speed has become 10-12KM per hr in the city. Pollution is the order of the day. Noise & Smoke fill the air from dawn to dusk. Excessive production & selling of cars, bikes has certainly made the country rich in money circulation. But it has made the cities ugly. Families buying private motorized transportation feel rich. But are they? Middleclass families have more private vehicles. But that has not made them rich but retained them as middle class only. That has not made them reach their office, schools, market faster. The upper class has got more luxury cars. But that has not made them reach their destiny any early.

There was very less or no slums in yester years. But a city today cannot grow further without the slums contributing to its wealth! Every major city in India has at least 40% living in filthy conditions. How can we boast of progress achieved? They lack clean water, air, sanitation. Where did they come from? They were driven from rural environs where they had at least clean lake, river, hills, forests, desert, plains, to laze, graze and live on god given natural resources.  Money was not a need to live. Why were they driven or opted for slums? Because the government snatched their environment & land and auctioned it off to businesses. For what? For the development. But that development has made our cities neither fast enough nor beautiful. Rural environs and people are also destroyed. Is this what is development?

So much of coal, petroleum, gas, minerals extraction; cars, bikes manufacturing has pushed people to be slaves at pittance losing their land and environment. It makes country rich on paper. Currently Economy is important. People are not. Large dams, coal mining, aluminum, iron, manganese all metal mining at a rapid pace is important for the country. Production of large quantities of cloth, metal, vehicles, phones, and its export are important for the country. Large consumption of milk, cereals, meat, vehicles, metals by few lucky city dwellers is most important for the country. Left out people of this luck are not important. This over production & over consumption brings down hills, creates artificial hills, concrete jungles, sucks up lakes, creates filthy rivers. Large dams have submerged many forests, villages. People still survive. Where will people go? They migrate to city slums. Few lucky get into apartments.

Number of people living in apartments and number living in slums are equal almost. So what development achieved?

The main thing is to imbibe and educate “ಸರ್ವೇ ಜನಾಃ ಸುಖಿನೋಭವಂತು” (Sarvey Janah Sukhino Bhavanthu: Means let all people be happy). It is not correct to say someone has to sacrifice for someone’s development. Those who “have” should control their consumption to leave something for “have nots”.

Smart City Concept

For a smart city, we should have very good public transport. Metro, Bus connectivity should be improved for long distance commute. Metro especially will be safe and fast. But metro doesn’t reach your home and office. The last mile connectivity is the key. Lack of it is one of the main reason for high number of private vehicles on road.  

For last mile connectivity we need to have shuttles. How shuttles should serve the locality?

• They should be electric non-polluting or non-motorized vehicles. Something like buggies in golf field. Or maybe something more robust.
• They should keep running in locality covering 1-2 kms radius continuously. It should connect people from near door to nearby main road corner
• High frequency connectivity; But low speed for keeping up safe environment.
• Hop on hop off service to be provided;
• Ease of ticketing, multi-mode payment, seamless smart card integration with metro & bus services

Apart from this, city should encourage and adopt cycling mode of transport. It is all possible and not a fancy story. Most of the European cities have become safe with zero road fatalities by adopting cycling as a chief mode of transport. http://www.copenhagenize.com/

And especially in India it works. Because Indians are civilized, obedient & tolerant by and large.

Owning and driving private motorized vehicles should be made extremely expensive in cities. That much reduction in vehicles will lessen that much burden on earthly extraction of aluminum, iron, petrol, gas. That will retain our beautiful rural environs.

To limit Consumption, Limit Production

Another most important factor is to make private vehicle production prohibitively costly. Because actually it is costly. Since we treated environment & people as cheap commodity, we have reduced the cost of production. We have shown apathy to environment and people, getting environment clearance, giving false assurance to people about job generation, the production goes unbridled. A Factory gets clearance for one million ton ore production but goes on to produce 100 tons. They get clearance for paper, plastic, rubber, vehicle production, many such things only to flout the clearance guidelines, brazenly producing more than approved. River pollution, lake sucking, canal diversion goes on unbridled. When a strict officer occasionally comes and hits at it, people get divided and oppose the closure. Because they feel they lost jobs. But jobs can be generated if they work for themselves and not for someone else as slaves. But that needs a very long education.

One solution is to treat the mineral rich lands as ones belonging to those local villages & not to the government. The current system of auctioning off the mineral rich hills, forests by the government to individuals, companies, foreign companies should be stopped.

So when government identifies that area is mineral rich, then it should educate and enable villages to join together to form cooperative societies. Cooperative society should constitute all sections of people from land owners to landless laborers, tribals etc., And they should be given education, equipment, technology to do the mineral extraction and provide to the industry/ factory.

Who should run the factory? That needs entrepreneur. Highly educated, specialist or a scientist will generally become entrepreneur. But again, if he is all and sole owner, however nice person he is, the power corrupts that person. So government should enable policy to make villages to be stakeholders of the factory. So that the decision process is democratized in favor of people of locality, and not in favor of the productivity.

All these will put delays in production, initiation, clearance. It will limit production too as the stakeholders are the dwellers around the factory. And they take decisions people centric and not productivity based. But that is fine. What is the hurry?

Or like America, we should also outsource all manufacturing, mineral extraction, mining industry to other hapless countries.

Production of military equipment, nations security related, railways production should take priority in getting government clearance and building consensus with the villagers.

Education

If government doesn’t interfere in rural people’s lives, they do live happily. They don’t need government subsidy, food card, PDS, etc., to live. They just need to be left alone. They find their way by utilizing what god has given them. They make indigenous solutions to their life problems. If at all they need anything from the government it is Education & Health care. Even disputes, quarrels, violence breakouts can be quelled within themselves by their own indigenous set up.

Education should teach them about their environment and surroundings:

• To be proud of their surrounding and protect their surroundings. It should teach them that they are the collective owners of their hills, lakes, river, forest etc.,
• Government cannot and should not snatch it from them without their share or consent.
• Government should not auction it off to some individual or a company or a foreign state for exploitation

While we cannot put blanket ban on urban middleclass consumption, we can certainly educate children. Right things taught in early age will mend their brain and will remain a habit through their life for long. For example there are chapters for children today on deforestation, wildlife destruction. The causes for deforestation are taught as cutting trees, poaching, polluting industries etc., But why cutting trees, why industries? That is not taught. The root cause is over consumption, over indulgence on luxury & creating high demand on the environment. The linkage between the consumption based economies to the ecology destruction has to be simplified and educated in young minds. Growing up they themselves will resist their parents in indulgence. And also they become good citizens.

On the one hand controlling consumption, on the other hand, community ownership of our surrounding will be the right recipe for controlled growth and development. Villagers, tribals have to be taught to own their surroundings. They need to be educated from primary levels to involve in decision making process of their area. If factory, mining, dams are coming up they need to be able to question and own that themselves.

Swami Vivekananda says “The national ideals of India are renunciation and service (ತ್ಯಾಗ ಮತ್ತು ಸೇವೆ). Intensify her in those channels and the rest will take care of itself”   

Idea of India And Idea for India: Series 2.1 – Capital Intensive Economy Vs Labor Oriented Economy

This series is on economic ideas of India and for India. This article is influenced by my reading of Made in America by Sam Walton the owner of the Wal-Mart, the world’s Fortune No.1 Company, and my reading of Small is Beautiful by E Schumacher, a very thought provoking book on sustainable economics.

Labor Oriented Economy is purely Gandhian economy which is practiced from ancient India. It is purely an Idea of India. It is people centric & not productivity centric. It is based on providing livelihood. The byproduct of this industry are: people’s harmony, need based consumption, equity of wealth, dignity of labor, sustainable development & production, regeneration of the raw materials, environmental harmony, art & cultural participation & appreciation, local art & artisan development, craftsman development and encouragement, local market etc., The world order created by this type of economy is mainly: Cooperative Movement & Cottage Industry. These 2 are discussed in detail later in the next article.

Capital Intensive Economy is a classic Western Idea for India.

Capital Intensive Economy means, the industry & economy centered on the Investment, Productivity, Quantity etc. It is simply driven on what is the return on investment. Time is of essence. Money is of essence. Industry has to produce maximum output in minimum time & effort. A by-product of this is excessive mechanization. Machines start replacing humans for quality and quantity production hence reducing labor requirement pushing up unemployment & agitation. Another byproduct is over production which in turn pushes for over consumption resulting in the monstrous “Consumerism”. Where one can live with 3 pairs of socks is enticed to buy 6 pairs for 3 pairs free creating a demand for 9 pairs which is not really the demand in a normal market. As one market saturates, companies are driven to find newer markets for their products. So this results in 2 major “World Order” s: Free Market Economy & Large Conglomerates. These 2 are discussed in detail in the sections below.

But before delving into those topics, let’s look at what is capital and where does it come from?

Capital is “Tomorrow’s Money = Loan”.

Capital is very cheap. World’s big banks are ready to lend money at less than 1% interest. They need credit worthiness. If a city commits to complete a fly over in 25 months and meets the timeline, that’s it, it is credit worthy. Then all banks queue up with the city to complete more flyovers, metro etc., then the city, country, states will get into debt cycle infinitely. The USA for example is the biggest debtor. (Data: http://www.mdleasing.com/nationdebt.htm ). Who cares? The country also runs on debt and the same mentality is encouraged for the public also. Everyone in US runs on debt only. If anyone is debt free then he is fool. So they go for higher commitment, higher consumption & live on credit. There is no ‘savings for tomorrow’ mentality. Living on ‘tomorrow’s money’ is considered wise in developed countries.

So the consumer becomes rich, and producer becomes poor!! Horribly convoluted idea. Isnt it? Similarly foreign exchange, stocks, bonds, is all very complex webs of deceits. All producing countries in east & tropical are rich in natural resources, minerals, plants, animals etc., people are also pious, intelligent, well behaved and hard working. But they are Lilliput in front of the monstrous consuming western countries. So what is the root cause? I would vehemently argue the LOAN formulas are the root of this evil design. All sorts of mathematical formula towards, today’s economic confusion are well rewarded by Nobel Prize. The Nobel Prize in Economics is only reserved for creation of wealth for the western nations.

When British came to India, they wanted to trade. They wanted to buy spices, diamond, emerald etc., But with what? They had to trade with something. Bullion in either Gold or Silver was standard trading means. But India already had plenty of it & didn't get excited. So they started with “we pay later”. They stocked and shipped items. They cut deals with local kings to build forts around ports of their exit. One important thing they did was fortification of ports and developing security of it using ammunition, guns, canons etc. Slowly they hit upon helping one feudal king to fight the other with arms & ammunition. And the rest is history.  

Coming back to the living on LOAN. In the ancient India, there was a visionary Philosopher called Caravaka. He proposed a system of Materialistic philosophy called Lokayata espousing religious indifference. Because our religion basically espouses, minimal living ideals like: vairagya (detachment), thyaga (Renunciation), seva (Service of elders & needy). His materialistic philosophy rubbished these ideals and espoused, take LOAN and live a life of luxury. His philosophy came about around 5^th-6^th cent BC. At which time, Buddhism was at peak which also espoused ‘desire is the cause of misery’. Mauryan kingdom was at helm. Most kingdoms adopted Kautilya’s Arthashastra to run their economy. There was very high opposition to Lokayata. No kings adopted Lokayata. But still it seems to have survived long in India in pockets. There are records of this philosophy debated in Akbar’s philosophy meets also. During Vijayanagara kingdom a great philosopher Sayana Madhavacharya, and Advaita vedanthi, wrote a book called ‘Sarvadarshanasangraha’. In that book he details the merits of Lokayata in the beginning and takes up thread by thread to demerit and demolish the ideals. It seems to have laid the final nail on that philosophy then. 

But alas! It is now raising its ugly head through western influence on India.

1.0 Free Market Economy:

This is one of the most embraced ideas around the world in the recent years. This is how the developed countries became developed. So this is vehemently thrust upon the developing countries to bring them up. India opening the flood gates since 1990’s though a series of trade liberalization legislations. It is reeling under its pressure now. It is also an irreversible phenomenon. So we cannot go back to the closed economy regime. Also in the closed economy, the Indian companies become laggards and compromise on the innovation, technological advancement, agility and global competitiveness. For example, Bajaj scooters were notorious for their bend & kick, difficult hand gears etc., But same company today is producing some of the best indigenous bikes and continuously innovating. Similarly, ITI phones, Ambassador cars, Televista TVs, Mafatlal suitings etc., Either they are bought over, or revived.

What is free market economy? Basically it is to make India a free market for the world. Removal of import duty on all items. So that makes all foreign products to compete with local products on equal footing. So immediately in the aftermath of the liberalization, in the 90’s, many local companies tumbled big time. Like Kirloskar, Videocon, Bajaj, Godrej, many units of Tatas like Tata Steel, etc., Because they couldn’t compete with the sudden surge of foreign brands vying to capture the Indian market. But most of our companies have revived big time since. Because once India signed Free Trade Agreement with other countries, our companies get free access to their markets. And hence the global competition has pushed our companies on the world stage. Today, for example, Tatas are a big conglomerate in UK!! J Spate of acquisitions there like Tetley Tea, Jaguar Landrover, Corus steel etc., has pushed it well on the world stage. Tables are turning!

1.1 Consumerism Monster

But the bad thing is free market economy has become a monster. It feeds only the greedy. It drives a very large section of people homeless, slum dwellers. It creates large scale migration, monotonous labors, long working hours, loss of dignity. It creates very large companies, large conglomerates, which can arm twist the governments in their favor.

Lets take American example. As a country of 250Million people it consumes about 25 clothes per person per year. The car population is about 1 per person. These are just 2 examples to give an idea. The self-indulgence life style is high but its consequences are unknown to them. They think they are leading normal life. For example, the high competition of apparel export creates unhygienic, high risk working environments in Bangladesh, China, and India. The producing workers don’t have enough clothes for themselves. But who does it matter? Recently in Bangladesh, a very large clothes manufacturing company building supplying to Wal-Mart collapsed killing thousands of people. America doesn’t ask for flouting security norms, hygiene norms etc., But it simply demands more, and does volume business. It goes to anyone who gives them volume discount. If the company supplying it, is squeezing humans and country is supporting it, it doesn’t care. We can see the same phenomenon of continuous squeeze in Software services too! In 90’s it was a sunrise industry, so the labor dignity was enviously high in that industry. Today it is not the case.

When it comes car production, it requires so much of minerals extraction, environment degradation, people displacement. For car running, it requires again all the fuel extraction, river basins impact, etc., So all those associated bad things are outsourced out of the country. Hence the developed country’s citizen doesn’t know & hence doesn’t care how he lives. He doesn’t even realize he is leading a self-indulgence life which has a spiral impact on someone else in some other country driving him to abject poverty, depriving his access to clear air, water, food.

Once the developed countries became saturated market, they are making developing countries as their free market. And India’s urban population is best field to play. We are playing well into their hands. We have created a similar self-indulgent society in the urban middleclass in India. And that society creates enormous demand on the earth’s natural resources by their insatiable consumerist lifestyle. It starts a spiral effect exploiting the earth and its resources, impoverishing the people and regions. 

References:

https://www.wewear.org/assets/1/7/usimportsapparel1112.pdf

http://en.wikipedia.org/wiki/List_of_countries_by_vehicles_per_capita

http://www.bbc.co.uk/news/world-asia-22476774 

2.0 Large Companies, Conglomerates:

This is a very typical Idea of the western world that India has greatly embraced. But it is quite unfortunate for the country. It doesn’t create equitable wealth. It concentrates ugly, humongous wealth with few individuals.

There is a very wide deep rooted belief that large conglomerates are the saviors of India’s economy; Following are some of the myths of the large conglomerates:

1.       A large conglomerate is responsible for a very large employment & hence socially responsible
        a.       Otherwise people would die of unemployment?
2.       A large company is large tax payer and helps running economy
3.       Large company is environment sensitive, responsible
4.       They can invest on R&D and future of the world innovations

2.1 Large Tax Payment Myth:

Lets say a trader opens a shop in a corner in a city. He does business for couple of years, and he does well. He balances his accounts, pays salary for his employees & himself, and makes profit. On the profit, he pays tax. The post-tax profit he either ploughs back into the business or takes home as personal money.

He then looks at the prospect of opening another shop. He takes loan from a bank. Bank allows loan based on his business & balance of accounts. The loan is basically tomorrow’s money and bank takes the risk on his ability to generate that tomorrow’s money.

He does well & business grows well. His risk taking appetite gets him to open few more such shops, all on loans. The loan keeps increasing, but the risk is shifted to the bank & he keeps increasing his asset building. For accounting purpose the shops are liabilities and not assets. But for him it is assets. So the loan also helps contain the taxes to bare minimum. And that also encourages the entrepreneur to keep growing his business across cities, counties, states, countries, continents and on and on. 

So the large tax payment myth is busted. If he were to run a small business, after the loan clearance, he would pay taxes on one shop & continue business for ever. And similarly 100 such shops by different individual owners would do business paying taxes from each of them. Now they are all bulldozed by one large player who doesn’t pay tax as he is on loan always!

2.2 Social and Environment Responsibility Myth

Back to the story. His ambition to expand further is limited by lot of accounting, balancing loans and that revenue is trickling branch by branch. So he intends to go public! This public trading is another big scam that the western world has created. When he is going public, the market analyzes his business & prospects and gives a verdict that he will grow by 20 times in next 5 years! That’s it. If his revenues are $1Mil for annum today, the market evaluates his company as $20Mil. So he rises $20M overnight that too from the public! So the entire risk of the business is shifted to the public! If “he fails”, the “public lose money”!! But do the public see it that way. No it is a crowd mentality; everyone is upbeat as long as it lasts.

It lasts as long as that business idea keeps generating revenue as per market expectations. In this case as long as he keeps opening shops and generating revenue. That’s why he goes across county, country, continent, world. Apply same logic for Car manufacturers, Earth movers, Oil&Gas extractors, Airplane manufacturers, Software, Hardware product developers, services etc.,. If they are public companies, they have to keep growing. Any slowdown they go down in history. All of these industries (Yes even software, hardware also) require enormous amount of earth excavation, hills, forest, and rivers destruction. Tribals in hills, forests, rural population to become victims of displacement.

The government is so helpless in the tax collection from big companies, that they have given up, and pushing “mandatory  CSR spend” by large corporates now. CSR = Corporate Social Responsibility. It is another very big scam. Corporate buys a million, 20Rs Notebook, and hope to distribute it to poor students. It calls for corporate individuals to donate “time” for the distribution. The corporate while encouraging the rat race doesn’t incentivize CSR activities. I have seen even good hearted people getting frustrated and giving up. So where do those note books end up? It is up to your wild imagination. No level of CSR can match government, not even, Azim premji’s education foundation. I’m not undermining that great person’s good heart. It is greatly laudable. But private entities are private. One quarter results go bad, they pull the plug out.

References:

http://indianexpress.com/article/business/economy/mandatory-2-csr-spend-set-to-kick-in-from-april-1/

2.3 Large Employment generation Myth:

The large conglomerate of course generates a lot of employment. Because it is large. But it is at the cost of killing SMB s (Small & Medium Business). And in comparison of those SMB s would otherwise have created a lot more jobs, lot more independent businesses. Take for example Apollo pharmacy chain or any other medical shop chains. You won’t get any medicine there. But only get toothpaste, soaps, cosmetics etc., and some cough syrup/ crocin. Why? Because they are a profit making company & not a public service company. They have to have optimized storage, inventory, maximum goods transportation in minimum trips, maximum sales in a day etc., So they become only FMCG company and not medicine shop. So their service to the society is also bad.

If it is a group of multi owned medical shops, then they need to serve their customer’s needs in order to make business. Because they have only one shop to survive on & few customers in their area. So they work with multiple suppliers. So it creates an environment for specialized suppliers in each area. Some are general medicine suppliers, some are cold storage based, etc., Similarly inventory owners in each area and their network.

So each are independent business owners. SMBs. So they hold their head high with dignity and work hard, under nobody’s compulsion but their own desire to do well and serve better. They create large employment, independent small businesses.

So why not everyone become big tycoons if it is so easy? By just passing the risks from himself to bank and then to the public.

A formal education ends with certification or graduation etc., A high point of graduation is landing a high paying job in a big company. At that point in time nothing beats that feeling. And normal population once financially independent, doesn’t look for risk taking in life. Entrepreneurs are rare in population, probably 1 in 1000. They have such abundance of energy, they don’t wait for formal graduation, certification etc., they jump out and start out on their gut feel. Again in that most end up being SMBs. But really perseverant, brave, intelligent are those who break out of the league. It takes lot of courage. Once they become big, then it is not the personal greed but the whole system including government, private competition, employees, doesn’t let the corporate settle down at a certain level at all. It has to grow, big, large and enormous.

Next Series 2.2: I wanted to cover the topics of Labour Oriented Economy in this series itself. But this itself became so big, that I have to carve out another article to complete the Economic Ideas topic.

Kindly put your comments and suggestions to move forward.