Bihar, the star performer !

In India, regional disparities in growth and poverty alleviation are well known. In general, the more western and southern a state is, it is much better off. And the more eastern and northern the state is, it is in doldrums. So says conventional wisdom. Well, not any longer.

The economic growth of states over the last five years has just been published, and has been seized by the media and reported widely. So pardon me, if you have read this before. But its such a compelling story that it needs telling.

There were two states that grew by 11% , each year, over the last five years. One of them is no surprise, Gujarat. But the other will take your breath away. Its Bihar. Bihar was, jointly with Gujarat, the fastest growing state in India over the last five years.

Pause for a moment and reflect on this number. Eleven percent per annum GDP growth. It’s a stunning performance by any standard, anywhere in the world. Breathtaking. And Bihar is not the lone surprise. Uttaranchal & Orissa grew by 9% each. Jharkhand grew by 8.5%. All at, or above the national average of 8.5%. Even UP grew by 6.3%.

This has some important lessons and inferences. Firstly the myth that growth in India is not inclusive is rubbish. The so called poorer states have all grown handsomely. Growth in any form will trickle down to everybody. It’s the best remedy for poverty. Sure, there are large inequalities in each state and the misery amongst many in Bihar still continues. But any day, I would rather have growth with so called inequality, rather than no growth at all. If ever there was compelling evidence that economic growth must be pursued with religious fervour, this is it.

Secondly, there is definitely a link between good governance and growth. Narendra Modi, Nitish Kumar and Naveen Patnaik are some of the better governing state leaders, No wonder, their states occupy some of the top positions in the growth chart.

Thirdly you can do good governance and win elections. Modi and Patnaik have been reelected and Nitish Kumar carried the Lok Sabha elections on his own. It’s a fallacy that in a democracy you can’t win elections by good governance. The electorate may be gullible, but not downright stupid. People do recognize the value that growth brings and are willing to reward the leaders by reelecting them.

This is cause for celebration. Don’t throw mud at the statistics saying they are inaccurate – Probably they are in absolute terms, but trendwise, not far from the truth. Even though “India Shining” can lose elections, India is shining. And India is shining across the country – not only in Gurgaon or Bangalore. Its easy to moan about poverty and claim that all the growth is elitist, doesn’t benefit the poor and the usual claptrap. I repeat ad nauseum in this blog, the only way to alleviate poverty is through economic growth.

Tip your hat to Bihar, the economic tiger.

To be an expat

Man is a territorial animal. His natural preference is to live with the group that he belongs to. But for two reasons, people choose to live away from their natural communities. The first, and the biggest, reason is economic. The second is political.

I would guess that 90% of migrants are economic – they move to earn more money; to have a better life. Even where people ascribe other reasons, the real underlying cause is economic. The Economist , my favourite magazine, put it beautifully. A journalist was covering the regular anti America rallies in Iran. Death to America, Death to America, the chants were going on. A protester paused in mid chant to ask the journalist – “can you get me a green card” !

Earlier in the week, I had posted about the The Economist’s brilliant article on “being foreign”, here. This post is my personal view on being an expat.

The sheer experience of being an expat is enormously enriching, both professionally and personally. Professionally, it is an experience, without which, you cannot grow beyond a point in today’s globalised world. It’s a virtual prerequisite for a successful career. Working with, and leading, teams of mixed cultures is a key skill to be acquired; you cannot grow above middle management without this skill.

But equally important is the impact personally, if you choose to gain the experience. And this is where people adopt widely varying positions. A new culture is by definition strange and resistance to something strange is in our DNA. Many expats therefore form their own ghettos – the Chinatowns, the Southalls, the Little Indias, the white Expat Clubs, and the like.

I have learnt enormously from the countries I have lived in, and travelled to, by being more social with the local community than with the expats. You learn about the good, and not so good, things about the culture. Without being judgmental, you can assimilate the experience the better. If you treat local practices with disdain and remain smugly superior, you are an ass. If you treat local practices as second only to God and deride your own culture, you are an ass too. Something in between, and you become a much richer person.

Invariably, when I have been an expat, I have come to appreciate my own country and culture better. At first, I found this strange, but later on I have accepted this as one of the wonderful benefits of expatriation. I see India and Indian culture better now. I appreciate its strengths better and I have learnt to bypass its weaknesses better.

One of the biggest decisions of an expat is the timing of the return home. For me personally, the ideal tenure is 3 years, at the end of which I would want to come back to India. And go back again, if possible to a different country, after a longish stretch back home.

People who stay beyond a certain period of time can never go back home. For home has changed to something they cannot relate to, or be comfortable in. And one which their children cannot relate to at all. If they have opened their experience to the local culture, they can be happy where they are. But if they have ghettoized themselves, then that is the real tragedy. They are nowhere and theirs is essentially a lost generation. Their descendants take a long time to find their identity. Nowhere is this more pronounced than in South Africa, where “ghettoisation” was forced because of apartheid.

For me, being an expat has been an experience that has been worth its weight in gold. Living in China now, has been an eye opener. I have experienced one of the great cultures of the world in a way I could never otherwise have. I have built some great friendships. I have understood, at least a little, the good, and not so good, of China. Sure, lots of things were tough, especially as I still can’t speak the language. But, without a doubt, I am a wiser man, for the experience. Older, but wiser, I would like to think !

Oh, the joys, and pains, of being an expat !!

THE BIGGEST MISTAKE OF JOURNALISM PROFESSIONALISM

Efforts to professionalize journalism began early in the twentieth century as a response to the hyper commercialization of newspapers and the “anything goes” approach to news that emerged in the late nineteenth century as a means of increasing street sales through sensationalism, twisting the truth, and outright lies.

The impetus for journalistic professionalism originated among publishers who wish to counter the trend and it gained support of journalists who saw it as a means of improving their working conditions and social standing. Journalism training and higher education programs, professional societies for journalists and editors, and codes of ethics and conduct emerged as part of professionalism. These promoted the core values of accuracy, fairness, completeness, and the pursuit of truth.

These efforts improved industry practices, pushed out the worst journalists and publishers, and creating some trust in the content of news. They also created environments in which advertisers were willing to promote their wares in newspapers and made news organizations more financially sustainable.

This is where journalistic professionalism took a wrong turn, however.

It did so in two ways. First, professional journalists were taught and accepted the idea that they should worry about the journalism and leave the business to itself. Second, journalists, along with other employees, decided to seek improvement to their compensation and working conditions through unionization—thus becoming adversaries of management rather than partners in the management of news organizations.

Both developments clearly improved journalism and lives of journalists; however, they also separated journalists from business decisions and removed them from any responsibility for the organization’s actions and sustainability.

Although some protests over editorial interference, owner avarice, and the corporatization of the news industry were heard in the 20th century, few efforts to alter the situation developed because the enterprises were willing to share a sufficient portion of the riches generated with journalists and because companies employed more journalists, improved newsrooms, built networks of bureaus, and provided resources to undertake interesting reporting activities.

That has all changed. The reporting resources are gone, the networks of bureaus are being dismantled, many enterprises can’t afford their own facilities, and journalists are being widely laid off. All of this is being done with little input and influence from journalists and editors precisely because they spent nearly a century denying responsibility and involvement in business decisions.

Today, many journalists are arguing for the creation of new types of news organizations—primarily not-for-profit enterprises—and they are repeating the same mistake. Most are suggesting, or already setting up, organizations in which journalists still have little say on strategy and business matters. Many are content merely with the idea that the new enterprises won’t be profit driven. That, however, is not enough.

Journalists need to be equally responsible in ensuring they produce news and information that has value. They need to be responsible for ensuring their new organizations create the revenues and organizational strength needed to carry out high quality journalism. They need to ensure that organizational decisions make the organizations and the journalism offered viable.

If journalists continue to deny responsibility for the operation and survival of their news enterprises, it will be impossible to create sustainable news organizations for the future.

Don't sack the CEO !

What would you say to a job that was one of the riskier jobs in the world – the chances of being sacked is high, and its very unlikely that you would survive 10 years. Not appealing, is it ? Welcome to the job titled the CEO.

In the UK, the FTSE 100 is the index that covers the top 100 listed companies. As the decade ended, only 16 of the CEOs who were there in 2000, were still there in 2010.

Heading that list is an illustrious name, Sir Martin Sorrell, the Chief of WPP, the global advertising agency. 25 years as CEO; he was the founder of the agency and still its head. And there are a few legends – Sir Terry Leahy, the boss of Tesco, Sir John Rose, the chief of Rolls Royce and only one lady – Marjorie Scardino, the head of Pearsons. But otherwise, most CEOs who were there in 2000 have got the boot.

The job of a Chief Executive, is obviously a crucial one in any company. The leader must stay for a reasonably long term, to be able to provide a meaningful direction for the company. Often the contribution of a CEO can only be seen in the longish term. An ideal tenure would be for 8 years or so.

But the capitalist system, as we have evolved it, is incredibly short term focused. Next quarter is all that seems to matter. Boards and shareholders expect instant performance from the CEOs, preferably in two quarters. If by three quarters the share price hasn’t doubled, then sack the CEO. The same story repeats with the new guy.

There must be something wrong with expectations if 84% of the CEOs fail to last the desired term. Sure, results are important, but how can the corporate sector be termed as successful if three quarters of the leaders aren’t considered to be doing their job.

Ok, the inference is a bit misleading. Some of the CEOs retired. Some of them might have done their stint, even if it didn’t coincide with the neat chronological span of the decade. And why 10 years - why not 7 or 8 ? But still, you get the drift.

There’s something that can be learnt from the survivors. More than half the survivors were founders. But even after they no longer owned the company and had very small holdings, they were still valuable to the company. And the professionals, all had long stints in the company before they became CEOs. Glamorous CEOs brought from the outside, have rarely survived long enough. There’s one company that has recently taken a fashion to only considering outsiders, on the presumption that every insider is a fossilized dinosaur. It might want to, sort of, look around it.

Its all a completely different story is Asia, usually. You have to carry the senile old man, kicking and protesting out of the door. That's almost as bad as the other extreme in the Anglo Saxon world. For once, a middle path seems most appealing.

A really dumb idea

It’s the end of the year and the holiday mood needs a light irreverent post. Its not a holiday around here, but since the rest of the world has caught holiday fever, we have “embraced” it as well.

Airlines are notorious for doing fairly dumb things – I think the rarified air in which they fly does some things to the brain cells. I had blogged about Ryanair’s idea of charging to use the toilets. But what All Nippon Airways (ANA) did in October takes the cake.

In October they ran an experiment. This was apparently an idea to reduce carbon emissions.

If you were to board an All Nippon Airways flight, this would be your experience.

As you queued up to board the flight, you would be met by a pleasant airline lady in uniform. Sayonara. Would you please go to the loo before you board the plane ? Its just over there. I’ll show you the way !!

In a brain dead piece of PR, ANA gave the following justification. The average human bladder capacity is apparently 15 oz. Apparently that totals to an extra weight of 63.7 kg (precisely calculated) for a planeload of 150 passengers. Carrying that extra weight means that much more CO2 emissions. ANA has estimated that it would save 5 tonnes of CO2 emissions per month by doing this. So this is a very green initiative and so must be tom tommed.

Can you even comprehend a company seriously trying something like this. ANA is not a tinpot airline. Its one of the top carriers in Asia and a global airline. And they go and do something as dumb as this.

Readers are invited to share their suggestions on how ANA could be even more green. We can then capsule this post with all the comments and send it to them.

Being an expat

What’s it like being a foreigner ? An expat living outside his or her home country ? I am an expat myself- an Indian living in China. Many readers of this blog are expats themselves. Most of us are expats because our jobs, or the jobs of our spouses, took us away from our native land.

The Economist has a beautiful article on “being foreign”. A superb and stimulating article I strongly recommend. My favourite “newspaper” is The Economist – the magazine calls itself a newspaper, in a quaint British tradition. OK, OK, I am nerdy; anybody who publicly admits to The Economist being his favourite magazine has to be the most “uncool” character in the world.

The article is so good that I offer it for your reading pleasure with no comment. What is your take ?

I’ll post my own view of being an expat later this week.

The fastest train in the world

China is a very competitive country. It likes to make a competition of everything it can win ! So its not surprising that last week it unveiled the “fastest train in the world”.

The train in question is the bullet train between Guangzhou and Wuhan. Guangzhou is where I live – the southern China city, known earlier as Canton and close to Hong Kong. You can be forgiven for not knowing anything about Wuhan. It’s a city in central China, mostly unknown to the rest of the world. Why is the fastest train in the world going there ? Well, its not going just there; the train is meant to be between Guangzhou and Beijing – Wuhan is about the midway point and this is the first phase of the line.

The train claims an average speed of 350 kmph. The earlier train journey between Guangzhou and Wuhan took some 10 hours. Now it takes 3.

This is all part of the massive investments in infrastructure that China is making. I had argued here that one of the obvious things India has to learn from China is the importance of infrastructure. China has further stepped up the infrastructure investment as part of the stimulus package. While most other countries have focused their stimulus on the short term – tax breaks, cash for clunkers, doles, etc, China has mostly focused on even more spending in infrastructure. Trains like the Guangzhou Wuhan link are going to spring up all over China over the next 5 years.

The Indian railways was, and is, one of the great organizations of the country. For a long time, it was the biggest railway network in the world. No longer. It has been rapidly overtaken by China and is going to be left far behind. For decades, Indian Railways has been starved of investments in tracks, high speed links, new trains. Instead the money has been wasted on subsidies, bloated lower level staff, and the like. Laloo Prasad brought efficiency and profitability back to the Railways and was sacked for his efforts as he had the temerity to stand against the Congress in the Lok Sabha elections.

Imagine if India replicated the Chinese achievements in the Railways. Madras to Bangalore would be an hour’s journey. Bombay to Delhi would be a 4 hour journey. Madras to Delhi, 6 hours. Bangalore to Bombay three and a half hours. The Bhopal Shatabdi, the fastest train in India has an average speed of 90 kmph. The Guangzhou Wuhan train’s average speed is 350 kmph.

I'm not able to post a photo of the Wuhan station, thanks to my Net Nanny, but just gaze at the photo here. Jaw dropping. We should bring Mamta and the entire Railway Ministry to China and make them travel on this train. Not the Railway Board – they know all this and in any case, they are one of the most efficient company Boards in the country. Maybe, just maybe, our netas and babus will realize the art of the possible, even in a poor country. Just let the top class Railway Board run it without interference. In 10 years, you and I will also have the privilege of commuting from Madras to Bangalore in an hour.

That will be the day.