Varied interests in the energy and power sector viz., CDM, carbon rating, Monitoring & Evaluation, Energy Management, Rural Development; Energy Efficiency and Renewable Energy related matters; Demand Side Management (DSM), Energy Audits, Distributed Power Generation (Biomass, Wind,Solar and Small Hydro), Participatory Management.

Tuesday, March 27, 2007


Developed Economy - at what cost?

I am always wondering what is the cost of a developed economy to a common man. India is on the verge of becoming a developed economy. Our industrial sector has shown an impressive 9% growth. Our foreign exchange reserves are bloating. The software exports are growing. But I am always tempted to compare our life style with that of the rich countries. Isn't life much simpler here now?


The retail sector is largely managed by several small entrepreneurs that make it easier to buy things across the road. But with the growing economy, the malls are coming up everywhere with massive advertisement campaigns purportedly selling only branded products. Then there are big bazaars that are supposed to sell cheap. They even guarantee to pay double the price difference if someone demonstrates that somebody else is selling cheaper. Do they really sell cheap with respect to quality? With the reported surplus income rising, big players like reliance and bharti are entering into the fray. World's leading grocer Wal-Mart is also making an entry albeit with bharti. If this culture is allowed to mature, what will be the fate of all the small time business dealers? Forget that. Is this system anyway cheaper for all types of consumer in the long run? Isn't it too early to introduce the mall culture in India? One observation I have made is that we are introducing all these western cultures only half-heartedly. The system is not integrated into our system fully. My comment is that the products packed and sold in these malls are not free from blemishes. There is no system of returning the products purchased if they are found defective like in the US. The 'greens and grains' stores which are supposed to sell fresh and green vegetables straight from the farmers are also very poorly managed. Neither the vegetables are fresh nor they are green. The stores are shabbily maintained unlike in the US. Now reliance is opening its fresh stores all over India. Can we expect better service here?


IT. India is supposed to be a leader in software development and exports. Many of the software professionals in the US and UK who are contributing to the development are supposed to be Indians. But what is happening within India? Why is the same input not being utilized for our own good? Our Indian professionals are greatly troubled by a lack of system if they shift their residences for better opportunities. Are our banks, telephone or postal services geared to effect changes immediately? Why can't they utilize our IT expertise to streamline their operations so that the services can be provided instantaneously? Banks and telephone departments are probably doing it in stages and they are constrained by the investments required vis-à-vis the customer base. But, what about the postal services? They are still archaic. The postman even today walks all the way carrying our precious letters. Sometimes, he may be carrying very important documents like, say, passport or an interview letter or a job offer. The other day I spent half a day to buy stamp papers worth Rs. 100 (there were many women as well in the queue). Can the post offices not sell stamp papers? If they can sell stamps, why not stamp papers? They have already effectively taken the responsibilities of accepting applications for Indian passports and reduced our burden to a large extent.  There are still so many agencies that are still not geared to meet the increased demands. However, there is a silver lining. I am happy about one thing. I don't have to stand in a queue every month for paying my electricity and water bills. There are 24/7 vending machines where I can pay the bills any time. I also don't need to go the bank to draw cash. The ATMs are providing that service effectively. One can also do online marketing like dealing with shares. I can run my small office home office (SOHO) effectively after the advent of broadband services. I can even book my bus, rail or air tickets online from home. That doesn't mean I don't have to make visits to the bank at all. Except ICICI, no other bank has really computerized all customer requirements online. SBI, the largest public sector bank, is yet to complete streamlining their operations. I had to wait for more than a month to get back my LIC maturity amount (after 30 years of premium payments) from Dena bank because they issued an outstation cheque and SBI has its own policy of crediting an outstation cheque. Dena bank does not issue multicity cheques although my registered address is in Bangalore and the branch issuing the cheque is in Mysore. I hope the developed economy takes these requirements of a common man for his day-to-day living into its fold and not just serve the mighty and rich.


I believe it is not worth going to any hospital in the UK for general health complaints, which are normally attended to by the nurses on duty. In the US, one needs to take a prior appointment and spend precious dollars for even small ailments. Are we heading towards such a system in India when it becomes a developed economy? Will huge polyclinics and multispeciality hospitals take the place of individual family doctors? Now, when I get a viral fever or cough, I just walk into a doctor's clinic and take prescription for the medicines required. I also have the luxury of taking ayurvedic or homeopathic medicines instead of allopathic medicines for minor ailments. This is not prevalent in the so-called western developed economies. But that is not to be in our India.


Most disturbing factor for me is water supply. I am ashamed to even talk about it. Even after so many years of liberated life, mankind has not been able to provide water, a basic necessity of life and existence, to all the peoples of the world. So what has all the development and technology done to us? Is it not the first thing we should have worked on right from inception? Now, we have the global warming effects looming over our heads and we are talking about water shortages around the world because of that. So we now have a good excuse to cover our deficiencies. Surprisingly, water shortages are not limited to rural areas. Even urban areas are troubled by intermittent water supplies. Delhi is no exception. I left Delhi in 1998 and came down to Bangalore specifically for that reason. There is not enough water to run the desert coolers to beat the summer heat.  Will a developed economy give us enough water?


There is one more reason for me to leave Delhi. That is power. There is no power to run the ceiling fans, not to talk of the air conditioners. Unfortunately, I have been associated with the energy sector since 1970's. We are talking about effective energy conservation and management since that time, Neither is energy conserved as desired nor capacity additions made as required. Even after 30 years, we still grapple with 15% peak shortage. Our efforts to commercialise renewable sources like wind, solar and biomass leaves much to be desired in spite of tremendous potential and a separate ministry to monitor the activities. There are so many business hurdles to overcome (it takes so much time to get valid approvals from statutory bodies) besides the opposition from the utilities themselves. I don't see any hope of reaching a level of spinning reserves (like in the US) in my remaining lifetime with all the financial and entrepreneurial constraints and reforms' opponents alive and active. Does a developed economy mean meeting everyone's present and future power requirements?


Then comes earth, that is land. With growing economy and infrastructure buildup, the land prices are skyrocketing. Fortunately land is available but the question is one of distance and accessibility to place of work. That is where infrastructure and road/rail/air connectivity is to be provided by the government. With developed economy, this is expected. But the question is how soon? The one disturbing factor is the rising home loan rates. Many of us have taken loans at low rates and invested in building homes. But the rates have increased and our repayments are rising. Will the salary increases or job opportunities in the developed economy cover these additional unexpected expenditures?


The air we breathe is getting more and more polluted. The situation is more alarming in metros and big cities like Bangalore. The developing economy requires that a high growth rate is maintained and sustained for a considerable period. This induces more emissions into the atmosphere both from industries as well as transport. Where do we draw the line? The effects of global warming are already reported in this early stage itself. So what more are in store for us when BRIC countries do achieve their goals?


Fortunately, we have not yet exploited the space. Although there is talk of space litter circling the earth, the situation seems to be under control. Our space scientists are well aware of the consequences and we have full faith in them. The ensuing space missions may pave way for more technological advances in communications and hopefully energy as well.


My concern is only this: are we doing enough in this developing economy to take care of the basic fundamentals of living – food, clothing and shelter for a decent living and the five basic elements for conservation of nature. Is it not time to declare a war like situation and orient all our programs and plans to meet this basic need for all the populace– sustainability of air, water and fire. The biggest irony of life is that these elements are in abundant supply on this mother earth and we, the mankind, are facing acute shortages of water, energy and clean air. I presume the space and land elements will be taken care of, once we reach the developed economy status and the saturation point like what the US and European economies are doing now.


I am not differentiating between urban and rural areas here. When it comes to basic necessities of life, all are equal. Is it not our fundamental right to ask for clean air, water and energy besides land and space?  If this is achieved, automatically development takes place. So our rural areas will get boosted. Job opportunities will increase and migration to larger cities will reduce. Once the communication technology takes over, the life becomes much easier everywhere. The present strain on the metros will lessen. So, are we asking for too much? But then, we are also told – 'crying baby gets milk'. So, we have taken the liberty of raising the issue. Is any one listening?


Mera Bharat Mahan!


Gopinath S
Chief Executive
nRG Consulting Services
Bangalore, India
Ph: 9180 26698211
Mob: 91 98455 11648


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