In an earlier post (Krishna Prashanth: An Illusion called 9%), I had compared the GDP growth figures of some developing nations with that of India and had stressed the need for focusing more on growth of consumption than merely GDP growth. This is important if we are to delink our growth more effectively from global catastrophes. With the centre of economic gravity shifting from the Atlantic to the Pacific, it is all the more important that we start looking more eastward and less westward to continue our dream of one day becoming a superpower.

In this post I want to talk about some interesting methods we can do to achieve these two objectives, namely, Increase levels of consumption and starting to look Eastwards.

First things first. Henry Ford, after the Great recession of 1929, increased jobs by largely recruiting people for his great car conglomerate, in turn increased consumption. We can try this novel approach. What India now needs is infrastructure. Roads, houses, and electricity. The government can offer jobs (irrespective of cast , minority status ) to the unemployed by way of creating jobs that will boost our infrastructure. When I refer to infrastructure, I mean better roads, more houses, and better access to uninterrupted power!

Now take a look at our Unemployment rate. It stands at a staggering 9% at the end of 2008. With a population of 1.2 billion, 9% is approximately 120 Million unemployed individuals. Even if you take 50% of that population to be employable (I guess the percentage could be higher in India) , we are talking about 60 Million , or 6 crore work force. Lets say in the first year we talk of targeting 15% of that population we have a work force of 1 crore. Even with a salary of Rs 50 per day (a lot higher than our current annual consumption rate of a little over Rs 20 a day!), we are talking about a total labor cost of 15000 Crores only! (Just 25% of the amount allocated for loan waiver for inefficient farmers) . Put in another 15000 Crores for basic skill training of this work force (irrespective of their level of education!) , and voila we have just created a consumption of 15000 Crores annually. Besides we have brought the unemployment rate down by 7.5% of its existing value. I guess a work force of 1 crore can create wonders.

This may not be sufficient to create better infrastructure, that’s when we open our markets for global power companies to generate more efficient power. Sign the nuclear deal with the US, and create cheaper efficient nuclear power. Privatize distribution and allow even global companies (even Japanese and Chinese ) to distribute power more efficiently. We should target to double our generation capacity in the next 5 years, and quadruple it in 7.

In the manufacturing sector, reduce the aids to EOUs (Export oriented units)and subsidize people willing to manufacture for local consumption. Allow more competitive products in the country from volume manufacturers like the Chinese! Encourage bulk manufacturing and make products cheaper for the masses to consume! Thus the domestic consumption can increase.

Looking Eastwards:
India should sign trade treaties with Pakistan, China, Taiwan, Malaysia, Sri Lanka and Japan and allow for foreign investments from these countries. That could be the beginning of our looking to the east. India can allow Japanese agriculturists to grow in India, if they can make cheaper commodities with better technology that is monsoon proof! Don’t worry about the Indian Farmer’s future. Identify farmers incapable of competing against the Japanese! Offer him jobs elsewhere! His sons will get employed with Rs 50 per day as against the Rs 20 per day that the farmer anyway makes today!

This recession, by the time it is over would leave behind the real winners. Not the ones who can bask about the growth of the past, but the ones who would have delinked their economies from the global catastrophes!

Dear Reader,

This is my 50th post on this blog. And I want to thank you for your valuable reading time and some really insightful comments on the same. I will dedicate this blog to refering to some interesting blogs that have come my way in the recent past.

At this juncture I want to point out an observation that I made about blogs in general. That they are (apart from being the most advanced form of communication) valuable sources of detecting the general pulse of public opinion. While some topics receive extra attention some are just touch and go. You will appreciate this if you have been browsing the ‘Hot Keywords’ at Blogscope (http://www.blogscope.net/). While traditional media like the TV or the newspaper relies mainly on what “they” think is important to communicate, blogs in general tell us what people all over “like” and would like to opine about.

I leave you with this thought and a few interesting blogs that I have enjoyed reading.

1. http://gauteg.blogspot.com/

2.http://managementrandd.blogspot.com/

3.http://nanopolitan.blogspot.com/

4.http://mumble_jumble.blogspot.com/

5.http://arundathiga.blogspot.com/

6.http://isbclassof2009.blogspot.com/

7.http://garygans.blogspot.com/

8.http://www.swaminomics.org/articlestitle.html

9.http://www.aamirkhan.com/blog.htm

10.http://www.indiauncut.com/iublog

That’s all for now. Happy reading (and Blogging of course!)

Best wishes

Krishna Prashanth

(kplogs)

7.

I watched a tamil movie produced by Prakash Raj last night– ‘Mozhi’. It was a story of a young woman ‘Archana’ ,who was born deaf and dumb , who didn’t appreciate speech,who did’nt understand music and who falls in love with a man of music, a keyboardist. Well, it was a neatly crafted movie with humor aplenty. If you haven’t watched it yet, I might recommend it.( Warning: Dont expect some intelligent thinking or curious plots. Its not of that class. Just enjoy it!).The movie however resounds an important thought that i want to discuss about here. The idea of music as a language rather than just a form of sound delivery. The idea of music as a medium of instruction rather than a mode of entertainment.

Music has been the friend of man since time immemorial. It is still not very certain regarding the origin of music amongst human beings. Besides in my opininon such information might only serve as valuable piece of historical information and no more. Because unlike the art of writing or engineering , ‘an-ear-for-music’ cannot be taught and does not go down through generations. Its more instinctive than intellectual. Although the art of creating good music can be taught. Not the way to appreciate it. May be thats why even a small kid in Algeria can get turned on listening to M S Subbalaxmi, or an old man in Taiwan listening to David Gilmour.

No, I am not suggesting that ‘an-ear-for-music’ has nothing to do with the culture of individuals. It is very much the case that culture, profession and standing in the society define the level and the timbre of music somebody appreciates. However , I would first want to distinguish between people who can listen to music and enjoy it and the ones who can listen to music and feel its message and hence enjoy the feeling. These are two categories of individuals in the world. And I would be compelled to refer to the former as ‘Music-Deaf’ (Kindly distinguish these from the ‘Tone-Deaf’ )

I meet numerous Music Deaf people all around me everyday, who appreciate “Kabhi -Kabhi’ because its catchy and easy to remember, who like A R Rahman because his tunes are ‘different’ from the rest, who like ‘ Metallica’ because they are ‘heavy’ , who like ‘Harry Belafonte’ because he is ‘funny’ , who like Nirvana because Kurt Cobain was a ‘true’ rockster, who like Roger Waters because he goes well with Dope and who like Joe Satriani because his fingering is very fast and Bhimsen Joshi because he can hold his breath for long.

But many times (although rarely) I meet those who can see the ‘Mozhi of Music’ . They can see the image each tune conjures up in their minds. As if each song were telling them something about life. As if each section of a stanza in (irresepective of the language or the content of the lyrics) can mean something. The feeling is the same world over. Perhaps thats why we have chord notations like minor , major or diminished. Because when you play a major , world over anybody who has the ‘an-ear-for-music’ will feel a positive message, a diminished will create a feeling of sinister or a feeling of depraved sorrw etc.

Whales are supposed to be the only other mammal on earth, capable of singing. But humans cant understand their music. This brings me to a thought that Human-Music is probably the only true universal language of humans cutting across all lines of political , religious, racial and enconomic barriers. If we went world over , a man of music can easily speak to another, irrespective of cultural differences. Music creates a higher world order. Music is the solution !

Fallen leaves on this pathway

some brown or yellow green

Shine on this sunshine mellow

remind me of what things have been

Of the days I was a young fellow

Of the fleeting images I have seen

Of trains and buses and trite

Of people and their unseen might

Of rivers that whistle a song

but quietly and all night long

Campfires, dances and rosy flowers

broken huts, shining towers

Fallen Leaves on this pathway

some cracked some a mossy mess

Varied like the people I have met

People whom I couldn’t like any less

Or those trapped within hatred’s net

Of children and their innocent games

Of fights that ended before sunset

people with forgotten faces and names

Weird ideas and unbeleivable powers

wary incidents but certain to the core

Waking to watch those midnight showers

I could never walk that way anymore

Fallen Leaves on this pathway

as they dry down to meet the dust

Like myself at my finest hour

Fleeting seconds that count my breath

As I watch down from this ivory tower

60 seconds before my death

I lived on a plateau

with the kids of the plains

played till the moon rose

never knew any pains

They hid in the shadows

and I called out their names

they showed up sometimes

Oh those lovely games

The huts had no lights

save for the lantern flames

and before the sun rose

The beams of the goods trains

Crickets and birds

Chirped in the night light

We knew no reason

No sins and no Fight

And then

The kids of the plains

Went hiding someplace

Now I call out their names

But they left me no trace

Not by the boulders

nor behind any door

and there is no sign

Of those days anymore.

I call out for them

But my sounds die in the noise

of money and sinister

And they dont hear my Voice

Diamonds on her fingers
and a stone studded wear
pearls from distant lands
Amidst a platinum glare

Kings from all lands on earth
Princes from far and wide
Ministers, all men of power
All her girl friends beside

Large palaces of grandeur
And mansions flowing with glee
A moment of a divine occasion
The wedding of the daughter of D

She looks like an heavenly angel
She shines under the camera glaze
with all the glitter, and color adorned
Where is the smile on her face?

She stares at a distant nowhere
Beyond the oceans of this noise
Behind all the pomp and grandeur
She has everything but a choice!

Bound by the stones on her neckline
and the words on the Morning Times
She sits without a word spoken
Nor listening to the wedding Chimes

She can’t stir away to her freedom
Feel the breeze in the Arabian Sea
For no matter what she is by herself,
She is the lovely daughter of D.

Down below falling swords

Craving for a human hand

Nothing said but silent words

Parted fingers, falling sand

And when she smiled a human smile

radiant and warm as the distant moon

dispelled fears of the dark and vile

I learnt I can be be alive too soon.

Saw the light of a friend’s trust

Saw the might of a tender touch

The power of love over skinny lust,

and Adam’s sin,but none too much

Stretched a second over several hours

Pushed a minute to over day and night

midnight winds into morning showers.

A Picture perfect in Black and White

Learnt the way to share a pie

Learnt the way to lose a game

Learnt to laugh and learnt to cry

To follow a rule and break the same

The grass around my fence grew green

The sky over my roof went blue

The air went fresh like it never had been

Daylight glowed with an yellow hue.

I knew she liked the way I sang

I knew she loved to hold my hand

The spreading joy when her laughter rang

Dismissing grief with a magic wand.

Growing plants of the trust we had seeded

Grew into branches that spread high above

And when at last I felt like needed

I knew for sure I was in LOVE!

Immersed in a fantasy of marmalede dream

Living on the clouds of a sunny day

I fell to trust an untrue scheme

Like an actor in an endless play

Failed to pluck out the thorns beside the rose

Failed to see the end coming soon

To sense the darkness before it shows

To see the craters on the Distant moon!

The end it came like a silent bird
Admist the noises of merriful glee
It came and left without a single word
It was bound to flow,and it did flee

Lost in words of a poets frame
Bound by the limits I cannot cross
An helpless player who lost his game
bearing the brunt of an unbearable loss!

Looks like we suddenly have something more serious to worry than catching up with China , on its fast paced growth. The harsh reality seems to be that we need to grapple the global recession.

After 4 years of consistent growth of above 9% on our GDP, and Chidambaram’s trust on our strong economic fundamentals, many of us reluctant to agree that we may have to fall along with the rest of the world, if the US hits (or has it already hit?) the bad ‘R’ word.

Was reading an article by Swaminathan Ankleshwar Aiyyar of the Swaminomics fame. (Read the full article here : End of the 9% Growth dream) and would like to present at this point the growth figures of the last four years of some countries probably unheard of by the normal Indian.

Country GDP Growth figure Year

Azerbaijan : 31% 2006

Azerbaijan: 27% 2007

Turkmenistan: 18% 2006

Sudan 12% 2006

Liberia 9% 2007

These growths only go on to accede to the debate that the growth in India was purely a result of surfing on the global tide of growth. Not necessarily due to Indian resourcefulness. The sustained growth of 9% might have pushed us into an illusion with a foul after taste.

The US over spending has undoubtedly created a huge demand for products and services, across the globe and when the demand got stretched beyond limit, anybody who could produce a good or cater a service got the chance to supply the same and make a lot of Forex. The growth has been directly or indirectly connected to the demand from the US. Propelled by the dream of sustained growth the markets were furthur opened. But is the promise of free global markets failing to work?

How delinked we can get to such global catastrophes is dependent on how fast can our domestic consumption grow. We need to aim at a high growth of domestic consumption and not merely an illusory growth due to external demand!

Today is the 5th anniversary of the US military operations in Iraq. World over, there is an increasing distaste over the US operations . Nearly 4,000 US soldiers have lost their lives. More than 30,000 US soldiers have been wounded. Tens of thousands of Iraqis have been killed. Millions have been forced to flee their homes. Suicide rates amongst US soldiers have increased by atleast 10%. About half a trillion US dollars have been spent on this mission, and another 2.5 trillion US dollars will be spent on the continuing US operations. No Weapons of Mass Destruction (WMD) were discovered in Iraq.And yet Al Qaeda is still alive and running!

Enough fodder for one to question the usefulness of this magnanimous sacrifice of human lives and money! However, George Bush , in a speech marking the 5th anniversary of Iraqi operations sticks firmly to his stand. He says that the operations have made the world a safer place to live in.

After the initial embarrassment of not finding any WMD’s , it was claimed that Saddam’s Government had links to the Al Quaeda, which is still is not proved. Later it was said that Iraq was funding the Palestinian Suicide bombers which didn’t seem to be true. Finally it was the oil in Iraq which was blamed for all the burning. The invasion resulted in the gory execution of Saddam, and finally the civil war between the Shias and the Sunnis in Iraq. Many people have begun to wonder if Iraq was after all just another Veitnam, a huge waste of precious lives and money!

In the wake of all this, one is astounded at the ability of Bush to still cling on to his veiws. A better leader might just realise the folly and call his troops back!!

The US Federal Reserve moved in as a saviour to stop the downward tirade of the stock markets by cutting 0.75% of key interest rates in the wake of the all the misfortunes in the world wide markets. Things indeed seem to have bettered a bit. The stock markets world wide have bounced back significantly. But the question for the moment is “How long will the party last?”

Experts feel that these kind of Fed cuts are fine as far as they are only a stimulus package. Not if these can become the sole backbone of good times. They fear that the environment of rising inflation is not the best for such cuts. Inspite of all that partying today when the markets closed, the fear of recession still lurks!

The fear for the moment is the worst for those working for banks (large or small!) in the US and UK. The fall of Bear Searn has probably triggered the panic already!(Read :The Fall of the Bear!) Its hard to digest that a bank as established as Bear Searn could not manage to convince other banks to loan it money to bale out of its hedge fund crisis. The condition seems tense and the banking districts (mainly in London and New York) are waking to a new reality. The reality of losing jobs.

An official forecast predicts the loss of atleast 10,000 banking jobs by the end of this year in UK alone. Already several employees have got their pink slips in various banks including Citigroup , Morgan Stanley, Merrill Lynch. The dot com burst in 2001-2003 saw atleast 20,000 banking jobs lost in 2 years. Bankers feel that this recession could be worse.