Interdependent co-arising intra-country example

In previous blog “Coalgate…” I touched on the topic of Dutch Disease. The concept of Dutch disease rebounds me to the interdependent co-arising once again (interdependent co-arising means – we are all dependent on each other.). This concept of Buddhism is applicable in every walk of life. If we (each individual) do not understand it we are going to remain in the problems we face. Check previous blogs on the same below.

Interdependent co-arising farmers example (ground level example) – this blog is about how interdependent co-arising relates to a smaller level of activity of one businessman / farmer. This could be you or me in our regular work environment.

Interdependent co-arising macroeconomic example (world level example) – this blog is about how interdependent co-arising relates to macro-economics.

This blog is a country level example of interdependent co-arising (Pali original concept – Pratītyasamutpāda – at Wikipedia).

What is Dutch disease?

The inflow of capital leads to an appreciation of the currency, making imports cheap and export expensive. The name comes from the Netherlands experience following the discovery of has in the north sea. Natural gas sales drove Dutch currency up, seriously hurting the country’s other export industries.

In late 50′s Netherlands found huge source of natural gases. This resulted in 1. investments (largely foreign direct investments) in that sector 2. decline in other sectors e.g. one example could be people moving for jobs in that sector (consider Indian IT sector as reference) 3. investments (specially foreign investments) in that sector resulted in stronger currency. The excessive investment made Netherlands currency stronger resulting in making exports expensive eventually resulting in decline of export from Netherlands. Manufacturing suffered and thus jobs in manufacturing too go to step 2.

This convoluted – action/reaction and impact at not so obvious industries – example again suggests to us that even if industries are not linked directly they are linked in some way. This link is interdependence. This interdependence should make one value the existence.

The  “Dutch disease” should make us once again think about the invisible connections we share with each other.

Image source – http://globalprosperity.wordpress.com/2010/08/19/oiling-africas-gears-for-democratic-change/

#CoalGate, corruption, politics & economics

A few days back I completed this book Globalization and is discontent by Dr Stiglitz, a nobel laureate. I wrote on that recently – Interdependent co-arising a macroeconoics example. Besides this macroeconomics example, I had this intra-country example of the same concept of interdependent co-arising. Stiglitz has written so many things more than 10 years back which are happening in India currently. However, here I am just interested in quoting a small part of the book which relates to the corruption of coal mine allocation in present day India. This example is from page 71 of the book -

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There is more to the list of legitimate Complaints against Foreign Direct Investment (FDI). Such investments often flourish only because of special privileges extracted from the govt. While standard economics focuses on the distortion of incentives that result from such privileges,  there is a far more insidious aspect: often those privileges are the result of corruption the bribery of govt officials. The Foreign Direct Investment comes only at the price of undermining domestic processes. This is particularly true for investments in much oil and other natural resources where foreigners have a real incentive to obtain the conversation at low prices.

Moreover such investment have other adverse effect- and often so not promote growth.  The income that mining conversation brings can be invaluable but Development is a transformation of society. An investment in mine – say in a remote area of a country – does little to assist the development transformation, beyond the resources it generates. It can help create a dual economy, an economy in which there are pocket of wealth. But this duel economy is not a developed economy. Indeed, the inflow of resources can sometimes actually impede development, through a process that is called “Dutch disease”

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So effectively, what Stiglitz said was bribing of officials for mining in developing / undeveloped countries. Further, the dual economy this FDI may create is not best for country to develop. I would take this example of Dutch disease in my next post – “Business to the Buddha”.

Here what I want to highlight is this – the current issue in India – #CoalGate scam is a clear example of what Stiglitz wrote more than 10 years back. Indian Prime Minister – Dr Manmohan Singh – being an economist might have been aware about this and perhaps therefore kept Coal Ministry with him. This is just an extrapolation. Otherwise why would Law ministry and Law minster would want to change parts of report? According to the Supreme Court of India, the changes are Heart of the report.

After reading the book – Globalization and its discontents – I realized that Stiglitz is not against Globalization but against the way Globalization is happening. So, when you read the above part, you should not infer that Stiglitz is against Globalization.

Generation running behind Technology

Over the weekend I was talking to Rummuser uncleji. We were talking about many things one was – “uncleji you dont call me, its only me who calls you!”. So he said “Pravin  I am a generation old and for me internet, mobile etc are new age things and not necessary to communicate.” In fact he told me that he even receives inland letters from some of his friends. What? thats history right? But yes  STILL that is also a mode of communication.

I happened to read the following, copied as image some time back (source unknown now). I was thinking that it is true, my father must be thinking, this is too much what these guys and the kids do. This is complex and where all would this technological running around go and end?

Convergence of Social Tech

The question I asked myself was is it generation, running behind the technology? That is Latest things and fashion introduced and the young one’s running behind them. Or is it Generation running behind, technology? That is generations left behind the technology evolution and just trying to catch up or sit and relax. Older people who use technology as and when required.

Perhaps 30 years from now I would think the same manner. Technology would be even more evolved and kids of that generation would find it cool, ok and obvious. At times those kids would think – how our forefathers survived without such gadgets?
I think if my father is thinking something about technology and how far would it go? He is right, there seems to be no end. Step back and ask yourself – do you need a tweeter or a facebook to have a “Social Network” or to be “socially connected”? Do you think you need a mobile to Communicate? Do you think you need a TV or movie for Entertainment? I dont intend to say that we dont need many things; the question is how much is needed? and when is it needed?

World would keep on evolving but there would be something that wont change and time and again a few people would think about it. Should we just stop and look within now? Is not it enough of running around?

Interdependent co-arising – macro-economics example

I hae written on Interdependent co-arising (older blogs at the link) earlier.  The concept simply means – we are all dependent on each other.

Those who want to know the concept in layman term follow this blog – interdependent co-arising example of a farmer.

Definintion of interdependent co-arising is below with a macro-economics example. In late 90′s the East Asian countries faced a very serious economic challenge of decades. The financial system came down like a house of cards. Dr Joseph Stiglitz - Economics Nobel Prize winner of 2001 – shares the concept of interdependent co-arising (dooming in otherwords) in his book  - “Globalization and its discontent“. On Page 106-107 he invariably – and inadvertently perhaps – explains what is interdependent co-arising. Hope economists would understand this lesson, if not from the Buddha then from Dr Stiglitz.

Beggar-Thyself Policies

Of all the mistakes the IMF committed as the East Asian crisis spread from one conuntry to another in 1997 and 1998, one of the hardest to fathom was the Fund’s failure to recognize the important interactions amont the policeis pursued in the different countries. Contractionary policies in one country not only deepened that country’s economy but had adverse effects on its neighbors. By continuing to advocate contractionary policies the IMF exacerbated the contagion, the spread of the downturn from one country to the next. As each country weakened, it reduced its imports from its neighbors, thereby pulling its neighbors down.

The beggar-thy-neighbor policies of the 1930s are generally thought to have played an important role in the spread of the Great Depression. Each country hit by a downturn bolster its own economy by cutting back on exports and thus shifting consumer demands to its own products.A country would cut back on export by imposing tariffs and by making competitive devaluation of its currency, which made its own goods cheaper and others countries’ more expensive. Howeer, as each country cut back on imports it suceeded in “exporting” the economic downturn to its neighbors. Hence the term bagger-thy-neighbor.

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Solution to all these economic, social, personal, spiritual or other problems?

Its interdependent co-arising itself. We all need to help each other grow – grow the pie and share it well, if not equally!

Border-less world

Let us imagine, a border-less world. A world where

Border-less world

1. people can move from one place to the other without Visas
2. goods and services can be bought and sold without import/export duties
3. education is free (at least basic education)
4. people would be free to do what they want to do (not taking law in their hand though)

I believe both the leading economic “-isms” and many spiritual/religious “-isms” have been trying to do that for years.

The economic “-ism” are capitalism and socialism. Socialists want this by making a world a single big society where everyone is working for the society. Capitalists are trying to do it through Washington Consensus and IMF. Until now the results have been failure. Russia failed, China becoming a capitalist USA (being protectionist) walking on the way to become more socialistic. Seems There could be a middle path where both these -isms are together.

Religious groups “-ism” are Christianity, Islam, Buddhism, Hinduism etc. Christianity wants the world to be Christan, Islam talks about Universal brotherhood. I am not sure about the other two asking people to convert to their religion though. However, Hinduism talks about Vasidhev Kutumbakam. Vasidhev Kutumbakam means one world family. But the idea all over the world is unity and unifying the world in different ways.

All this is failing because – the ulterior motives are money or fan following (I mean increasing number of followers of the religion).  Since both they ways seem not working, what if we turn to something else, no politician, no economist and no religious group to lead. People leading the people’s movement!

Take the following case – Social media for social service, crowd sourcing based funding (crowd funding) and initiatives such as Janlokpal (India), Occupy Wall Street (USA), Jasmin revolution (Tunisia) and Tahrir square (Egypt) etc. If people are empowered yet are asked not to encroach on others freedom. What if we really become an educated world, without politics, without divisions, without borders.

This may happen if we remove ego and greed from our society!

Segment of one & inclusive growth

What are we? We are a society, made of communities, families and individuals. We are talking about growth on global scale. At times we are talking more about “saving” the world from financial melt down. I sometimes think – who has created it at the first place? That is for some other day though.

When we see growth we talk on aggregate level – GDP of the country, GDP growth rate, reserve, unemployment rate etc. Have we ever thought that these numbers are “aggregate level” number for example – if I put my one hand in boiling water and another at minus thirty degrees [100+ (-30)], average temperature of my body is 35 degrees. But does that mean I am fine? No my one hand is burnt and other is numb. That is the reality of aggregate level measures.

How do we resolve such inconsistencies? Let us start measuring things in terms of segments. As they call it in Marketing, Segmentation. On a very deeper level as segment of one. “Segment of one” means handling each individual as an individual (and not as any generic segment). Though is more of marketing and in my professional experience analytics gyan (which is not purpose of this blog) so I would come back to the point.

If we do that Marketing stuff of Segment (segment of one) in society and eventually to the individuals. We would realize that “inclusive growth” is only possible when we take growth stories to communities, at smaller level say villages, communities, to each family to each individual. I see that as the solution to a better reflection of growth. I better measure would emerge from there, upliftment of each individual.

Writing this, I feel as if I’m a politicians, speak and no action! How to do that is the question. A very idealistic solution – what if we’ve unemployment benefits for everyone also encourage everyone to do what he/she wants to do – until found success, unemployment benefits would help these people. Word of caution – there may be free-riders one has to fix that challenge. Take an example of Venture Capitalists and Funders. They do the same but at a later stage – say when I found my calling, started working and kind of see a revenue model. This is truly a very impractical and idealistic solution, but can we build on this to devise a practical and applicable solution from it?

Image source – http://www.dmnews.com/marketing-to-a-customer-segment-of-one/article/262747/

Wealth and Wisdom

Wealth is the abundance of valuable resources or material possessions. Wealth in itself is of no value, someone owning it gives “it” some “value”.  Similarly Wisdom (Hinduism) is considered a state of mind and soul where a person achieves salvation. Again here salvation is achieved by “someone”. So salvation may not be anything in itself, right? Once you achieve it there is no “self”, that is another side of it though.

The definition of wealth (or for being wealthy) in my opinion is – when you have no more desire to earn more possession – when you have complete disinterest for money – you are wealthy. Because there is no end to earning. There may be a possibility that you are the wealthiest person on earth in the list of Forbes. You may not be interested to say “enough is enough!” I don’t need more money.

According to me one is wealthy – if one decides doing things because he/she enjoys doing the work and therefore does his/her work just for the hack of it. Say if I go to office with a motive of Salary at the end of the month, I am not wealthy. But if I do the same work because I enjoy doing it, feel self-satisfied and content. so the salary is not the desire but the fulfillment I achieve makes me wealthy. The later becomes reality with wisdom.

What if wealth and wisdom meet? The age old approach of the west (wealth) meets the even older approach for life of the east (wisdom). I do not think the world would remain the same, this world would become wealthy and wise. Largely we would stop running for growth, to bailout countries and to make more money. This would be the world where the Business would meet the Buddha and people would do their work as their duty rather than compulsion.

Definition source – Wikipedia

Image source – Pinterest

33 – Understanding change and change in understanding

33 Understanding change and change in understanding is a book by Richard Saul Wurman. You know TED conferences? He created that. I want to write a lot of blogs (perhaps one for each page from the book).

Professor Mankad gave this book to me, when I requested him for opinions on few of my blogs. The book is very interesting, I will read it again before giving back to him. Today I am referring to a chapter of the book – I am a zoo episode.

The protagonist is astound at the arrogance of man. The author writes – “… they are just so proud of themselves in all their various religious books, the Bible, the Koran, the Book of the Dead, the Bhagavad Gita and many, many more.

In every one of these tomes it was man this man that man, and besides the fact that it was men and women, the arrogance of thinking of ourselves as a single species just amazed the Commissioner…”

“Bacteria, the Commissioner knew, subdivide and reproduce, in effect multiplying by division. The human body… …has many trillions of cells and 90% are bacteria!…”

“I am a zoo, the commissioner said, Because that is what I am. It would be only religious arrogance to see myself as a single species.”

I wonder if the author wanted to say zoo in terms of our thoughts too. We have so many so diverse thought that we are a zoo and a jungle within our mind too.

We are much more than what we think we are. I was recently talking to my father and he suggested – “we are made of various tissues, tissues are made of cells and molecules and atoms and particles. Now each particle is in effect an energy packet. So we eventually are indestructible in that sense.”

What we need to remember is – understanding the change helps in change in understanding!

Budget 2013 & rainwater harvesting

I was on twitter when Budget speech was going on. I read investment in so many good projects and felt good about it. Suddenly realized – wait, should I objectively look at the expenditure? How are these expenditure be accounted for and use? What best use is possible of this money? Can we reduce some expenses by approaching a lot of things differently? Though I did not mean overlooking required support to common man, but still is there any alternative way? Is there any Jugad as we call in Hindi.

My previous blog was on the plight of farmers in Maharashtra – Self respect. In Budget 2013 Drinking water and sanitation is allocated 15,000 Cr and watershed 5000 Cr. So, I connected these thoughts and remembered a discussion with my father last Sept when I went to Indore. We discussed that the area of Indore is about 500 square-KM. Each year Indore receives average of 39 inches of rainfall about 1 meter. Rainfall is calculated as based on a simple method – how much water would a container receive in the rains, if the container is kept open under the sky?

If only 10% of this rainwater is harvested, how much would it be? This 10% is very least which can be done. Right now I can think of  this 10% as roof tops of private & public buildings, unused space under Govts possession e.g. polo ground (a place in Indore), University &  college grounds and say roads (with proper water canal diverting water to the harvesting area).

Based on the definition of rainfall measurement if that 10% is the container, this container would be of a size of 10% of 500 square-KM

Container size would be about 50 square-KM.

This container can accumulate a whooping 50 square-KM water upto 1 meter height during the rains.

Let me convert it into cubic meters – 50X 1000 X 1000 (Square meters) X 1 meter

50,000,000 cubic meters of water!

If it is assumed that population of Indore is 2,000,000 and each individual uses 40 cubic meter water per year, 63% of the water requirement (50,000,000/2,000,000X40) of Indore can be fulfilled by harvested rainwater itself. The surplus saved water (which otherwise required in Indore) can be used by farmers around Indore. What if that is done all over India? Government can save a lot of extravagant expense on  irrigation & drinking water schemes.

Advantages -

1. Budget money saved by water harvesting

2. Life saved by reducing chances of drought

3. Increased agriculture produce due to availability of water – addition to the GDP!

I belong to a small district headquarter Dhar in MP. About a thousand years ago a King ruled Dhar – Raja Bhoj. It is said that during his tenure he made 12 lakes for water. All these lakes were connected to each other for collecting rainwater. If during rains one lake overflows, the water would flow to the other. This was 1000 years back. I wonder what are we doing now.

Now watch this Ted talk for solution implemented even before Britishers came to rule India. There is hope, just Wake up and take action.

Self respect – Volunteer for a better India

I see that poor people have very high self respect- they wont accept money even as a support in their plight. However, those who have the least self respect are asking for money (see the corruption/scams – politicians and babus).

Remember Satyamev Jayate of last year? Remember Amir Khan talking about drought problem in India in the show? This blog relates to similar such incident close to 9 months after the airing of the show.

On Thursday I came back home from work as usual – tired and just wanting to quickly have dinner and go off to bed. On dining table I heard this story – well a truth. This story ends (rather continues till today 25th Feb 13) at the Azad Maidan in Mumbai. A group of farmer from Solapur District in Maharashtra are sitting on Dharna for last3 weeks. The reason, what I understood with no maps and little understanding is below.

There is a river Bhima in Maharashtra (Check Google maps for Ujani dam). On this river government of Maharashtra has made a dam (Ujani Dharan, in Marathi) and a canal (Ujava dava kalva). This canal was apparently created for providing irrigation support to the farmers in that area. Well the Government confiscated the land from farmers stating that this land acquisition is for making a canal for them. Check the handmade drawing and explanation of situation below.

The canal is dried; water is released to the Sina River side for factories but not for the Villagers. Why? Sugar lobby! The stark reality I came to know is this -

1. someone (at least one, possibility of more cannot be denied) died digging a well further (the well was already very deep)

2. someone died digging a well even further because some poisonous gases emitted from the earth (dug so deep)

3. someone fell (perhaps jumped) in the well and died

The truth I came to know at my dinning table is this that The demonstrating farmers wanted to meet The Honorable CM of Maharashtra (Mr Prithivraj Chavan). They could meet him somehow (pushing their way in).

Pritish Nandi (a respected person of India) tweeted some days back about Mr Chavan “he is a good fellow”. He may be, but the solution he gave to the farmers would shatter this statement of Mr Nandi. The solution he suggested to the Farmers is this – you would get water in the Ujava Dava Kalva, but promise me your would only use it for drinking. What? Are you insane? Boss – what would farmers “do” than? leave their villages and start working in, perhaps the Sugar mills? Where would the sugar mills get cane for making cane sugar? Honestly speaking – I have no doubt on what Mr Nandi had to say, Mr Chavan must be a good fellow, under pressure from somewhere to make this statement.

Mr Chavan – I respect him because Mr Nandi said something good about him – is called ‘Baba’ amongst locals. these villagers are singing songs in the evening – “‘Baba’ pani dya…”. It sound like “Allah megh de, megh de pani de…”. ‘Baba’ can you please listen to these villagers?

The villagers were sitting on Dharna at Azad Maidan, these people are surviving on Vada pao (in Mumbai Vada pao is the one of the cheapest food to survive). When I heard that situation I felt like crying. Yet crying would not solve the problem. I thought I would help them in whatever way I can, perhaps give them some money. However, I have seen – poor people have very high self-respect, they wont ask or take money. I feel that something has to be done because giving money once is not going to solve the problem. They wont even accept that money. Be a Volunteer for a Better India!

At the same time Guruji (Sri Sri Ravishankar) is in Mumbai. In one public talk he said -

1. do rain water harvesting, that seems a solution

2. Volunteer for a better India

Pictorial sketch of the Solapur district discussed above -

The central box is Ujani dam, left to it is Bhima river. From the Ujani dam there are two ways water flows. To your left there is Ujava dava Kalva and to your right a tunnel to Sina River (Govt also created this tunnel). At the bottom of this image there is Sina river. On the shores of Sina river, there are Sugar mills. Now you see a box has been created between Ujava dava Kalva and Sina river. People of these villages do not even have water to drink.

By the way Sugar mills are supported by Government of India big time (check ET 25th Feb 13 for page 20) . Actually, Home Minister of India (Mr Sushil Kumar Shinde) belongs to Solapur District and the Agriculture Minister of India (Mr Sharad Pawar) is from that side. Also, many of the owners of these mills are sitting MLAs or MPs. I heard Guruji saying that the Sugar lobby is very strong in India.