India should evolve a common economic model that works and apply it sector after sector. Despite setbacks, among all the sectors, telecom is a success story in India. It has created value to both rich and poor and served as a infrastructure for other sectors to grow. IT sector again has grown by the presence of multinational companies.
A common economic model should have place for
– public sector participation, in addition to being a financially sound competitor, companies should focus on being a good employer or employer of choice with adequate balance vis-a-vis other stakeholder. Like any company they should grow and generate employment, support customers and benefit to society at large. Stake need not be majority as long as it is high enough to have control/influence depending on if acting as a strategic investor/financial/social investor. Each institute should find its own theme and differentiation, compete aggressively without compromising values.
– Domestic private players are key to grow the market. They should be encouraged to develop great brands, best practices in corporate governance with strong focus on innovation and quality
– Multinational/Foreign companies that bring technology and investment
– Small and Medium enterprises, distribution channels overall expanding the eco-system
– A strong regulator
– Auditor like CAG
– Encourage branding
– Regime of License Fees, which makes sure that Government gets good revenue up-front for market opportunity shared. Generally income tax and other taxes can be evaded
– Focus on making products keeping both unique local needs and global standards
How about applying this model to sectors like Roads?
In addition, instead of going for lowest bids, decide on a fair rate that is fair to both parties and choose the party that can provide best Quality. Use Quality First approach. So evaluate bidders as per credentials.
Manage Moral hazards- Many vendors try to sell licenses and make windfall gains and some others try to buy them through back-door.
Vendors that outwit Government in conspiracy with Government Officials or otherwise should be given negative scores which will put them at a disadvantage.
Any terms for bids should be pre-approved by CAG or standardized so that they are not tweaked with malicious intent.
Think of entire state regions managed by one big player for road-work and you can call and report a problem. The same operator should both build and maintain the road network, putting onus on him to do a good job. Instead of going for L1, which meant bidding unrealistically low bids to gain contracts and eliminate other competitors and then trying to renegotiate should be stopped. Again if you factor kickbacks, quality gets further compromised Quality and price should be fixed and vendors should be chosen based on track record and reputation.
All large entities(public or private) should be subject to RTI and CAG audits, and be forced to reveal information that may impact public interest. All whistle-blowers should be protected.
Common model should be applied to defence and any sector that is getting opened up or need to grow. Even agriculture can benefit from significant investment. India can benefit from shops like Costco in US, which sell large quantities to retail consumers at reduced price, These can balance and stabilize the prices. Both buyers and sellers should have choice.
Every time we should not have to work a new model for every sector. Evolve and standardize one and apply it like a cookie cutter.
Americans build big businesses out of even Parking lots.
Ideally using automation and process re-engineering it should be made very easy for a company to scale and operate as per rules. There should be no rules which change as per the size of the company. Distinction between regular and contract staff should be minimized. A clear regime for right to justice and continued employment/fair compensation at work place should be established.All work force in organized/unorganized sector should have access to benefits of pension, PF, and health-insurance, as appropriate using a common nation-wide model.