Can India Ever be Free of Corruption?

Posted by: on Dec 23, 2011 | 22 Comments

‘Trial Opens in Indian Telecoms Case’

‘Graft Scandal Hits Indian Opposition’

Are these the newspaper headlines we

Zero Tolerance for Corruption

Posted by: on Dec 16, 2011 | 4 Comments

The number 1 topic of discussion these days is corruption. Will putting people in jail solve the problem? Is it even the right thing to do? NO.

The Commonwealth Games

Posted by: on Oct 18, 2010 | No Comments

It must have struck some of you; the way the media, in the middle of the commonwealth games, seemed to change its very acrimonious stance towards the government. The games went very quickly from being shame of the nation to being a cause for patriotic pride.

Government: Less is More

Posted by: on Sep 7, 2006 | No Comments

Why do governments fail? Why are governments everywhere the butt of jokes? In the US, comedians regularly make fun of the president and the gargantuan federal government he heads.

Freedom and Peace

Posted by: on Jan 16, 2005 | No Comments

Nepal needs peace. Its people are demanding it. They are demanding it because they know intuitively that the peace dividend can be huge. They know – no economist needs to tell them – that the resources which are being diverted by the government and the Maoists to fighting each other could go towards enriching them, should peace prevail.

I am not an expert on conflict resolution; I do not know what demands of Maoists can be met and what can’t be. However, I do know that to end the recruitment of the young people of this nation by Maoists, alternate employment opportunities are required.

Lack of opportunity is the reason that enabled Maoists to cheaply recruit the unemployed youth. If the young boys and girls had economic opportunity, if they could obtain jobs, or had the chance to start their own businesses, it would have been impossible for them to be hired by any terrorist organization.

People who are making money cannot easily be led to their deaths. The young in Singapore, Hong Kong, Dubai, South Korea, and Australia do not offer their lives for revolutionary causes. They have too much to lose.

In Nepal, the girls and boys joining the Maoist had little to lose. It was easy, therefore, for the leaders of this ‘red revolution’ to capture the imagination of the young. They offered the young a life with a purpose. Yes, you could die, but, is life without a job and without hope of one any better? And, what if you won? You would then have the opportunity not only to chart your own destiny but that of your motherland as well. Many considered the rewards well worth the risk of catching a police or army bullet.

For peace to come, negotiations must go on, and one hopes that they succeed. However, the government must, irrespective of how the negotiations proceed, also take measures to end the conditions which led to so many of Nepal’s able-bodied men and women becoming terrorists.

It is not a pre-condition for Nepal’s economic progress that peace prevails. It would indeed be nice if it happens. If however the country and its citizens have access to economic opportunity and wealth, peace is that much more probable.

What is it that is essential for progress and prosperity? Economic freedom. Let the government institute as many market friendly policies granting people freedom to trade, manufacture, and deal with foreigners, and the chances of ending terrorism increase manifold. People, if they are busy doing business deals will not join the Maoists. Those who are already with the Maoist will find reasons to leave if jobs and opportunity are on offer.

The single most important measure which the government can take is to end all controls and taxes on foreign trade. As soon as this happens, people will become busy with imports and exports. They will become busy selling cheap goods to the Indians and Chinese. They will be busy manning the shops, and running shopping arcades for tourists. They will be busy handling the avalanche of shoppers which will descend on them from the neighbouring countries.

Imagine a duty free Nepal. Keep in mind that labour rates are the cheapest in the world and real estate costs are low. All this results in an explosive combination except that this will be an explosion which doesn’t cause death and destruction, but results in wealth and jobs. Shoppers will forget Hongkong, Singapore, and Dubai for Nepal.

Free foreign investment from bureaucratic oversight and regulation. Open every sector of the economy to investment. Reduce taxes and end the red tape which feeds corruption. Guarantee property rights and apply the law equally to all.

Do this and unemployment will end in no time. It will then be an uphill task for the Maoists to retain their comrades let alone obtain fresh recruits. The opportunity to pursue prosperity is hard to compete against, and the Maoist will soon find that out. Revolutionary slogans sell only if the audience have nothing to lose.

I don’t know when or even whether this country’s rulers will take it on this path to prosperity and peace. I do know that should a leader with vision and guts choose to make the people economically free, peace will follow as surely as the day follows the night.

The Himalyan Times

India Shining

Posted by: on Jan 10, 2005 | No Comments

The evidence is staring us in our face. Government is inefficient. Get it out of our lives. Restrict it. Let it perform only its core functions. We will benefit greatly.

Consider the opening of the skies between New Delhi and Kathmandu to private airlines. The exclusive privileges of RNAC, IA and Druk, have been revoked – hopefully for ever. We now have Jet, Sahara, and Cosmic offering us flights as well.

As would be expected, fares have crashed, service has improved, and travelers have a much wider choice as to the time they leave or arrive in Kathmandu. The benefits are going to the travelers, travel agents, hotels, casinos, and others associated with the tourism industry of Nepal.

Economy airfare to Delhi used to be Rs.13,000. Not any longer. All sorts of offers are available. It is easy to travel for Rs.9,600 if you are alone, and if you are in a group, you may pay just Rs.8,000.

If on average 500 travelers use these flights daily, and they now have to spend Rs.1,600 less on their tickets, that means Rs.800,000 a day is being put back into the pockets of the traveling public. On a yearly basis commuters will save Rs.300 million on their travel to Delhi alone. One can now have some idea of how much government monopolies, restrictions, and licensing requirements are costing the people of this country.

The savings have seemingly come out of thin air. Everyone is smiling. Consumers are paying less despite increase in the general price level. Private airlines are happy otherwise they would not have so eagerly commenced operations. Everyone related to the travel trade is ecstatic hoping that additional travelers will mean more money in their pocket.

The only loss has been that of ‘inefficiency’. Bloated government bureaucracies manning RNAC and IA now have to compete and this competition is making them improve too. Those in the travel trade tell us of how the arrogance exhibited by the staff of these airlines has been replaced by a new found humility.

The only question is, why did it take so long? These steps could and should have been taken much earlier. We had enough examples of the success of ‘open sky policies’ in the world.

Let us take the US. Almost 13 years ago, on December 10, 1991, this is what was published in the International Herald Tribune under the heading “Deregulation is working”.

“… deregulation has mostly done just what it was supposed to do, giving most air travelers more flights, more convenient schedules and substantially lower fares.

… For every Midway or Pan American that has departed, a USAir or Delta has taken its place.

…the number of airlines competing on typical routes has risen by one-third under deregulation. That is why fares are now 20 per cent below what the government would have set under its old formula.

… In a new study, Robert Gordon of Northwestern University shows that hub-and-spoke schedules have added more nonstop flights than they have eliminated. And there are more convenient options for nearly every traveller.

…the Brookings scholars conclude that travelers are better off, to the tune of tens of billions a year in lower fares and added convenience.”

It is apparent that no business should ever be granted monopoly or semi-monopoly privileges. Competition benefits us and it is only a matter of time before the benefits spread to all the people of a country.

The road ahead is clear. There should be no further hesitancy or partial steps. Open the skies completely. Allow any airline from any part of the world to come to Nepal. We need more flights and more competition on every route. Let any airline which is willing to fly from Kathmandu to any place on earth do so.

Further privatize all airports and allow them to cater to not only domestic airlines but to international ones as well. Allow international airlines to fly on domestic sectors too and open the domestic airline business to foreign investment.

The benefits to the people of Nepal would not be in millions of rupees but be in billions.

The Himalyan Times