Trades have undergone a sea-change in their characteristics and variety over the years. The consumer’s demands today are no longer the same what they used to be yesterday. Even the markets have adapted themselves accordingly. Moreover, the change itself is not at all constant. It changes its pace depending upon the circumstances. Amid so much vulnerability and instability, it will be worthy enough to discuss constructive role of trades in promoting development of an economy in particular and of the world in aggregate.

BACKGROUND

“Need” had been a prime and sole cause for buying and selling on the basis of barter system for centuries. But with evolution of kingdoms, desires and luxury items also took place in the list. Unfortunately, after industrial revolution in London and before the end of World war – II, even the laborers (human beings) were added to such lists. Nevertheless, trades have always been a subject of debate and have faced protest at most of the times. Now – a – days, these are divided into three categories by nature. First is the system of buying and selling of goods which had been in place for several centuries. With establishment of stock exchanges, buying and selling of financial products began. Third is rendering of services in exchange of a particular fee for a particular period. These trades can significantly increase the productivity of an economy if executed in the right manner. Tunnel effect – a scientific phenomenon studied by Burke in the year 1952 is an apt concept in understanding and simplifying underlying criticalities of trades and issues related with them.

SIGNIFICANCE OF IMPORTS AND EXPORTS

• Competition: As the number of trades increase, competition for harvesting its benefits also increases provided entry and exit in the market are not restricted.
• Friendship: Trades promote peace. Any kind of exchange between two countries opens the gates for talks.
• Cultural Exchange: Public of the countries involved in trades need to understand each other’s culture in order to communicate effectively. This kind of mutual interaction indirectly enriches their cultures.
• Opportunities: Opportunities of business are directly proportional to trades. As the number of trades increase, more and more people tend to be a part of economic productivity and as a result, employment is bound to increase.
• Equalization: Trades act as a stabilizing agent by reducing “Demand – Supply” gap.

Increased competition, friendship, cultural exchange, opportunities and meeting of demand and supply in totality promote development.

CHALLENGES

Firstly, formations of Cartels like OPEC, Swiss banking cartels etc. empowers them to regulate prices of a specific commodity irrespective of actual demand and supply. Secondly, protectionism policies adopted by many countries like France and USA in an order to safeguard their domestic jobs from foreigners tends to overlook their indirect contribution. Thirdly, deadlock on issues of global importance like agricultural subsidies, environment etc. between developed and developing nations in Doha round are a great cause of concern. Lastly, other than tariff; dumping and currency pegging are the next two most serious challenges in the front of WTO as they promote unfair practices and cause damage to other economies.

UNDERSTANDING THE ROOT CAUSE

The scenario resembles exactly with an interesting yet controversial phenomenon of physics called ‘Tunnel Effect’ which advocates wave nature of light. According to it, if a wave of light is projected on an object then some of its part crosses that object and the rest of it gets reflected back. Similar is the case of an economy. Some of the trades projected towards the barrier of laws and regulations of an economy could enter through it in the form of import and the rest are sent back. The imports which could not take place due to barrier cause opportunity cost particularly to the exporting country as represented in the diagram below:

Figure 1: Three Dimensional Barriers

The 3-D barrier here represents rules and regulations applied by the government of a country on its economy. One of its dimensions is the government’s (ruling party) agenda itself, second belongs to the public which empowers the government to rule and third is the middlemen or businessmen whose growth indicates success of co-ordination, co-operation and collaboration between the other two dimensions.

SOLUTION

It is to accept that formulation of a universal solution for all issues may not be possible. Still, the study of 3D barrier as described above can assist us to handle major challenges. As shown in Fig. 2, government holds highest power within its few members. However, it is politically dependent on public desires in the form of their votes. Hence, it needs to follow the public indirectly (at least in democracy) if it wants to retain its chair.

It is the opportunity cost which if reduced can promote development. This can be done if WTO spreads awareness among middlemen or businessmen of various countries about how they are incurring silent losses in the form of opportunity cost. The need is to shift focus from the helpless governments to the major GDP contributors because a government cannot afford to neglect their demand. No doubt it is difficult to talk with so many middlemen but handful corporate giants can easily be persuaded.

It is to conclude that WTO plays a dual role of promoting free and fair trades and restricting unhealthy competition. Countries do take undue advantage of the loopholes arising out of the bifurcation of these two powers. Hence, it is the voting methodology by which all the members of WTO can arrive at a consensus on whether an act is morally right or not.

REFERENCES

1. Dr. Thomas Zettler – “The Tunnel Effect” (http://curvebank.calstatela.edu/tunnel/The%20Tunnel%20Effect.pdf)
2. Raymond V. McNally – Problems of Cartel Policy, American Journal of Economics and Sociology Volume 8, Issue 2, pages 107–115, January 1949
3. Aradhna Aggarwala – Trade Effects of Anti-dumping in India: Who Benefits? The International Trade Journal, Volume 25, Issue 1, 2010
4. UNDERSTANDING THE WTO: THE DOHA AGENDA – The Doha agenda (http://www.wto.org/english/thewto_e/whatis_e/tif_e/doha1_e.htm)

Contributed by Manish Gupta(Batch 2010, IBS Jaipur)

The demographics of today’s generation are racing at a speed as that of a rocket into the space.  The amount of shopping than an average person does is more than his needs and requirements. The reasons for this being the wide variety of choices, higher pay among people and higher standard of living. With such advent the frequency of people visiting stores has increased (though the race for online shopping is quickly taking a pace ahead)

Shopping in the olden days used to be limited to the need s and requirements or carried on only during festivals and occasions. People used to carry their own bags so that they need not depend on the shopkeepers to provide them with their carriers. With times changing people believed that carrying cloth bags or rather jute bags in their hands while shopping would make them feel low or decrease their levels of attitude.

The recent law introduced wherein the shopkeepers charge for plastic bags from public (as seen in stores and malls) in most of the cities is followed thoroughly. It was an action to curb people from excessive use of plastic bags and clogging the environment. However ever wondered how much is the amount that is charged for such plastic bags. In comparison to the amount of shopping paying 5 or 10 rupees for each of the bag it really does not burn a hole in the pocket.

The stores and shop owners should instead support the environment in other ways. By charging for the plastic bags the storekeepers do not really think of well being of the environment. Rather they should provide jute and cloth bags for the purchases made by the customers. Paying a little higher for such bags may not seem feasible all the time for the customers. This will make customers’ realize that they need to carry their own bags (preferably cotton/jute) and also the stores will build a stronger and eco friendly environment.

If such interests are considered well by everyone even with a small initiative it will create a bigger impact on the society. It goes well by saying-

Carrying a plastic in hand will make no human great

An eco friendly gesture will positively change your fate.

Contributed by Anju Bafna (Batch 2010, IBS Bangalore)

“Life is a cakewalk inside those closed walls of a classroom. Once you pass out with the degree in your hand, you witness the real battle. Suddenly you see all the eyes just staring towards you with expectation and anticipation. People become rationale, relations become demanding and life becomes a struggle without any further assurance of success. The competition gets intense and you just become paranoid with the thought of failure. And just in case if you fail, be ready to see turned backs, broken trust, aloofness along with the blessing of god.”

I passed out of IBS-Gurgaon in 2010 with a good job offer in ING Vysya Bank. Going for meetings, persuading clients, meeting targets and designing portfolios really seemed interesting in the first instance but with the passage of time, it pointed towards the harsh realities of the corporate world. I gained the needed experience from banking industry and joined my dad to head the business of auto security components.

Life seemed great until I suffered some setbacks personally and realized the contrary shades of life. People and environment both are changing at a rapid pace these days which sometimes leaves us perplexed longing for various unanswered questions. Trying to seek answers from my inner-self, I started to write. The writing helped me to relieve out my emotions and I started to preserve them in my diary without sharing it further. Soon, I witnessed some more friends around me going through a similar turmoil not knowing how to stay afloat. I made an attempt to help them with my writings and was luckily blessed with success. And since that point of time, there has just not been any turning back. I got an aim to work for which not only would fulfill my passion but would benefit each and every reader understanding those deep words.

Every poem I have written till date clearly has a story and a message intended to help the people undergoing through the same situation. Words have the power which no weapon can match and my collection of poems is a simple attempt to ease out the pain all around.  The ease and dedication with which every poem has been written would surely connect with the readers and would leave them motivated and inspired in life. Being famous has always attracted me from childhood but the fame has to come only after creating a difference in the society so that the world is a better place to live in for everyone.

Currently I am on the finishing stage of my poetry book which has already received some great publication offers. I am also working on my untitled fiction novel which I feel would be loved by each and every person having a heart.  My poem “The Waiting Heart” has been published in June 2012 Edition of “The Taj Mahal Review” which is Cyberwit’s International Journal devoted to Arts, Literature, Poetry and Culture. My poems on worldwide problems like “Global Warming” and “World Peace” have received appreciation from poetic groups and received invitation for entry in different contests. I am also an active member of poetic groups like “Delhi Poetree” and “Caferati”. We at Delhi Poetree are also organizing the “Thousand Poets Reading” starting October 28, 2012 which would feature writings of some great poets from all over India.

For any suggestions and insights you can email me at mr.saluja@gmail.com

You can also get in touch with me at Facebook- https://www.facebook.com/SalujaAngad

Contributed by Angad Singh Saluja ( Class of 2010, IBS Gurgaon)

Today’s post by Linda Zabriske touches on an issue important to IBS and all other learning institutions providing advanced degrees—online graduate programs . Her article will discuss the potential drawbacks of these programs and what still needs to be done to bring them up to par with traditional learning environments. Zabriske currently collaborates on a site for people interested in learning about graduate degree programs.

As online education rises worldwide and more students get additional certifications and complete doctorate programs remotely, many economists speculate the massive influx of e-learners will have a continuous impact on the global market, though not necessarily in a positive way. In theory, web-based learning should provide much-needed opportunities for students. But many employers posit that traditional college is still the most effective channel by which to receive education – and they note the rise of online programs is merely over-saturating the job market with under-qualified applicants.

Yet, online college education is now a worldwide phenomenon.

Some countries have seen massive growth in online college education in recent years. The 2011 Sloan Consortium reported that more than 6 million American students – or roughly one-third — were enrolled in at least one online class. Over the past decade, the United Kingdom also recorded a 28% increase in the overall number of undergraduate and graduate students – and the advent of online learning is partially credited. While enrollment numbers in India are still low, the nation recently launched the National Knowledge Network, a one billion dollar project that virtually connects more than 1,500 colleges and universities across the nation. And though only 384,000 Canadian students, or 11%, enrolled in at least one online class last year, the nation’s largest web-based academic provider, Canadian Virtual University, has reported a steady rise over the past decade.

But to many, the online college spike is not a good thing. Compared to ‘traditional’ college, web-based higher education presents a number of challenges that are problematic to graduates-turned-job applicants. Some critics have posited that online university courses are overall inferior to campus-based courses, citing inexperienced faculty and insufficient course materials. Others argue that online curricula vary nation-to-nation, and this subjectivity goes against the universality that is crucial to global economic progress. Currently, many online programs are only practical if the graduate plans to work in his or her home country. Finally, critics have also voiced concern about the lack of standardized material, a deficiency that hinders development on a global scale.

Many groups and organizations are hard at work to mitigate these challenges. For instance, in November 2011, panelists for the World Innovation Summit for Education agreed that online education should be subjected to universal standards in order to benefit the global economy. Significant aspects of this system would include a standardized curriculum, faculty orientation and training and a strong system of student and peer support that students can utilize throughout their online program. The panel also identified contextual challenges that might hinder a universal system, such as cultural/language misunderstandings, varied learning styles/academic standards and public perceptions of e-learning as a viable educational outlet.

Despite these efforts, public perception of online learning programs remains speculative. “Presently, the job market is more willing to hire an entry-level online graduate in accounting than a high-level marketing executive with an online graduate degree,” wrote Global Economic Intersection contributor Brooke Folliot. She noted the overall economic impact of these programs would be significant – and ostensibly quite positive – if online academics were held in the same high regard as traditional college. But most online graduates are currently unable to find work, and the increased number of unemployed and underemployed individuals – many of whom are forced to default on their student loans — has merely hurt the economy.

The rising number of online students heralds a new, digital age of global education. However, the transition will not be complete until web-based programs are in equal standing with campus-based academics. In order for online education to benefit the global economy, employers must begin to consider graduates of these programs for positions that might otherwise be awarded to traditional degree-holders.

Authored by Linda Zabriske.

Dear Friends, with technological advancement, stressed lives, heavy traffic and distances with in the city, social networking sites like Facebook , twitter etc are becoming the fastest mode of communication and expression. A decade ago mobile replaced greeting cards and telegrams and now these sites have replaced mobile phones, and reduced the personal touch to minimal.

Although these sites have helped in saving a lot of time, but where are we utilizing this saving? The time we save is either utilized at the work place or by surfing these sites slowly getting part of this perfect world.

What is a perfect World?

In economics markets are described as Perfectly competitive and imperfectly competitive markets.

As per definition, a perfectly competitive market is a theoretical situation in which

1) All the products are homogenous and abundant in supply, there cannot be a demand constraint.

2) There are abundant buyers and sellers and none has the capacity to control the market. In simple words people are good at heart.

3) No restriction on entry exit and 4) All the information is publicly available. To summarise, it’s a kind of ‘ RAMRAJYA AND PRAJA SUKHI” Or “ SATYUG’ kind of market. On the other side imperfect competition is just opposite to it (KALYUG).

In practice a perfect market never exist, we all live in a imperfect market.

Social networking space is like a perfect world.

1) There is abundant supply of contacts. Friends of friends and so on. Even School kids have hundreds of contacts.

2) All information is publicly available.

3) Everybody is homogenous Ie good at heart, LIKE’s your opinions, Patriotic, give importance to values and teaching of great people like gandhiji, Anna and others. Everybody is against corruption and feels that black money should come back to India etc.

4) As good and responsible citizens each of us use our right to LIKE and Right to SHARE honestly. After sharing Annas cause against corruption or writing against congress/BJP all of us feels that we have discharged our duties and a SHARE/LIKE/COMMENT Iis the solution to all problems

5) If there are differences, they should not be shared on wall. Everybody is well mannered.

6) From morning to evening everybody is busy pasting quotations copied from Google and
counting LIKE’s posted by others without reading and understanding the meaning.

In practice there is no perfect world. The people who run the system are elected by people who come from an imperfect world.

This new form of society has confined itself to like or dislike, I am afraid we are losing personal touch no matter we are 24*7 online. In coming years most of us will see our next generation only through a mobile upload.

Contributed by Rahul Singhvi  (Batch 2002, IBS Ahmedabad)

Since the last few years, there is a lot of fuss in India saying that Cricket is a very much hyped game and the only game in limelight in India. Many big names in the journalism industry keep on writing articles as to why not any other game and why only cricket?

According to me, what is wrong in Cricket being the only game in limelight in India? Cricket is a game which is easily accessible to each and every kid during childhood. It is a game attached with both the mass and the class. Ever seen a middle class or a lower middle class kid playing Tennis, Snooker or Golf on his society streets?

Cricket is the only game that a kid plays and as he grows up, his love for the game continues, hence he hypes or pushes this game into the limelight. Yes, there are other games also which are commonly played which include Badminton or Carrom etc. But ever seen TV coverage of these games as frequent as Cricket? No. Cricket has a connect with the lives of Indian audience.

Now if something is not covered on TV or in the print media, how would one be aware about the tournaments and schedules of that particular game or how will one have knowledge about that game itself?

Yes, I do agree that like Sachin Tendulkar or MS Dhoni in Cricket, we have other high performers and famous players also. For eg. Take Vishwanathan Anand, who recently won the Chess World tournament, but do you expect an average minded person to learn or develop interest in Chess. Its not at all possible.

Take Saina Nehwal, she recently won the Indonesian Open for the third time, but many of us who love watching or playing Badminton never knew the schedule of the tournament.

There have also been sporting legends in these games who have gained a lot of popularity and has given a brand image to their respective sport. Take Major Dhyan Chand or P.T. Usha for an example. There was a time during Major Dhyan Chand era that hockey was the most famous sport in India. But did hockey, hockey federation or players save this image of hockey? Of course not. There may be many reasons for the same but degradation of the sport has been there, which is a practical fact.

Cricket as compared to that has been always routed in the hearts of Indian fans since ages. Now if a sport is able to dominate the Indian sports viewer crowd, what is wrong in that??? Why do people have problems with that?

Another factor which keeps someone linked to the sport is the performance by the sportsmen. During the last hockey world cup which was hosted in Delhi, we had lots of awareness and promotions being done by private players also. This had in fact created hype about hockey as well as the tournament gained good viewership. But the Indian hockey team disappointed with just 1 win in the entire tournament and it was difficult to again gain the same viewership in the next hockey tournament.

Cricket as compared to this has good sportsmen, who perform better in their tournaments as compared to other sportsmen. Yes, we do have losses series after series in Cricket as well, but that is not the regular status which is the case in other sports.

We can not to blame the satellite television providers for this as; they are here to do business. They will telecast what has TRP or what can give them maximum revenues. If IPL gives them more TRP then Indonesian Open or the Chess World Tournament, no doubt they will telecast IPL.

If there is someone who can do something on this, it is the media. They can spread a word of awareness for other games which in turn would generate the interest of the Indian audience. But this group of people are busy in writing or showcasing what has maximum readership or viewership. Now a days, writing an article which has a headline “NO CRICKET” gains readership, hence authors and reporters who were once the most trusted and the most acknowledged, have turned into writing articles which excite people against cricket.

Even if there are people who are promoting other games there is no media coverage on the same. Just to describe a recent event,  Shah Rukh Khan has shown interest in purchasing one of the Indian Football club, but there has been very less coverage of this event as compared to what Shahrukh does during IPL matches, what kind of alcohol does he consume to celebrate the victory and things like that.

My message to such media content writers is that, by writing such articles you can fool us and make us non-cricket viewers but you might also turn down sports viewers. As after Cricket we would not have any other option in sports left.

Hence instead of turning down Cricket, why don’t you educate us about other sports and develop our interest in other sports also. If in case an interest is developed, we would surely start having satellite coverage for these sports. If in case there are satellite coverage, there would be investments pouring down in the sport which would further develop the sport and the sportsmen.

Hence, instead of turning down a sport, why is not another sport being promoted to build an option for the sports loving crowd of India.

Contributed by Chirag Vaishnav(Batch 2006, IBS Bangalore)

This post is No.3 in a 3 part series:

Read Part 1, Part 2.

The Way Ahead (Anna’s Way)

“I want to tell the youth of this country that this fight should not be stopped with Lokpal alone. We have to fight for removing the faults of the present electoral reforms. Because of the fault in electoral system, 150 criminals have reached Parliament.”

– Anna Hazare[1]

Anna Hazare, a of 74 years old Indian social activist[2] and former Indian army soldier from Maharashtra has showcased implacability of some valuable principles of non-violence by adopting simplicity of Gandhi to the world following which India can get rid of the repercussions arising out of corruption and its supplements. Widely recognized Anna Hazare has become a youth icon since he sat on 12-day fast in the year 2011 in order to persuade government of India to pass a stringent Lokpal Bill in both houses of parliament.[3] The government could somehow manage to bring a resolution in the parliament on the same to ensure that Anna’s efforts do not go in vain[4]. This success of Anna has brought considerable impact on the mindsets of millions of young Indians who directly or indirectly supported his efforts. He has become the only antonym against all the synonyms of corruption.

Mere generalization of the issue by saying that responsibility of combating corruption lies on all of us will not suffice. Attitude of challenging the wrong will only work. The time is to take some concrete steps in addition to the ways suggested by Anna. Firstly, it should be made compulsory for all the law students to do their final internship with any of the anticorruption body. It will be a win-win situation for both of them as law students will gain valuable experience and at the same time entry of young professionals in these organizations will improve their efficiency resulting in better performance. Secondly, inclusion of law as a compulsory subject at higher secondary level of school can serve the purpose of increasing awareness among the next generation. Thirdly, passing a strong Lok Pal bill can assure a proper and timely punishment to the guilty of taking bribe. Fourthly, there should be an incentive system in place to encourage whistle blowers in an organization. Their identity should be kept confidential and their efforts should be rewarded suitably in monetary terms. Lastly but most importantly, it is to understand that the people involved in corruption are not fools. They are clever enough to take undue advantage of the loopholes of a typical bureaucratic system. Therefore, mapping their brains can help in reducing bottlenecks of such other systems as well. It goes in line with the view which argues that diamond cuts diamond. In parallel, use of modern technology by making most of the processes online, proper utilization of Right to Information Act, active participation of youth in social activities, awareness among the youngsters towards not taking things for granted can act as a catalyst to the reforms.

Conclusion

It is to conclude that corruption itself is not a cause but an effect of indiscipline. The recommendations suggested might not be the only ways to take up the challenge. Anna’s philosophy and principles might not be the ultimate answer to it either. But such experiments are bound to increase the participation of youth in the subject of national interest. Above all, young blood of India can no longer afford to negate the severe consequences of corruption and in particular its own future thereof.

I have been under a lot of mental and emotional stress lately, and did not know the reason. But with a lot of introspection and a couple of very good reads, I was able to find the root cause of this and am in a much better state of mind. Ask my wife  I will like to share this to spread the good words that helped me.

So, what was wrong?

Personal Mission Statement

When I entered formal work life, my HR helped me frame my personal mission statement, or in fact how would I like to be remembered when I leave the world. It came naturally to me: “The Guy who made a difference.” and I try to live my life towards this goal – “Make a difference in every role I play”

Let’s first speak of the roles we play in life. Typically one plays several roles in life. A few play more, a few play less.

• Individual
• Family person – Child, Spouse, Parent, Relative
• Learning – Student, Teacher
• Working – Sub-ordinate, Co-worker, Boss, Mentor
• Society – Friends, Community member, Citizen

And the challenge is to maintain a balance between the roles; otherwise one of the roles dominates the others. This is called the ‘Work Life Balance’, which according to me is a misnomer. It is about balancing the importance you accord to each role.

The reason for discontent was that I was doing a good job at work and had been struggling to think of a way to make a difference in the community. I was trying to increase my circle of influence and was having a difficult time doing so. But more importantly, I was neglecting my other roles in pursuit of this singular role, especially the roles which got added after I started my career. I was not making a difference as a husband and later as a father. This caused a lot of internal turmoil and stress but I did not realise the root cause. Which in hindsight is obvious, I was not fulfilling my mission statement, my goal, and my reason for existence. When I realised this and also realised the many things under my control that I can do to make a real difference to my family, I was suddenly at peace.

I now have renewed energy, a renewed sense of purpose and actively looking at ways to justify my role as a family member.

Community will come next; meanwhile I am working at growing my circle of influence to get to a position to be able to make a difference to the community.

So let me ask you this:

• What roles do you play?
• Are you justifying all the roles or is one role far bigger than the rest?
• Would you like to be remembered as?
  • A great worker
  • A great spouse
  • A great parent
  • A great child
  • All of the above – and above all, a great person
• Are you spending your time to achieve the above?

Related Read:

This article greatly inspired me: http://steveblank.com/2009/06/18/epitaph-for-an-entrepreneur/

Contributed by Hitesh Sarda (Batch 2001, IBS Hyderabad). Find out more about him on Linkedin.

This post is No.2 in a 3 part series:

Read Part 1

Scenario in India (Major Scams so far)

The problem of corruption in India is so deep rooted that sometimes it becomes difficult to even identify when and where one gets involved in it. Below examples of mammoth corruption incidents in the recent years are sufficient enough to aggrieve an Indian patriot:

• 2G-Spectrum Scam (Rs. 1.7 lakh crore)[1]: Telecom companies were offered 2G spectrum band at nominal charges within a few minutes by A. Raja – the then telecom minister of India. This resulted in a huge loss of revenue amounting to lakhs of crores of rupees to the government.
• Cash for Vote Scam (Rs. 50 crore to Rs. 60 crore)[2]: It was alleged that the ruling party bribed members of parliament in order to survive a confidence vote in the year 2008.
• 11^th Commonwealth Games Scam[3] (Rs. 8000 crore)[4]: The games ran into controversies when Indian media covered various game venues where the work had been running with snail’s pace and the quality was poor. Such irregularities were shown as breaking news in the electronic media and as front page headline in the national newspapers which attracted immediate attention of government officials. Later, doubts were also raised on the unexpected increase in the budget of the games within a small period of time and Prime Minister had to intervene to make sure that the preparations get completed in time. Finally, a performance audit done by the CAG who found numerous irregularities like manipulation of prices, contracts with incompetent companies, unnecessary delays causing effect of inflation, use of poor quality material, over and above payments for products and services consumed etc.

Above are the examples to name a few. These depict the intensity of unjust competition prevailing in the country causing opportunity cost to those companies which are capable of doing a job but couldn’t get chance because of nepotism. Mention of corruption in the speech of the Indian Prime Minister while addressing people of India on Independence Day again evidences that the problem is far more serious than that of any other country.[5]

Many Bollywood movies like “Lage Raho Munna Bhai”, “Chala Mussadi Office Office”, “Corporate”, “Aarakshan”, etc., have already outlined the various aspects of the issue. Even advertisements like that of tata tea with slogan “jaago re” are constantly spreading awareness among the youth to bring a change in the system.

Present system to deal with Corruption

From the point of view of law, there are mainly two acts at present in India which shoulder the responsibility of exposing unfair practices going on in a concerned organization. One is Prevention of Corruption Act, 1988^[6] and the other is Right to Information Acts 2005.[7]

Plenty of regulatory and surveillance authorities like ACB^[8], CVC^[9], CAG^[10], CBI^[11], ICAI^[12], Income tax department^[13], Central Board of Excise and Customs^[14] etc., have been working as either an independent body or a government body. Unfortunately, independent authorities have not been given the power of arresting a guilty. They are hence toothless. Contrary to this, government agencies are extremely powerful in this regard but are indirectly driven by political interests.

Causes and Effects of Corruption on Young Entrepreneurs and on Economy

With one third of the total population being youth, India is certainly the youngest country in the world[15]. Many of these youngsters are either doing their own business or are on the verge of becoming future entrepreneurs. During this phase they encounter various legal formalities to be met with like filing of proposed name of company for approval of ROC, getting MOA vetted by the ROC and its stamping from superintendent of stamps, AOA, getting company seal, paying registration fee, obtaining PAN and TDS account numbers, following rules of taxation, complying with Shops and Establishment Act, taking care of various laws pertaining to employees etc.[16]

Amid utmost chaos in completing ‘n’ number of formalities, instances of demanding bribery surge. The more a procedure becomes complex and lengthy, the more cases of personal greed are likely to arise. It only furthers the sufferings of a common man. The attitude of compromise and adjustment is probably the first and biggest reason for the same. Weak laws, time consuming judicial procedure, inherent supremacy of politicians and lack of public awareness add fuel to the fire. Existence of such a system in India is a major cause of anger to the next generation.

“Baboos” have become a synonym of corruption for an “aam aadmi” who has to bear heavy fees of “dalals” to make them work on their requests. This black money is exported to tax heaven countries. According to the data provided by the Swiss bank, India has more black money than rest of the world combined. India topping the list with almost $1500 Billion black money.  It’s embarrassing for any country to top the list of black money holders. The money which belongs to the nation and its citizens is stashed in the illegal personal accounts of corrupt politicians, IRS, IPS officers and industrialists. Every year this amount is increasing at a rapid speed but the Indian government seems to be silent over this matter from a very long time. The total black money accounts for 40% of GDP of India, if all the money comes back to India then that could result in huge growth burst for India.[17] What can be a better example of tax appropriation than this? Another surprising fact is that at one end, India ranks at 65^th poor country in the world with an alarming global hunger index score of 23.9[18] and at the other end, it ranks 4^th with 55 billionaires in the list of countries with highest number of billionaires.[19] This proves that the there is a wide gap in between rich and poor people of the same society. It is both surprising and unfortunate.

Nepotism is yet another form of corruption which hampers job prospects for the right candidates and leads to unhealthy competition. It is also called as favoritism. It is well established in India. Examples of nepotism are visible in politics (Nehru-Gandhi family), in business (Reliance), in arts (Kapoor Family)[20] and in education (management quota). These all gather together to bring India at 87^th place in the Transparency International World Corruption Index.[21]

Nevertheless, Mr. Suhas Gopinath who was born in Bangalore, Karnataka, India and launched a web site at the age of 14, and incorporated his company at the age of 14, making him the world’s youngest CEO[22] has set an example for the upcoming entrepreneurs who are willing to make their dreams come true.

This post is No.1 in a 3 part series:

“Corruption and hypocrisy ought not to be inevitable products of democracy, as they undoubtedly are today”

-Mahatma Gandhi[1]

Aug 28, 2011: Who better than an Indian can state the significance of this date in his life? It was not the day of Diwali! India didn’t win any Cricket World Cup on that day! Yet the celebration was huge. After all, a 12-day long fast of Anna Hazare came to an end when parliament of India agreed to pass a resolution in favor of a stringent “Lok-Pal Bill” against corruption. Indeed, a history was written on the “paper of democracy” with the “quill of protest” inked in “non-violence” indicating that countdown to a corruption free democracy has finally begun.

 Background

 Today, when corruption has been gulping plethora of liquidity from the markets across the globe, economists are scratching their heads hard for unearthing new ways and means to combat the severe outcomes of black money. India is no exception to it. Government agencies, politicians, public companies, private companies, NGOs, trusts, judiciary and media related scams are too many in number to count and too much in monetary terms to summarize in the units available causing dent to its image of being the fastest growing biggest democracy in the world. A 74 year old person “Anna Hazare” has however lightened the torch of anti-corruption the way Gandhi did for the freedom of India in the year 1947. Their objectives might differ but the way to achieve them is one or the same i.e., “non-violence”. Its immense influence particularly on the youth has been energizing them to struggle for the good cause. It will therefore be interesting to discover how this age old remedy can cure the long lasting diseases of unfair practices noticed at every level of Indian society.

Understanding Terminologies Involved in Unfair Practices

“Corruption” can be defined as a wrongdoing on the part of an authority or powerful party through means that are illegitimate, immoral, or incompatible with ethical standards. Corruption often results from patronage and is associated with bribery.[2] It can also be defined as a type of strategic action in which two or more actors undertake an exchange relation by way of a successful transfer of money (material) or power (political or status) or promoting of gene (genetic), which sidesteps legality or morality or civility to regulate the relation. It is a strategic interaction or an art of nonviolent negotiation. As mentioned before, social action is strategic when it is aimed at the successful realization of personally defined goals. It makes distinction between “need driven” and “greed driven” necessity harder.[3]

“Nepotism” can be described as a practice of appointing relatives and friends in one’s organization to positions for which outsiders might be better qualified. Despite its negative connotations, nepotism (if applied sensibly) is an important and positive practice in the startup and formative years of a firm where complete trust and willingness to work hard (for little or no immediate reward) are critical for its survival.[4]