The uneasy mix of superstition and science in rural India
By Jason Overdorf - GlobalPost
Published: January 26, 2009 13:30 ET
BETUL, MADHYA PRADESH, India — As a priest wafts incense over her with a broom and recites an melodic incantation, Jyoti Salu begins to declaim loudly over the noise of the crowd. "All religions are one. All saints are one. Sai Baba and Guru Saheb are one. Only Guru Saheb understands the trouble in my heart."
Since collapsing at a marriage ceremony a month ago, Salu has been behaving strangely and raving about gods and saints. Her parents believe she may be possessed.
"Once or twice a day she has a fit and then she starts talking like this, taking the name of gods and saints," says the girl's father, Bhim Lal Sahu. "We took her to a psychiatrist and he prescribed some medicines for 20 days. But we are also taking her to shrines where they perform exorcisms, just in case."
Like most of the thousands of people who flock to the central Indian village of Mallajpur for the annual ghost fair — some traveling hundreds of kilometers — Bhim Lal believes more strongly in evil spirits than modern medicine. So he has brought his disturbed daughter to this shrine to Guru Saheb — an 18th century ascetic purported to have on this spot in 1770 attained moksha, or the liberation from the endless cycle of birth and death that is the ultimate goal of Hinduism. With smoke and mantras, a little help from Guru Saheb, and more than a few healthy whacks, the priests here claim to cast out demons and imprison them in the nearby trees. Bhim Lal hopes they can help his daughter.
The treatment appears to help Mahenge Lal, a farmer from the village of Hardu, about 10 kilometers away, who says he is possessed by 500 million ghosts that shake his body like a rag doll, torment him with migraines and fill his head with a clamor of voices. As the priest sweeps smoke from the shrine over him, Lal's head wags spasmodically, his eyes rolls skywards, and he cries out the name of the guru. The priest delivers a resounding slap to the middle of Lal's back, and the patient sighs with relief and eagerly slumps to lick a lump of raw sugar from the concrete base of the shrine. One down, 499 million to go.
Locals say the victims of evil spirits speak in odd voices and foreign languages that their families claim they never learned. Most of the afflicted are women, who according to Bhopal University sociologist Gyanendra Gautam lead heavily constricted lives with little hope of escape. With slack faces and off-kilter stares, most of them appear to be haunted by nothing more exotic than schizophrenia, bipolar disorder or mental retardation.
Psychological professionals agree. According to a recent study by the Indian Council of Medical Research, India's poorly educated masses most frequently ascribe the abnormal or inappropriate behaviors that Westerners would associate with insanity to black magic, evil spirits, masturbation and excessive sex. And even if it were desired, the appropriate medical treatment is rarely available. "Godmen of every faith that we have have forever been in charge of mental health in India," says Dr. Vinay Mishra, a Bhopal-based psychologist. "Science has not really caught on in our lives."
About ten years ago, Mishra and some colleagues attempted to educate rural clerics about mental illness, hoping to encourage them to counsel people with minor neuroses but to send those with chemical disorders like schizophrenia to urban hospitals for treatment. The project failed miserably. The priests depended on the cash and offerings of the possessed for their livelihoods, they were reluctant to give up the privileged status that performing exorcisms granted them, and they found the psychiatrists' scientific explanations utterly absurd. "They didn't believe that psychological problems could be triggered by chemical imbalances in the brain," says Mishra.
Perhaps that's why the possessed attending the fair seem so eager. Forming an impromptu lineup in hopes of attention from what appears to be a foreign specialist, they recount a litany of mysterious and random ailments. "I saw a doctor, but he couldn't understand my problem," says 35-year-old Kaushal. "The ghost gives me headaches and makes my body parts crack, but yet I am unable to cry."
"The ghost possessed me nearly two years ago," says 52-year-old Gauri Bai. "At the shrine I am finding some relief." And then 45-year-old Buri steps forward, snaps to attention, and sticks out her long, yellowish tongue. From her eyes, it is clear that she believed her problem to be self-evident.
But that is the last moment of humor. Soon after her exorcism, Jyoti's voice rings out in protest as the priest tries to convince her father to keep her there overnight. "You said I would only have to come here for two hours!" she shouts. "It's been two hours. Now I want to go home." Thanks to her education, she is strong enough to exert her will, whatever her problems. But that is not true for everyone. Soon a terrified 14-year-old girl is dragged to the altar. As the tears stream down her face, the priest winds up and smacks her in the middle of the back, then grabs her by the hair and forces her to lick the piece of raw sugar from the shrine.
Her ailment is unclear. But the devil who torments her is plain to see.
Tuesday, January 27, 2009
Thursday, January 22, 2009
beware the "killer blueline"
Private bus companies take a deadly toll on Indian pedestrians. Here's the problem: they're needed.
By Jason Overdorf - GlobalPost
January 9, 2009
NEW DELHI — Around 10 a.m. on a busy Wednesday last month, 38-year-old Raj Kumar had a narrow escape from death when a careening bus plowed into him from behind. He picked himself up, dusted off his clothes and felt his limbs for breaks. Shaken but not gravely injured, he climbed into an auto rickshaw headed for the hospital.
Twenty minutes later, he decided that he didn't need the emergency room, so he left. As he started crossing the road to make his way to work, a second bus slammed into him and dragged him under the wheels. This time, he didn't get up.
This bizarre story is not as unlikely as it seems. Kumar was the 118th person to be mowed down in 2008 by one of Delhi's “killer Blueline buses,” as the local press has christened the 4,500-odd buses contracted out to private operators by the Delhi government.
And he wasn't the last. The killer buses have claimed more victims in 2009, and despite a relentless media campaign, the government's plan to phase them out is progressing at a snail's pace.
To be sure, the Bluelines are symptomatic of a larger problem. With more than 100,000 traffic fatalities a year and a mortality rate about seven times that of the roads in developed countries, according to the World Bank, India's roads are among the world's most deadly. And Delhi, where the number of vehicles is growing faster than any other city in India, presents a frightening vision of the future.
Every few months pavement dwellers — sometimes whole families — are run over in their sleep by drunk drivers. Road rage assaults and even murders are on the rise, and nobody, but nobody, follows the rules. Last year, for instance, police statistics show that incidents of dangerous driving in India's capital nearly doubled, increasing to about 125,000 from 69,000 in 2007.
"The road safety issue of Delhi is not just the Blueline buses,” says Dinesh Mohan, a professor at the Indian Institute of Technology (Delhi) who studies traffic safety. “Our roads are still not designed for the amount of traffic in Delhi and other cities in India, and that's not likely to change for some time.”
Reckless drivers are indeed common on Delhi roads. But because of their mammoth size and the deafening whistles that they use instead of horns, the Bluelines are the most frightening of all. And when they strike, their victims are among India's most vulnerable people. “They may be rickshaw pullers, or people traveling on the bus, or just walking on the road,” says advocate Rajinder Singh, who has argued 20 such cases. “They're from the poorest strata of society.”
Since July 2007, when Delhi chief minister Sheila Dikshit announced that the Bluelines would be taken off the roads, they have killed as many as 200 people. Hardly a single bus has been removed from service, and when tough action was taken to cancel the permits of errant operators the government was forced to cave by a citywide strike.
Killers or not, it turned out that the Blueline buses were the only thing keeping the city running. “There are about 4,500 Blueline buses, and they transport about 6.5 million passengers per day,” said H.S. Kalra, president of the Federation of Delhi Bus Operators. Despite covering many kilometers in the city's worst traffic, he adds, “Bluelines are only responsible for about 10 percent of the city's traffic fatalities.”
Plans are still underway to get rid of them. Just a week before Kumar was hit twice in 20 minutes, Transport Minister R.K. Verma had unveiled a new scheme that — if implemented — steps up the phaseout deadline to 2010 from 2012. But observers remain skeptical that a plan to consolidate the Bluelines under corporations that own 100 or more vehicles, instead of individual owners, will be effective in reining in reckless drivers.
“The basic problem is that the drivers try to catch the maximum number of passengers by racing to overtake one another,” Singh says. “The reason is that the more tickets they sell, the more revenue they earn, and if the drivers don't bring in a base of revenue, the bus owners don't pay their salaries at the end of the day.”
Says Mohan: “You shouldn't have a public service which is given to private operators, because then you have a profit motive that drives the system. Any human being would behave the same way under that incentive system.”
Pedestrians have good reason to be cynical. The Bluelines are actually this decade's solution to last decade's problem — the relaunched and rebranded version of the Redline buses that enjoyed their own reputation for mayhem. Initially, the government opted to pay the Blueline operators by the kilometer, rather than letting them compete for ticket revenue, in an effort to stop the racing and careening into the bus stops that was thought to account for most accidents.
But when bus owners decided that it was more convenient, put less wear and tear on the fleet, and earned them just as much money not to stop for passengers at all, the kilometer scheme was scrapped and the Bluelines became nothing more than the Redlines with a less-bloody sounding name.
By Jason Overdorf - GlobalPost
January 9, 2009
NEW DELHI — Around 10 a.m. on a busy Wednesday last month, 38-year-old Raj Kumar had a narrow escape from death when a careening bus plowed into him from behind. He picked himself up, dusted off his clothes and felt his limbs for breaks. Shaken but not gravely injured, he climbed into an auto rickshaw headed for the hospital.
Twenty minutes later, he decided that he didn't need the emergency room, so he left. As he started crossing the road to make his way to work, a second bus slammed into him and dragged him under the wheels. This time, he didn't get up.
This bizarre story is not as unlikely as it seems. Kumar was the 118th person to be mowed down in 2008 by one of Delhi's “killer Blueline buses,” as the local press has christened the 4,500-odd buses contracted out to private operators by the Delhi government.
And he wasn't the last. The killer buses have claimed more victims in 2009, and despite a relentless media campaign, the government's plan to phase them out is progressing at a snail's pace.
To be sure, the Bluelines are symptomatic of a larger problem. With more than 100,000 traffic fatalities a year and a mortality rate about seven times that of the roads in developed countries, according to the World Bank, India's roads are among the world's most deadly. And Delhi, where the number of vehicles is growing faster than any other city in India, presents a frightening vision of the future.
Every few months pavement dwellers — sometimes whole families — are run over in their sleep by drunk drivers. Road rage assaults and even murders are on the rise, and nobody, but nobody, follows the rules. Last year, for instance, police statistics show that incidents of dangerous driving in India's capital nearly doubled, increasing to about 125,000 from 69,000 in 2007.
"The road safety issue of Delhi is not just the Blueline buses,” says Dinesh Mohan, a professor at the Indian Institute of Technology (Delhi) who studies traffic safety. “Our roads are still not designed for the amount of traffic in Delhi and other cities in India, and that's not likely to change for some time.”
Reckless drivers are indeed common on Delhi roads. But because of their mammoth size and the deafening whistles that they use instead of horns, the Bluelines are the most frightening of all. And when they strike, their victims are among India's most vulnerable people. “They may be rickshaw pullers, or people traveling on the bus, or just walking on the road,” says advocate Rajinder Singh, who has argued 20 such cases. “They're from the poorest strata of society.”
Since July 2007, when Delhi chief minister Sheila Dikshit announced that the Bluelines would be taken off the roads, they have killed as many as 200 people. Hardly a single bus has been removed from service, and when tough action was taken to cancel the permits of errant operators the government was forced to cave by a citywide strike.
Killers or not, it turned out that the Blueline buses were the only thing keeping the city running. “There are about 4,500 Blueline buses, and they transport about 6.5 million passengers per day,” said H.S. Kalra, president of the Federation of Delhi Bus Operators. Despite covering many kilometers in the city's worst traffic, he adds, “Bluelines are only responsible for about 10 percent of the city's traffic fatalities.”
Plans are still underway to get rid of them. Just a week before Kumar was hit twice in 20 minutes, Transport Minister R.K. Verma had unveiled a new scheme that — if implemented — steps up the phaseout deadline to 2010 from 2012. But observers remain skeptical that a plan to consolidate the Bluelines under corporations that own 100 or more vehicles, instead of individual owners, will be effective in reining in reckless drivers.
“The basic problem is that the drivers try to catch the maximum number of passengers by racing to overtake one another,” Singh says. “The reason is that the more tickets they sell, the more revenue they earn, and if the drivers don't bring in a base of revenue, the bus owners don't pay their salaries at the end of the day.”
Says Mohan: “You shouldn't have a public service which is given to private operators, because then you have a profit motive that drives the system. Any human being would behave the same way under that incentive system.”
Pedestrians have good reason to be cynical. The Bluelines are actually this decade's solution to last decade's problem — the relaunched and rebranded version of the Redline buses that enjoyed their own reputation for mayhem. Initially, the government opted to pay the Blueline operators by the kilometer, rather than letting them compete for ticket revenue, in an effort to stop the racing and careening into the bus stops that was thought to account for most accidents.
But when bus owners decided that it was more convenient, put less wear and tear on the fleet, and earned them just as much money not to stop for passengers at all, the kilometer scheme was scrapped and the Bluelines became nothing more than the Redlines with a less-bloody sounding name.
Monday, January 12, 2009
the boom from the bottom
Isolated from world trends, India's aspiring poor will help it grow through the credit storm.
Jason Overdorf
NEWSWEEK
From the magazine issue dated Jan 19, 2009
Though it may not look it on the ground at times, India is one of the few bright spots in a global economy with decidedly dim prospects in 2009. It is forecast to grow at a robust 5 to 6 percent this year—which is faster than it averaged in the 1990s, and nearly double the rate of expansion over the country's first three decades of independence. Yes, its stock market has crashed, unemployment is spiking, swaths of the real-estate market have more than a passing resemblance to Miami Beach and it now turns out that Satyam Computer Services—one of the country's top five IT companies—has been cooking its books. But a one off incident of fraud in the flagship IT sector won't knock the country off the rails. India boasts an unlikely growth driver all its own: legions of poor whose incomes have risen just enough in recent years to create powerful demands for basic goods and services.
The rise of India's aspiring middle—a group that lives above the poverty line but hasn't yet attained true membership in modern consumer society—is hardly a new story. But what's surprising is the resilience of this cohort, and the extent to which it has counterbalanced the global credit crisis and the slump in the global export economy of which India is a key player. In part, this is a consequence of New Delhi's past failures; policymakers were never able to make India the export powerhouse that China has become over the past three decades, so now they don't rely nearly as heavily on growth driven by investment and demand from foreign markets.
Yet Indian planners deserve some credit, too, for avoiding a national addiction to cheap credit and creating "growth multipliers" like roads and telecom networks that now link the country's vast interior to modern cities. "The basic component of domestic demand [in India] is consumer demand, because people still have incomes to earn," says Saumitra Chaudhuri, chief economist at ICRA, an Indian credit-ratings agency affiliated with Moody's. "And those incomes are not substantially influenced by international developments."
The idea that Indian backwardness is a plus may sound absurd. But it is always easier to grow from a poor base, so the fact that India is not yet a major economy is an advantage in a downturn. A population so large that subsists at such a low economic base is a powerful economic driver if it can be mobilized. India's has been, and it is proving resilient to the prevailing headwinds in the global economy. "It's kind of a self-sustaining process," says Subir Gokarn, chief economist at Crisil, the Indian arm of Standard & Poor's. "There's a huge, huge underpenetration of most commodities and services, and you have enough people at the bottom experiencing enough of an increase in income to sustain growth."
So even as middle-class consumption wanes in India—signified by a sharp drop in auto sales, airline travel and fine restaurant dining since mid-2008—domestic demand remains strong thanks to aspiring consumers, many still tied to the farms, who spend their rupees on essentials like soap, medicine and the shoes and clothing that they wear to work. As Gokarn puts it: "If you go back to the economic textbooks, they will tell you that the poorer you are, the stronger your propensity to consume."
The contrast with China, Asia's other economic giant, is stark. Domestic demand makes up three quarters of the Indian economy, compared with less than half for China, which is "why, relative to East Asian economies, India is somewhat insulated from the global trade slowdown," says Shankar Acharya, a former chief economic adviser to the government. Another Indian mainstay—agricultural growth—should remain steady this year, and the services sector, which now accounts for about 55 percent of India's GDP, is expected to be "more resilient" than manufacturing, says Acharya.
Despite the financial crisis, the nation's IT sector managed to grow some 20 percent in 2008, according to India's National Association of Software and Services Companies, and IT companies have already extended 100,000 new job offers for 2009. "For whatever reason, China has been highly focused on the export market, while Indian business has been highly focused on the domestic market, and their exports have been incidental," says Chaudhuri. Which makes India, more than China, a master of its own destiny.
The conventional wisdom has always held that India failed to become an export-driven dynamo on the Chinese model because its democratic system couldn't deliver the hard infrastructure and soft labor laws needed to manufacture competitively. While there is some truth to that, what is often overlooked is how much India's current growth multipliers—all of them linked to infrastructure—resemble China's in the 1980s.
One example: India's ambitious program to expand the national highway system, launched in 2003, which is now adding about 100 kilometers of highway per day to the grid. Each new strip of pavement links additional villagers to urban markets, allowing them to fetch more for what they grow or make and to travel farther afield for wage-paying jobs. Capitalized at a whopping 5 percent of GDP in 2000, India's rural roads program will ultimately connect all Indian villages of more than 500 people to one another with all-weather roads. Fewer than half of these villages had roads of any sort when the project started. Similarly, in a six-phase national project, the National Highway Authority plans to add or upgrade nearly 30,000 kilometers of highway, which would expand the existing system by a third.
Telecommunications has made faster inroads. In 2008 the subscriber base for India's national telecom network topped 350 million people, and India's telecom market is now growing faster than even China's. Charges have dropped to less than 50 U.S. cents per call. That connectedness has a huge potential impact on incomes in a job market "extremely sensitive to how quickly one can get information," says Gokarn. There's also the IT sector itself to consider. It has created 1.8 million jobs directly over the past decade, and as many as 6.5 million more support jobs for drivers, security guards and gofers with primary or high school educations. That has put rupees into the hands of people "more likely to spend it rather than save it," says Gokarn, and though job creation will slow as the IT sector cools off, the huge workforce creates a good deal of momentum.
India's bottom-up boom can't drive the economy at full speed, to be sure. But it is largely immune to the downturn that's evident higher up the consumer chain. The stock bust hasn't affected the aspiring underclass because its members are not invested in the markets, and they're not to blame for the drop in auto sales because they're too poor to afford cars. Even the housing bust is far removed from them; despite the glut of top-end condos in places like Mumbai and New Delhi, India as a whole is suffering an acute housing shortage. The problem: construction companies all aimed for the top of the market, leaving the lower tiers underserved. According to the National Planning Commission, urban India needs an additional 24.7 million ordinary homes to satisfy current demand. As evidence of this unquenchable thirst, when the Delhi Development Authority held a lottery last year to find buyers for 5,000 affordable flats it built in the city, some 500,000 applications flooded in.
The mismatch illuminates India's way forward. Like many other governments, New Delhi recently announced a major new spending package aimed at bolstering growth. And it, too, seeks to spur domestic demand. Yet the main target isn't the urban middle, as in China or the United States, but the poor. In October, Parliament approved additional spending of about $50 billion (or 4.5 percent of GDP) to boost salaries of government workers, waive farm loans, further fund the rural-employment-guarantee program and finance petroleum bonds so that oil and fertilizer companies can keep prices low. "While there are legitimate concerns about the long-term impact of some of these measures," says Gokarn, "they will undoubtedly help boost consumption spending, particularly by lower income households, which in turn will help shore up growth in the immediate future."
India avoided a U.S.-style housing bust and is better positioned to pump money into the cash-starved financial system today because its much-maligned central bank was never wooed by the allure of easy money—no matter how loudly industry clamored for faster growth. When the central banks of other countries were essentially offering free money, India's realized that, as a democracy of mostly poor voters, it couldn't afford to grow at 10 percent a year if that meant skyrocketing prices for essential commodities like rice and flour. For that reason, the central bank constricted the money inflating the real-estate bubble (and prices for everything else) by raising interest rates to a peak of 12.5 percent last summer, which earned it criticism for being out of step with more aggressively growth-oriented central banks. Because of this, India has ample ground clearance to lower rates and reduce reserve requirements for banks to spur growth and avert deflation.
The private sector is in pretty solid financial shape, too. The central bank kept a close eye on both state-owned and private banks, preventing them from leveraging to perilous heights by keeping the cash reserve ratio high, limiting the use of securitizations and derivatives and essentially barring the off-balance sheet vehicles that U.S. banks used, disastrously, to hide their debt. As a result, India's banks aren't sitting on a mountain of bad loans, which makes them freer to lend to companies in need. Indian companies, cognizant of the cash crunch that burned them in the late 1990s, didn't overextend this time, either. "[One] great source of strength is India's corporate sector, who have much stronger balance sheets [than in the past]," says Chaudhuri.
One sign of that is companies that are putting their wealth to work. In December, India's Wipro Technologies purchased Citigroup's captive IT services firm Citi Technology Services for $127 million in cash, and in October, Tata Consultancy Services was able to buy Citi's business process outsourcing business, Citigroup Global Services, paying $505 million. Both moves suggest that reports of the IT sector's demise in India are greatly exaggerated.
The biggest risk to India in 2009 at this point may not be the global economy but domestic politics. Prime Minister Manmohan Singh's United Progressive Alliance will see its term expire in May, and India's election rules mean that he can no longer enact any significant policies—a measure adopted to prevent incumbents from stacking the deck with populist sops. That means as much as five months of paralysis, precisely when speedy, creative action is the order of the day. Moreover, though the nemesis of Singh's Congress party—the Bharatiya Janata Party—mostly favors similar policies, a change in government would likely result in some further slowing of infrastructure projects that are already running behind schedule. And elections in India can be tricky. In the last one, the BJP-led National Democratic Alliance lost despite racing economic growth, because poor voters rejected the BJP's campaign claims of an "India Shining."
With the light bulb flickering, Singh's Congress may face an even bigger challenge winning them over. The poor don't care how much faster than other nations India is growing, only whether their lives are better than they were five years ago.
URL: http://www.newsweek.com/id/178814
Jason Overdorf
NEWSWEEK
From the magazine issue dated Jan 19, 2009
Though it may not look it on the ground at times, India is one of the few bright spots in a global economy with decidedly dim prospects in 2009. It is forecast to grow at a robust 5 to 6 percent this year—which is faster than it averaged in the 1990s, and nearly double the rate of expansion over the country's first three decades of independence. Yes, its stock market has crashed, unemployment is spiking, swaths of the real-estate market have more than a passing resemblance to Miami Beach and it now turns out that Satyam Computer Services—one of the country's top five IT companies—has been cooking its books. But a one off incident of fraud in the flagship IT sector won't knock the country off the rails. India boasts an unlikely growth driver all its own: legions of poor whose incomes have risen just enough in recent years to create powerful demands for basic goods and services.
The rise of India's aspiring middle—a group that lives above the poverty line but hasn't yet attained true membership in modern consumer society—is hardly a new story. But what's surprising is the resilience of this cohort, and the extent to which it has counterbalanced the global credit crisis and the slump in the global export economy of which India is a key player. In part, this is a consequence of New Delhi's past failures; policymakers were never able to make India the export powerhouse that China has become over the past three decades, so now they don't rely nearly as heavily on growth driven by investment and demand from foreign markets.
Yet Indian planners deserve some credit, too, for avoiding a national addiction to cheap credit and creating "growth multipliers" like roads and telecom networks that now link the country's vast interior to modern cities. "The basic component of domestic demand [in India] is consumer demand, because people still have incomes to earn," says Saumitra Chaudhuri, chief economist at ICRA, an Indian credit-ratings agency affiliated with Moody's. "And those incomes are not substantially influenced by international developments."
The idea that Indian backwardness is a plus may sound absurd. But it is always easier to grow from a poor base, so the fact that India is not yet a major economy is an advantage in a downturn. A population so large that subsists at such a low economic base is a powerful economic driver if it can be mobilized. India's has been, and it is proving resilient to the prevailing headwinds in the global economy. "It's kind of a self-sustaining process," says Subir Gokarn, chief economist at Crisil, the Indian arm of Standard & Poor's. "There's a huge, huge underpenetration of most commodities and services, and you have enough people at the bottom experiencing enough of an increase in income to sustain growth."
So even as middle-class consumption wanes in India—signified by a sharp drop in auto sales, airline travel and fine restaurant dining since mid-2008—domestic demand remains strong thanks to aspiring consumers, many still tied to the farms, who spend their rupees on essentials like soap, medicine and the shoes and clothing that they wear to work. As Gokarn puts it: "If you go back to the economic textbooks, they will tell you that the poorer you are, the stronger your propensity to consume."
The contrast with China, Asia's other economic giant, is stark. Domestic demand makes up three quarters of the Indian economy, compared with less than half for China, which is "why, relative to East Asian economies, India is somewhat insulated from the global trade slowdown," says Shankar Acharya, a former chief economic adviser to the government. Another Indian mainstay—agricultural growth—should remain steady this year, and the services sector, which now accounts for about 55 percent of India's GDP, is expected to be "more resilient" than manufacturing, says Acharya.
Despite the financial crisis, the nation's IT sector managed to grow some 20 percent in 2008, according to India's National Association of Software and Services Companies, and IT companies have already extended 100,000 new job offers for 2009. "For whatever reason, China has been highly focused on the export market, while Indian business has been highly focused on the domestic market, and their exports have been incidental," says Chaudhuri. Which makes India, more than China, a master of its own destiny.
The conventional wisdom has always held that India failed to become an export-driven dynamo on the Chinese model because its democratic system couldn't deliver the hard infrastructure and soft labor laws needed to manufacture competitively. While there is some truth to that, what is often overlooked is how much India's current growth multipliers—all of them linked to infrastructure—resemble China's in the 1980s.
One example: India's ambitious program to expand the national highway system, launched in 2003, which is now adding about 100 kilometers of highway per day to the grid. Each new strip of pavement links additional villagers to urban markets, allowing them to fetch more for what they grow or make and to travel farther afield for wage-paying jobs. Capitalized at a whopping 5 percent of GDP in 2000, India's rural roads program will ultimately connect all Indian villages of more than 500 people to one another with all-weather roads. Fewer than half of these villages had roads of any sort when the project started. Similarly, in a six-phase national project, the National Highway Authority plans to add or upgrade nearly 30,000 kilometers of highway, which would expand the existing system by a third.
Telecommunications has made faster inroads. In 2008 the subscriber base for India's national telecom network topped 350 million people, and India's telecom market is now growing faster than even China's. Charges have dropped to less than 50 U.S. cents per call. That connectedness has a huge potential impact on incomes in a job market "extremely sensitive to how quickly one can get information," says Gokarn. There's also the IT sector itself to consider. It has created 1.8 million jobs directly over the past decade, and as many as 6.5 million more support jobs for drivers, security guards and gofers with primary or high school educations. That has put rupees into the hands of people "more likely to spend it rather than save it," says Gokarn, and though job creation will slow as the IT sector cools off, the huge workforce creates a good deal of momentum.
India's bottom-up boom can't drive the economy at full speed, to be sure. But it is largely immune to the downturn that's evident higher up the consumer chain. The stock bust hasn't affected the aspiring underclass because its members are not invested in the markets, and they're not to blame for the drop in auto sales because they're too poor to afford cars. Even the housing bust is far removed from them; despite the glut of top-end condos in places like Mumbai and New Delhi, India as a whole is suffering an acute housing shortage. The problem: construction companies all aimed for the top of the market, leaving the lower tiers underserved. According to the National Planning Commission, urban India needs an additional 24.7 million ordinary homes to satisfy current demand. As evidence of this unquenchable thirst, when the Delhi Development Authority held a lottery last year to find buyers for 5,000 affordable flats it built in the city, some 500,000 applications flooded in.
The mismatch illuminates India's way forward. Like many other governments, New Delhi recently announced a major new spending package aimed at bolstering growth. And it, too, seeks to spur domestic demand. Yet the main target isn't the urban middle, as in China or the United States, but the poor. In October, Parliament approved additional spending of about $50 billion (or 4.5 percent of GDP) to boost salaries of government workers, waive farm loans, further fund the rural-employment-guarantee program and finance petroleum bonds so that oil and fertilizer companies can keep prices low. "While there are legitimate concerns about the long-term impact of some of these measures," says Gokarn, "they will undoubtedly help boost consumption spending, particularly by lower income households, which in turn will help shore up growth in the immediate future."
India avoided a U.S.-style housing bust and is better positioned to pump money into the cash-starved financial system today because its much-maligned central bank was never wooed by the allure of easy money—no matter how loudly industry clamored for faster growth. When the central banks of other countries were essentially offering free money, India's realized that, as a democracy of mostly poor voters, it couldn't afford to grow at 10 percent a year if that meant skyrocketing prices for essential commodities like rice and flour. For that reason, the central bank constricted the money inflating the real-estate bubble (and prices for everything else) by raising interest rates to a peak of 12.5 percent last summer, which earned it criticism for being out of step with more aggressively growth-oriented central banks. Because of this, India has ample ground clearance to lower rates and reduce reserve requirements for banks to spur growth and avert deflation.
The private sector is in pretty solid financial shape, too. The central bank kept a close eye on both state-owned and private banks, preventing them from leveraging to perilous heights by keeping the cash reserve ratio high, limiting the use of securitizations and derivatives and essentially barring the off-balance sheet vehicles that U.S. banks used, disastrously, to hide their debt. As a result, India's banks aren't sitting on a mountain of bad loans, which makes them freer to lend to companies in need. Indian companies, cognizant of the cash crunch that burned them in the late 1990s, didn't overextend this time, either. "[One] great source of strength is India's corporate sector, who have much stronger balance sheets [than in the past]," says Chaudhuri.
One sign of that is companies that are putting their wealth to work. In December, India's Wipro Technologies purchased Citigroup's captive IT services firm Citi Technology Services for $127 million in cash, and in October, Tata Consultancy Services was able to buy Citi's business process outsourcing business, Citigroup Global Services, paying $505 million. Both moves suggest that reports of the IT sector's demise in India are greatly exaggerated.
The biggest risk to India in 2009 at this point may not be the global economy but domestic politics. Prime Minister Manmohan Singh's United Progressive Alliance will see its term expire in May, and India's election rules mean that he can no longer enact any significant policies—a measure adopted to prevent incumbents from stacking the deck with populist sops. That means as much as five months of paralysis, precisely when speedy, creative action is the order of the day. Moreover, though the nemesis of Singh's Congress party—the Bharatiya Janata Party—mostly favors similar policies, a change in government would likely result in some further slowing of infrastructure projects that are already running behind schedule. And elections in India can be tricky. In the last one, the BJP-led National Democratic Alliance lost despite racing economic growth, because poor voters rejected the BJP's campaign claims of an "India Shining."
With the light bulb flickering, Singh's Congress may face an even bigger challenge winning them over. The poor don't care how much faster than other nations India is growing, only whether their lives are better than they were five years ago.
URL: http://www.newsweek.com/id/178814
from bollywood to hollywood
The "Mozart from Madras" is ready for his close up after winning a Golden Globe for "Slumdog Millionaire."
By Jason Overdorf - GlobalPost
January 12, 2009
NEW DELHI — Calling India's A.R. Rahman — who won a Golden Globe award for the score of "Slumdog Millionaire" last night — the best composer you've never heard of is beyond understatement.
Known locally as "the Mozart from Madras," Rahman has sold over 200 million albums worldwide: more than Madonna and Britney Spears combined. But the truth of the matter is you probably can't hum one of his songs. That's about to change.
"There are a number of gifts that single [Rahman] out as special. His handling of rhythmical elements is astonishing and his solutions very South Indian," said Ken Hunt, one of the authors of the upcoming third edition of "The Rough Guide to World Music." "His melodies are catchy, clever and reveal a command of theatrical music techniques," Hunt adds. "He was pretty much ready for the big time from the get-go."
And now the big time is ready for him. With a multicultural soundtrack unlike anything he's ever done for Bollywood, the 43-year-old composer-singer-producer might be on his way to becoming America's hottest new hand on the mixing board. Indian-origin DJs in New York and London have been saying it for years, but now it just may be true. Brown is the new black.
As far as Indians are concerned, it's about time. Audiences here, where "Slumdog Millionaire" has not yet been released, have been overjoyed by the film's surprise victories at the Critics' Choice and Golden Globe awards. Here's one tribute: Only three Indian films ever have been nominated for an Oscar in the foreign language category, "Mother India" (1957), "Salaam Bombay!" (1988) and "Lagaan" (2001). None took home the prize.
So even though "Slumdog" — written by Simon Beaufoy and directed by Danny Boyle — is not technically an Indian production, or even a Bollywood-style film, the accolades for Rahman have provided some validation for the larger-than-life musicals that Indians often simply call "our films."
Rahman, who started to learn the piano at the age of 4, is something of a Slumdog Millionaire himself. After his father died, he was forced to start work as a keyboard player to support his family at just 11 years old. He later dropped out of high school to pursue his music career. About that same time, he converted from Hinduism to Islam, a brave choice in a country where Muslims often face persecution. But he says Islam "set [him] free."
From his humble beginnings, Rahman swiftly became one of Bollywood's biggest money spinners — a kind of Indian Quincy Jones — virtually owning the industry for more than a decade. His hits, like Chaiya Chaiya, Chhoti Si Asha and Thee Thee, have as much enduring appeal as any Beatles standard, and not only for Bollywood fans. "A.R. Rahman is nothing short of a melodic genius," Andrew Lloyd Webber has said. "I admire his unique sense of harmony, his staggering rhythms and his melodies that take an unexpected twist that no Western composer would dream of."
Bollywood insiders know that kind of staggering genius can make or break a film in India. "In Indian cinema, the music is such an important part of it that music can save a mediocre film," says film critic Jai Arjun Singh. "With Rahman, it happens frequently."
That's not an overstatement. Marketers use song-and-dance numbers from movies for the trailers, videos on Channel V and MTV drive repeat business, and soundtrack sales and music video rights account for a significant part of the picture's revenue.
That's why Indian producers swear by him. "He has demonstrated fusion of west and east more than most musicians over the world," said Ronnie Screwvala, chief executive of UTV Motion Pictures, one of India's most successful film production companies. "All our tent pole [productions] have always been Rahman [films]—from Swades to Rang De Basanti to Jodha Akhbar and Delhi 6."
Nevertheless, though he performed with Michael Jackson and wrote the music for Webber's Broadway musical Bombay Dreams and the stage production of the Lord of the Rings, Rahman was virtually unknown to Western fans until last night.
Now he has to be considered a frontrunner for an Oscar, and a raft of offers from record companies and producers in the U.S. music industry.
Here comes the close up.
By Jason Overdorf - GlobalPost
January 12, 2009
NEW DELHI — Calling India's A.R. Rahman — who won a Golden Globe award for the score of "Slumdog Millionaire" last night — the best composer you've never heard of is beyond understatement.
Known locally as "the Mozart from Madras," Rahman has sold over 200 million albums worldwide: more than Madonna and Britney Spears combined. But the truth of the matter is you probably can't hum one of his songs. That's about to change.
"There are a number of gifts that single [Rahman] out as special. His handling of rhythmical elements is astonishing and his solutions very South Indian," said Ken Hunt, one of the authors of the upcoming third edition of "The Rough Guide to World Music." "His melodies are catchy, clever and reveal a command of theatrical music techniques," Hunt adds. "He was pretty much ready for the big time from the get-go."
And now the big time is ready for him. With a multicultural soundtrack unlike anything he's ever done for Bollywood, the 43-year-old composer-singer-producer might be on his way to becoming America's hottest new hand on the mixing board. Indian-origin DJs in New York and London have been saying it for years, but now it just may be true. Brown is the new black.
As far as Indians are concerned, it's about time. Audiences here, where "Slumdog Millionaire" has not yet been released, have been overjoyed by the film's surprise victories at the Critics' Choice and Golden Globe awards. Here's one tribute: Only three Indian films ever have been nominated for an Oscar in the foreign language category, "Mother India" (1957), "Salaam Bombay!" (1988) and "Lagaan" (2001). None took home the prize.
So even though "Slumdog" — written by Simon Beaufoy and directed by Danny Boyle — is not technically an Indian production, or even a Bollywood-style film, the accolades for Rahman have provided some validation for the larger-than-life musicals that Indians often simply call "our films."
Rahman, who started to learn the piano at the age of 4, is something of a Slumdog Millionaire himself. After his father died, he was forced to start work as a keyboard player to support his family at just 11 years old. He later dropped out of high school to pursue his music career. About that same time, he converted from Hinduism to Islam, a brave choice in a country where Muslims often face persecution. But he says Islam "set [him] free."
From his humble beginnings, Rahman swiftly became one of Bollywood's biggest money spinners — a kind of Indian Quincy Jones — virtually owning the industry for more than a decade. His hits, like Chaiya Chaiya, Chhoti Si Asha and Thee Thee, have as much enduring appeal as any Beatles standard, and not only for Bollywood fans. "A.R. Rahman is nothing short of a melodic genius," Andrew Lloyd Webber has said. "I admire his unique sense of harmony, his staggering rhythms and his melodies that take an unexpected twist that no Western composer would dream of."
Bollywood insiders know that kind of staggering genius can make or break a film in India. "In Indian cinema, the music is such an important part of it that music can save a mediocre film," says film critic Jai Arjun Singh. "With Rahman, it happens frequently."
That's not an overstatement. Marketers use song-and-dance numbers from movies for the trailers, videos on Channel V and MTV drive repeat business, and soundtrack sales and music video rights account for a significant part of the picture's revenue.
That's why Indian producers swear by him. "He has demonstrated fusion of west and east more than most musicians over the world," said Ronnie Screwvala, chief executive of UTV Motion Pictures, one of India's most successful film production companies. "All our tent pole [productions] have always been Rahman [films]—from Swades to Rang De Basanti to Jodha Akhbar and Delhi 6."
Nevertheless, though he performed with Michael Jackson and wrote the music for Webber's Broadway musical Bombay Dreams and the stage production of the Lord of the Rings, Rahman was virtually unknown to Western fans until last night.
Now he has to be considered a frontrunner for an Oscar, and a raft of offers from record companies and producers in the U.S. music industry.
Here comes the close up.
for which it stands: india
Decoding Obama's (increasingly) complex India problem
By Jason Overdorf
GlobalPost (Jan. 8, 2009)
NEW DELHI — Like many countries, India was rooting hard for Barack Obama to become America's 44th president. But the enormous challenges that Obama faces in South Asia — and India's huge expectations — could make the love affair short-lived.
Since former President Bill Clinton's second term, U.S.-India ties have been growing ever closer. With the nuclear agreement signed in September, the relationship has begun to look like a strategic alliance.
But that warm embrace could turn into a cold shoulder. The rub: Obama's commitment to building a viable state from the rubble of Afghanistan, which will likely lead him to lean on Pakistan for assistance.
Indians worry that the U.S. may allow Pakistan to wriggle out of its espoused promises to arrest and prosecute the terrorists responsible for the Nov. 26 attacks in Mumbai.
"We expect the U.S. to apply the same strict standards that they have for the western border of Pakistan for Pakistan-sponsored terrorism against India," said former foreign minister Yashwant Sinha.
"The litmus test for this will be the surrender or repatriation to India of those criminals who have taken shelter in Pakistan, and no alibi by the Pakistani rulers should be allowed to stand in the way," he added.
India has banked heavily on America's ability to pressure Pakistan to bring the Mumbai culprits to justice. But the U.S. needs the Pakistani army's help in fighting the Taliban on Pakistan's western border.
If in return the U.S. allows Islamabad to skate on its promises to catch and prosecute the perpetrators of the Mumbai attack, India's love affair with Obama would come to a speedy end.
And it could well reverse the trajectory of India's increasingly U.S.-centric foreign
policy — which has seen New Delhi step back from Iran, inch closer to Israel and distance itself from the Shanghai Cooperation's Russia-China-India formulation in favor of a budding alliance with the U.S., Japan and Australia.
"President Bush has left a very strong legacy of establishing a strategic relationship between India and the United States and President Obama will have to find ways and means to consolidate that relationship and build on it," said Kanwal Sibal, a former India foreign secretary.
"However, (Obama's) thinking about Afghanistan and what the United States needs to do there — the surge strategy that is being propounded by Gen. Petraeus — will require certain tough policy decisions vis a vis Pakistan," Sibal added.
Pakistan has maneuvered U.S. intervention after the Mumbai attacks into an effort to stop India from taking action, rather than compelling Pakistan to do so, according to M.K. Bhadrakumar, a career Indian diplomat.
That has already "exposed the fallacy" of India's thinking that in the post-Cold War world it is a natural ally of the U.S., while the U.S. relationship with Pakistan is a mere marriage of convenience, said Bhadrakumar.
And when Obama takes office, the rhetoric of putting pressure on Pakistan to arrest terror suspects will likely give way to a multibillion-dollar aid package, including $300 million in annual military aid for the next five years.
"That gives Pakistan a misplaced confidence that they can get away with terrorist acts against India. That the world will watch for awhile, then remain quiet and wait for the next strike, and India will be helpless to act," Sinha said.
"Mumbai, with the kind of deep hurt it has caused to the Indian psyche, is making India increasingly unwilling to accept this situation," he added.
So far, Obama's early efforts at developing a strategy for balancing America's complex dual alliance with India and Pakistan have appeared to Indians like naive blunders that play into Pakistan's hands.
According to U.S. media reports, for instance, Obama suggested he might appoint former President Clinton as special envoy to Kashmir as part of an effort to resolve India-Pakistan tensions, freeing Pakistan to be more aggressive in fighting al-Qaida on the Afghan border.
That might sound like a good idea to non-Indian readers.
But to most Indians, the suggestion betrays either a basic ignorance or a deliberate oversight of India's point of view: that Kashmir is a bilateral issue in which it occupies the literal and the moral high ground.
India has trumpeted the fact that despite the attacks on Mumbai and a call for a boycott by separatists, more than 60 percent of eligible voters turned out for state elections held in Kashmir in November and December, and the clear majority chose pro-India parties.
Pakistan's chief argument against the legitimacy of India's dominion over Kashmir is that India has never held the plebiscite to determine who will have sovereignty over the state that the U.N. Security Council ordered as part of the original peace plan for the region in 1948.
"The inherent message that you get from this is that by appointing a special envoy, the United States would want India to make additional compromises," Sibal said.
"That is where the rub is," Sibal continued. "What additional compromises? Because we have a purely defensive strategy on Kashmir. It's Pakistan that has the offensive strategy, which wants to grab part of the territory, which wants to destabilize the situation from within, which is engaging in terrorism."
Though India remains skeptical, the latest news out of Pakistan has been relatively positive.
Under increasing U.S. pressure as the FBI progresses in its own investigation of the Mumbai attacks, Islamabad has at least acknowledged that the terrorist in Indian custody is a Pakistani national.
What remains to be seen is whether Obama's administration will be as forceful in dealing with Islamabad at the beginning of his term as Bush suddenly seemed to be in his final days in office — when he knew his successor would have to deal with the consequences.
For Indians, the answer could define the Obama presidency almost before it begins.
By Jason Overdorf
GlobalPost (Jan. 8, 2009)
NEW DELHI — Like many countries, India was rooting hard for Barack Obama to become America's 44th president. But the enormous challenges that Obama faces in South Asia — and India's huge expectations — could make the love affair short-lived.
Since former President Bill Clinton's second term, U.S.-India ties have been growing ever closer. With the nuclear agreement signed in September, the relationship has begun to look like a strategic alliance.
But that warm embrace could turn into a cold shoulder. The rub: Obama's commitment to building a viable state from the rubble of Afghanistan, which will likely lead him to lean on Pakistan for assistance.
Indians worry that the U.S. may allow Pakistan to wriggle out of its espoused promises to arrest and prosecute the terrorists responsible for the Nov. 26 attacks in Mumbai.
"We expect the U.S. to apply the same strict standards that they have for the western border of Pakistan for Pakistan-sponsored terrorism against India," said former foreign minister Yashwant Sinha.
"The litmus test for this will be the surrender or repatriation to India of those criminals who have taken shelter in Pakistan, and no alibi by the Pakistani rulers should be allowed to stand in the way," he added.
India has banked heavily on America's ability to pressure Pakistan to bring the Mumbai culprits to justice. But the U.S. needs the Pakistani army's help in fighting the Taliban on Pakistan's western border.
If in return the U.S. allows Islamabad to skate on its promises to catch and prosecute the perpetrators of the Mumbai attack, India's love affair with Obama would come to a speedy end.
And it could well reverse the trajectory of India's increasingly U.S.-centric foreign
policy — which has seen New Delhi step back from Iran, inch closer to Israel and distance itself from the Shanghai Cooperation's Russia-China-India formulation in favor of a budding alliance with the U.S., Japan and Australia.
"President Bush has left a very strong legacy of establishing a strategic relationship between India and the United States and President Obama will have to find ways and means to consolidate that relationship and build on it," said Kanwal Sibal, a former India foreign secretary.
"However, (Obama's) thinking about Afghanistan and what the United States needs to do there — the surge strategy that is being propounded by Gen. Petraeus — will require certain tough policy decisions vis a vis Pakistan," Sibal added.
Pakistan has maneuvered U.S. intervention after the Mumbai attacks into an effort to stop India from taking action, rather than compelling Pakistan to do so, according to M.K. Bhadrakumar, a career Indian diplomat.
That has already "exposed the fallacy" of India's thinking that in the post-Cold War world it is a natural ally of the U.S., while the U.S. relationship with Pakistan is a mere marriage of convenience, said Bhadrakumar.
And when Obama takes office, the rhetoric of putting pressure on Pakistan to arrest terror suspects will likely give way to a multibillion-dollar aid package, including $300 million in annual military aid for the next five years.
"That gives Pakistan a misplaced confidence that they can get away with terrorist acts against India. That the world will watch for awhile, then remain quiet and wait for the next strike, and India will be helpless to act," Sinha said.
"Mumbai, with the kind of deep hurt it has caused to the Indian psyche, is making India increasingly unwilling to accept this situation," he added.
So far, Obama's early efforts at developing a strategy for balancing America's complex dual alliance with India and Pakistan have appeared to Indians like naive blunders that play into Pakistan's hands.
According to U.S. media reports, for instance, Obama suggested he might appoint former President Clinton as special envoy to Kashmir as part of an effort to resolve India-Pakistan tensions, freeing Pakistan to be more aggressive in fighting al-Qaida on the Afghan border.
That might sound like a good idea to non-Indian readers.
But to most Indians, the suggestion betrays either a basic ignorance or a deliberate oversight of India's point of view: that Kashmir is a bilateral issue in which it occupies the literal and the moral high ground.
India has trumpeted the fact that despite the attacks on Mumbai and a call for a boycott by separatists, more than 60 percent of eligible voters turned out for state elections held in Kashmir in November and December, and the clear majority chose pro-India parties.
Pakistan's chief argument against the legitimacy of India's dominion over Kashmir is that India has never held the plebiscite to determine who will have sovereignty over the state that the U.N. Security Council ordered as part of the original peace plan for the region in 1948.
"The inherent message that you get from this is that by appointing a special envoy, the United States would want India to make additional compromises," Sibal said.
"That is where the rub is," Sibal continued. "What additional compromises? Because we have a purely defensive strategy on Kashmir. It's Pakistan that has the offensive strategy, which wants to grab part of the territory, which wants to destabilize the situation from within, which is engaging in terrorism."
Though India remains skeptical, the latest news out of Pakistan has been relatively positive.
Under increasing U.S. pressure as the FBI progresses in its own investigation of the Mumbai attacks, Islamabad has at least acknowledged that the terrorist in Indian custody is a Pakistani national.
What remains to be seen is whether Obama's administration will be as forceful in dealing with Islamabad at the beginning of his term as Bush suddenly seemed to be in his final days in office — when he knew his successor would have to deal with the consequences.
For Indians, the answer could define the Obama presidency almost before it begins.
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