January 20, 2006

The (not-so)Innocents Abroad : The case against IIMs

The Globalisation mantra is one that is routinely chanted by most sections of Indian civil society with the possible exception of those of at the xenophobic fringe, both left and right. However in the case of IIM-Bangalore we need to look at the issue from a slightly different perspective.

Comparing an IIM with a Indian multinational like Infosys, L&T, Telco, ONGC or SBI or the IIM brand to something like Kingfisher is erroneous and to understand why let us look at the structure and charter of IIM vis-a-vis these other organisations.

A shareholder owned company, whether listed or otherwise, exists for the creation and enhancement of shareholder wealth. If by expanding abroad, the management feels that it will earn more business and hence enrich its shareholders ... then there is no question that it must do so.

But in the case of IIM, who is the shareholder ( or stakeholder ) ? It is the people of India, the tax-payer, acting through the Government of India who have set up these Institutes. How does this shareholder, or stakeholder, benefit by the IIM setting up a branch in Singapore ? He does NOT and this is the simple reason why both Arjun Singh as well Murali Manohar Joshi is, perhaps for the first time in their respective lives, correct in their opposition to IIMs setting up branches outside India.

But let us analyse why the IIMs are so enthusiastic about setting up branches outside the country. The reason is money, not so much for the Institute but for individual professors. And we cannot really deny them this (ulterior) motive. After all what does an IIT or IIM professor earn ? Something around Rs 500,000 / year and that too at the end of their career. Their students on the other hand routinely earn an identical amount on the day they step out of the institute. Naturally, this huge discount from the market price makes a professor's job extremely unattractive for talented people. [ It is of course a different matter that when talented people seek teaching assignments, even at these abysmal salaries, they are kept out by the old, incompetent incumbents ... but that is a different story ]

Net-net this attempt at opening IIM branches abroad is a ploy by some of the smart and enterprising professors to earn more money. Which is perfectly commendable but falls foul of the basic ground rules ... so is there any way by which the rules can be changed ? Here are two options ..

[a] Let faculty salaries be market driven. Which means that a professor of Computer Science should be paid what his or her counterpart in the IT industry makes and a professor of sociology or history or bengali should expect what a graduate or post graduate in these disciplines currently gets in the industry. By adhering to phony socialistic principles and paying the same money, at "UGC scales" to all teachers we have created a severe distortion in the market that results in smart teachers having to take such dubious and devious ways to get money that they should be getting anyway.

the other option is more radical.

[b] Let us 'privatise' the IIMs and IITs through an IPO. Education is a service business that has enormous potential and there will be no dearth of individuals who would want to invest in the same. The proceeds of the IPO, the money raised from the market, belong to the people of India and should be invested by the Government in more schools and colleges within the country. Given the huge brand value of the IITs/IIMs this money should be fabulous and if used well can create twenty more Institutes in the country.

The existing Institues on the other hand would now be accountable to their new owners, the shareholders, and would have the freedom to pursue whatever course they wish to choose. Should that lead them outside India, so be it, it is none of our business ... just as it is none of our business to ask where Infosys decides to open its next office.

January 08, 2006

K J Rao and The Misplaced Euphoria

The nomination of Mr K J Rao to lead the election process in the 2006 Assembly Elections in West Bengal has caused an eruption of euphoria in civil society. The expectation is that he will repeat his marvelous performance in the Bihar elections and by ensuring a fair, free and safe poll he will act as a catalyst for the change of regime. Unfortunately, this expectation may be belied and the budding hopes of Bengal's civil society may be dashed. Let me explain why ...

Malpractices in the Bihar elections are easier to contain. This is because they are point events. A short burst of murder and mayhem, money and muscle power plus liberal doses of liquor and other meaningless perks ensures that criminals can get a ticket to contest elections and then win them. Such point events are easy to fix provided one has sufficient legal firepower , in the guise of central paramilitary police forces AND ( and this is a very big AND ) the courage and conviction to use it .. In this case this person was Mr Rao ... widely hailed as the hero of Bihar.

The case of Bengal is radically different. The current rulers of Bengal are here not on the basis of such crude point events but on the back of a long drawn strategy of capturing and retaining power and point solutions like Mr Rao may not be enough to prick their balloon. What is this long drawn strategy ? Let us look at it in terms of its various components ...

1. Regular stream of 'committed' voters from across the Bangladesh border. The original communist party drew its strength from the Hindu 'bangal' refugees who had legitimately come from East Pakistan. By allowing them to forcibly occupying government and other private land they bought a vote bank. When this vote bank got absorbed into civil society and there were no Hindus left in Bangladesh ... they took the drastic step of encouraging illegal immigration from other communities. Vast numbers of foreigners were brought into Bengal and given false ration cards. An MLA who was linked to the murder of the Deputy Commissioner of the Port Police in Calcutta was one of the ringleaders of the racket. He might have retired now or has perhaps moved on to even higher ranks ... but the process continues unabated. Any attempt to check this disaster, even by civil communists, is criticised from the high platform of secularism and minority protection.

2. The entire education system has been taken over by ideologues. For the last 30 years no one can become a teacher in any school or college of West Bengal ( other than the central government institutes ) unless he or she is an active member of the party or is endorsed by a party member. As a result two generations of Bengalis have grown up with a specific being drummed into their ears for the first 20 years of their life. Some of them are of course smart enough to see through the propaganda but a statistically significant number remain in the psychological comfort zone that they are told about. Being unaware of anything else, they vote instinctively.

3. The machinery of the government has been taken over by party in the guise of trade unions or co-ordination committees and police associations. The roles and responsibilities of the Government -- census, dilineation of constituencies, preparation of voters lists, distribution of voter cards, management of the election process, counting of votes and announcement of results -- is done in a manner that is biased at each and every level. There is no crude and visible application of force that Mr Rao can counter, only a slow and subtle 're-adjustment' of parameters and that too over a long period of time. Mr Rao is of course smart enough to see through this ... but can he prevent it ? Let us look at some strategic approaches.

4. Strategic realignment of constituencies is a sinister tool that has been used for the past 30 years with devastating effect. Let us see how it works. Suppose we have 4 constituencies each having 10 population blocks. Assume each population block (which could be a village or as is more often the case nowadays, an illegal 'colony') votes for a specific party .. the Flower party and the Hammer party. Initially the distribution was A[6F,4H], B[6F,4H], C[6F,4H], D[4F,6H] .. and the Flower party should win three seats (A,B,C) and the Hammer party 1 (D). At the next census, the population is (mis)counted by committed party cadres and based on this new and erroneous data, the population blocks are re-organised by moving one H block from B and C to A and moving two F blocks to from A to B and C. Thus the distribution now looks like A[4F,6H], B[7F,3H], C[7F,3H], D[4F,6H]. In this election, the Flower party wins 2 seats and the Hammer party wins 2 seats ... a net gain of one seat just by re-arranging boundaries. In the next cycle, B is declared to be too large and two F blocks are assigned to A and D and to compensate for this one H block is moved from C to B. [ The Gopalnagar bustee next to the Rabindra Sarobar in Calcutta is such a case. They were physically uprooted and 'rehabilitated' in another part of the city just before the elections ] The distribution is now A[5F,6H], B[4F,5H], C[8F,1H], D[5F,6H] ... and with no change of voting pattern, the Hammer party wins 3 seats and the Flower party wins 1 seat ... which is just the reverse of what it used to be in the past.

Replicate this exercise year after year for the past 30 years in all the constituencies in the state and you would realise the dimensions of the problem.

5. In the earlier model we assumed that the voters are allowed to vote but that is very often not the case. In a constituency that runs neck to neck, blocks of people who have traditionally voted against the current rulers find their names missing from the electoral rolls ... which have been methodically updated by government census employees who are of course committed members of the State Employees Co-ordination Committee. Of course it is the duty of the voter to ensure that his name is there ... but then how many of our impoverished and marginal voters have the time and enthusiasm to spend a day or two to fix things. On the day of the vote they realise that they are not allowed to cast the vote. Other ways of preventing people from voting is to delay and withhold the distribution of the voter identity cards and this is very easy since the distribution is done by government employees who again are committed members of the State Employees Co-ordination Committee. The icing on the cake is of course the issue including the names of cross border immigrants [ point 1 above] in the electoral rolls ... thousands of them, and all neatly supported by the relevent ration cards and voter ID cards.

This then is 'scientific rigging' as opposed to the crude and violent methods adopted in Bihar and the cow belt. This science is now so well established that discredited political outfits from Eastern Europe and elsewhere are sending students of political science to Bengal to understand this process. Once again we recollect, nostalgically, what Tilak said about us : What Bengal Thinks Today, India ( or the world in this global era ) Thinks Tomorrow.

If Mr K J Rao can find an antidote for this Science, then the Bharat Ratna would be too small for him. We have to campaign with the Nobel Committee to include Political Science as another subject for which they can award a prize and the inaugural one should go to our hero.