motivation

Whatever you think, that you will become; so take care about what you think. If you have to think, think good thoughts, great thoughts. Words are secondary.  Thoughts live; they travel far." - Swami Vivekananda  

Take up one idea. Make that one idea your life – think of it, dream of it, live on that idea.

Throughout our life, we have met people who seem to have more intelligence than the rest of us. We term these people brilliant, smart or address them as genius. We may assume that their intelligence is God’s gift to them. Perhaps you are one of these gifted souls yourself.  Then there are others who find it hard to concentrate and perform well academically, struggle with assigned jobs, to learn new things, and perhaps wish that they were more like those geniuses.

A competitive society places a lot of importance on intelligence. Intelligent people are considered valuable everywhere. People who display lower levels of intelligence fear the consequences of not being able to keep up with the peers in their respective fields. When our children perform well academically, we proudly rejoice and share their performance with everyone around us. On the other hand, when the child is struggling academically, it causes much anxiety and worry to parents. 

Do you struggle academically and in your career? Do you  consider yourself dull and wished that your were smarter? Or do you just wish to do better at the tasks that you take up? The good news is that you are already a genius, just that you may or may not know it. Even top performers use only a small percentage of their brains, and it follows that each one of us has a potential within us to be a genius. It is a myth that geniuses are born that way. In reality, geniuses are the ones who have developed their inner capabilities more than others.

If you believe that your intelligence is static and cannot be enhanced,  consider this. The performance of  students who are otherwise brilliant suffer greatly after experiencing some traumatic event in their lives. The same students are not able to learn and retain like they used to. Sometimes, the drop in academic performance is so drastic, that a top student might get failing grades in school after experiencing the trauma, until the situation is correct by therapy. The same is true with adults as well. This suggests that clearly there is something more to performance besides raw intelligence and genetics. 

Why is it that some people perform higher than others?

The following observation from geography helps to understand this better. In the Indian subcontinent, many rivers originate in the Himalayas. Most of these rivers break up into smaller distributaries, until they get either land locked or dried up by the sun. The rivers that break up into smaller streams and distributaries never reach the ocean.  On the other hand, the river Ganges, which also starts in the Himalayas, continues to flow steadfastly south east  without breaking up, and is able to pour its waters into the Bay of Bengal. The fact that the Ganges flows without dividing herself is the dominant reason for her to be able to reach the ocean. 

The path of the river ganges.

Such is the case with the intelligence of the human mind. People who are able to focus their thoughts on a particular subject with undivided attention appear to be more intelligent than others. In reality the same potential exists in the rest of us as well.  Genius is less about the faculty of intelligence itself, and more about the ability to concentrate on a specific task without getting distracted.

Swami Vivekananda

As swami Vivekananda said:

“Take up one idea. Make that one idea your life – think of it, dream of it, live on that idea. Let the brain, muscles, nerves, every part of your body, be full of that idea, and just leave every other idea alone. This is the way to success, that is way great spiritual giants are produced.”

Now the question is, why is it that some people are able to give undivided attention to what they take up, whereas some others are not able to?

There are two reasons for this:

1. A high goal that greatly inspires and motivates the individual
2. A mind that is free from distraction

 Let us take this up this up one by one:

1) A high goal that greatly inspires and motivates the individual 

Until and unless an individual selects a task that greatly inspires and motivates him, his full potential does not get unleashed. This is why it is extremely important to “follow your heart”. Selecting a field of work only because of the need to survive ensures that an individual forever remains only in survival mode. All of the potential of such a  person remain dormant.

Mahatma Gandhi

Mahatma Gandhi was a mediocre student in school. He was a shy, soft-spoken individual who had no great spark of intelligence or leadership in him. All that changed when he suffered discrimination in Africa due to the color of his skin. He took upon himself the goal to correct the injustices that he faced. Highly inspired and motivated with this goal, this once shy man of mediocre abilities underwent a tremendous transformation. He grew by leaps and bounds, fought diligently and untiringly towards the goal of freedom for the entire nation, and in the process introduced some of the most brilliant and powerful ideas known to fight injustice in a peaceful manner. His leadership was par excellence. No one remembers the shy mediocre student,  all of us know him as a highly powerful and revered political leader who we lovingly call “Bapu” – The father of the nation. All of us can bring out the great potential sleeping within us, if only we find a high goal that deeply inspires us, like Mahatma Gandhi did.

2) A mind that is free from distraction

As seen above in the example of the intellectual performance of people suffering after undergoing mental trauma, even people who are otherwise considered brilliant, perform poorly when the mind is distracted. Only when the mind is quietened does the intellect starts to perform to its full potential. An individual with a quiet mind is better able to make decisions that are in true alignment with his purpose, and thus increases his chances of success. Also a quiet mind conserves a lot of energy, as it is at peace. A quiet mind is more creative and intuitive. An agitated mind is more prone to negative emotions  such as anger, hatred, doubt, insecurity, unworthiness, etc, which wastes precious energy that would be otherwise channeled towards the task at hand. 

The other source of distraction come via our senses. It is not uncommon for a person’s intellectual performance to suffer when the mind is distracted thanks to  preoccupation with gratifying one of more of the senses – which is what happens when the mind deeply craves for anything. This is why people who experiencing a breakup of their relationship, or are addicted to alcohol or drugs perform well below their potential. Regular meditation reduces our cravings and aversions. It helps to cultivate a mind that is creative, intuitive, and free of distraction, which unleashes more of the power of your intellect to the tasks you undertake.

Your intelligence is not a fixed entity. You have enormous potential within you to enhance it.  Each one of us carries within us the seed of genius. Most of us preserve the seed as it, whereas some of us take that seed and grow it into a mighty tree  – and that makes all the difference in the world.  You are a genius. Once you know this and believe it completely, it is a only matter of time that the rest of the world will acknowledge it too.

Warren Buffet made largest donation of '14: Wealth-X

Billionaire investor Warren Buffet has made the largest philanthropic donation of this year, by giving USD 2.1 billion to the Bill and Melinda Gates Foundation in the form of 16.6 million shares of his company, Berkshire Hathaway.

According to global wealth intelligence and prospecting company Wealth-X, Buffet topped the list of the 10 biggest single charitable donors of 2014.

Nicholas Woodman, GoPro Founder, CEO and Chairman was ranked second on the list as he along with his spouse donated USD 497.5 million to Silicon Valley Community Foundation.

Eight of the top 10 donations of 2014 were made by American philanthropists. Hong Kong real estate tycoons Ronnie and Gerald Chan are the only non-Americans to appear on the list.

Ronnie and Gerald Chan were ranked third and fourth on the list. The billionaire brothers collectively gave a USD 350 million gift to Harvard University, the largest ever in the school's history.

Harvard also received a USD 150 million donation from hedge fund manager Kenneth Griffin to support financial aid.

Griffin was ranked fifth on the coveted list.

Six of the top ten donations of 2014 were made to educational institutions, two were given to health causes and two went to philanthropic foundations, Wealth-X said.

Among other contributions, Gert Boyle's USD 100 million donation to Oregon Health & Science University was ranked 6th on the list followed by John Morgridge at the 7th place (USD 100 million to University of Wisconsin-Madison), John Jay Jordan at 8th rank (USD 75 million to University of Notre Dame).

The top ten largest philanthropic donations of 2014 also include, Edward Meyer at 9th rank (USD 75 million donation to Weill Cornell Medical College) and Charles Munger at the 10th place (USD 65 million to University of California Santa Barbara).

The Donated amounts mentioned in this report only took into account donations that have already been made, and do not include pledged amounts.

Wealth-X is the world's leading ultra high net worth (UHNW) intelligence and prospecting firm with the largest collection of curated research on UHNW individuals, defined as those with net assets of USD 30 million and above.

Questions for the new year What will be the challenges before a re-energised India in 2015?

Another new year is around the corner and it promises to be as unpredictable and uncertain as the year gone by. This is a good occasion on which to reflect on some major developments of the past year and identify what may preoccupy us most as a country in the coming year. Undoubtedly, the historic general elections in India that, for the first time since 1984, threw up a majority government must qualify as a potentially transformational event. This has reversed the mood of despondency and frustration that pervaded the country in the last two years of the previous government; it has also revived foreign interest in India as an economic opportunity.

India's credibility as a substantial power has revived and it can deal with its external environment with renewed strategic heft. The prime minister himself has contributed significantly to this change in mood and outlook by conveying a sense ofstrong leadership and clear direction. The coming year will be critical in determining whether these altered perceptions will be translated into substantive change. Failure to deliver real change may push India off the international radar screen once again even while disappointed expectations within the country may lead to domestic turmoil.

No one expects that substantive change will come in the shape of big bang reforms. However, the changes must be significant enough to justify continued optimism about India's prospects. The display of strong leadership must be matched by systemic changes. For example, the Swachh Bharat Abhiyan is an admirable initiative, but will run out of momentum if structural changes do not follow. We need better and more efficient waste-management systems; we need municipalities that deliver public services and impose penalties for littering. A large number of toilets are being built both through public funding as also part of the corporate social responsibility projects of public sector undertakings. In the absence of quality control and proper arrangements for maintenance they are likely to become symbols of tokenism. It was recently reported that about 25 per cent of toilets built in the initial rush are already non-functional.

The energy domain has witnessed substantive change. Diesel has been de-controlled and the direct benefit scheme, through Aadhaar and inclusive banking, are important steps. They are being applied to LPG supplies and hopefully, may be extended to kerosene.

However, energy governance continues to be fragmented with multiple agencies pursuing their own narrow interests in their respective silos. This prevents the country from formulating and implementing an internally consistent and comprehensive energy strategy encompassing different fuel sources and their inter se pricing. While ensuring adequate energy supplies to drive a renewed growth push particularly in manufacturing, some thought has to be given to the longer-term challenge of sustaining accelerated growth.

Our economic structure continues to mimic the energy-intensive and wasteful patterns of production and consumption spawned by an industrialised West that experienced growth in an era of energy and resource abundance. In an increasingly energy- and resource-constrained world we cannot aspire to the lifestyles and consumption patterns of the West. Even a fraction of the car ownership density of the West would demand fuel and land for highways and parking that is way beyond reach. The citizen's right to mobility must be delivered through efficient and affordable public transport, not through enabling car or even two-wheeler ownership. The policy implications of this are obvious. We must discourage private vehicle ownership through progressively higher taxation and use the funds to invest in public transport.

Agriculture is another sector that is crying out for fundamental reforms. The Green Revolution of the late 1960s and 1970s was based on the use of hybrid cereal seeds, with the intensive use of inputs like water, chemical fertilisers and pesticides. The focus was on crop yields, not the farmer's viability. This strategy helped to generate high crop yields and enabled food security over the next few decades. Unfortunately, this strategy has now run out of steam. Prolonged use of chemical fertilisers has diminished the natural fertility of soil, while increasing requirement of water has led to the alarming drop in groundwater levels across the country. The use of toxic pesticides has not only led to contaminated food chains, but also caused adverse health effects on farmers and their families who rarely wear protective gear while spraying these pesticides. The time has come to shift towards more water-frugal agricultural practices and to rely on crop rotation and organic pesticides to ensure high yields. The focus must shift from raising crop yields to making the farmer economically viable. This may require a judicious combination of animal husbandry, horticulture and other farm-related income generating activities that give the farmer both a more predictable income as well as insurance against the failure of one or another crop. These new practices have been tried and tested in Andhra Pradesh and some other states and have yielded excellent results. They need to be upscaled.

Prime Minister Narendra Modi has already made his mark on the foreign policy front. His instincts are sound and the initiatives he has taken so far bear the stamp of a leader with an eye for perceiving and confidently grasping an opportunity that presents itself. The invitation to South Asian Association for Regional Cooperation (Saarc) heads of state and government at his swearing-in ceremony, the visits to India's hitherto neglected neighbours and the latest invitation to United States PresidentBarack Obama as chief guest for the next Republic Day are all sophisticated moves of an accomplished tactician. But these moves need to be fitted into a larger strategic vision about the future of India. How does the rapidly transforming international landscape shape India's external environment and is India able, in some way, to alter that landscape to its own advantage? How must India deal with the collateral fallout from the Ukraine crisis that has locked Russia and China into a more enduring strategic embrace than we are comfortable with? Will India be reconciled to the growing power asymmetry with China, or is it determined to shrink if not eliminate that asymmetry? If the latter, what does that mean for choices we make at home, and what we do in relationships with both friends and adversaries? What does the rise of the Islamic State of Iraq and Syria in the neighbouring Gulf region mean for a secular India, and what do we do to ensure that the virus of sectarianism does not infect our own vulnerable population? These are challenges that demand clear-headed reflection and longer-term responses. Tactical deftness must serve a compelling vision of the kind of country India wishes to become in 10, 20 or 30 years from now, and what kind of society it wishes to bequeath to succeeding generations. These are the issues that await an answer in the new year.

An advisory council?

Prime Minister Narendra Modi hosted a meeting with state chief ministers over the weekend, where the future of thePlanning Commission was discussed. The prime minister had declared as long ago as his Independence Day speech from the ramparts of the Red Fort on August 15 that the Commission would be disbanded. However, since then, there has been little clarity on what will replace it, if anything. As it happened, the meeting of chief ministers did not move the discussion forward as much as was hoped, either. One thing that did emerge from the Prime Minister's Office, somewhat typically, was a suggestion for a replacement name - "Team India". While it will naturally raise a few eyebrows, the name does underline the fact that Mr Modi will wish to position any replacement of the Planning Commission as something that is more deferential to the increasingly powerful chief ministers of states. This is, of course, not unrelated to Mr Modi's own experience as a powerful chief minister uncomfortable with the restraints of the Planning Commission. However, Finance Minister Arun Jaitley reportedly confirmed after the meeting that there was still no timeline on when the replacement body would be set up.

Essentially, the questions should be: what functions of the Planning Commission are still relevant? Which of those that are relevant can and should be farmed out to other bodies? And what additional functions should a new body take on? The old Commission had various duties. The basic perspective planning division is something that many agree is outdated, and no longer serves a major purpose. Even under the last government, as the prime minister emphasised in his meeting with chief ministers, the perspective planning process was sought to be modernised and dragged out of the 1950s. To the extent that this is the core of the old Commission's task, it should be just shut down. The projects appraisal division discharged the other main function of the Commission. This, too, should be phased out as this function can be discharged by ministries at the Centre or relevant departments in the states where such projects are to be located. Another function of the Commission, however, was to control the disbursement of central money. This has already been farmed out to the finance ministry in many ways, rendering the Commission toothless.

There are other functions, too. The Planning Commission often served as a referee between various stakeholders. First of all, between the Centre and the states - the problem being that, in the last decade in particular, it was seen as too biased towards the Centre. But also, it was a referee between states and between Union ministries. Indeed it often served as India's sole infrastructure regulator, questioning bad decisions that were being taken by powerful ministries. These are important functions, and should be hived off to other bodies. And an infrastructure regulator - a Bill for which was ironically drafted by the Commission - is overdue.

Finally, there is the question of providing relatively independent and long-term economic advice to a government chronically short of expertise. This is the direction in which the last dispensation also wished to take the Commission. The question here is whether a simple independent think tank is the best idea, or whether it should be replaced by an enhanced council of economic advisors within the Prime Minister's Office - or indeed by a reinvigoration of the economic service, and advisors placed within individual ministries. In general, the Commission's replacement should be the product of a realistic estimation of the problems of capacity in the government.

Tampering with scientific temper

Is scientific temper an attitude for both the public and the private domains or is it only for the public domain? Is it opposed to or can it coexist with superstition? These are questions India must debate

In early November, the Prime Minister announced that an important initiative to celebrate the 125th birth anniversary of Jawaharlal Nehru was the “promotion of scientific temper among children”. Endorsing this view, a few days later, the Home Minister, who is also the convener of the committee tasked to organise the celebrations, lauded Nehru’s leadership role in promoting scientific temper and in establishing the institutions of science in the country. He described Nehru as a “Rashtra Purush,” high praise which the Sangh Parivar reserves for very few. The message from the two leaders is clear: India needs to invest in “scientific temper” especially among the young if we wish, as a nation, to be a proud participating member of the world of scientific knowledge. There was no ambiguity about government intent. India was on the threshold of a new push towards scientific temper.

Issue of domains

Some weeks later, the Union Cabinet Minister for Human Resource Development, which is the Ministry in charge of schools, colleges, universities, the Indian Institutes of Science Education and Research, the Indian Institutes of Management and the Indian Institutes of Technology, and thus with the responsibility for the “promotion of scientific temper among children”, was reported, by the media, to have spent four hours with an astrologer in Rajasthan.

When queried about the nature of the consultation, since it concerned the link between palmistry and forecasting the shape of the future, and about the message this publicly reported consultation would give to children, the Minister responded by asking the media to respect her privacy. She thereby introduced a new element into the debate. Is scientific temper an attitude for both the public and the private domains or is it only for the public domain? Is it an attitude of being, for the whole person, or is it only a protocol for public activity? Is scientific temper opposed to superstition or can it cohabit easily with superstition? Is astrology a science or is it superstition? Can the evidence from the palm provide testable hypothesis about future events, such as high humidity means that it will rain, or increased particulate matter in air will produce respiratory illnesses? Is there a causal relation?

These are interesting questions and India, following the Prime Minister’s call, will need to debate them. The urgency of the debate was emphasised when the former Chief Minister of Uttarakhand stated, in no less a place than Parliament, that astrology is superior to science and that Jyotish is a science to make calculations lakhs of years in advance and that all other sciences are dwarfed in front of astrology. With these two counter statements, to the two of the Prime Minister and the Home Minister, the debate has now got very confusing. Can one make calculations lakhs of years in advance? Is scientific temper only a public and not a private matter? Is astrology the master science?

Nehru on astrology

Perhaps it is useful to go back a little and see what our Rashtra Purush’s attitude was to astrology. In a letter to Ram Swarup Sharma, the Director of the Indian Institute of Astronomical and Sanskrit Research, New Delhi, dated July 16, 1959, the Prime Minister wrote: “Dear Shri Sharma. Thank you for your letter of the 13th July which has reached me. You have referred in this letter to my lack of belief in Astrology. This is largely true. But every kind of real scientific research should be welcomed, provided it is conducted on scientific lines. My own impression is that our forefathers in India made very considerable progress in astronomical calculations. While I welcome the effort you are making to have a scientific inquiry in these matters, I do not think it will be at all suitable for this book to be dedicated to me. I am sure you will appreciate my point of view. …. Yours sincerely, Jawaharlal Nehru.”

Sharma was researching Sanskrit texts to see how far astrology in ancient India could be separated from astronomy. Nehru’s letter has four lessons for our debate on astrology and scientific temper. The first is his lack of belief in the claims of astrology to predict the future. That is why he did not wish the book to be dedicated to him. To be honoured in a book on astrology went against his scientific temper. The second is the distinction he made between astronomy and astrology in ancient India and his appreciation of the ancient advances of astronomy. The third is his welcoming of the use of the method of scientific testing. Such a method is valid for all domains of knowledge. In spite of his disbelief in astrology, he was open to the idea that its claims should be tested by the scientific method. This was the nature of his scientific temper. He would have argued that if astrology constitutes a set of testable propositions, which it claims to be, then the claim that “a marriage conducted when Mangal is entering the fourth quadrant is doomed to fail,” made by astrology, is similar to the claim that “it will rain tomorrow afternoon in Chennai south,” made by the meteorological department. A science must be made up of testable propositions. A science has researcher independent protocols for validating its truth claims. Would different astrologers agree in their reading of a single horoscope? The fourth is his taking, as Prime Minister, a public position against astrology in spite of the public’s deep belief in it. He risked a loss of political capital but still as the first educator to the nation he had to promote a scientific temper. The message from him was clear. Astrology cannot cohabit with a scientific temper.

The fact that astrology is not a science was most dramatically established by Padma Vibhushan Jayant Narlikar, India’s most eminent astrophysicist, who, along with Narendra Dabholkar, Sudhakar Kunte and Prakash Ghatpande, conducted a statistical test on astrological claims. In an article titled “An Indian Test of Indian Astrology,” published in the March/April 2013 issue of Skeptical Inquirer, which is available on the net, Narlikar describes how a set of 200 horoscopes were collected — 100 from bright students and 100 from students — in schools for the mentally challenged. Taking all the preoccupations of a double blind process, astrologers were invited to read the horoscopes. Twenty-seven responded. Here are the conclusions. “Our experiment with twenty-seven Indian astrologers judging forty horoscopes each, and a team of astrologers judging 200 horoscopes, showed that none were able to tell bright children from mentally handicapped children better than chance. Our results contradict the claims of Indian astrologers and are consistent with the many tests of western astrologers. In summary, our results are firmly against Indian astrology being considered as a science.”

We are now called upon to choose between two incompatible positions: one that sees no contradiction between astrology and scientific temper and the other which views them as fundamentally opposed. “A Statement on Scientific Temper” released by P.N. Haksar, Raja Ramanna and P.M. Bhargava on July 19, 1981, stated that it is “an attitude of mind which calls for a particular outlook and pattern of behaviour” and which advocates the method of science for “acquiring knowledge.” It advocates for the “fullest use of the method of science in everyday life and in every aspect of human endeavour from ethics to politics and economics …” Scientific temper is thus not a private matter. Article 51A(h) places on all citizens the duty to develop a scientific temper and therefore we cannot be “chalta hai” about these events since social behaviour is impacted by it and a culture of fatalism created by it. We must rally behind the Prime Minister’s call to spread scientific temper. We must revive the debate of the 1980s on the nature of scientific temper. The Prime Minister must give us his views on the relation between scientific temper and astrology. Scientists must enter the debate.

The Mangalyaan launch

It is reported that when Mangalyaan was launched — the satellite which India was able to place in Mars’ orbit in the first attempt, the only country to be able to do so — the Chairman of the Indian Space Research Organisation (ISRO), Dr. Radhakrishnan, went, the day before the launch, to pray at Tirupati for its success. When asked, he is reported to have said that he did not want to leave anything to “chance.” The Mars mission was successful. ISRO deserves a double round of applause. The team of scientists had to perform a set of complex calculations and manoeuvres to lift the satellite and position it in such a way that it could be flung towards Mars using not only its own propulsion systems but also earth’s gravity. This is science at its finest. The complex calculations gave accuracy and confidence that the commands of mission control would translate into outcomes. The technology that these calculations created, and the predictions made of place and velocity of the planet and the satellite were so accurate that they could place, after several months, the satellite in Mars orbit. This is the triumph of Nehru’s scientific temper. The previous night of prayer has, however, introduced some uncertainty into the celebrations. Was it the puja at Tirupati or the science at ISRO that worked? Was “chance” reduced by combined power? Did they cohabit to place Mangalyaan in orbit, or, asked counterfactually, if there was no puja, would Mangalyaan have entered Mars’s orbit? Which was the cause of success? This is a question of scientific temper and not pseudoscientific temper.

The only way up

To bring economic growth back to at least 6 per cent in the short run and 8 per cent in the long run, the government needs to strengthen the processes for investment by corporates. Investment in the manufacturing sector,  which accounts for only 16 per cent of the GDP (in China, it accounts for about 25 per cent), is essential for growth and job creation.

The steps needed to be taken to reignite the investment cycle fall in two categories. 

The first set of steps relates to removing the many obstacles in the investment process. The second to enabling the financing of investments.

As far as the obstacles are concerned, the land acquisition act is an important stumbling block that must be corrected. The act provides for “fair compensation” for acquiring farmland for industrial projects. However, it has made acquisition difficult and the process of acquiring land for corporate investment tedious. Modifying the act so that it facilitates land acquisition while ensuring that the interests of farmers are protected is a key step towards reigniting the investment cycle. Like several other laws in India that are unnecessarily complex, the land acquisition act also introduces several avenues for bribe-taking by officials. Take, for example, the provision mandating social impact assessments, which are supposed to be carried out in consultation with representatives of panchayati raj institutions. These representatives are likely to act as powerbrokers, demanding their pound of flesh. Rather than enacting a law that has a simple provision for determining fair compensation, such provisions only create more hurdles for land acquisition. The law must be modified to simplify the process of acquisition while ensuring that fair compensation is paid to landowners.

Second, a meaningful single-window clearance system must be created, where all approvals are packaged together and granted — from cabinet-level nods to the government clerk finally signing off on a component of the project. Even though the UPA administration and the current government have cleared several large projects at the cabinet level, the lack of the streamlining of approvals between the states and the Centre, as well as between the different levels of the bureaucracy, has prohibited these projects from getting off the ground. Bringing all the different levels of the bureaucracy, as well as the polity, under the same roof for a few days through an “investment mela”, could not only speed up approval-granting, but also reduce bribe-taking. The government clerk signing off on a power connection to a factory is unlikely to demand a bribe when he is sitting next to the cabinet secretary or the environment secretary, who provide high-level clearances.

Third, to ensure that labour costs in manufacturing, which inter alia affect the economic viability of investments, are inline with the value added by labour, the stringent laws that prevail both at the Central and the state level need to be rationalised. While the government has taken some steps in this direction, the speedy dismantling of draconian labour laws is essential. In this endeavour, the government must realise that opposition from the labour unions is unavoidable. 

In any case, the unions represent only 15 per cent of the workforce, which is employed in the organised sector. Labour unions militate to preserve the advantages they receive from stringent labour laws at the cost of 85 per cent of the workforce, employed in the unorganised sector. Even when one person in a family gets a job in the organised sector, the entire family gets economically uplifted. Political parties need to realise that this 85 per cent of the workforce represents a significantly more attractive political constituency, or “vote bank”, to cater to than the 15 per cent represented by the labour unions. 

As far as the steps needed to ease financing for investments are concerned, the government must utilise the room provided by lower oil prices to keep the fiscal deficit at the promised level despite possible shortfalls in tax revenues. A high fiscal deficit crowds out lending to the private sector because it has to be funded through government borrowing, which is provided by banks. Every additional rupee lent to the government means one rupee less for lending to the private sector. Also, compared to a large corporate firm, small and medium enterprises get disproportionately affected when government debt crowds out credit to the private sector.

 While reducing the fiscal deficit will release credit for the private sector, the efficiency with which it is allocated depends on reforming the governance of public-sector banks. The Nayak Committee, set up by the Reserve Bank of India, which submitted its report this May, has recommended the steps that need to be taken for this. Reforming public-sector banks would enable more efficient allocation of scarce credit to the private sector and thereby facilitate efficient investment in the economy. -