Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Monday, 21 September 2015

SECOND INDUSTRIAL REVOLUTION ?


The First Industrial Revolution started in Britain , with the invention of steam engine , which multiplied human power many times

With help of steam engine power , one man could do the job of ten men

Human productivity went up sharply , enabling production of ten times more goods , in ten times less time

Thousands of factories came up ; first in Britain , then in USA and gradually spreading to rest of Europe

But it took over a century to reach the poor countries of Asia / Africa / China

Under colonial rule , these countries were forced to export own raw materials to industrialized countries at a very cheap price and import their factory-made finished goods at very high prices

But as poor countries started catching up on factory-based manufacturing using its cheap labour , the developed countries are now worried !

One time importers of finished goods are now exporting those very products to the developed countries , which are finding it difficult to compete with the emerging markets

An outstanding example of this is the rise of China , in the past 25 years as the , " Factory of the World "

But Western countries are not resigned to their fate of a lowered

 " Standard of Living "


They are gearing up to usher :

The Second Industrial Revolution  !


In the form of Robots :

Robots manufacturing cars / appliances / machinery / anything


Robots 3 D printing products from designs downloaded from Net

Robots managing health care in hospitals

Robots serving food in restaurants

Robots carrying out office jobs

Robots teaching in schools

Robots entertaining

Robots everywhere !


And these are :


Robots which work 24 hours/day and do not ask for a salary

Robots that do not " go slow "or go on a strike

Robots that do not demand " Quotas / Reservations "

Robots that do not take holidays or take " Sick Leave "

Robots that do not resign / demand promotion

Robots that neither envy other robots nor sabotage 

Robots that do not complain against unpleasant work

Robots that do not get tired and need rest

Robots whose production does not drop after working for 8 hours

Robots that do not demand " Overtime Pay " @ 200 % of normal

Robots that perfectly co-ordinate their tasks with other robots

Robots that willingly " retire " at any age , whenever required

Robots that do not demand Unemployment/Retirement Benefits

 Robots which may , some day , provide you with emotional support when you are sick / depressed  !


And this Second Industrial Revolution is NOT going to take a hundred years to reach the shores of India


With spread of DIGITAL INDIA / Internet / Mobile Apps , it may take , no more than 20 years !


Question :

Fearing that it will create further unemployment , shall we try to stall its arrival  ?

OR ,

Will our Self-Employed and Start Ups expedite its arrival and imaginatively use it to create 100 new jobs for each lost job ?

Let us stop tinkering with ,

*  The India Aspiration Fund

*  The MakeinIndia Soft Loan Fund

*  The MUDRA Bank



Converting millions of Job-seekers into Job - Creators ,  would entirely depend upon Union Government quickly passing , what I earlier advocated as :


Start Up Act - 2015


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hemen  parekh

21  Sept  2015

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Saturday, 19 September 2015

FROM SINGLE WINDOW TO SINGLE DAY ?



Launch of  " Make in India " one year ago ( 25  Sept  2014  ) , ushered a revolution

A revolution to improve India's rank in " Ease of Doing Business " from 142 to under 50

And no Indian State wants to be left behind as far as its own rank among the various States is concerned

Here is the proof :


Tamil Nadu


    CM , Selvi J Jaylalithaa has promised to approve all Investment proposals in 30 days


Andhra


    CM , Shri Chandrababu Naidu wants all clearances given from an Online Single Window clearance , in 21 days


Telengana


    CM , Shri K Chandrasekhar Rao has promised to give a Single Window clearance within 30 days

If the investment is more than Rs 200 Cr , project will be cleared in 15 days

If it is an IT project , it will be 12 days !

For delaying approval beyond these limits , concerned Officer will be fined Rs 1000 per day of delay !


Maharashtra


  CM , Shri Devendra Fadnavis did not want to be left out !

On 17th Sept , he announced :

"  If permissions to set up industry are not issued within 7 days through the online Single Window system , applications will be considered approved "


Can we look forward to one of the remaining Chief Ministers , to come forward and announce :


" We will clear all investment proposals in  ONE DAY  "


[ And , he / she may not even belong to a BJP-controlled State ! ]


That would place that State on par with Singapore ( which continues to hold , rank # 1 , in World Bank Survey , for many years in a row )


Following real incidence will prove my point :


Some  40 years ago , Mohan Pherwani ( VP - Planning / Larsen & Toubro ) , made a presentation to the officers of Singapore Development Authority ( SDA ) , for a joint venture between L&T and SDA , for manufacture of Bottle Closures ( Crown Corks / Alu. Capsules ) in Singapore


After the presentation , a SDA officer took Pherwani to look up  suitable sites  for setting up the proposed factory


In the evening , when Pherwani returned to his hotel , receptionist handed him a letter from SDA ,


>     confirming SDA willingness to form a JV with L&T

>     allotting the factory plot selected by Pherwani

>     enclosing a cheque ( drawn in favour of L&T ), towards SDA's  contribution to the equity capital of proposed JV


Sure ,  difficult to beat  !


But not impossible , considering that the person propelling Singapore's current " Business Friendliness " is also , a person of INDIAN origin !


That person is Mr Tharman Shanmugratnam , Singapore's Finance Minister since 2007 and Deputy Prime Minister since 2011, whom , Shri Jaitley met 2 days back


Among the many good things taking place due to " MakeinIndia " initiative , promoting competition among the States for attracting investments , is right at the very top


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hemen  parekh

20 Sept  2015

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Friday, 18 September 2015

WHAT NEXT ? UNDISCLOSED INDIAN ASSETS ?



In August 2015 , Lok Sabha passed :

" The Undisclosed Foreign Income and Assets Act - 2015 "

The declaration period ends on 30th Sept 2015

It is estimated that undisclosed assets worth Rs 40,000 Crores may get disclosed , netting Union Government , Rs 20,000 Crores by way of tax and penalty. Another estimate places collection at Rs 7,000 cr only

We should know the exact figure by 15 Oct

Peanuts when you compare with estimates of Black Money stashed abroad , at between Rs 1.7 lakh*crores ( $ 250 billion ) and Rs 2.9 lakh*crores ( $ 450 billion )

Some knowledgeable persons are saying :

>   During these past 3 months , an amount equal to TEN times what gets
     declared  , ( ie : Rs 4 lakh*crore )  found its way back into India thru
     hawala route and got invested in gold or land or got deposited in bank
     lockers

>   The total amount of DOMESTIC  BLACK  MONEY  is close to Rs 25
      lakh*crores  !


So , what next ?

Pass in Lok Sabha , " The Undisclosed INDIAN Income and Assets Act " ?

And , if such Act follows the same pattern ( of 30% tax + 30% penalty ) , then the Union Government may end up with revenue of may be, Rs 40,000 Crores  !

It is time to stop wasting time ! Time to stop tinkering !

By the time these Rs 40,000 crores get collected , one more year will pass !

By that time another Rs 4 lakh*crores of  FRESH  black money , will get generated  !

It is like cat chasing its own tail !


The only FINAL / LASTING solution is :

Abolish Personal Income Tax

Simultaneously declare :

No questions will be asked for any amount of cash deposited in bank accounts by individuals ( of course , with linkage to PAN / Aadhar / RuPay card etc )

Sure , Government will lose Rs 2.5 lakh*crores by way of tax revenue,
received from some 3 crore individual tax payers

But , Abolition of Personal Income Tax ( and no questions asked re bank deposits ) , could lead to 30 crore persons , each depositing Rs 1 lakh into their bank accounts !

 { Not unthinkable , considering that during past one year alone , Rs 20,000
   Cr got deposited in 20 crore new bank accounts , under Jan Dhan Yojana }

 So , we are talking of bank accounts swelling by  Rs 30 crore*lakh  !

Even if that money earns the depositors , only 3 % rate of interest !

And banks will give out these moneys as loans to Corporate @ 5 % interest rate  !

Trillions of BLACK MONEY Rupees will become " Productive Assets "

And , Corporate World ( + our Finance Minister ) would not need to keep begging RBI for a " Rate Cut " to boost the economy !

To keep growing at 10% rate , we have got to make ours , a :

LOW  COST  ECONOMY

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hemen  parekh

19  Sept  2015

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Wednesday, 16 September 2015

FREEDOM BEHIND BARS ?



There was no TV , when Allied Army invaded the shores of Normandy on early morning of 6th June 1944

People of the World learned about it 24 hours later thru newspapers

But , in the afternoon of 16 Sept 2015 , the entire World was watching on TV  


INVASION  OF   EUROPE ,


by hundreds of migrants trying to cross the Serbia - Hungary border

Of course , closed gates / 4 meter high barbed wire fence / water cannons and tear gas shells , held back those few hundred refugees

But , for how long , when those few hundred become few thousands  ?

Hungary's response :

Passed a law treating illegal migration as a criminal offence

I presume , Hungary will prosecute those thousands of Syrian / Libyan / Iraqi refugees and imprison them on its own soil

A step that would be welcomed by those refugees , even though they have no intention to seek asylum in Hungary !

Getting imprisoned in Hungary will ensure that

>  they have a roof on their heads

>  they will not die of cold in coming harsh European winter

>  their children / infants will not starve

>  they will not get killed by wars ravaging their own countries


I expect them to sing :

" Stone walls do not a prison make , nor iron bars a cage "


I hope rest of Europe realizes that no fence can stop millions of migrants marching from its eastern borders and over the Mediterranean sea

They are trying to escape from war / hunger, to peace / food  !

But then, this problem will not remain an European Problem alone, for long !

It is bound to get replicated all over the World !

World over, poor people will try to migrate to " Islands of Prosperity " - whether just across the borders or across oceans

In my 08 June blog, I had suggested turning Antarctica into a ,

UNITED  STATES  OF  MIGRANTS ( USM )

But on a serious note :

Russia / Canada / Australia / China / Mongolia / Scandinavian Countries are , relatively prosperous countries

They also happen to have millions of square km of uninhabited - but entirely habitable , land masses

Between them , they should be able to accommodate ,

100 million migrants ,

- and still have population density far below the world average !

It is still not too late for such a constructive - and humanitarian solution !  


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hemen  parekh

17  Sept  2015

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Tuesday, 15 September 2015

FROM JOB-SEEKERS TO JOB-CREATORS ?



How to turn 12 million persons entering our work-force each year from being job-seekers to becoming job-creators ?

At the conceptual level , this was well-answered in BJP poll manifesto as :

" Encourage and empower our youth for Self Employment - incubating entrepreneurship as well as facilitating credit "

How to translate this policy into specific actions ?

May be the clue lies in the following incidence :

After getting a post-graduate degree in engineering from USA , when I returned to India in 1959 , my father took me to meet Shri Manubhai Shah  , the then Minister for Industry in Union Government

My father inquired if Manubhai could give me a job in government

Manubhai answered :

" Chunibhai , I have no job for your son .

  Let him set up a factory and manufacture fractional horse power motors of which India is currently importing some 3000 per year

 We will ,

>    Immediately issue to him , an Industrial License

>    Allot him a factory-shed in Rajkot Industrial Estate

>    Give him a loan of Rs 5 lakhs to buy machinery  "


56 years later , we are better organized / equipped to " Institutionalize " this pioneering thinking


Here is my suggestion :


Role of MakeinIndia web site


    >  On its web site , list 5000 products that we currently import ( with
        annual import bill / sources / ave landed cost etc )

    >  Invite 1000 leading manufacturing companies of India , to make
        online selection of minimum of 5 items each, for preparing DPR
        ( Detailed Project Reports ) .

         Freely visible online database of who selected which items will avoid
         duplication

         

Role  of  Manufacturing Companies

    >  Prepare and submit to Ministry of Commerce, at least 5 DPR  by
        Dec 2016 . More the merrier ! Earlier the better !

    >  Each report must carry , name of at least one bank which has
        accepted that as a " Bankable Report " , eligible for funding

    >  Train at least 100 fresh engineering graduates in various
         manufacturing related functions under GET ( Graduate Engineer
         Training ) Scheme  , each year



*   Role of Ministry of Commerce

   >  Publish DPRs on its web site for free downloading


Role of  Income Tax Department

   >  Give 200 % tax deduction to existing manufacturing units for 2
       years , for employing fresh engineering graduates on their rolls ,
       under :

      " Graduate Engineers Training Subsidy Act - 2015 "
        ( to be enacted )

      This will motivate manufacturing units to impart manufacturing
      related experience to fresh engineering graduates before they
      venture to set up own  MSME factories
     
  >  Admit expenses incurred by manufacturing units for preparation of
      DPR ,under their CSR obligation ( 2 % of ave net profit for 5 years )

  >  Exempt all GET Start Ups ( registered on eBiz web site ) from
      paying Corporate Income Tax for first 10 years of working
     

  >  Exempt all GET Start Ups from GST payment ,  for 10 years



*   Role of Fresh Engineering Graduates


  >  Get GET Training Certificate from employer companies

  >  Download DPR from Commerce Ministry web site

  >  Apply for funding to banks , attaching DPR and GET Certificate

  >  Upon receiving Approval Intimation from bank , apply for various
      permissions on eBiz web site , quoting Bank Approval Number



Role of ASSOCHAM / FICCI / CII etc

 >  Encourage their manufacturing member firms to take on the
     task of preparation of DPRs and follow up

>   Publish DPR reports on their web sites for free downloading

>   Constitute State-wise " Hand-holding Teams " of retired
     executives having " Manufacturing " experience , to guide the
     local GET applicants in obtaining all permissions from various
     State Authorities



Role of eBiz web site

  >  To make available in public domain , all investment related
       applications , and progress status of each


Role of State Governments

  >  To keep track of those eBiz investment applications where
       the State is the proposed manufacturing location

  >   Pro-actively reach out to such applicants for expediting their
       proposals


All of the above need not / must not take months to materialize !

If it takes any longer , millions of India's jobless will overthrow the governments in power !

We don't need an Oracle to tell us what future holds for us !

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hemen  parekh

16 Sept  2015

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