Autobiography of an Appliance

Some 60 years ago, teachers who set questions for “ English Language “ exam paper for 10^th standard , were fond of selecting following type of question for writing an Essay :

“ Write an autobiography of a Pencil  ( or a Shirt or a Table …… )  “

Predictably that essay ( answer by students ) would  start with :

“ I was born as a teak-wood sapling in the jungles of Burma….. “ (  before they renamed Burma )

Students just loved this kind of a question since they had mugged up the answer (  affectionately called “ LBH = Learn By Heart “ in  “ Solved Question Papers “,   published by Kutmutia )

I am not aware of the present-day preferences by exam question paper setters and the students

But for some time now, product manufacturers in India are being asked to write :

“  Autobiography of an Appliance “

Let me explain

There is a demand from all and sundry, that Indian product manufacturers should place a sticker / label, “ COUNTRY  of  ORIGIN “ on each piece manufactured / sold

Hear this voice :

CAIT seeks 'country of origin' info on all products sold through e-commerce portals 

Extract :

Trader's body CAIT has urged Commerce and Industry Minister Piyush Goyal to make it mandatory for every e-commerce portal to mention 'country of origin' on each product sold at their platforms, so that buyers can make an informed decision.

Most e-commerce portals are selling Chinese goods, about which the consumer remains unaware, said the Confederation of All India Traders (CAIT), which has launched a campaign for boycott of Chinese goods

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To me, this concept of “ Country of Origin “ seems like a very nebulous matter ( not unlike CRAB nebula )

Now , even in these days of “ Global Supply Chain “, it is quite possible that the humble pencil’s “ Country of Origin “ remains Burma – all the way from that piece of wood encasing a slender piece of black lead, to its printing / packing / dispatching

But it gets very complicated to determine the “ Country of Origin “ of ( say ) a domestic appliance such as a Fridge / Microwave Oven / Dish Washer etc., which has many processes ( stages of Value Addition through inputting of local manpower )

Question :

How much “ Value Addition “ ( as a percentage of total cost of production or selling price ) should take place in India, to qualify an appliance for “ Made in India “ tag ?

I am unaware of any official / authentic definition

To get a clear picture of how “ Value Additions “ take place in a chain of countries , before an appliance gets delivered to your home, consider the following ( over-simplification ) :

=======================================================

   Value-Addition is a Many Splendored Thing – in today’s Global Supply Chain

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PROCESS STAGE	OUTPUT ( at each stage of Process )	Country supplying Inputs to Processing Country	PROCESSING COUNTRY ( where value addition takes place using local manpower )	INPUTS at each Stage ( Value Addition )	MANPOWER COST as % of final total cost ( Value Added )
1	Iron Ore		India	Manpower	5 %
2	Ingots	India	Australia	Manpower	10 %
3	Bars	Australia	China	Manpower	10 %
4	Components	China	Indonesia	Manpower	10 %
5	Sub-Assy	Indonesia	Singapore	Manpower	25 %
6	Assembly	Singapore	South Korea	Manpower	30 %
7	Packaging and Dispatch	South Korea	India	Manpower	10 %
				TOTAL	100 %

Obviously the scenario described above is an “ Over Simplification “ considering that , at each “ Stage of Processing “ ( in a given country ) , “ Inputs “ may come from many other countries ( not just one country )

Since I was confused about the exact “ Methodology “ employed by our Government to declare :

Ø  This product is “ Made in India “ ( ie; “ Country of Origin “ is India ) , and

Ø  This product is “ Made in China “,

-      some  2 years ago , I sent following blog / email to our Policy Makers :

E Commerce Definition : a Space Ship ? …………………………………[ 05 July 2018 ]

Extract :

And , as far as defining what is “ Made in India “ is concerned , I believe , government goes by “ Percentage of Value Addition “ locally

But, this is a very difficult and time-consuming exercise

Even when possible, its result holds good for a very short period in a dynamic situation

A manufactured “ local product “ could have hundreds of components ( both, local and imported )

And those “ local components “ could have “ imported “ raw materials or intermediates

These days , a product could be,

*  patented in one country ( concept )

*  designed in another country

*  developed ( detail manufacturing drawings  ) in another country

*  components made all over the World

*  Sub-Assemblies ( of those components ) carried out in another country

*  Final Assembly done in another country

*  Packaging done in another country

*  Offered for sale on ONLINE e-commerce portals in another country

*  Marketed by agencies located all over the World

*  Delivered using manpower / drones / supply chains of several countries

*  Financed by funds from all over the world ( Interest Costs )

At which “ Level  “ of Value Addition , does a product become “ local “ ?

And if I download a " Product Drawings / Design " over the internet and then " 3D Print " it in my garage ( using " imported " resins ) , then is that a " local " product ?

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And 4 years ago, I sent following blog / email to Cabinet Ministers  :

Missing the Woods for the Tree ?   …………………………………………[ 12 Aug 2016 ]

Extract :

Entire cycle of Designing / Manufacturing / Marketing / Selling / Order-taking / Delivering / After-sales Servicing  / Logistics / Collecting Payments / etc , will get spread so thinly across Countries / Continents / Companies / Individuals, that it will become next to impossible to,

Ø  keep track of " WHO "

Ø  is adding " WHAT " value to the process 

Ø  and " WHEN " 

Ø  and from " WHERE "   

No one will be able to unravel this GORDIAN KNOT !

 ========================================================

Dear Shri,

B C Bhartiaji ………………………[ President – CAIT  /  president@cait.in  ]

Praveen Khandelwalji ……….[ Secretary General – CAIT  / sec-gen@cait.in  ]

There are news reports that this “ Country of Origin / Made in India “ draft policy will soon be put in public domain for comments

I hope my comments above, helps you in framing CAIT comments

With regards,

Hemen  Parekh

hcp@RecruitGuru.com   /   23  June  2020 

    

Urban Poor : Existence Admitted !

Just came across following news report in today’s Economic Times :

Jharkhand plans NREGA-like scheme for urban poor   /   June  21,  2020

Highlights :

Ø  Jharkhand is set to become the first state to launch an employment guarantee scheme for urban poor on the lines of the Mahatma Gandhi Employment Guarantee Act.

Ø  The scheme, Mukhyamantri Shramik Yojna, will guarantee 100 days of work in a year for urban unskilled labourers. The new scheme would have a provision to pay an unemployment allowance if the state fails to provide 100 days of work.

Ø  It says that if the person doesn't get work within 15 days of asking, he or she should be liable to unemployment allowance which would be one fourth of the minimum wages in the first month.

In case the person doesn't get work in the second and third months, the allowance would be half of the minimum wages in the second month and equal to the minimum wages in the third month.

The wages would be directly transferred to the bank accounts of labourers within 15 days

======================================================

A little over a month back , I sent following e-mail to all State Chief Ministers :

    MGNREGA : Can it morph into UBI ? ……………………………………………[ 11 May 2020 ]

  

-      Where I suggested :

MGNREGA should be re-named, MGNRUGA ( Mahatma Gandhi National Rural Urban Employment Guarantee Act )

Ø  Besides RURAL households, it should cover URBAN households as well

Ø  Besides “ Unskilled Manual Work “, it must also cover “ Semi-skilled / Skilled “ work as

    well

Ø  The daily wages payable , must be the “ Minimum Wage “ at the start of each Skill

    level grade and periodically revised upward, depending upon CPI

Ø  Number of “ Guaranteed Days of Work Employment / year “ should be :

#  Rural Areas ………………….. 300 days ( up from current 100 days )

#  Urban Areas :

-      Class II towns ………………… 200 days

-      Class I Cities……………………  100 days

Ø  On MGNRUGA website , there will be provision for,

#  Jobless persons to register ( providing full personal data / job locations preferred / Skill

    level / prior experience etc )

     

#  Companies / Establishments to register , providing full details of vacancies

#  Match-making / Allocation etc

Ø  If an Urban establishment provides work to any of the REGISTERED UNEMPLOYED

    referred by MGNRUGA web site, it will not be required to pay wages ( to those  persons

    ), for periods mentioned above.

      

    For them, the wages will get paid directly by the Ministry subsidizing , at rates

    prescribed under the Act ( DBT ) . Any wages paid in excess , will have to be borne by

    the establishment concerned

      

   This “ Wage Subsidy “ will be available ONLY to those establishments, who install in

   their premises, Mobile-based Attendance System , as described at :

                From BAD to MAD                   [ 01 June 2016 ]

                MAD goes to Mandi                  [ 02 Jan 2020  ]

HOW WILL THIS HELP ?

Ø  This modification of Scheme will cover jobless persons, all over India – not only Rural

    India

Ø  The MGNREGA scheme as it stands now, covers “ works “ related only to ,

             #   Soil and Water Conservation

             #   Ground Water Recharge

             #   Irrigation

             #   Drainage

             #   Plantation

             #   Land……. Etc

           My suggestion will extend the scheme to cover urban offices / factories / shops etc

           , where millions have been rendered jobless due to lockdown

Ø  Current rural schemes have to be monitored by govt officers / panchayat office-

    bearers, who may lack supervision skills and / or lack “ motivation “ to ensure that

    each MGNREGA worker puts in honest / hard / productive work, at the end of the day !

    As against this, when organized / profit driven establishments ( in Urban setting ) are

    supervising such workers, productivity of “ Asset Generation “, will be very high !

             

    { Read : https://myblogepage.blogspot.com/2017/11/discovering-obvious.html  }

Ø  Because of this Wage Subsidy ( better name it CORONA EMPATHY – so as not to run

    foul of WTO ) , MSME will revive faster , with less worry for Cash Flow . Products will

    become cheaper

Ø  By providing jobs and enabling people to earn their own living , there will be no need

    for Delhi-type “ doles “ – which are unsustainable in long run

Ø  This scheme overcomes the major objections against UBI ( Universal Basic Income )

     viz :

#    How to decide whom ( defining “ poor “ is difficult ), to give UBI

#  People will become too dependent on “ Sarkar Maa-Baap “ and become lazy / stop

    looking for work

Ø  It is better than the Unemployment Allowance of USA ( now for 33 million persons,

    sitting at home )

Dear Shri Narendrabhai,

It is time to think about a PERMANENT SOLUTION to this problem of UN-EMPLOYMENT { even beyond COVID }

Please consider my suggestion

======================================================

For recognizing the existence of URBAN POOR and trying to help them through partial implementation of my suggestion, you deserve Congratulations ,

Ø  Shri Hemant Soren – CM , Jharkhand (hemant_jh33@yahoo.com

Ø  Shri Naveen Patnaik -  CM ,  Odisha      (cmodisha@nic.in  )

======================================================

Considering that URBAN POOR live in towns and cities of all States, I have no doubt other States will soon launch similar Schemes

I urge the Chief Ministers of these States to consider incorporating my suggestions

With regards,

Hemen Parekh

hcp@RecruitGuru.com   /  22  June  2020