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

Friday 6 June 2014

Bravo , Kshama Sawant !



On an average , Minimum Wages for unskilled workers all over America , are,
*  $  7.50 / hour


President Barack Obama has been trying for some time now , to  raise that to
*  $ 10 / hour


In the meantime , Mumbai born and educated engineer , Kshama Sawant , has persuaded State Legislators of Washington State , to raise this to ,
*  $  15 / hour



Bravo , Kshama  !



The Unskilled of Washington State will , no doubt praise you for now


But what happens if other US States do not follow suit  ?


All over the World , jobs have a tendency to migrate to places where these can be performed cheapest


Of course , that may not happen to " UN-SKILLED " physical effort jobs of Washington


If you want to dig a trench in Seattle , it has got to be dug in Seattle  !


But there is a real possibility that the excavator digging the trench was made elsewhere  !


And , it is a different matter when it comes to SKILLED MENTAL jobs , which can be performed remotely , with help of Internet


Successive American Presidents have tried their best to stop out-sourcing of such jobs to India - but , in vain


Simple enough reason :


*  Indian Software companies pay fresh software engineers , between $ 500 / month to $ 1,000/month


*  American companies pay 10 to 20 times , as much  !


As long as ,


*  Quality and Delivery ( of outsourced software projects ) are satisfactory


*  Cost difference remains attractive  ( even as Indian salaries rise ),


American companies will find ways and means to outsource to India


India does not have much advantage over Western Nations when it comes to factory-based manufacturing jobs because of our low labour-productivity


Although , may be 10 times more expensive , Western countries employ 20 times less workers ( for manufacturing same product ) - using better / faster / automated  machinery


And Western Manufacturers borrow funds at 1% - 2% interest rates , as compared to 15% - 20 % in India


In these matters ( of highly automated machinery and low interest rates ), it is not possible to catch-up with the developed countries , overnight


In long term , these factors are important for raising the contribution of Manufacturing in our GDP, from current 12 %-15 % to 25 %


But , in the meantime our State Policy ( - as will get manifested in Central Budget , very soon ) , must focus on exporting our BRAIN power



To do that , we need :



*   Computers - and related hardware


*   Country-wide Optical Fibre based / Wireless-based , internet broadband


*   Free tablet for every child ( approx 400 million )


*   E-learning of Software Technology



I hope, Mr Arun Jaitley is listening  !




*   hemen   parekh   (  07 June 2014 / Mumbai )

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Thursday 5 June 2014

Urban Renewal ?



An important aspect of urban renewal is to get rid of slums , by resettling slum-dwellers in better houses


Then convert those vacated slum areas into gardens


But slum-dwellers are unwilling to vacate their huts .


Why  ?


Over the past 25 / 30 years , the standard method was to move the slum-dwellers into some temporary , make-shift transit camps , pending permanent rehabilitation


But that promised " permanent rehabilitation " never came  !


Those who agreed to get shifted into those transit camps , continue to live there for generations - without any hope of ever moving into multi-story concrete buildings with running water / electricity / toilets


Given this broken promises , who would agree to shift out  ?


Second problem is availability of jobs nearby where they are forced to move - even if these buildings happen to be well-built , modern and permanent multi-storied buildings


Who would want to move to a better / permanent house , if it is 30 Km away from a work-place  ?


No one wants to spend 4 hours on the road every day , commuting to a place of work in dense traffic , riding a crowded bus / train  !


But most slum-dwellers would happily vacate their slums and move 150 Km away , if ,


*  It is a well built building with all amenities


*  It is a  permanent home ( - and not a transit facility  )


*  It is given FREE , on ownership basis


*  There is a job within 1 Km of the new home



This is exactly what China is doing , by building ONE brand new Mega City , EVERY 20 DAYS  !


And moving 250 million slum-dwellers into those cities over the next 20 years ( - nearly ONE MILLION people , EVERY MONTH  !  )


May be this is what NaMo was thinking when he dreamt of constructing 100 Mega Cities in next 5 years - at the rate of ONE city EVERY 18 DAYS  !


OLD  cities cannot " Re-new " themselves , until well-planned NEW cities are built first and ready to receive those old city slum-dwellers and offer them jobs



Only problem :



* Mega City of Dholera ( in Gujarat ) is under construction for over last 3
 years and expected to cost , Rs 70,000 Crores


* Central Government has neither the money needed to construct 100 cities,
nor the administrative / technical competence for such a project


*  Democratic Institutions are un-suited for taking bold / harsh /
 controversial decisions - then bulldoze !



It seems urban renewal will remain a mirage  !




*   hemen  parekh  (  05 June 2014 / Mumbai  )

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Be-Sahara Shree ?



These days , Sahara-Shree Subroto Roy seems to be , Be-Sahara Shree  !


He is in jail for past 3 months or so


And Supreme Court won't let him out on bail , unless he deposits Rs 5,000 Crores in cash and furnish a surety bond of an equal amount


Then within a few weeks , Supreme Court wants him to hand over to SEBI , Rs 24,000 Crores that SEBI claims he raised illegally from " Public "


But Subroto says ,



" What public  ?


  I am ready to pay-off all of my depositors , if only , they would come forward to claim their deposits


I have raised , a few rupees each ( Rs 5 - Rs 10 ), from millions of small depositors , all of whom , gave their postal address as , " Delhi-Agra Road ", or  " Kanpur - Lucknow Road "


I just can't find them  "



Now , all of us ( Supreme Court and SEBI included ) , know that ,


>  Those Rs 24,000 Crores belong to politicians ( - most who got defeated in
     recent Lok Sabha elections ) , businessmen / bureaucrats / film stars etc


>  Each of them have given this in CASH to Sahara-Shree ( Range : Rs 10 -
    100 crores )


>   Sahara-Shree knows that they don't dare to publicly ask him to return
     their deposits . He managed to render them be-sahara  !


>   Neither Sahara , nor SEBI have true addresses of those fake depositors



So , what happens now  ?


>   Subroto will be forced to sell most of his properties to raise money


>   To ensure that there is no hanky-panky in sale of these properties ,
      Supreme Court may appoint some world-famous Real Estate
      Consultants to conduct e-Auctions for each of these assets


>    SEBI will have a windfall of Rs 24,000 Crores that no one wants  !


>    SEBI will deposit it with banks and earn a fat interest - for ever



I would say , a smart way to convert BLACK money into WHITE money  !



*   hemen   parekh   (  05 June 2014  /  Mumbai  )

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Tuesday 3 June 2014

1 down ; 259 to go !



NaMo requested voters to give him 60 months ( against 60 years , they gave to Congress  )


That is 260 weeks


What did he achieve in the FIRST week  ?


*  Formed a small / compact Cabinet


*  Constituted SIT to look into Black Money issue


*  Issued TEN COMMANDMENTS of Good Governance


*  Told MPs / Ministers , not to appoint relatives


*  Phoned MP Priyanka to remove her father as her " Representative "


*  Asked all Ministers to prepare " 100 Days Action Plan "


*  Issued " Performance Appraisal Formula " for Ministers


*  Abolished 30 GoM / E-GoM


*  Invited SAARC heads-of-States to swearing-in ceremony


*  Started dialogue with Pakistan


*  Talked to Obama / Li Keqiang / Abe


*  Met Jaylalitha / Naneen Patnaik


*  Alloted Rs 1 Lakh Crores for toilets




Well begun , Narendrabhai  !



You get 90 marks out of 100 ( Very Good )


Will next week get you 100 out of 100  ? ( Excellent )



*   hemen   parekh  ( 04 June 2014 / Mumbai  ) 

White Holes of Black Money ?



Astrophysicists say , even light cannot escape a black hole


Closer at home in India , even the most stringent laws have not stopped the Indians from siphoning out their undeclared income to secret bank accounts in 40 odd Tax-Haven nations - the White Holes of Black Money  !


Depending upon your source , the amount varies from Rs 25 lakh Crores to Rs 90 lakh Crores


The exact / actual amount is itself , irrelevant


What matters is :


*  In those foreign banks , there are lakhs of " Secret / Password-protected " bank accounts , belonging to Indians


*   Those countries are refusing to divulge these accounts to Indian Government, under some or other International Law / Convention


*   India has no extra-judicial influence over these countries to force them


*   Economies of these countries do not depend upon trade with India

     These economies depend upon those secret accounts  !


Of late , some people have suggested passing yet another law to declare all such black monies, illegally stashed abroad , as " National Property "


Sure  !  Can be passed in BJP controlled Lok Sabha in 4 hours  !


Like all previous laws , that won't make any difference 


In the meantime , let SIT debate and deliberate and dither , for ever  !


No harm in persevering , even as those Rs 90 lakh Crores become Rs 900 lakh Crores  !


Do our Politicians /  Babus /  Janata , realize that the only persons who can - and will - bring back those black monies , are those account holders  ?


Do we realize that human greed is cleverer than those laws  ?


Do we understand that no one wants to pay increasing amount of Income Tax , with each higher slab  ?


Do we appreciate that our present taxation system ( of higher tax rates , with rising income ) , prevents people from declaring all of their incomes ?


Why work harder to earn higher income , only to hand over that income to government - who will distribute it , by way of salaries to the bureaucracy ?


Do we know that our present Tax Regime penalizes honest tax payers and discourages wealth - creation  ?


Do we understand that this Tax Regime , diverts funds into unproductive assets ( eg: Land / Gold etc ) - funds , which are badly needed for nation-building  ?



Will  Mr Arun Jaitly  have courage to implement following  ?



*  INVERSE  TAXATION   REGIME



    Where one pays DECREASING , incremental  tax , with each higher slab of
    income. This will encourage full declaration of all income and remove
    incentive to hide income . People will insist upon receiving all payments
    by cheques .

    " Reverse  Hawaala " system ( converting black money to white
    money ) will , soon eliminate parallel economy  !



*  AMNESTY  SCHEME


    Where no questions will be asked as to the source of declared black
    money , if that money is invested in Government-Approved Infrastructure
    SPVs . Dividends / interests from such investments will be free from
    Income Tax for 15 years . Infrastructure should also include , Education,
    Health-care , Sanitation etc



Dear  Narendrabhai ,



Applying this ( mildly  " Out -of - Box " ) thinking , you can raise Rs 1000
 Lakh Crores , and build those 100 Mega-Cities and create those 100 million
jobs



*   hemen   parekh   (   04 June 2014 / Mumbai  )

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Saturday 31 May 2014

NaMo had no choice



On 26 May , NaMo assumed office


On 27 May , he appointed a committee to look into the issue of Black Money


He had no choice , since Supreme Court had given Central Government , time till 28th May to appoint a SIT ( Special Investigation Team )


NaMo  did this despite his firm belief that ,


" Governments appoint committees when they want 
to postpone taking unpopular / unpleasant decisions "


[  Eg : Issue of KG gas price rise  ?  ]


How else can you explain a 8 member committee  of the Senior-most bureaucrats , without ,


>   a clear mandate / terms of reference


>   a firm target date


>   power to take decisions , which are binding on the government


>   accountability for failure to achieve its objectives



NaMo knows too well that ,



>  Committees only make " Recommendations "


>  Their foremost recommendation is invariably , to appoint another follow-
     up committee , to examine their original recommendations  !


>  Committees rarely meet . When they do , they do so without a clear
    agenda . Only decision that gets taken is fixing the date for the next
    meeting


>  Other names by which committees are well known are ,


    *   Come - Meet - Tea


    *   Procrastination Incarnate


>  Committees have no power / authority , to instruct Government Officers
    to act " as directed "


>  When questioned in Lok Sabha , concerned Minister can get away for
    inaction by saying , " Committee report is awaited "


>  For the members , being on a committee is a status symbol


>  For retired officers , committees are a source of some income


>  A committee is a " Mutual Admiration Society " - where members never
    tire of patting each other's backs


>  Committee Members love to hear their own voices


>  Committees are never  held accountable for failing to achieve anything
     concrete / tangible


But when NaMo had a choice , yesterday , he abolished 30 GoM / E-GoM


NaMo does not tolerate a culture of buck-passing


He cannot suffer nincompoops  !


He is telling his Ministers ,


"  Shape up or Ship out "



*  hemen  parekh  (  01 June 2014 / Mumbai  )

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Make    Yourself    Heard

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