Tuesday, March 1, 2011

India 2.0 The Future is Today

That India is a technological leader, not marching but rather moving smoothly and swiftly into the future, is seldom a matter for dispute. In fact, it is not really discussed but simply assumed as the conversation progresses.

Still, as with any country or economy, there are adjustments to be made in the economics of a country's economy.

The issue of food is uppermost on the minds of the people of India. In a previous monograph, I referred to increased supply. A literal understanding would be counter productive. The issue is not resolved by saying, "Grow more food." However, if we were to discuss the issue from that statement, we would have to ask, "Do the same number of farmers increase their output, or do we need an increase in the number of farmers?" A subtext would involve farmers joining to take advantage of economies to scale, and form large farms. (Remember, the absence of primogeniture caused the collapse of pre Soviet Russia. The absence of private ownership led to the collapse of post-Czarist Russia. Conclusion: many small farms don't satisfy the need; collective farming won't solve the problem.

The first issue to address is that India has a culture of co-operation. This will serve India well as time marches on. However, on the question of supply, we are not simply suggesting more food for today; but a stable supply of food for a foreseeable future.

Two problems indicated in recent reports from the media are that

1. India cannot get food to the market. It rots before it can be sold or eaten; and 2. That the fluctuation in food prices in a largely agricultural nation has a greater impact in that nation than they would in a heavily industrialised nation.

Some options to consider.

If there is difficulty getting food to the market,

the food can be preserved at the source. Canned and frozen foods, processed at the source, can be stored as a hedge against future food supply failures. In addition, they can be sold on the national and international market. (The marketing of Indian cuisine can become a larger industry. I had curry for the first time when I was about 9 years old. Only recently have Indian food products made their appearance in supermarkets. That is a gap of almost half a century.)

The food supply prices can be leveled slightly through the investment in commodity options. This would allow investment consortia to

a. Have food available at a more affordable price if food prices rise considerably
b. Provide a return on the investment if national supplies are sufficient to meet demand
c. Provide the necessary supply of food to process for market and hedge against a future crop failure
d. Attract investors to partner with the agriculture, manufacturing, and finance industries to bring in money for capital investment.

The government can assume the responsibility of developing roads; negotiating trade deals (read: taxes, tariffs, concessions, etc.), and provide for a stable food supply and food pricing system to stabilise the government.

The economic growth, political stability, national unity, can be promoted.

Now, many people are skilled in the various areas mentioned above. The only thing necessary is what is too often referred to as a shared vision. This monograph is a demonstration of one of the few times that the term, shared vision, may perhaps have been used appropriately.

Sincerest regards,


Mail slimfairview@yahoo.com

Copyright (c) 2011 Slim Fairview


Hemendra Kulkarni said...

Hi !
The major problem which creates "food problem" in India has more to do with "political will" & curbing chain of "vested" interests. Also the geographic distribution of agriculture is unequal. Government has tried to address this problem by allocating sufficient funds for "Green Revolution" in Eastern India. Important question is .... Whether allocated money reaches to end user?. Answer to it is, less than 10% reaches end user. Administrative reforms is something which can address all of such problems.

Can world believe, that a country which caters to the "brain" needs for SCM, Processes & IT has failed to unleash the same within its own system? Its THE REALITY ....

Thanks for sparing your time to address concerns of Billions of Indian's.. Hope that some government babu(official) visits this blog and gets motivated to deliver ....

God bless you !!!!!

Hemendra Kulkarni
Group CEO
EEquinox Group

slimfairview said...

Thank you for your comment, Mr. Kulkarni.

The phrase:

Government has tried to address this problem by allocating sufficient funds for "Green Revolution" in Eastern India. Important question is .... Whether allocated money reaches to end user?

leapt out at me. It is analogous to the poor crop output in Colonial America. Once the Pilgrim leaders decreed that people would be allowed to grow their own food, production rose.

It is also related to reports (back in the day) that 85% of food grown in the Soviet Union was grown on 15% of the land. This was not a geological problem. This was the 15% of the collective where the families grew their own food.

My emphasis, therefor, was focused on private, free-enterprise initiatives and partnerships both in agriculture and commodity investments with a profit share opportunity for the farmers who would more eagerly agree to work together if they had a vested interest in the success of the enterprise.

Let us both hope that the entrepreneurial spirit takes hold, and investors with vision can inspire the agriculture industry in India to move forward.

India already seems to have the technology industry in good order.

Thank you again for your comment.

Sincerest regards,


Hemendra Kulkarni said...

Certainly its good suggestion. India is still a country which is yet to learn moving away from Govt. Subsidies and Help.
The stalling of FDI in Retail is a classic example of it. I don't think Agricultural reforms shall precede FDI in Retail.

I also missed another point in my remark. Indian Agriculture as of now is still heavily Dependant on Chemical Fertilizers. Organic Farming has started gathering some momentum. Hope that it quickly gains the pace.

Good Thoughts !!!!

slimfairview said...

Investors looking to stay ahead of the curve and partnering with business in India can focus on the growth of organic farming.

Organic is good. Unless the change is impeded by further reducing the peoples' ability to eat.

No one should starve to death waiting for the crops to grow.

Organic crops, organic processing--there is a growing market for this. But the people of India have to eat first. They should not be mutually exclusive.

Food processing, commodity options investments, job creation, will work together with an added benefit. The taxes paid on the incomes will aid the government in building road, rails, and so on.

Schools in agricultural development zones can prepare young people for the new technology jobs they would not otherwise have access to.

Once farming becomes more efficient there will be fewer jobs on the farm.

The Indian Government can have a new view on the issue: "We will not keep people shackled to poverty by keeping people shackled to poverty programs."

Prosperity programs will be far more beneficial in both the short and the long term. And, too, don't underestimate the power of profit-sharing. Specially appealing to the younger generation who live in Netopia. (Don't believe me? Look to Egypt, Tunisia, Libya...there young people are moving quickly. India already has the technology industry that is much needed. India has the educated employees, India already has the raw materials.

The Indian government does not have to do much to get ahead of the curve. They are already in position.