Howdy Modi – Extravaganza of Democracy

President Donald J. Trump holds hands with Prime Minister Narendra Modi of India as they take a surprise walk together Sunday, Sept. 22, 2019, around the NRG Stadium in Houston, Texas

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Washington, DC – Indian Americans are one of the most successful and prosperous group on planet earth. Total net wealth of 4M Indian Americans will far exceed the wealth of 99 percent Indian back home. They played crucial role in IT revolution for both US and India. Today India has a $160 billions IT industry which feeds 12 million middle class. This export owes its existence to Indian Americans who found an opportunity in outsourcing and together with Indian entrepreneurs laid the basics of business since 90s.

I am not a spokesperson of Indian Americans as they are as diverse as they were in home in their political and personal aspiration. However, being a business person whose future and livelihood depends on $160 billions IT export and someone who regularly visits all the major cities of the US and India, I get to see the aspiration and frustration of both the countries first hand.

As a US citizen, I am also active in local politics and for business in India, I happen to meet Indian politicians on regular basis. This gives me a wide perspective of how both the countries work. And more importantly what works and what doesn’t work in the largest and the most powerful democracy. Therefore for an event where two of the ruling leaders of both the countries share same stage rooting for same future, definitely I should be delighted.

But frankly I am not that optimistic because I do see that politicians of both the countries treat Indian Americans as holy cash-cow who would bring more business without giving us what we need to succeed. Yes, we are creating jobs in the both the countries, but it will be fair to say, politicians of US and India so far gave us a lip service. What we wanted, has never been listened or taken cared of adequately. Sadly that is the ground truth. And while both the leaders boosted of their success for their performance, I couldn’t find any clue how Trump or Modi would take initiatives that would help our Indian American community to create more business and jobs that both the leaders wanted.

Let me start with criticism of Modi of what he has promised for NRI like us and what is the reality on ground in India. Even today he said, he would reform easy of doing business in India. It’s the same old cliché he promised five years back in his gala show in New York. What is the reality? Did you ever try to open a private company in India? It takes enormous amount of time if one of the director is a foreigner. Even if you are having an OCI card, it means nothing to ED ( Enforcement Directive).

Next trouble starts with FDI or foreign direct investment. Normally whenever you wire a money for buying equity in Indian firms, that confirmation that you have personally done it must come from a class officer in your foreign bank which he has to communicate using SWIFT code ( Bank to bank secured communication). Else RBI will not accept. I have personally suffered two years of paperwork because my banker even didn’t realize what to do! Even after they did it, still RBI said why that was not done in six month!

First of all, in USA, if an Indian invests, all they care about whether money has been wired. In India there is so much of bureaucracy even today, I would never invest in India had I not been Indian. After I became US citizen in 2011, I found it is one of the worst place to do business as a foreigner. Compared to that, the US is still a top destination for FDI because when we form a company in USA, we can do that online within 24 hours and I will have my business account in 48 hours. In India if there is a foreign director, it takes more than 3 months. Of course, even then you have to pay consultants who will “manage” it for you.

Then let’s look at the import to India. If you are in pure software, of course there can’t be any issue. In sensor business, where we regularly import from the US, including GST and import duty, we pay on average between 40-48 percent. On the US side, on import from India, it was 6 percent earlier but since Indian administration didn’t listen to request from US commerce department for reduced tariff, it is now at 25 percent. On top of that, due to GST, it is costing us 18 percent more to produce in India. Overall, Indian import is 50 percent more expensive after Modi came to power. This has killed many Indian exporters already. It’s no wonder GDP growth in India has come down to 5 percent from 12 percent. It’s not a magic but a systematic failure of Modi administration to pay attention to details in the matter of economics. Instead they were more busy in their ideological politics like NRC or Kashmir to please their electorates.

Amidst the charade and pomposity that has grappled the imagination of a Hindu nation, Modi or his administration found no time to discuss with their US counterpart to do something so that bilateral trade improves. On all of these matters, I must say, the US administration has conducted more responsibly while they received lukewarm reciprocation from their Indian counterpart.

No wonder, foreign investors have lost confidence in Modi.

Now I will turn to criticism of Trump Government. H1-B visa is vital to this $160 billions Indian export. I am also in favor of recruiting local software talents from the US but let face the bitter truth. Our US school system is outdated and they are not producing as many coders as we need. Besides Indian middle class does their job in IT because they have very little option of doing anything else that gives them decent salary. Many jobs in IT are so boring, most of the American kids don’t want to do it. This being the case, we have no option but to get talented coders from India to the US. That process made America the capital of world IT- all most all software products and innovation still happen from the US.

But if that is forcefully eliminated, how IT entrepreneurs would do well in a globally competitive market? H1B visa rejection stands at 42 percent. You want Indian Americans to create jobs in the US- but that is not possible without H1B program being reformed. We are all for local talents but even local talents would need grooming from experienced Indian software engineers.

I discussed only short-term issues. There are other long term structural issues. We are entering into an age of AI driven automation. We need far more talented coders and software engineers than that we needed earlier. Indian school system is still based on old rots. It has not been reformed. It is producing BTech in engineering of whom 97 percent are unemployable. Modi Govt took no step in reforming engineering education which is badly needed. No wonder, there is no Indian University within top 300.

We can all dance around hailing democracy and its celebration, but hard fact is China is surging ahead based on its vast public education system. India has fallen far behind and the US is also failing to catch up. China must be a wake-up call for all of us – both the nations. Our leaders must do better in public education system.

Buried in pomposity and paraphernalia of Howdy Modi, we the Indian Americans should not forget there are two critical factors that led to our success. We received very high quality public education in India almost free of cost- something that is being destroyed over last two decades by successive Indian Governments. I may be prejudiced but I have seen, talents always come from needy families. They shouldn’t be deprived of quality education or else even our outsourcing business will suffer.

Second important thing that happened positively in our life is American capitalism which doesn’t discriminate based on color and embrace merit over color or race. Sundar Pichai, had he been living in India would not have dreamed of running an Indian business empire which is always run by family dynasty. Therefore, if we understand why we succeeded in the US, we must have to protect the very value of American capitalism which is under threat from American socialists and white supremacists. We also have a duty to spread American capitalism and its positive dimensions in India.

India doesn’t have a capitalist infrastructure and Modi did very little to even recognize the issues other than lip servicing. To realize the great potential of India and its people, instead of adulating Modi, we need to constantly pressurize him for more reform of archaic business regulations so that with improved capitalist framework, India should dream of 15 trillion economy and not 5 trillion economy which I doubt they can achieve even in 10 years given such a poor capitalist framework. It’s a high time Modi should think of scrapping IAS, IFS, IPS etc. altogether and instead recruit experienced MBA professionals to run the country.

Having said all the negative sides, I must admit democracy is wonderful and it allows best talents to be the leaders. They are intelligent people but more often than not, they take decision to please their vote bank. I hope things will change soon. So far so good, I am proud to be an Indian American-I consider myself very fortunate to be born in India and living in the United States.

Dr Biplab Pal
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Dr Biplab Pal founded Machinesense in Baltimore, Maryland and Kolkata, India. Machinesense is a leading company in the area of Industrial IoT and public safety. He is a popular blogger for emerging Technology and Politics.

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