However, the rights-based economy still has a long way to go. Yamini Aiyar, whose Accountability Initiative is India’s only organization that tracks grassroots government spending, says this kind of demand has barely scratched the surface because of the lack of delivery mechanisms. “The trouble is that we don’t have the district-level, or block-level people to enforce government schemes, including cash transfers.” She rues the fact that we keep talking about technology, but on the ground people can barely use pen and paper correctly. Rights governance, coupled with rural economic growth, is waiting to fuel an explosion of demand. But industry needs to push for administrative reforms and provide better training to tap it. “What they would be doing is securing a very large future market,” says Aiyar.
In such an environment, many aam entrepreneurs are targeting some of the most protracted problems of the Indian nation-state. For one, they are moving India from a reactive to a responsive democracy. To understand this simply, think of the old Bollywood Hindi film where the cops would always arrive late. That was the usual pace of the Indian state—if they arrived at all.
But the expansion of India’s grassroots enterprise means that an unprecedented tide of daily pressure is being brought to bear on the delivery mechanisms of the state. An empowered, entrepreneurial citizenry is ready to exert pressure not merely in one riotous burst, but in a relentless daily campaign to chip away at the malevolent resistance of feudal politics and fetid bureaucracy.
International conglomerates have always smiled happily at the thought of India’s millions of new consumers, especially in the middle class, and the late author and management guru C. K. Prahalad spoke about the fortune at the bottom of the pyramid. But to see Indian society today merely as a mass of consumers is perhaps fundamentally flawed.
India is fast becoming a nation of creators as well as consumers. Indeed, it’s in this mushrooming of latent creativity that India’s redemption likely lies. Looking for the next “Arab Spring” is the new pastime of the West, but it might find a different season in India, where the high noon of dissent cleanses the ills of democracy not with a sudden war but rather with an incessant, intelligent wearing down.
As I started writing this book, I met Chandra Bhan Prasad, a prominent intellectual in India who writes on his community, the Dalits, long considered untouchables in orthodox Hinduism, and the impact of capitalism on the community. He laughed when I asked him what his answer was to those who ask when the revolution would come to India.
“It has already come. It has happened. Only we are a very large country and you might not see it everywhere yet but the revolution has happened and all the upper-caste intellectuals and Brahmins have never bothered to notice,” Prasad guffawed. “But how will they? Many of the so-called great Marxists of India were upper-caste land owners and then they became Marxists and started declaring what the poor and the oppressed need. They had no clue.”
Enterprise and consumer demand at the grassroots level are completely transforming centuries-old social barriers, says Prasad. He is from Azamgarh in eastern Uttar Pradesh, notorious, sometimes unfairly, for seeding Islamic terror. These are the areas of north India that foreign journalists sometimes describe as the “badlands” of the country. In such areas, the battle between the Dalits and other low castes and the upper-caste Bhumihars, Thakurs and Brahmins has gone on for generations, and always with blood-soaked attacks and reprisals.
Prasad tells me a tale of change. The first is from a village in eastern Uttar Pradesh on the Jaunpur-Azamgarh road. The number of bullocks in the village dropped from 1,200 to 4 between 1995 and 2005. You might think this is a natural transition from animal plowing to machine plowing. But Prasad found a deeper reason. There was no one to plow with the animals any more. “This was a task done traditionally by the lower castes, the upper castes would not do this because it involved taking care of the animals, working with dung, all of which the upper-caste landlord wouldn’t do,” said Prasad. “Landlord after landlord complained to me that the Dalits have left the village and moved to the city with better jobs. Once they taste the city life, no one wants to return to this kind of work in the village. No matter how much money they are given. There had been no choice but to get machines. The entire working relationship between the Thakurs and Bhumihars and the Dalits has broken down. What do you think this mobility, this migration represents to the Dalits? Is it not enterprise?”
This tale of dramatic social change brought about by commerce and enterprise is best captured in a Prasad phrase: “Pizza delivery ka koi jaath nahin hota” (Pizza delivery has no caste).
Empowered by urban anonymity and commerce, Dalits across India are tearing down centuries of bizarre and bloody repression. In 2010, Prasad was part of a four-member team, including Devesh Kapur, the director of the Center for the Advanced Study of India at the University of Pennsylvania; Lant Prichett, from the Kennedy School of Government at Harvard University; and D. Shyam Babu, of the Rajeev Gandhi Institute for Contemporary Studies, that studied all Dalit households (19,087) in two districts of Uttar Pradesh (Bilaria Ganj in the Azamgarh district from the east and Khurja from the Bulandshahar district from the west) to compare their lives before and after Indian economic liberalization, from 1990 to 2008.
What they found startled them. There had been a sea change in the number of Dalits owning consumer items, like bicycles, fans, TVs and mobile phones, and living in concrete houses.
On average, in both areas, roughly 50 percent more people started living in concrete homes in this period of economic growth; the number of TV set owners grew by 33 percent; 45 percent more households had fans; and of course mobile phone ownership had jumped, from near zero to almost 35 percent of the households. Just to get a sense of how impoverished the situation used to be—for the first time, a quarter of households in both areas had chairs.
There was an even more intimate transformation. Few people here had ever used toothpaste. This number jumped a combined average of more than 65 percent. Shampoo use, another unheard-of luxury, jumped nearly 70 percent.
What impact did this have on centuries of discrimination during which it was forbidden to drink water from a glass touched by a Dalit or eat from a plate used by a Dalit?
The instances of upper castes eating and drinking at Dalit homes, once nearly unthinkable, rose more than 70 percent in the east and nearly 45 percent in the west. The practice that only Dalits would pick up dead animals almost disappeared.
“The migrating Dalit worker picked up more money than ever at jobs at the nearest town or city and changed their habits and society forever,” said Prasad. He says that to understand what changed, it is not the Dalit who should be asked, but the upper castes.
“I remember this Bhumihar landlord in eastern Uttar Pradesh telling me that, ‘Aaj kal uhi log lal murgi haath mein pakar ke motorbike mein pharphareke jaate hain‘ [These days these people buy plump red chicken and pass by our houses holding the fluttering birds and zipping by on their motorbikes]! His resentment and disappointment was utterly complete, and the whole thing was very funny for me,” laughs Prasad. “Earlier social rank was by birth alone, but now status could be bought by enterprise—that is a priceless change.”
And this change was not restricted to Uttar Pradesh. In Sangli, in the western state of Maharashtra, he asked an upper-caste Patil woman why she was working on the large farm of a successful Dalit food manufacturer.
She told him that earlier the tulsi plant (considered sacred and to be found only in the front yards of the upper caste) defined who you were. Now it’s whether you have a TV or not. “I don’t think of this as a farm,” she said. “This is so big, and all the rules are like a factory. A factory has no caste.”
This is the revolution, Prasad told me—don’t look for Tahrir Square or the guillotine. It is happening every single day.
When I told my mother all this, as always she had something to add. “See, all this enterprise-shenterprise, na, this is why I taught you to make
bread and butter and omelet when you were only ten years old,” she said. “You must be free. Not like your father. Totally not free. Who is going to cook and feed you? All that is gone. Mother is the last woman doing that. No wife these days. If you can’t even feed yourself every day, what freedom?”
Even my mother seemed to understand that our regular, everyday rebellion—enterprise—is what sets us free.
CHAPTER 2
BUSINESS MODELS IN THE WORLD’S MOST DANGEROUS PLACE
“If we delay you,” says the English and Urdu sign on the gate, “for more than two hours, we will pay you Rs 2 per minute for every extra minute.”
This is one of the first things that a driver carrying a truckload of apples—anywhere between 50 apples and a ton of apples—sees when he arrives at the gate of the cold storage and fruit processing factory of Harshna Naturals in Lassipura district. The factory is about an hour and a half’s drive north from Srinagar, the capital of Jammu and Kashmir.
The man who put up the sign, 31-year-old agriculture entrepreneur Khurram Mir, says the sign works like a talisman, telling the farmers who come to sell and store fruits at his plant, his workers and even himself that things are getting better in a valley in which, depending on who you are reading, between 50,000 and 100,000 people have been killed in a two-decade insurgency that started in 1989.
“We are saying yes, things are so normal that we can pay for delays in a state used to shutting down for days with violence and anxiety.” Once described (by former US president Bill Clinton) as the world’s most dangerous place, this is the new sign of peace in Jammu and Kashmir, the Himalayan state over which India and Pakistan have fought three wars.
Long used to peace brokers in the shape of politicians, diplomats, aid workers, even ex-militants, the valley is getting used to a new kind of agent of calm: the entrepreneur.
And why not? More small and medium enterprises have been set up in Kashmir in the last two years than in the previous decade, says the Jammu and Kashmir Entrepreneurship Development Institute (JKEDI).1 Its two flagship projects have produced more than 1,700 new entrepreneurs in the last two years, says Zamir Qadri, head of the JKEDI. One project provides unemployed high school graduates with 35 percent of the cost of their dream project or Rs 3 lakhs, whichever sum is lower, with the remaining amount financed as a loan by the Jammu and Kashmir Bank, the biggest bank in the region. The amount for postgraduates is 35 percent of the project cost or Rs 5 lakhs; and for professionals, Rs 7.5 lakhs. The other project, financed by the National Minorities Development Finance Corporation, gives out loans of an average of Rs 2.5 lakhs to jobless young Kashmiris.
It’s a small number, 1,700 entrepreneurs, in a state of 12 million with more than 600,000 registered unemployed people, but Qadri says the numbers are like Mir’s signboard—a small step in the right direction that has many people excited. “One of our big problems is that people feel lost—we have lost a generation to the violence. This is one way to tell people that all is not lost and they can start afresh.”
Back at the farm in Lassipura, Khurram Mir says the whole idea of new entrepreneurship is about people regaining respect and control of their own lives in a state that is estimated to have more than 330,000 military and paramilitary troops.
“There has been a respect deficit in the state. For instance, no one has ever appreciated the time of the farmer. The power was always in the hands of the people who were buying from the farmer. With this small board, right at the point of entry, we are saying ‘you are important’ to the farmer,” says Mir, who started Harshna Naturals in 2008 after returning from America with a management degree from Purdue University. His father is one of the biggest fruit and vegetable traders in the region. “Basically I came back and told him, ‘Dad, I am starting a project that will put you out of business,’” smiles Mir. “And he said, ‘Well, we can always find other business opportunities but if the farmers continue to suffer, the state has no future. So best of luck to you.’ That was all I needed.”
The first Rs 4 crores of investment built 5,000 metric tons (5,512 short tons) of capacity cold storage and a fruit sorting facility. Mir is now aiming to touch 40,000 metric-ton (44,092 short-ton) capacity at the cost of more than Rs 250 crore by 2014. He says there is no dearth of investors since Kashmir is one of the main production hubs for fruits in India with, for instance, 57 percent of the apple production of the country (1.8 million metric tons [1.98 million short tons] in 2010–2011).
But conservative estimates suggest that between 10 percent and 30 percent (in some seasons as high as 45 percent) of the Kashmiri apple crop gets wasted due to the lack of storage and processing facilities in the state, and the farmer is poorer for it. “The farmer has always had to sell when the trader tells him to—this has always been the way in Kashmir. But with the right storage facilities, the power shifts back to the farmer. He can choose when he wants to sell.”
To show that his efforts are bearing fruit, Mir forks out a set of charts that display how farmers are taking to Harshna. There are three kinds of business that Harshna is involved in: the company buys produce from farmers to stock and then sell at a later date; multinationals and big corporate houses like Reliance Fresh and Bharti Walmart use its cold storage facilities when they buy from local farmers; and local farmers themselves use the facilities.
The vision statement of Harshna Naturals says that the aim of the company is to be used almost wholly by local farmers. They are certainly moving in that direction. In 2008–2009, big companies used more than 60 percent of Harshna’s facilities, while 30 percent was used in-house and only around 10 percent by the local farmers.
In 2012–2013, however, the company did not use any of its facilities to buy and store for itself, exiting that aspect of the business entirely. Less than 30 percent of the space was used by big companies and more than 70 percent by local farmers.
This has also meant that Mir’s other big poster—warning that no one should be seen eating an apple within the compound—is taken very seriously these days. “If somebody is seen eating an apple, and there are farmers around, they will immediately wonder, ‘Whose apple is that?’ And they raise the alarm. We are working to create an environment of full transparency, which has been difficult here.” Kashmir was ranked among the four most corrupt states in India in a 2008 Transparency International study; Mir says modern enterprise and systems are bringing sociological change.
“For instance, Kashmiris have always been called lazy, but in 2010, when the stone pelting was going on through the day, what we did was we just did all the work at night!” laughs Mir. “We told our employees that instead of working during the day, just work at night and that way our trucks could pass undisturbed.”2 In a state that has lost five years of working days to strikes in the last 23 years, such innovation is critical. “Today in Kashmir, if there is a will, there is a highway of enterprise that is open,” says Mir, who tells his employees that they should never aim to work at Harshna for more than two years. “My standard introduction is—after two years, if you do not leave me and start your own business, then I have failed.”
There are many signs that this time around, the peace wave might be enterprise driven. On the back of record tourist arrivals (1.1 million in 2011–2012), Congress Party general secretary Rahul Gandhi, a personal friend of state chief minister Omar Abdullah, made a gesture in October 2012 that was as much political as it was economic. He invited some of India’s biggest tycoons, including Ratan Tata, Kumaramangalam Birla, Deepak Parekh and Rahul Bajaj, to visit the valley with him, promising to bring India’s biggest business houses to the beleaguered region. Part of the idea was old—integrating the valley into the economic growth story of India—but as a top-ranking bureaucrat in the Kashmir government told me, the method was new.
“We have tried everything from interlocutors to prime ministerial missions. Now the thought is the delivery of hope cannot be just top-down. It has to be bottom-up too,” said the bureaucrat. “Sometimes
economics can tell people that there is something to look forward to better than politics.”
Khurram Mir was at a closed-door meeting with the business leaders. “Mr. Birla said for enterprise to grow, there has to be a degree of stability. But I liked what Mr. Tata said—that the true spirit of enterprise is to circumvent the situation and continue the work, and that ultimately brings peace,” he says.
In 2011, Tata’s Taj chain of hotels opened their first property in the valley, with an 89-room hotel overlooking the Dal Lake and Asia’s largest tulip garden and boasting a 2,500-square-foot presidential suite. One of the earliest big hotel chains in the valley, The Lalit Group, announced in 2012 that their palace hotel in Srinagar had become the chain’s highest revenue generating property after years of losses since they took it over. In 2012 Srinagar’s first radio taxi service, called Snow Cabs, was launched, and Kashmir University started to offer its first MBA course.
Numbers back Tata’s claim. According to the Home Ministry, terrorism-related murders in the valley in 2010–2011 amounted to 2.77 per 100,000 population, lower than the murder rate in Delhi (3.1) and Haryana (4.1). Essentially many more people are being murdered in the seemingly peaceful heart of India than in what is often described as “insurgency infested” Kashmir. So there is greater consensus than ever that Kashmir’s military force needs to be drastically reduced, and a sense that that might be work in progress (the Home Ministry is reviewing a strong proposal) has lifted the mood. One of the big achievements of the Omar Abdullah government has been to keep the army largely in its barracks. For instance, compared to 2004–2005, there are far fewer in-your-face boots on the streets and military check points in Srinagar city. And why not? There is hope from the side of the terrorists too: Syed Salahuddin, the dreaded chief of the Pakistan-aided Hizbul Mujahideen, declared in 2012 that he has no more men in Kashmir. (In 2014, new threats emerged in Kashmir from ISIS and Al Qaeda, but the push to reduce army presence remains extremely strong and many argue it is key to reducing support for militancy.)
Recasting India Page 4