A Gandhian experiment with community-owned companies
is not just a flourishing retail enterprise in India,
but a model for all kinds of companies in the developing world
This year Fabindia turns fifty. Founded in 1960 by John Bissell, an American working with the Ford Foundation in New Delhi, as an export house to market Indian handloom textiles, Fabindia is now also a leading lifestyle retail brand with 115 stores in big cities and small towns across India, and overseas.
Yet more than its spectacular growth, which has turned Fabindia into a household name, its unique business model has evoked awe and admiration, not to mention a Harvard Business School case study as well. Though by no means the only business founded on the balance between commercial profit and social commitment, Fabindia is certainly among the most successful. In 2008 it registered revenues of Rs 250 million, an increase of 30 per cent over the previous year, and certainly a long, long way from the Rs 0.9 million that Bissell used as seed capital when he started out.
Fabindia’s business philosophy was summed up by Bissell as: “In addition to making profits, our aims are constant development of new hand-woven products, a fair, equitable and helpful relationship with our producers, and the maintenance of quality on which our reputation rests.”
Bissell’s vision translates as a kind of inclusive capitalism, linking over 40,000 craft-based rural producers, primarily weavers, block printers, woodworkers and organic farmers, to modern urban markets through its “community owned companies” which act as value adding intermediaries, between them and Fabindia. These companies are owned, as the name suggests, by the communities they operate from; a minimum 26% shareholding of these companies is that of craft persons. The ownership structure is mutually beneficial for Fabindia and the artisans, with the retailer ensuring it has the supplies it needs while the artisans are assured a steady income. The model Fabindia has, in the process, developed and nurtured a base for skilled, sustainable rural employment, and preserving India's traditional handicrafts in the process.
For all its success, Fabindia continues to try and resist the temptation of going “mainstream”, content to develop and widen the niche segment where its presence is formidable. This belief is being put to test, as John Bissell’s son, William, who took over after Bissell’s death in 1999, plans to open 150 more stores in the next four years! How Bissell overcomes the natural constraints of his unique business model while maintaining the scorching pace of expansion is what the business world is waiting to find out.
Given Fabindia’s track record and adherence to principles of quality, fair pricing, customer satisfaction and, above all, commitment to provide employment to thousands of v illage weavers and artisans, the answer is a no-brainer! In the intensely competitive retail sector, Fabindia’s unique business values have helped not just shaped the way the Indian middle class dress and furnish their homes, but set a high standard of vision, innovation and social commitment.
13-03-2011
Saturday, March 12, 2011
Design for Inclusive Development
Design for Inclusive Development
Prof M P Ranjan, Design Thinker & Independent Academic,
writes about the role of design in inclusive development in India.
Our economists and planners have got used to the idea of measuring progress by the growth and their metrics include industrial production, agricultural production and the growth of money itself in the system along with the notional value of a host of financial instruments and derivatives that reside in the digital space. Politicians have not been told that there could be other ways to measure progress and if they have the theory of economics is very sparse in this area. Design education and innovation in India too has languished in the shade of scientific and technological investments (S&T). The deep- seated belief in the Planning Commission and the Political establishment, both in Government and in the Opposition, is that huge investments in science and technology combined with private entrepreneurship and the profit motive will somehow solve the problems of inclusive growth that is beleaguering the Indian economy. This is a consensus that has played itself out in the IT & software revolution in the Silicon Valley and more money is placed in the S&T kitty but the problems seem to grow, nevertheless. The huge gap between the haves and the have-nots grow by the day and the promises that are held out by the advocates of innovation investments in S&T behold a hot social and political time bomb waiting to explode in all our faces. The other approach is more direct, that of providing direct subsidies through political appeasement that is resorted to by Central and State Governments using pre-poll promises and politically mediated grants and aid that are dished out to the poverty ridden folks through direct action primarily to nurture a vote bank. Unfortunately, here too the delivery system is so porous and corruption so rampant through our society that it permeates the system all the way through the supply chain, leaving a very unsatisfied public that is simmering at the fringes, both urban and rural, all over the country. Our corporate bodies too are no better at addressing these needs with all the disclosures that
are coming out in the media on a daily basis these days.
The result of all these plans and actions is the grave political and social unrest that is facing us in the form of a very angry citizen near the bottom of the pyramid who can for the first time see the lives of the other affluent sections and the growing middle class played out in full colour in daily broadcasts of the television channels and the open access through the internet in an age of heightened communication. Charles & Ray Eames had warned us about this impending impact of such disruptive change through extended communication, a change in kind and not in degree they said, in their 1958 India Report and we have not paid heed to this sanguine advice. He had called for the use of design to address the needs and aspirations of a people in the throes of such change but we have perhaps let slip an advantage by not channeling adequate investments to address their dreams and aspirations in close partnership with the people directly. Innovation at the grassroots has become a buzzword in management circles and here the case studies that are celebrated fall into the category of Jugaad (creative make-shift) and not of Design (intentional and sensitive configurations) as we would argue that it should be. Jugaad stands for the creative interpretation of severe limitations and shortages to produce a workable contraption or scheme held together by available opportunity, hope and hard work, always at a fraction of the cost that would otherwise have been available, with most of the action lying in the unregulated space of zero taxation and technical specifications, in many cases illegal. So the celebration is in the extreme cost cutting that has been achieved by the poverty ridden creator and service provider and the rest of us stand in mute respect for the heroic achievement, the response of the poor or a clever service provider to an impossible situation, a sheer act of survival. Unfortunately, Jugaad also fosters a Chalta-hai (make-do) attitude that permeates all our offerings from Government services to low cost infrastructure, products and service solutions that are not sustainable for inclusive development, all lacking in refinement and costly in the long run, creating the platform for a low quality sub-culture far from the rich tapestry of traditional wisdom that are at the very foundation of the Indian society that has somehow survived till date. However is this the only way? Is there another way?
The communication boom and an era of transparency have ensured that the Indian consumers are no longer willing to accept the mediocre when better value is available. For example, in many parts of India the poor have shunned incompetent public education systems to place their child in expensive private schools and in going the extra mile to avail quality where it is on offer, a new phenomenon for both urban and rural India that is communication enabled. However, the design establishment in the country has languished in the face of great apathy from both Government and industry during an extended period of a highly regulated and centrally managed economy and the absence of any real competition. Design schools like the National Institute of Design have suffered from an absence of both funding and vision in recent years and the National Design Policy of 2007 too has a very limited mandate which does not include the huge opportunities that exist for local investments in innovation and design for inclusive development. It stops short of harping on slogans and on the export and luxury product industries as their area of focus. Further, on the education front while several new NID’s are proposed to be funded by Government there is an absence of any new vision statement as to their focus and purpose as if the model exemplified by NID Ahmedabad could be used as a clone for the creation of these new centres in four geographical regions of India, a missed opportunity to address the change that is taking place in our country. The India Design Council, another outcome of the National Design Policy is harping on “Good Design” as a quality benchmark which is product of Western Industry and their consumer marketing focus that is least suited to evaluate design solutions for inclusive development that is now needed in India.
No international design solutions are available that are ready and off the shelf to address the pressing problems of the Indian people such as affordable healthcare, rural and urban sanitation, dispersed quality education at the primary and secondary levels, agricultural and rural tools, rural housing and mobility and a host of other design opportunities across 230 sectors of our economy that are in crying need of design attention. These will have to be addressed locally and innovation and design will be the way forward but the infrastructure for action is not in place since the existing institutes are barking up the wrong tree it seems. The Eames Report and the National Institute of Design in the early years innovated an unique education programme in design that was addressing these very issues but over the last ten years these advances in design education and research were systematically demolished by literally throwing the baby out with the bathwater in their misguided effort to get university status and in the search for qualification rather than content and relevance. The DIPP, the department in Government that handles the NID budgets and the National Design Policy has proved to be patently incompetent to support the design movement in the country and to move it in directions that it needs to be taken if it to be relevant to the creation of a platform for inclusive development. Perhaps their limited mandate to address the needs of Indian industry has made them myopic to the larger roles that design has to play if it to be relevant to our national agenda. Design is not a mere hand-maiden for industrial development but a much broader strategy that can help transform society and feed into the culture forming processes of a country and a region. The evidence of this incompetence is visible in the poor quality of vision and funding that is provided to the NID when compared to the IITs and IIMs, both of which were set up around the same time in the early 60’s. The National Institutes of Fashion Technology (NIFT) was set up in the late 80’s through the Textile Ministry and they used a special export cess that was accumulated with Government to rapidly fund the establishment and growth of a huge national infrastructure that is now recognised as a university of national importance. Further, NID’s faculty are a poorly remunerated lot when compared to their counterparts in any comparable institute or university in India and this I am sure will ensure that the best will veer away from committing themselves to pressing design education roles that are facing the nation today. Perhaps the correct way out of this messy situation is to move the NID’s to a new ministry that is capable of addressing the multi-facetted roles of design action that are needed in India across all verticals and all ministries. My students once proposed a structure and they called for the creation of the Ministry of Design, perhaps as part of the Prime Ministers Office till it can move to the area of Culture where it could find a niche that is appropriate to address the emerging challenges of quality and relevance to society.
When I reflect on the various projects done at the NID in the early years from the Electronic Voting Machine to the Jawaja project, through the Chennapatna toy project to numerous textile design projects such as the Dhamadka Block Print project a number of design strategies come to mind. We need to ponder deeply on many of these real world design experiences to cull out lessons that can take us forward to a socially and culturally appropriate application of design action that could bring great value to our population. More recently, our initiatives in Tripura State through the “Katlamara Chalo” project integrates bamboo cultivation with product manufacturing as a means to alleviate rural poverty using local skills, resources and local enthusiasm as the primary resource. We were able to discuss design and develop strategies for the bottom of the pyramid with colleagues at the Indian Institute of Crafts and Design, Jaipur, an initiative of the Government of Rajasthan that is now being managed under a public- private partnership and here we built a more generalized sketch model called “Raindrops and Footprints” that explained the process leading to the selection of the village through local intensive research and the building of an understanding of the local context from which a number of design opportunities are identified and modeled before they are taken through a participatory development process which used the local strengths and resources in a sustainable manner. Here design is not just looking at “Good Form” but at the strategies and approaches along the entire supply chain and at each stage value is unfolded. The attempt was to find local solutions suitable for local application using our macro-micro strategy for design action that are informed by serious research and sustained contact with the beneficiaries through hand-holding and educational contact in the field. This integrated strategy has paid off but the investment of time and effort is considerable to prototype and test such a strategy to be rolled out to various locations using available local resources as the platform for sustainable change. For the first time in India we have a rural community using farm based bamboo to drive a local industry towards self reliance and managed growth. Starting with bamboo products and furniture we see the sustained action providing an uninterrupted supply of raw materials and skill sets that can foster the growth of a decentralized, local and self governed economy that could survive and thrive in the emerging era that I call the “Post industrial and Post-mining era”.
This is a new form of design action not to be confused with the form giving activity of traditional industrial design, although it would include elements from the old form of design thought and action. Here we are proposing that the design action take into account the structure of society along with their macro aspirations, their histories and cultural preferences as a starting point and from here build imaginative approaches for products, services and systems that would include the meta-system, the infrastructure, the hardware, the software and the processware to ensure a perfect fit to the circumstances and requirements of the particular situation. This kind of offering is complex and would need a multitude of knowledge and skill sets to be brought to bear with sensitive social and cultural orientation and with a fine tuned economic and technical feasibility. Design for inclusive development is therefore a multi-disciplinary activity that needs to draw a variety of knowledge and skills in an innovative and future oriented setting that is well informed about the legal and the ethical parameters. In this form it becomes a powerful political activity since it is propositional in the manner in which it visualizes and realizable alternatives for the stakeholders from which the process of selection and decision can begin. It is a democratic activity at the very heart and gives power to the people who are at the location and to those who would be most impacted by its implementation. This shift in design thinking can be better understood through the model that I have proposed that explains the three orders of design – Form, Structure and System – material & functional, aesthetic & socio- economic, environmental and political – all of which need to be addressed in all cases if we are to be assured of its sustainability and relevance to the local context. Under these terms of reference industry and business must take responsibility for end to end offer of service and not just for the delivery of brands and boxes that contain a “Good Design” product but ensure that they serve the purpose that was promised in the first place.
I do believe that design can help here and we may need to make some fundamental changes in our design education approaches and widen the base for action, a shift from a focus on business and industry to the design for public good that is operational at the local community level. These should include the grassroots workers in the design education loop and the content of such education needs to be informed by design insights that are local and rooted in the local reality for which our current crop of textbooks would be found wanting. This will need fresh approaches and enlightened support from the political establishment if these changes are to be forged. I do feel that we need to raise this debate and explore the various roles of design and its potential application that is today ignored by design education and practice alike, including my own school if I may admit here, so that a new sense of commitment is brought into the use of design in areas far outside industry and business. This is one of my mission objectives for setting up the 'Design for India" blog to help create a platform from which I can share my thoughts on the possibilities that I see in my minds eye. I also find the peer review system of the research publications as not so perfect for the dissemination of design insights although it does work wonders for science analysis and knowledge creation but it may be extremely defective for design demonstration since the idea of “design opportunity”, a very specific term – a combination of perception and imagination – excludes the viewer or reader from "seeing" the imagination part of the designers statement and therefore it compels the designer to take the idea far down the visualisation and realization path before it can even dawn on others that the idea is truly credible. This means that we may need to create a platform or even a multitude of platforms for design incubation and development that can be accessible to many across numerous areas of application and these kinds of platforms just do not exist in India today, or if it does, it is dominated by centralized administrative controls that stifle innovation and exploration which is critically needed to make the demonstration. Our policies for faculty research and action need to be liberal and this needs substantial change and autonomy for the ‘Maverick innovator” with good intentions and value systems in place to do their innovative work. Some of us have had to battle hard to achieve even a small degree of autonomy of action and this is not a good climate for addressing these complex problems which surround us here in India in an effective manner. We need new institutions and whole new mind set to address these complex issues at hand.
How do we create such autonomous and decentralized action strategies and how do we roll this out across our Universities and Institutes of design action? This will be one of the central questions that can change the current impasse in development approaches dealing with poverty in many parts of India. There are no simple answers but we will need to look deeply at our experiences in the field and build new institutes and strategies that can use the promise of design to find approaches to address these complex needs. The current conviction that we hold is the use of a macro-micro design strategy which has been developed after years of application and we need to do more before we can spread this deep conviction that we hold to others who hold the purse string in our countries where real action is needed today.
13-03-2011
Prof M P Ranjan, Design Thinker & Independent Academic,
writes about the role of design in inclusive development in India.
Our economists and planners have got used to the idea of measuring progress by the growth and their metrics include industrial production, agricultural production and the growth of money itself in the system along with the notional value of a host of financial instruments and derivatives that reside in the digital space. Politicians have not been told that there could be other ways to measure progress and if they have the theory of economics is very sparse in this area. Design education and innovation in India too has languished in the shade of scientific and technological investments (S&T). The deep- seated belief in the Planning Commission and the Political establishment, both in Government and in the Opposition, is that huge investments in science and technology combined with private entrepreneurship and the profit motive will somehow solve the problems of inclusive growth that is beleaguering the Indian economy. This is a consensus that has played itself out in the IT & software revolution in the Silicon Valley and more money is placed in the S&T kitty but the problems seem to grow, nevertheless. The huge gap between the haves and the have-nots grow by the day and the promises that are held out by the advocates of innovation investments in S&T behold a hot social and political time bomb waiting to explode in all our faces. The other approach is more direct, that of providing direct subsidies through political appeasement that is resorted to by Central and State Governments using pre-poll promises and politically mediated grants and aid that are dished out to the poverty ridden folks through direct action primarily to nurture a vote bank. Unfortunately, here too the delivery system is so porous and corruption so rampant through our society that it permeates the system all the way through the supply chain, leaving a very unsatisfied public that is simmering at the fringes, both urban and rural, all over the country. Our corporate bodies too are no better at addressing these needs with all the disclosures that
are coming out in the media on a daily basis these days.
The result of all these plans and actions is the grave political and social unrest that is facing us in the form of a very angry citizen near the bottom of the pyramid who can for the first time see the lives of the other affluent sections and the growing middle class played out in full colour in daily broadcasts of the television channels and the open access through the internet in an age of heightened communication. Charles & Ray Eames had warned us about this impending impact of such disruptive change through extended communication, a change in kind and not in degree they said, in their 1958 India Report and we have not paid heed to this sanguine advice. He had called for the use of design to address the needs and aspirations of a people in the throes of such change but we have perhaps let slip an advantage by not channeling adequate investments to address their dreams and aspirations in close partnership with the people directly. Innovation at the grassroots has become a buzzword in management circles and here the case studies that are celebrated fall into the category of Jugaad (creative make-shift) and not of Design (intentional and sensitive configurations) as we would argue that it should be. Jugaad stands for the creative interpretation of severe limitations and shortages to produce a workable contraption or scheme held together by available opportunity, hope and hard work, always at a fraction of the cost that would otherwise have been available, with most of the action lying in the unregulated space of zero taxation and technical specifications, in many cases illegal. So the celebration is in the extreme cost cutting that has been achieved by the poverty ridden creator and service provider and the rest of us stand in mute respect for the heroic achievement, the response of the poor or a clever service provider to an impossible situation, a sheer act of survival. Unfortunately, Jugaad also fosters a Chalta-hai (make-do) attitude that permeates all our offerings from Government services to low cost infrastructure, products and service solutions that are not sustainable for inclusive development, all lacking in refinement and costly in the long run, creating the platform for a low quality sub-culture far from the rich tapestry of traditional wisdom that are at the very foundation of the Indian society that has somehow survived till date. However is this the only way? Is there another way?
The communication boom and an era of transparency have ensured that the Indian consumers are no longer willing to accept the mediocre when better value is available. For example, in many parts of India the poor have shunned incompetent public education systems to place their child in expensive private schools and in going the extra mile to avail quality where it is on offer, a new phenomenon for both urban and rural India that is communication enabled. However, the design establishment in the country has languished in the face of great apathy from both Government and industry during an extended period of a highly regulated and centrally managed economy and the absence of any real competition. Design schools like the National Institute of Design have suffered from an absence of both funding and vision in recent years and the National Design Policy of 2007 too has a very limited mandate which does not include the huge opportunities that exist for local investments in innovation and design for inclusive development. It stops short of harping on slogans and on the export and luxury product industries as their area of focus. Further, on the education front while several new NID’s are proposed to be funded by Government there is an absence of any new vision statement as to their focus and purpose as if the model exemplified by NID Ahmedabad could be used as a clone for the creation of these new centres in four geographical regions of India, a missed opportunity to address the change that is taking place in our country. The India Design Council, another outcome of the National Design Policy is harping on “Good Design” as a quality benchmark which is product of Western Industry and their consumer marketing focus that is least suited to evaluate design solutions for inclusive development that is now needed in India.
No international design solutions are available that are ready and off the shelf to address the pressing problems of the Indian people such as affordable healthcare, rural and urban sanitation, dispersed quality education at the primary and secondary levels, agricultural and rural tools, rural housing and mobility and a host of other design opportunities across 230 sectors of our economy that are in crying need of design attention. These will have to be addressed locally and innovation and design will be the way forward but the infrastructure for action is not in place since the existing institutes are barking up the wrong tree it seems. The Eames Report and the National Institute of Design in the early years innovated an unique education programme in design that was addressing these very issues but over the last ten years these advances in design education and research were systematically demolished by literally throwing the baby out with the bathwater in their misguided effort to get university status and in the search for qualification rather than content and relevance. The DIPP, the department in Government that handles the NID budgets and the National Design Policy has proved to be patently incompetent to support the design movement in the country and to move it in directions that it needs to be taken if it to be relevant to the creation of a platform for inclusive development. Perhaps their limited mandate to address the needs of Indian industry has made them myopic to the larger roles that design has to play if it to be relevant to our national agenda. Design is not a mere hand-maiden for industrial development but a much broader strategy that can help transform society and feed into the culture forming processes of a country and a region. The evidence of this incompetence is visible in the poor quality of vision and funding that is provided to the NID when compared to the IITs and IIMs, both of which were set up around the same time in the early 60’s. The National Institutes of Fashion Technology (NIFT) was set up in the late 80’s through the Textile Ministry and they used a special export cess that was accumulated with Government to rapidly fund the establishment and growth of a huge national infrastructure that is now recognised as a university of national importance. Further, NID’s faculty are a poorly remunerated lot when compared to their counterparts in any comparable institute or university in India and this I am sure will ensure that the best will veer away from committing themselves to pressing design education roles that are facing the nation today. Perhaps the correct way out of this messy situation is to move the NID’s to a new ministry that is capable of addressing the multi-facetted roles of design action that are needed in India across all verticals and all ministries. My students once proposed a structure and they called for the creation of the Ministry of Design, perhaps as part of the Prime Ministers Office till it can move to the area of Culture where it could find a niche that is appropriate to address the emerging challenges of quality and relevance to society.
When I reflect on the various projects done at the NID in the early years from the Electronic Voting Machine to the Jawaja project, through the Chennapatna toy project to numerous textile design projects such as the Dhamadka Block Print project a number of design strategies come to mind. We need to ponder deeply on many of these real world design experiences to cull out lessons that can take us forward to a socially and culturally appropriate application of design action that could bring great value to our population. More recently, our initiatives in Tripura State through the “Katlamara Chalo” project integrates bamboo cultivation with product manufacturing as a means to alleviate rural poverty using local skills, resources and local enthusiasm as the primary resource. We were able to discuss design and develop strategies for the bottom of the pyramid with colleagues at the Indian Institute of Crafts and Design, Jaipur, an initiative of the Government of Rajasthan that is now being managed under a public- private partnership and here we built a more generalized sketch model called “Raindrops and Footprints” that explained the process leading to the selection of the village through local intensive research and the building of an understanding of the local context from which a number of design opportunities are identified and modeled before they are taken through a participatory development process which used the local strengths and resources in a sustainable manner. Here design is not just looking at “Good Form” but at the strategies and approaches along the entire supply chain and at each stage value is unfolded. The attempt was to find local solutions suitable for local application using our macro-micro strategy for design action that are informed by serious research and sustained contact with the beneficiaries through hand-holding and educational contact in the field. This integrated strategy has paid off but the investment of time and effort is considerable to prototype and test such a strategy to be rolled out to various locations using available local resources as the platform for sustainable change. For the first time in India we have a rural community using farm based bamboo to drive a local industry towards self reliance and managed growth. Starting with bamboo products and furniture we see the sustained action providing an uninterrupted supply of raw materials and skill sets that can foster the growth of a decentralized, local and self governed economy that could survive and thrive in the emerging era that I call the “Post industrial and Post-mining era”.
This is a new form of design action not to be confused with the form giving activity of traditional industrial design, although it would include elements from the old form of design thought and action. Here we are proposing that the design action take into account the structure of society along with their macro aspirations, their histories and cultural preferences as a starting point and from here build imaginative approaches for products, services and systems that would include the meta-system, the infrastructure, the hardware, the software and the processware to ensure a perfect fit to the circumstances and requirements of the particular situation. This kind of offering is complex and would need a multitude of knowledge and skill sets to be brought to bear with sensitive social and cultural orientation and with a fine tuned economic and technical feasibility. Design for inclusive development is therefore a multi-disciplinary activity that needs to draw a variety of knowledge and skills in an innovative and future oriented setting that is well informed about the legal and the ethical parameters. In this form it becomes a powerful political activity since it is propositional in the manner in which it visualizes and realizable alternatives for the stakeholders from which the process of selection and decision can begin. It is a democratic activity at the very heart and gives power to the people who are at the location and to those who would be most impacted by its implementation. This shift in design thinking can be better understood through the model that I have proposed that explains the three orders of design – Form, Structure and System – material & functional, aesthetic & socio- economic, environmental and political – all of which need to be addressed in all cases if we are to be assured of its sustainability and relevance to the local context. Under these terms of reference industry and business must take responsibility for end to end offer of service and not just for the delivery of brands and boxes that contain a “Good Design” product but ensure that they serve the purpose that was promised in the first place.
I do believe that design can help here and we may need to make some fundamental changes in our design education approaches and widen the base for action, a shift from a focus on business and industry to the design for public good that is operational at the local community level. These should include the grassroots workers in the design education loop and the content of such education needs to be informed by design insights that are local and rooted in the local reality for which our current crop of textbooks would be found wanting. This will need fresh approaches and enlightened support from the political establishment if these changes are to be forged. I do feel that we need to raise this debate and explore the various roles of design and its potential application that is today ignored by design education and practice alike, including my own school if I may admit here, so that a new sense of commitment is brought into the use of design in areas far outside industry and business. This is one of my mission objectives for setting up the 'Design for India" blog to help create a platform from which I can share my thoughts on the possibilities that I see in my minds eye. I also find the peer review system of the research publications as not so perfect for the dissemination of design insights although it does work wonders for science analysis and knowledge creation but it may be extremely defective for design demonstration since the idea of “design opportunity”, a very specific term – a combination of perception and imagination – excludes the viewer or reader from "seeing" the imagination part of the designers statement and therefore it compels the designer to take the idea far down the visualisation and realization path before it can even dawn on others that the idea is truly credible. This means that we may need to create a platform or even a multitude of platforms for design incubation and development that can be accessible to many across numerous areas of application and these kinds of platforms just do not exist in India today, or if it does, it is dominated by centralized administrative controls that stifle innovation and exploration which is critically needed to make the demonstration. Our policies for faculty research and action need to be liberal and this needs substantial change and autonomy for the ‘Maverick innovator” with good intentions and value systems in place to do their innovative work. Some of us have had to battle hard to achieve even a small degree of autonomy of action and this is not a good climate for addressing these complex problems which surround us here in India in an effective manner. We need new institutions and whole new mind set to address these complex issues at hand.
How do we create such autonomous and decentralized action strategies and how do we roll this out across our Universities and Institutes of design action? This will be one of the central questions that can change the current impasse in development approaches dealing with poverty in many parts of India. There are no simple answers but we will need to look deeply at our experiences in the field and build new institutes and strategies that can use the promise of design to find approaches to address these complex needs. The current conviction that we hold is the use of a macro-micro design strategy which has been developed after years of application and we need to do more before we can spread this deep conviction that we hold to others who hold the purse string in our countries where real action is needed today.
13-03-2011
Friday, March 11, 2011
Tax on Healthcare services may go in Budget revisit, hints FM
NEW DELHI: The government has indicated that it will reconsider the imposition of service tax on healthcare and re-examine other contentious tax proposals announced in the Union Budget 2011-12 . "Since the presentation of the Budget 2011-12 , I have received several suggestions and representations , including feedback from Members (MPs) on taxation proposals. These are under examination ," Finance Minister Pranab Mukherjee said during discussions on the Budget in Lok Sabha on Friday.
The minister also said that educational institutions and hospitals would be treated as infrastructure sub sectors and capital investment in them would be eligible for the finance ministry?s Viability Gap Funding Scheme. Commenting on the power situation , Mukherjee said "We hope to add 15,000 MW by the end of the current financial year. India has already added about 10,462 MW power capacity from April 2010 to February 2011, which is one of the highest capacity addition.
"Without power we cannot have the desired level of growth. Therefore emphasis was given... We have added a capacity of 10,462 MW during this year itself in the current plan, which is higher than the capacity added in any of the previous years," Mukherjee said. Power minister Sushil Kumar Shinde has exuded confidence the country could exceed 15,000 MW capacity by end of this fiscal.
Even though India has initiated various initiatives including Ultra Mega Power Projects (UMPPs), the demand for electricity is growing. The capacity addition target for the 11th Five Year Plan (ending March 31, 2012) is little over 62,000 MW. Currently, India has installed power generation capacity of over 1.75 lakh MW.
Mukherjee also said the country has started a process to trace black money stashed away in foreign banks. He said the government would work under the legal framework to bring the money back and punish the culprits. The finance minister said the government had started a legal proceeding to book the culprits.
Rollback Chorus
The government will revisit some of the proposals in the Budget 2011-12 that have led to high-pitched demands for rollback from various industry segments, FM Pranab Mukherjee said on Friday. ET takes a look at the contentious proposals:
SERVICE TAX ON HOSPITALS
10% service tax, with an abatement of 50%, on treatment at hospitals with 25 or more beds with central air-conditioning and diagnostic test services.
The minister also said that educational institutions and hospitals would be treated as infrastructure sub sectors and capital investment in them would be eligible for the finance ministry?s Viability Gap Funding Scheme. Commenting on the power situation , Mukherjee said "We hope to add 15,000 MW by the end of the current financial year. India has already added about 10,462 MW power capacity from April 2010 to February 2011, which is one of the highest capacity addition.
"Without power we cannot have the desired level of growth. Therefore emphasis was given... We have added a capacity of 10,462 MW during this year itself in the current plan, which is higher than the capacity added in any of the previous years," Mukherjee said. Power minister Sushil Kumar Shinde has exuded confidence the country could exceed 15,000 MW capacity by end of this fiscal.
Even though India has initiated various initiatives including Ultra Mega Power Projects (UMPPs), the demand for electricity is growing. The capacity addition target for the 11th Five Year Plan (ending March 31, 2012) is little over 62,000 MW. Currently, India has installed power generation capacity of over 1.75 lakh MW.
Mukherjee also said the country has started a process to trace black money stashed away in foreign banks. He said the government would work under the legal framework to bring the money back and punish the culprits. The finance minister said the government had started a legal proceeding to book the culprits.
Rollback Chorus
The government will revisit some of the proposals in the Budget 2011-12 that have led to high-pitched demands for rollback from various industry segments, FM Pranab Mukherjee said on Friday. ET takes a look at the contentious proposals:
SERVICE TAX ON HOSPITALS
10% service tax, with an abatement of 50%, on treatment at hospitals with 25 or more beds with central air-conditioning and diagnostic test services.
Dalal St seen fretting on Japan aftershocks; markets may get edgy
MUMBAI: It could be an edgy weekend for traders and investors as the Japan quake cast a shadow on the market and a tsunami threat engulfed the US west coast. The devastation in Japan is likely to be far lesser than what it suffered in the ?95 Kobe earthquake, but aerial photos of the catastrophe flashed across television screens sent jitters across financial markets, already rattled by a boiling oil and sluggish US growth.
Analysts said tsunami warnings for other Asian countries could hold back investors from buying stocks in the continent, which has already seen a flight of foreign money in 2011. ?It may add to the risk aversion already affecting many emerging markets, including India,? said V Anantha Nageswaran, head-investment research for Asia-Pacific of Bank Julius Baer.
Benchmark indices of Asian stocks fell on Friday, with Japan?s stock gauges dropping 1-2% on fears the earthquake would further strain the finances of the world?s third-largest economy. The Sensex fell 153.89 points, or 0.84%, to 18,174. Most Asian markets were already weak after China?s monthly inflation data exceeded expectations, raising fears of further monetary tightening in the country.
Unless the US and other countries in Asia are hit by tsunami, the Japan quake is unlikely to have a lasting effect on Indian stocks. But there may be other impacts. ?Japan has substantial infrastructure funding commitment in India. One needs to watch out whether that will slow down,? said Anand Tandon, CEO of JRG Securities .
A few other brokerages felt incremental inflow from Japanese investors may come down in the short run. ?Oil and US job growth will remain the big worries, but there will be movements in specific stocks having business relations with Japan ,? said a trader.
Currency dealers in India as well as abroad will closely track the market in the next few days. The rupee slipped six paise on Friday to close at 45.24/25 against the US dollar on sustained dollar demand from importers and sluggish equities. But the Japanese yen?s sharp rebound against the dollar to end with gains despite the calamity surprised many in the market.
Analysts said tsunami warnings for other Asian countries could hold back investors from buying stocks in the continent, which has already seen a flight of foreign money in 2011. ?It may add to the risk aversion already affecting many emerging markets, including India,? said V Anantha Nageswaran, head-investment research for Asia-Pacific of Bank Julius Baer.
Benchmark indices of Asian stocks fell on Friday, with Japan?s stock gauges dropping 1-2% on fears the earthquake would further strain the finances of the world?s third-largest economy. The Sensex fell 153.89 points, or 0.84%, to 18,174. Most Asian markets were already weak after China?s monthly inflation data exceeded expectations, raising fears of further monetary tightening in the country.
Unless the US and other countries in Asia are hit by tsunami, the Japan quake is unlikely to have a lasting effect on Indian stocks. But there may be other impacts. ?Japan has substantial infrastructure funding commitment in India. One needs to watch out whether that will slow down,? said Anand Tandon, CEO of JRG Securities .
A few other brokerages felt incremental inflow from Japanese investors may come down in the short run. ?Oil and US job growth will remain the big worries, but there will be movements in specific stocks having business relations with Japan ,? said a trader.
Currency dealers in India as well as abroad will closely track the market in the next few days. The rupee slipped six paise on Friday to close at 45.24/25 against the US dollar on sustained dollar demand from importers and sluggish equities. But the Japanese yen?s sharp rebound against the dollar to end with gains despite the calamity surprised many in the market.
Essar to spend $750m to revive Zimbabwe group
Essar, the Indian conglomerate, plans to spend at least $750m to revive Zimbabwe’s stricken state-owned steel company in a deal that advances Asian groups’ thrust into Africa.
The agreement will see the Mumbai-based telecoms-to-refining conglomerate take majority stakes in joint ventures that will take over the assets of the Zimbabwe Iron and Steel Company.
It accelerates the Indian private sector’s push into a continent where Chinese state-owned groups have made the running in the race for markets and resources.
“We believe the new ventures will be well positioned to be a low-cost steel producer that can meet the growing demands of the regional steel market and capitalise on the forecast growth in sub-Saharan Africa,” Firdhose Coovadia, Essar’s resident director for the Middle East and Africa, said.
Essar’s Zimbabwean venture expands an African presence that includes coal assets in neighbouring Mozambique, oil projects in Nigeria and Madagascar and a telecoms business in India.
The group, controlled by the Ruia brothers, its billionaire founders, saw off rival bidders including ArcelorMittal, whose main owner is Lakshmi Mittal, the steel mogul.
Robert Mugabe, Zimbabwe’s president, said last year that Arcelor was “too big” for the country.
Essar planned to spend an initial $750m restarting steel manufacturing operations that had sunk into disrepair, a person familiar with the plans said.
Mr Coovadia acknowledged that this would be a “challenging task”.
It aims to bring the plants, which have capacity to produce 1m tonnes of steel, back into operation within 12 to 15 months and to target the African market.
Essar’s steel arm aims to increase production to 14m tonnes per annum from 8.6m by next year.
Like peers including Tata Steel, India’s biggest producer, Essar is seeking to lock in supplies of iron and coal – the raw materials of steelmaking – at a time when high commodity prices are eroding margins.
As well as a 60 per cent stake in a steel joint venture with Zimbabwe’s government, Essar will take an 80 per cent holding in a separate joint venture that will control the former state-owned group’s mineral resources, potentially affording it access to what are thought to be Zimbabwe’s substantial iron ore stocks.
Welshman Ncube, industry minister in a fractious power-sharing government between Mr Mugabe’s party and the former opposition led by Morgan Tsvangirai, prime minister, said Zisco was “totally, completely insolvent”.
Essar will assume the company’s debts, which Mr Ncube said were in excess of $340 million.
The company was worth only about $45m, he said.
The agreement will see the Mumbai-based telecoms-to-refining conglomerate take majority stakes in joint ventures that will take over the assets of the Zimbabwe Iron and Steel Company.
It accelerates the Indian private sector’s push into a continent where Chinese state-owned groups have made the running in the race for markets and resources.
“We believe the new ventures will be well positioned to be a low-cost steel producer that can meet the growing demands of the regional steel market and capitalise on the forecast growth in sub-Saharan Africa,” Firdhose Coovadia, Essar’s resident director for the Middle East and Africa, said.
Essar’s Zimbabwean venture expands an African presence that includes coal assets in neighbouring Mozambique, oil projects in Nigeria and Madagascar and a telecoms business in India.
The group, controlled by the Ruia brothers, its billionaire founders, saw off rival bidders including ArcelorMittal, whose main owner is Lakshmi Mittal, the steel mogul.
Robert Mugabe, Zimbabwe’s president, said last year that Arcelor was “too big” for the country.
Essar planned to spend an initial $750m restarting steel manufacturing operations that had sunk into disrepair, a person familiar with the plans said.
Mr Coovadia acknowledged that this would be a “challenging task”.
It aims to bring the plants, which have capacity to produce 1m tonnes of steel, back into operation within 12 to 15 months and to target the African market.
Essar’s steel arm aims to increase production to 14m tonnes per annum from 8.6m by next year.
Like peers including Tata Steel, India’s biggest producer, Essar is seeking to lock in supplies of iron and coal – the raw materials of steelmaking – at a time when high commodity prices are eroding margins.
As well as a 60 per cent stake in a steel joint venture with Zimbabwe’s government, Essar will take an 80 per cent holding in a separate joint venture that will control the former state-owned group’s mineral resources, potentially affording it access to what are thought to be Zimbabwe’s substantial iron ore stocks.
Welshman Ncube, industry minister in a fractious power-sharing government between Mr Mugabe’s party and the former opposition led by Morgan Tsvangirai, prime minister, said Zisco was “totally, completely insolvent”.
Essar will assume the company’s debts, which Mr Ncube said were in excess of $340 million.
The company was worth only about $45m, he said.
China, India driving global oil demand: Obama
WASHINGTON: Increased use energy resources by fast growing economies like India, China and Brazil is driving the global oil and gas demand, US President Barack Obama said on Saturday.
"The problem is a great deal of uncertainty in the oil markets, part of it prompted by the fact that the economy's growing faster in some places than others, but you've got China and India and Brazil and other emerging nations that are using more and more energy as their economies advance," Obama said at a news conference when asked about the rising gas prices in the US.
Following the current unrest in the Middle East, gas prices in the US have crossed USD 3.5 a gallon and is expected to further go up, which is prompting demand of use of strategic oil reserve, which Obama said is an option not under consideration right now because there is no major disruption in oil supplies.
"We already saw that trend in 2008. Because of the worldwide recession oil prices went back down, but to some degree a lot of what's happening in prices is as a consequence of economic growth, and countries and economies starting to use more oil.
"Part of it, though, is also uncertainty in terms of what's happening in the Middle East," he said.
"One of the messages that I want to send today is that we are confident about our ability to fill any potential gaps in supply. Libya, for example, does not account for a large portion of overall world production.
"They provide a type of oil that is highly valued and there's a high premium on it, but basically even if Libyan oil production was suspended for a significant period of time because of the unrest there, we'd be able to fill that gap. So a lot of this has to do with uncertainty in the market," he said.
Obama said the idea behind the Strategic Petroleum Reserve is if there was a severe disruption in supply, similar to what happened in the '70s, for example, when OPEC making a decision not to sell for a while, how would the US economy continue to function, and making sure that Americans have sufficient supplies for that.
"Another example would be during Hurricane Katrina when you've got a whole bunch of refineries that have been impacted and production in the Gulf has been impacted. You know, that's another example where in a short term you can fill that hole," he said.
Obama said rising prices are not a new phenomena. "Three years ago, before the recession hit, a combination of factors, including rising demand from emerging economies like China, drove gas prices to more than USD 4 a gallon," he said.
"The world-wide recession and the decrease in demand pushed prices back down. But over the past year, as the economy has picked up steam and global demand for oil has increased, prices have increased again," he added.
Obama said the turmoil in North Africa and the Middle East has added uncertainty to the mix, and lost production in Libya has tightened supply.
"The global community can manage supply disruptions like this. Other oil-producing nations have committed to filling any gaps. And we will continue to coordinate closely with our international partners to keep all options on the table when it comes to any supply disruptions," he said.
"The problem is a great deal of uncertainty in the oil markets, part of it prompted by the fact that the economy's growing faster in some places than others, but you've got China and India and Brazil and other emerging nations that are using more and more energy as their economies advance," Obama said at a news conference when asked about the rising gas prices in the US.
Following the current unrest in the Middle East, gas prices in the US have crossed USD 3.5 a gallon and is expected to further go up, which is prompting demand of use of strategic oil reserve, which Obama said is an option not under consideration right now because there is no major disruption in oil supplies.
"We already saw that trend in 2008. Because of the worldwide recession oil prices went back down, but to some degree a lot of what's happening in prices is as a consequence of economic growth, and countries and economies starting to use more oil.
"Part of it, though, is also uncertainty in terms of what's happening in the Middle East," he said.
"One of the messages that I want to send today is that we are confident about our ability to fill any potential gaps in supply. Libya, for example, does not account for a large portion of overall world production.
"They provide a type of oil that is highly valued and there's a high premium on it, but basically even if Libyan oil production was suspended for a significant period of time because of the unrest there, we'd be able to fill that gap. So a lot of this has to do with uncertainty in the market," he said.
Obama said the idea behind the Strategic Petroleum Reserve is if there was a severe disruption in supply, similar to what happened in the '70s, for example, when OPEC making a decision not to sell for a while, how would the US economy continue to function, and making sure that Americans have sufficient supplies for that.
"Another example would be during Hurricane Katrina when you've got a whole bunch of refineries that have been impacted and production in the Gulf has been impacted. You know, that's another example where in a short term you can fill that hole," he said.
Obama said rising prices are not a new phenomena. "Three years ago, before the recession hit, a combination of factors, including rising demand from emerging economies like China, drove gas prices to more than USD 4 a gallon," he said.
"The world-wide recession and the decrease in demand pushed prices back down. But over the past year, as the economy has picked up steam and global demand for oil has increased, prices have increased again," he added.
Obama said the turmoil in North Africa and the Middle East has added uncertainty to the mix, and lost production in Libya has tightened supply.
"The global community can manage supply disruptions like this. Other oil-producing nations have committed to filling any gaps. And we will continue to coordinate closely with our international partners to keep all options on the table when it comes to any supply disruptions," he said.
Rajat Gupta takes 'leave of absence' from New Silk Route
MUMBAI: McKinsey veteran Rajat Gupta has decided to take "leave of absence" from the management of the $1.4-billion PE fund New Silk Route which he co-founded five years ago. Gupta is facing charges from the Securities Exchange Commission of the US for conspiring with his associate and hedge fund manager Raj Rajaratnam who stands accused in a sensational insider trading trial.
New Silk Route (NSR) said Gupta took voluntary decision to proceed on leave of absence till he sorts out his issues. This would also avoid any distraction and ensure NSR's continued focus on the execution of its investment strategy. The fund, which tracks investment opportunities in India and neighbouring south Asian markets, maintained that "matters involving Gupta have nothing to do with NSR or any of our portfolio firms. The allegations relate to US public markets, while the fund is focused on investing in private companies in the Indian sub-continent".
On Monday, Gupta also exited the boards of Genpact, American Airlines and Harman International just before the Rajaratnam trial commenced in a Manhattan federal court. He resigned from the board of Procter & Gamble and Goldman Sachs earlier. SEC had filed civil charges against the best known Indian face in Corporate America alleging that he passed on sensitive boardroom details of Goldman Sachs and P&G to Rajaratnam. Gupta's lawyers have refuted the charges as "baseless" and said he did not profit from any of these alleged tip-offs.
NSR had started communicating with its international investors, or limited partners (LPs), soon after charges were filed against Gupta last week. The reaction of the American and European LPs to the unfolding development is crucial, and it is not clear whether their feedback played any role in his leave of absence. TOI's query to New Silk Route's US-based PR firm in this regard did not elicit any response.
Rajaratnam was supposed to figure prominently in the establishment of NSR when it was originally planned. He The main accused in the insider trading scandal was expected to spearhead a hedge fund variant focused on the sub-continent. But the plan did not materialize. Gupta went ahead with the private equity fund in which Victor Menezes and Parag Saxena are co-founders.
Meanwhile, Gupta, 62, remains as the chairman of Hyderabad-based Indian School of Business (ISB). Pressure has been mounting on this management honcho, and a big endorser of the India investment story, to quit ISB's executive board till his name is cleared in the ongoing scandal. But the ISB board, which include some of corporate India's best known CEOs, has rallied behind the troubled man who was till recently one of the most credible faces of corporate governance globally.
New Silk Route (NSR) said Gupta took voluntary decision to proceed on leave of absence till he sorts out his issues. This would also avoid any distraction and ensure NSR's continued focus on the execution of its investment strategy. The fund, which tracks investment opportunities in India and neighbouring south Asian markets, maintained that "matters involving Gupta have nothing to do with NSR or any of our portfolio firms. The allegations relate to US public markets, while the fund is focused on investing in private companies in the Indian sub-continent".
On Monday, Gupta also exited the boards of Genpact, American Airlines and Harman International just before the Rajaratnam trial commenced in a Manhattan federal court. He resigned from the board of Procter & Gamble and Goldman Sachs earlier. SEC had filed civil charges against the best known Indian face in Corporate America alleging that he passed on sensitive boardroom details of Goldman Sachs and P&G to Rajaratnam. Gupta's lawyers have refuted the charges as "baseless" and said he did not profit from any of these alleged tip-offs.
NSR had started communicating with its international investors, or limited partners (LPs), soon after charges were filed against Gupta last week. The reaction of the American and European LPs to the unfolding development is crucial, and it is not clear whether their feedback played any role in his leave of absence. TOI's query to New Silk Route's US-based PR firm in this regard did not elicit any response.
Rajaratnam was supposed to figure prominently in the establishment of NSR when it was originally planned. He The main accused in the insider trading scandal was expected to spearhead a hedge fund variant focused on the sub-continent. But the plan did not materialize. Gupta went ahead with the private equity fund in which Victor Menezes and Parag Saxena are co-founders.
Meanwhile, Gupta, 62, remains as the chairman of Hyderabad-based Indian School of Business (ISB). Pressure has been mounting on this management honcho, and a big endorser of the India investment story, to quit ISB's executive board till his name is cleared in the ongoing scandal. But the ISB board, which include some of corporate India's best known CEOs, has rallied behind the troubled man who was till recently one of the most credible faces of corporate governance globally.
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