What Narendra Modi Can Do For The Entrepreneur

Published: May 30, 2014 20:08 IST
(Captain GR Gopinath founded Air Deccan and is considered a pioneer in the low-cost airline sector. He quit Arvind Kejriwal's Aam Aadmi Party on May 24, five months after joining it)

The late CK Prahlad, while delivering a lecture a few days before he died, said entrepreneurs are the new freedom fighters and can lift India out of the shackles of poverty.

Entrepreneurship is the art of stretching limited resources with daring unlimited dreams. But India is a riddle. There are seemingly four Indias today - the India of vast teeming restless multitudes mired in poverty and living in sub-human conditions; the India of scams, scamsters, politicians, fixers, middlemen and oligarchs; the rising middle class and the new entrepreneurial India with a common heartbeat.  
Entrepreneurial India will, in my opinion, propel the country to prosperity. This new entrepreneurial energy will probably solve and remove some of the problems and impediments of the first two Indias.

But first a few words on the other three Indias. The sheer magnitude of poverty and unemployment of a majority of our population is overwhelming. They are seething with anger and resentment at their exclusion and are ready to take to arms and violence seeking equity and justice because of a pervading sense of helplessness and despair.

They rightly feel cheated and robbed of their dreams when they watch mutely those who have expropriated to themselves undue or out of turn benefits at the cost of the common weal.
The new educated middle class, who were till recently indifferent and cynical to the larger general problems that afflict the country, are now in the forefront of the movement against corruption. They are also dreaming of an India whose golden age is not behind, but ahead of us.
But it is only the spirit of adventure, continued optimism and entrepreneurial energy that can save India from what sometimes looks like an impossible situation and create the new India of our dreams. Prime Minister Narendra Modi can with his leadership provide the impetus here by dismantling the stranglehold of the discretionary powers of the bureaucracy and ministers through systemic changes in various institutions to bring about autonomy, accompanied by a focus on administrative and judicial reforms and reducing or eliminating the role of government in many areas.
It is the entrepreneurial economy which built America and many countries in Europe and destroyed feudalism. The reforms that were set in motion by Narasimha Rao spawned a new, resurgent and aspirational India. It dismantled the old aristocracy and built on its ruins a new economy.

Though it is true that some of the old aristocrats have been replaced by a few powerful business houses resembling the oligarchs of some countries in the last few years of the UPA's misrule, which facilitated crony capitalism, a sheer entrepreneurial drive and innovation has propelled India into becoming an enviable economic powerhouse in varied sectors like IT, Biotech, Pharma, Engineering, Design, Mobile Telephony, Financial Services and Banking, Automobiles and Healthcare.
Entrepreneurs challenge the status quo. They create wealth where none existed before - a new market, a new customer satisfaction, something new, something different, they change and transmute the nature of resource for better value.
A simple idea for example and an audacious dream - "Every Indian must and can fly" - made me set up Air Deccan. The first clear-cut thought of starting an airline for the common man came to me thousands of miles away from home on the low-cost South West Airlines flight in the US when I was seated next to a beefy man, chewing on a burger. He turned out to be a carpenter. And that was my moment of epiphany! I had no money but was consumed and possessed by the dream of making the common man fly in India and Air Deccan took to the skies within a year. The eco-system made it possible.
There is Pratap Reddy and Appollo Hospitals or Deepak Parekh and HDFC Bank or Narayana Murthy and Infosys. It was the power of their ideas, their vision combined with venture which spawned new ventures for others to follow.
Though the great companies born out of reforms and the poster boys of enterprise have come to represent modern India, real wealth and transformation has taken place in less glamorous industries. It was and is a myth that most jobs get created in the hi-tech industries and corporate sector. As management Guru Peter Drucker noted in the American context in the 1980s at the height of America's economic power, the growth and large-scale employment came from very small and mid-size companies not Ford and General Motors.

In India, though the respectability has come from world class companies like TATA, Reliance, Infosys, TCS, Reddy Labs, etc., real jobs and wealth are being created in less glamorous small-scale industries and in millions of small scale factories and shops across the country in the wake of reforms - you cannot escape the beehive of economic activity in Chandni Chowk or Sarojini Market in Delhi or DVG Road in Basavanagudi, Bangalore or any other city and town in India.

For us in India, the challenge now is how to create jobs in the "other India". If the "new India" with speed and greed and manipulation of the system creates a dual economy - a wealthy economy with islands of prosperity co-existing with vast areas of poverty and illiteracy and malnutrition, then, it does not lend itself into a stable and socially cohesive society.
Self-trust is the first secret of success and hope is the mother of all reforms. Narendra Modi has already infused that optimism and sense of pride into the people of the country, especially the young with aspirations and dreams.

The biggest impediment to our entrepreneurs today and by extension to growth of the economy are our policies, our bureaucracy and antiquated rules and regulations which strangled innovation and growth and encourage corruption and indecision. To cite an example, the official corporation licence fee to start a very small Udupi Hotel in Bangalore is just three thousand Rupees. But the incidental expenses, the euphemism for "speed money", to get your small outfit off the ground is anywhere from 30000 to 40000 rupees. Let us not even speak of the kind of astronomical sums needed to get clearances in aviation or allocations in coal or out-of-turn allocation of various resources at the corporate level, as it is an open secret.

It is relatively easier to clear large-scale industrial projects and Modi has an enviable track record in his state. But the challenge for him will be how he translates that promise of good governance, more governance and less government across the country at lower levels of enterprise so that millions of entrepreneurs with hardly any money but full of dreams, ideas and energy can easily start their ventures and sustain them without being preyed on by vultures.

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