Demographics without a Dividend

There are some common issues highlighted in almost all political, corporate and intellectual discourse in India regarding the economic growth and development of the nation. On one hand, while it is a general consensus that India’s greatest advantage viz-a-viz its peers in the developing countries’ bracket is the world’s highest working age population,  on the other, almost everyone agrees that we need massive investments in education, infrastructure and healthcare to uplift millions out of poverty. However, there is one critical factor at the base of these two issues which, till around 15 years back was prevalent in government policy as well as general educated discourse but has disappeared since then. It is our burgeoning population and the high population growth rate which, if not controlled immediately, can derail the country’s dream of inclusive growth and poverty alleviation forever. There are some concrete reasons behind this argument.   

As per the latest census results, the population of the country in the decade 2001 to 2011 grew by around 18.2% in absolute terms while it grew at around 18.5% in the previous decade. Now, India’s population in 1991 was 85 crore and it was almost 100 crore by 2001. Now, it stands at 120 crore. We have added 20 crore people in the last 10 years while we added 15 crore in the previous ten. In essence, we have added more than the total population of USA in the last twenty years. Here comes the worst part. Among the thirty largest nations in terms of land area, we have the highest area density of population, almost twice that of China’s. Now, for all the proponents of the so called ‘demographic dividend’, the only way a population can feed itself and live a bare minimum life standard as per UN standards is if there is a bread earner in every household. Despite India’s family oriented structure, even if we assume a very rough estimate of 6-7 persons per household, we require atleast a working population of 17-18 crore. Herein lies the reality check.

Agriculture, which already somehow sustains 700 million in the country at life standards way below minimum UN benchmarks, is already suffering from extra labour wherein, beyond a point, a standard hectare of agricultural land cannot employ more than a certain number of labourers. Our agriculture suffers from an economic concept called ‘disguised unemployment’. In simple terms, it means that employing more labour beyond a threshold can only be achieved if you do not employ tractors and other machines to do manual work. But the total productivity of that increased labour would still remain below that what could have been achieved by less labour and more capital investment in technology. Thus, the only option is to transfer this excess labour to manufacturing and construction industries. But that’s where the Pandora’s Box is fully opened.

Construction and manufacturing are capital intensive sectors which can only achieve high employment levels if massive plants are built and huge infrastructure projects are initiated. But such money can only come from foreign direct investment and opening up of the sectors to private investment. And that’s where the twist in the tale arrives. Advancement of technology in the developed world (mostly western nations) has enabled foreign companies to possess latest technology and automated factories wherein manual work is restricted to a certain number beyond which the plant or factory would go for a loss (similar to what happens in agriculture as described above). Thus, while India has slowly opened up its manufacturing and construction sectors to foreign and private investment in the last two decades, the deployment of capital intensive technology by foreign companies has led to all private players within India as well going for the same technology which enhances productivity and lets them compete in the market place. This has limited the total number of workers that can be employed by any manufacturing plant or construction site of a standard size. For example, the total number of direct employees in Tata Motors’ manufacturing facilities in India put together were around 85,000 till the mid 1980s but has reduced to around 45,000 now.

The solution to this issue as promulgated by some experts that there should be more and more number of manufacturing facilities set up in the coming decades so as to absorb the massive youth population brings into the limelight one of the most critical development issues facing India today. We must remember that the one factor that is fixed permanently is the total land area we have. So, increasing number of manufacturing plants, roads, real estate projects and railways is fast gobbling up cultivable land. As per estimates, by 2025, the total per capita agricultural land area in India will be reduced to less than 0.1 hectares while the most alarming figure is that the while per capita agricultural land area remained at around 0.64 hectares in 1950-51 (population then was 360 million), it has nosedived to 0.22 hectare by 2008-09 when the population was 1.2 billion. And, if the population grows at the current rate, we will have 1.5 billion to feed by 2025 as against 1 billion in 2000, with per capita agri land area plummeting to 0.15 hectares. So, as per experts, the only solution lies in increasing the productivity of agriculture around 2.5 times in the next 10 years. Also, if we consider a shift in the dietary patterns of our population especially the middle class from wheat and rice towards vegetables, fruits and non vegetarian diets, it will require greater capital and technology investment by the government to provide incentives to farmers to grow fruits and vegetables and feed for livestock. The sustaining high food inflation rates in the last few years, low levels of agricultural R&D spend coupled with rotten governance in rural areas makes increasing agri-productivity to 2.5 times a task beyond Herculian capacities.

Coming back to employment, the much glorified services sector is already constrained by its very nature to provide employment beyond a certain figure. Despite the fact that growth in the IT/IT services space and the financial sector has provided jobs to around 2.5 million youth in the last ten years, services sector jobs require a certain level of skill set which requires an individual to atleast have diploma level qualifications. There were roughly 400,000 engineers churned out by our engineering colleges last year and this figure increases by about 15% every year. And this is in addition to the 2 million arts, humanities and basic science graduates and diploma holders annually produced by non vocational courses in the country. Thus, number of college graduates every year is almost equal to the numbers which have found employment in organised services sector in the last ten years. Most end up doing part time or temporary jobs in the retail and construction related industries and the few unfortunate ones are absorbed by increasing crime and movements like Naxalism.

The only solution to this colossal challenge is a government policy in collaboration with industry and NGOs/NPOs on three fronts. Firstly, central and state governments led population control and family planning programmes must be initiated which promote the concept of having one child or at maximum two. These programmes must be run in collaboration with banks and NGOs to educate adults and rural youth which incentivises young married couples to rewards and better insurance and housing/auto loan schemes if they have just one or maximum two children. This will especially work wonders in the rural areas.

Secondly, there must be massive public and incentives for private investment in creating capacity based on current technology as in agriculture and food processing industries which have the capacity to create millions of new jobs in rural areas. Its a known fact proven through numerous economic and demographic studies that greater financial security and possibility of jobs for rural youth result in them marrying late and having lesser number of children as the age old concept of children contributing as bread earners for the entire family is done away with. Thus, in other words, not just for poverty alleviation but also for controlling population growth aret, we need another revolution in our agriculture much greater in impact than the Green Revolution (to be discussed in another blog post soon).

Thirdly, there is a pressing need to include chapters and topics on demographics and ill effects of population growth in India in the primary school syllabi especially in local language school boards since there is vast evidence proving that more than 85% of primary school children in Tier 2 cities and below study in state language boards. This will prepare the youth for better family planning in the future. That is also where the effective implementation of the Right to Education Act 2009 comes into the picture. As more and more students are able to attain better quality education with a syllabi in sync with modern realities, that can go a long way in reducing the population growth arte to below 1% in the coming decades.      

However, as we have already produced more than 10 million in each of the last 3 decades, we might face a bleak scenario beyond 2040 that probably very few experts have dwelled upon in recent times. Assuming that the population growth rates go below 1 percent by 2030 and there are more and more single or at max dual child families in the country, it will pose the harrowing new challenge of taking care of the elderly who were born in after 1960. In rural India, it’ll be a huge challenge with one or two young people with not such huge family incomes (since even by 2040, real household incomes in rural India at present rates would not grow beyond 15% at current rates) taking care of 2-4 elders per household, That’s where the need for taking initiatives right now by the Centre in conjunction with the states to launch a huge social security program for the elderly across rural and urban India belonging to Below Poverty Line (BPL) households which can be in terms of cash transfers along with free medical insurance is a must. But despite above issues (which need to tackled through financial and social security penetration), there is no doubt that at present level of technological penetration and decreasing per capita land, population growth rate reduction measures must be the primary aim of our government and Parliament. Else, we might be pushing a large part of India into an abyss where generations might be lost forever.  

  

Where's good ol' Science??

The last fortnight had full of red letter days for the global scientific community and national scientific achievements. While the bedlam of noises following the discovery of the “God particle” or the Higgs Boson, by the European organisation for Nuclear Research (CERN) contained more energy than that used up in the Large Hadron Collider, which was used to smash protons that culminated in the discovery, there was an equally thunderous announcement to the world by the People’s Republic Of China of their first ever manual docking manoeuvre being achieved in space with the Shenzhou 9 spacecraft carrying the first Chinese female astronaut docking with the Tiangong 1 space orbiting module. This mission is part of China’s proposed space station, targeted to be complete by 2020 which will make China the third nation to possess such capability after USA and Russia. However, there was another piece of news about the dragon that largely missed the limelight wherein the Jiaolong, a state owned research submersible will make the record of reaching a depth of 7,000 metres in Mariana Trench, the deepest part of the ocean on Earth. It will be the deepest a state owned and a research submersible has ever gone. Interestingly though, its not the deepest man has gone in the ocean.

Now, while I leave it to the reader to find out whom and when man has been to the deepest part of the ocean (which is much deeper than what the Chinese sub achieved), there was another depth to which somebody went just a week before the above. It was the cynosure of media circus for 3-4 days In India. It was Mahi (not Dhoni), a 5 year old girl who fell in a 70 feet deep borewell in Khaow village of Manesar district, Haryana. It took 85 hours before her corpse could be brought out. While it was another disgraceful example of gross civil negligence by all of us (we, the people), the media made us forget it soon and continued on its hollow sensationalistic schmaltz. While god may give peace to Mahi’s soul, let me ask a question. How many of you can guess the two names hidden in the term Higgs boson? Well, one is Peter Higgs, the British particle physicist who promulgated the theory behind the particle’s existence back in 1964. The other name is Bose, (BOSon) after Satyendra Nath Bose. Still Stumped? The legend late Satyendra Nath Bose is a famous particle physicist from India who along with Albert Einstein gave the famous Bose-Einstein Statistics which describe the discrete energy states of a collection of indistinguishable particles. The name ‘boson’ was given by none other than physicist Paul Dirac in honour of S N Bose. However, in free India, the story of Indian science and Indian scientists surpasses any Shakespearean tragedy.

The multitude of problems facing Indian science is deep rooted and can be explained by understanding the entire perspective first. Indian science is not product based or IT based technological innovation. However, even technology development from scratch is only fathomable if there is an infrastructure and promotion from the government for research in basic sciences which can then be put to develop newer technologies. It is basic sciences and technology development from the scratch. Firstly, the biggest problem plaguing Indian science is the lack of funding for hard core research from both the governments as well as the private sector. India, in total put only a little above $10 billion for R&D last year which is miniscule as compared to USA’s $405 billion (ranked 1 in the world) and China’s $140 billion (please see my previous article on blog “The Indian LSD deficiency Syndrome”). Out of this, around $1.5 billion went for defence R&D and about the same on product R&D used by the public and private sector companies for launching new and upgraded products while basic sciences had to make ends meet with the remaining crumbs.

The Indian Science Congress, that recently completed 99 years, has become the platform for enchanting lofty goals for science R&D by respective PMs in India but the 5year jinx continues. In 2003, the then Prime Minister Atal Behari Vajpayee declared to increase science and technology R&D in the country to 2% of GDP by the end of the 10^th 5 year plan (2002-2007). Then in January 2007, Prime Minister Manmohan Singh further postponed the achieving date of the same target till the end of the 11^th plan (2007-2012) which is about to end and the train remains at the same station, 10 years late already. While the dragon has leapt over to 1.5% of GDP equivalent for R&D, Uncle Sam remains at the pinnacle with 2.8% (please see previous article “The Indian LSD Deficiency Syndrome”)

Then comes the variable which is one of the prime indicators of the potential of a nation’s scientific clout, the number of PhDs being produced annually and the number of cited research papers authored by scientists and researchers. The number of PhDs produced stands hopelessly low as compared to China and way behind that of USA and Germany. The number of PhDs produced by India reduced a staggering 18.5% in 2008-09 to around 10700 from 17800 in the year 2004-05. At the same time, China produced the highest number in the world at over 50000. Also, among the number of PhDs produced, science and science related PhDs were just around 8000 in 2008-09 which is far less than the near 20,000 churned out by China. Herein lies a deep gutter sucking everything in courtesy the draconian devil called Indian bureaucracy. The fact that the Indian bureaucratic system still runs on archaic British era laws and is guided by Soviet style socialism has squandered six decades when we could have covered a lot of ground.

Firstly, even smaller targets like getting new equipment for labs etc. entails a long process comprising clearing proposals with committees and tender notifications to giving contracts and getting deliveries which take from months to years until the egos of each and every head in between are not satisfied. Often, larger expenditures like setting up a new lab or complex within an institute take eons as it requires the written approval from the concerned department of a central or state government ministry. Secondly, each and every enthusiastic researcher in the state run labs and research institutes barring a handful of premier institutes has to face the ignominy of being a junior in the initial years since future funding and approval and appraisal of thesis directly is in the hands of the senior professors who until and unless themselves get pay hikes or promotions, never allow a ‘junior’ to progress. Thirdly, the overall autonomy of many of these research facilities is only on paper as for any moderate to high expenditure projects, the institute’s management is at the mercy of the whims and fancies of the concerned department which comes under a certain ministry (read ‘politicians and bureaucrats rule the roost’).

However, the Achilles heel of basic science in India is the compartmentalization of higher education wherein, an engineering graduate can never dream of majoring in Organic Chemistry also at the undergraduate or postgraduate level simply because in most cases, the separate discipline is just not available in an institute or it is not possible as per the course structure of the concerned institute. There are colleges which provide either arts or science or commerce degrees and very few universities have quality multidisciplinary course structure available. And once we go to professional course like engineering, management and medicine, they only make you to cram up books and books in one particular field. Interdisciplinary study and research (an entire article on this will follow soon on my blog) simply is non-existent in India. Imagine a mathematics graduate simultaneously graduating in biology as well!!

Well, in essence, we can be sure of not producing the next generation of the likes of Ramanujan (mathematician), Sir CV Raman (Nobel laureate in Physics), Satyendranath Bose, Sir Jagdish Chandra Bose (inventor of crescograph), Dr. Hargobind Khurana (studied in India and then did research in USA) and Dr. Subramanian Chandrasekhar (Nobel laureate in Physics) until and unless we clear the malaise that is our own creation. It is critical for using the knowledge created within our borders to reap fruits for taking out millions of poor Indians from the Abyss they have been languishing in for generations. By the way, thinking about abyss reminds me of The Abyss, a sci-fi flick directed by James Cameron (director of Titanic and Avatar) who also happens to be the joint world record holder of reaching the maximum depth in the Ocean when he achieved this feat in March this year to reach the bottom of Mariana Trench in his sub Deepsea Challenger. The first time man went was in 1960 when US Navy Lt. Don Walsh and Swiss Oceanographer Jacques Piccard went there in a bathyscaphe called the Trieste.

Corrigendum: In my previous post "The Indian LSD Deficiency Syndrome", the total R&D spend by China last year has been incorrectly mentioned to be around US$110 billion when it actually $140 billion.  

The Indian LSD Deficiency Syndrome

“We choose to go to the moon...” These words are not a part of some motivational sermon but the beginning of an episode in human history that culminated in arguably the greatest feat achieved by mankind. These words are a part of the historic speech delivered on May 25, 1961 by then US President John F Kennedy to a special joint session of the US Congress. It laid the foundation stone of the Apollo Program, the techno-scientific project headed by National Aeronautics and Space Administration (NASA) to put man on the moon. At that time, there was no available technology or planned project on paper to achieve such a target and it was still largely in the realms of science fiction. Those were the heydays of the Cold War and just 4 years ago, in 1957, the Soviet Union had given the Americans the Sputnik shock by sending the first ever man made satellite into space. Quickly followed by Yuri Gagarin’s historic first human flight in space, Americans were left reeling in humiliation and fear of space weapons and technological supremacy by the Soviets.

However, going to the moon was till then still considered a near impossible technological feat. That’s wherein lies the story of the unprecedented efforts put in by a nation and a vast group of humans that surpassed all previous feats achieved in science. Within 8 years, comprising 400,000 people involving scientists, engineers, supervisors, managers, doctors and manufacturing workers, coupled with the greatest burst of technological creativity ever seen in history, “a giant leap for mankind” was achieved when astronaut Neil Armstrong landed on the surface of the moon on July 20, 1969. The project cost over US $25 billion or US $180 billion in today’s dollars, the most for any single project ever. (it was on an average 42% of India’s total GDP in the 1960s). The Apollo Program, till date, stands as the greatest feat in science and technology ever achieved and the only other scientific projects that come close in scope and size are the building of the Panama Canal and the Manhattan Project (the development of the first atomic bomb in the 1940s).

However, the greatest achievement of the Apollo Program, which many experts from different fields believe was not the lunar landings but what happened as a spin off the program. How many of us know that the first integrated circuit, the progenitor of the entire ICT industry which was developed by Texas Instruments was funded by the NASA Apollo Program for use in space based computing applications? (all IT engineers in India must thank NASA) The entire concept of the modern day artificial hearts and cellphones is a spin-off of the Apollo era computers and communication technologies developed by NASA and its associated scientists. A simple technology used in millions of homes on the planet today, the microwave oven is a sacred relic of the space program. Would you believe me if I tell you that even the modern day golf clubs and the rim of our spectacles are all vestiges of the materials research done under the aegis of Apollo and other NASA space programs? And, well, most of this was made possible because of one gigantic project executed within 11 years – the Apollo. However, let me cut short this lethargically slow history lesson and come to the point. From our washrooms to classrooms, from banks to cinema halls and from offices to sports grounds, the technologies that have seamlessly integrated themselves into our quotidian existence is a direct consequence of massive capital and human investments made in R&D. (Research and Development – sorry if I forgot to mention its Indian translation is jugaad”). But as things stand, the country with the single greatest potential to provide the human capital for many coming generations of scientists and researchers, our own “Incredible India” stands languishing in the ‘glorious’ company of Middle Eastern and sub - Saharan African nations when it comes to scientific and technological research and development.

Ever since the dawn of economic liberalisation in India, the Gen X and Gen Y (frankly they sound like the names of human chromosomes that determine the sex of an unborn child) has reaped the fruits of wealth generation with growing incomes, better living standards, better technological adoption in daily life and higher consumption levels (did I mention that the per capita consumption of staple food such as wheat and rice has reduced by nearly 40% in the lower middle and lower classes in the country). Anyways, so how was this incredible India made possible? Surely, through taking a leaf out of the scientific histories of USA, UK and Germany, the three beacons of scientific development in the industrial world and investing heavily in scientific and technological development which would have resulted in better products and services for the majority of the populace. Hell no... We surpassed our peers in the western world and reinvented the word ‘innovation’ itself. We opened our doors to buying foreign technology developed in the industrial world which was then used by our government enterprises and private sector to exploit our scarce natural resources already acquired from the government mostly at dirt cheap rates (read “2G spectrum and coal mines”). The burgeoning middle class, (myself included) blinded by the onslaught of new products and having disposable incomes earned from working mostly in the IT and financial services industries using technologies developed in the west, has happily improved their life standards and wealth while the majority of India (read 800 million poor Indians) bask in the ‘glory’ of Neolithic Age life styles courtesy a complete policy paralysis to unleash indigenously developed technology for the millions languishing in darkness almost literally.

Be it the energy or construction sectors where most of the heavy machinery used is based on technology bought or acquired through royalty from Germany, USA and Japan. Come to consumer based products, form refrigerators to air conditioners, from cars to computers and from thermometers to mobile phones, everything is based on technology developed in a foreign land. Our institutes of higher education especially in the technical domain continue to serve as hubs of “jugaad” with a complete lack of an institutional framework to promote individual’s original research and innovation. Every budding engineer and technical graduate continues to copy everything from computer codes to engineering designs to entire model specifications readily available on the internet. And thanks to a ‘level playing field’ for each one of us (read Indian education system), the consequences are better marks at the cost of a complete lack of a repertoire of technical and scientific knowledge. (thanks to Larry and Sergey, Google hai naa).

Well, let me stop India bashing like the Englishmen and the Australians did on their cricket pitches and take a bird’s eye view of the entire scene. Prime Minister Dr. Manmohan Singh recently stressed on the urgent need to promote R&D in basic sciences especially in the fields of agriculture, energy, materials, healthcare and space. After all, the home grown and developed variety of rice, the Basmati was patented by a US firm and is now available in India at much higher prices courtesy a fledgling system of patent applications, assessment and grant. In fact, till 2005, a product patent regime was not even available in the country. The PM aptly said that we need to invest heavily in R&D in our government and industry R&D facilities but herein comes the good old enemy in the form of economic vagaries. I remember a conversation with the CFO of one of the biggest infrastructure firms in India in Mumbai some months back when he said that until and unless the per capita GDP of the country reaches a certain figure (he did not mention the figure), there is no way we have the capacity to invest heavily in R&D because of lack of capital and adequate funding. He may be right but the conversation ended before I could ask that how come China has been able to gain the second rank globally in the last decade in terms of R&D spend at US $130 billion second only to USA’s $405 billion. We stand at a rather proud 14^th or 15^th globally at $10 billion, complimenting our ranks in most of the games at the Olympics. Except our pharmaceutical industry, which has taken some solid strides in the R&D aspect and come out with newer molecules with increasing frequency, Indian academia and industry continues to bite the dust at the end while others have gone far ahead. While rural India continues to use ploughs used since the 15^th century and fertilisers developed by Indian companies continue to deteriorate the soil fertility in the long run, millions of tonnes of foodgrains gets rotten annually due to lack of adequately equipped food processing and storage facilities. And all this on top of the fact that Indian farmers use expensive seeds developed by foreign firms. And I don’t even want to get started on the use of every single medical diagnostic and drug delivery system developed by firms like GE.      

Coming to the doyen of Indian industry, the IT sector, when was the last time an Indian firm came up with an Indian developed software product (sorry to Infosys but I just remembered Finacle). Most of us are not even aware that we are not a software industry but a software services industry. Anyways, to bring my monologue to a rather light end, I’d use the famous dialogue by one of Hollywood’s most famous drug addicts Dennis Hopper in one of my favourite movies Speed – “Pop quiz hotshot” and ask you - Where did one of the most famous database software products in the world, Oracle, come from?... It was originally conceptualised as part of a project of the CIA in which Oracle founder Larry Ellison worked. And to all Google and Wikipedia aficionados, Bhuvan is there to give you a run for your money. And if you don’t know what I’m blabbering about, I’m not referring to Aamir Khan’s character in the movie Lagaan but India’s indigenously built satellite based 3D mapping application Bhuvan, similar to Google Earth and Wikimapia. And guess who developed it? None of the Indian IT companies sadly but the Indian Space Research Organisation (ISRO).

And please somebody try to unravel the secret behind the title of my article above...