In your experience, how easy is it to break into the international market in power equipment business? It all depends on how you set it up. Here the state plays a vital role because the grid (by nature) is owned by the state. It has to provide a level-playing field. In my own country, you can’t come up with riders that if you are bringing in new technology, it should have been working elsewhere. I have only been in this business for 15 years. However, now we can’t have such conditions as there is a lot of awareness here.
One can’t avoid a China comparison. Like Indian companies, they too are low cost. But they are far ahead in innovation and technology. Where do you see the real difference? The Chinese companies that we talk about are all state-owned. Fortunately or unfortunately, the most innovative companies in India are privately owned. In that regard, you are hamstrung by the fact that resources are not unlimited. I know people talk about China’s infrastructure, but one thing that China has done far better than us is cashing in on soft infrastructure — particularly their education system. Their system is far ahead of us. In India, the concept of research does not exist. There is too much regulation — why is an MBA in India a two-year programme? In fact, we have a system that does not draw out the best.
Are Indian banks beginning to take more risks on their lending to corporates? Where else are the big Indian banks going to lend? Where else will they know that for the next 30 to 40 years they will be building infrastructure? Will they park their money with RBI? The answer to this is a big no. It is a fact that no project is going to come to you with all risks covered. From the cost point of view, it is easier for the management of a bank to take a decision on lending larger chunks of money than to lend to a lower level. It is far easier to do a credit appraisal of a company with a good track record than of a person who has a dream and wants to make it a reality. Here I think the system needs to change. Even this kind of entrepreneurship should be rewarded. There is nothing wrong with failure. Failure is a good indicator of a person’s ability to succeed later on. Failure is a pre-requisite for success. In India, we penalise failures.
Do you see India forging ahead in the manufacturing sector, especially given the crash in demand in developed economies? In the manufacturing sector, I think we are very competitive. But I also believe that we don’t have the right policies. Do we have something like say the Indian Service Industry Act? But we do have something like the Indian Factories Act…
...that says you can’t do this and that. That’s right. why would I like to get into manufacturing if I read that? A modern economy is not only about 8 per cent growth and going in a particular direction. In other countries, you feel welcomed. Recently, we decided to expand our transmission facility in the US. In a recession hit economy, we pumped in about $10-15 million in these facilities. In the US, we have low and medium voltage transformer facilities, while in Canada we have high-voltage facilities. In order to show support for our business initiative that would lead to creating 140 new jobs, the state senator showed up along with other municipal leaders and even announced a bond issue in our support.
(This story was published in Businessworld Issue Dated 31-05-2010)
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It all depends on how you set it up. Here the state plays a vital role because the grid (by nature) is owned by the state. It has to provide a level-playing field. In my own country, you can’t come up with riders that if you are bringing in new technology, it should have been working elsewhere. I have only been in this business for 15 years. However, now we can’t have such conditions as there is a lot of awareness here.
One can’t avoid a China comparison. Like Indian companies, they too are low cost. But they are far ahead in innovation and technology. Where do you see the real difference?
The Chinese companies that we talk about are all state-owned. Fortunately or unfortunately, the most innovative companies in India are privately owned. In that regard, you are hamstrung by the fact that resources are not unlimited. I know people talk about China’s infrastructure, but one thing that China has done far better than us is cashing in on soft infrastructure — particularly their education system. Their system is far ahead of us. In India, the concept of research does not exist. There is too much regulation — why is an MBA in India a two-year programme? In fact, we have a system that does not draw out the best.
Are Indian banks beginning to take more risks on their lending to corporates? Where else are the big Indian banks going to lend? Where else will they know that for the next 30 to 40 years they will be building infrastructure? Will they park their money with RBI?
Do you see India forging ahead in the manufacturing sector, especially given the crash in demand in developed economies?
In the manufacturing sector, I think we are very competitive. But I also believe that we don’t have the right policies. Do we have something like say the Indian Service Industry Act? But we do have something like the Indian Factories Act…
...that says you can’t do this and that.
That’s right. why would I like to get into manufacturing if I read that? A modern economy is not only about 8 per cent growth and going in a particular direction. In other countries, you feel welcomed. Recently, we decided to expand our transmission facility in the US. In a recession hit economy, we pumped in about $10-15 million in these facilities. In the US, we have low and medium voltage transformer facilities, while in Canada we have high-voltage facilities. In order to show support for our business initiative that would lead to creating 140 new jobs, the state senator showed up along with other municipal leaders and even announced a bond issue in our support.