Economic Thoughts of Ambedkar 2017
• Trade in early India was not entirely individualistic. There is enough evidence to show the corporate commercial activity and partnership in Trade were occasional, if not general.
• The trade between India and Judea does not date with Soloman: it enjoys considerable antiquity; mentions of Qphir are to be found long before the time of Soloman in the I Chronicles XXIX, 4, I kings XXII 48, and in Isaiah, XIII 12.
• These Biblical evidences may be supplemented by linguistic evidences, such as the Hebrew word tuki which is but a little changed form of the poetical word Tokei i. e. the Tamil- malayalam language for peacock or the Hebrew word Ahalim or Aholoth — * aloes. * — a corruption of the Tamil-malayalam word, Aghil. [f34]
• Certain of the Tamil poets have beautifully described some of the commercial ports and towns in southern India. One of them says, " The thriving town of Muchiri, where the beautiful large ships of the Yavans,bringing gold, the gold received from ships, in exchange for articles sold, is brought to shore in barges at Muchiri,
Deendayal Upadhyay “I visualize for India a decentralized polity and self-reliant economy with the village as the base. We cannot rely upon superficial Western concepts like individualism, socialism, communism, capitalism and need to be rooted in the timeless traditions of our ancient culture. He was of the view that the Indian intellect was getting suffocated by Western theories and ideologies and consequently there was a big roadblock on the growth and expansion of original Bharatiya thought. 1960s
Humankind, according to Upadhyaya, had four hierarchically organized attributes of body, mind, intellect and soul which corresponded to four universal objectives, kama (desire or satisfaction), artha (wealth), dharma (moral duties) and moksha (total liberation or 'salvation'). While none could be ignored, dharma is the 'basic', and moksha the 'ultimate' objective of humankind and society. He claimed that the problem with both capitalist and socialist ideologies is that they only consider the needs of body and mind, and were hence based on the materialist objectives of desire and wealth
Features of Indian Business Models Relationship, Faith and Goodwill as the Base Family Community Drive Business Generation of funds from own and close sources Dominance of Less Non-corporate Dependence Sector on State Risk-bearing Nature Indian Financial and Business 8 Models
Family Orientation • Age-old , rich and continuous tradition of family business • Predominant proprietorship pattern • Required finance for initial investment raised through family savings, earnings of the family, support from relatives and friends, and borrowings from local financiers using family goodwill and against family assets • Two outstanding features of India’s family business: Tradition of surrendering one’s individuality before the family Attitude of self-denial and dedication • Families provide continuity to business • Family and ethnic ties give competitive advantage • Advantages of division of responsibilities, pooling of talents and sharing of risks Indian Financial and Business 9 Models
Dominance of Non-corporate Sector Share of Unorganized Segment in Net Domestic Product by Economic Activity Industry 2002 - 03 Manufacturing 36.6 Construction 62.8 Trade, hotels and restaurants 74.2 Transport, storage and communication 62.9 Financing, insurance, real estate & business services 39.6 Community, social & personal services 17.3 Net domestic product at factor cost 56.7 Source: Statement 76.3, Statement of National Account Statistics 2005, Central Statistical Organization, Government of India. • Share of non-corporate sector to the Indian economy and business is much higher than other sectors Indian Financial and Business 10 Models
Dominance of Non-corporate Sector • Significant role in providing employment • The non-corporate sector businesses develop on their own without spending on the state Out of the 10.52 million units in the SSI sector, only 4.55% units have outstanding loans with institutional sources 40% of these units function without making use of power • The non-corporate sector continuously produces lakhs of entrepreneurs every year making India one of the largest entrepreneurial nations in the world. Local entrepreneurs have devised business models that suit their conditions and systems • Rests on the larger foundations of Indian ethos and values Indian Financial and Business 11 Models
Generation of Funds • Most of the funds are usually generated by the promoters through savings and close sources of networks • A study of the branded ghee business in Tamil Nadu revealed that in almost all the cases the families provided the entire funds to start businesses • Ladies play an important role in financing: Contribute funds to businesses Market household products Control family earnings to secure commodities necessary for the family • In a few cases, dowries have played the crucial role in the promotion of ventures • Local financiers play a notable role in many centres cont …. Indian Financial and Business 12 Models
cont … . • Businessmen prefer local financiers to banks due to reasons such as convenience, easy availability and lack of rigid formalities and procedures • Businessmen in clusters usually invest most of their surpluses back into the business for expansion and diversification • An analysis by the Economic Times Intelligence Group noted that the Indian companies in the FMCG category ‘seem to be almost thrice as efficient as global heavyweights when it comes to utilization of capital. ’ It showed that for every rupee invested, the Indian companies generated Rs 4/- worth of sales, whereas it as only Rs 1.50/- for multinationals Indian Financial and Business 13 Models
Community Drive • Indian business is society-driven. It is the society that promotes and drives businesses • Community relationships provide certain benefits and cost advantages in business: Trust – communities generate high level of trust due to their close-knit relationships Lower transaction costs – this results in increased efficiency and reduction in costs (division of labour) • The World Bank has acknowledged that the community- based relationships help business to become competitive in the international market • Higher and similar value systems prevail among different business communities across the country Indian Financial and Business 14 Models
Less Dependence on State • Indian economy and business had largely remained a product of the society, until the intervention of the British • Indian mind has always been a self-dependent, and not a state-dependent, one • Post independence, this self-dependent mind led to the large-scale developments in various sectors • The independent attitude of Indians has made them to develop all the facilities that they require on their own initiatives without depending on the state • While the different sectors of businesses grow with the support of the state and institutional mechanisms in developed countries, much of the Indian businesses have grown on their own Indian Financial and Business 15 Models
Risk-bearing Nature • Indian businessmen generally tend to bear all the risks upon themselves • Non-corporate sector: Owners shoulder all the risks Take up all the responsibility for their investments • Proprietorship units: Proprietors take all the risks on their shoulders Partners share the risks • Corporate sector: Dependence of companies on equity markets is generally low, compared to the western countries Indian Financial and Business 16 Models
Sectoral Contribution in Growth 1.Traditional Society, majority of workforce is based on agricultural activities 2.Phase of Industrialisation ruled by manufacturing sector 3.Growth of services sector 18
Facts and Figures 19
Ease of Doing Business 20
Need for Make In India • Difficult business environment : India ranks 134 out of 189 countries in the World Bank’s ease of doing business index in 2014 • Slow growth of manufacturing sector : Share has stagnated at around 15 percent of the GDP. The aim of this campaign is to grow this to a 25% • Need to create jobs : By 2025 will see GDP double. To India will add over 80 million net new job seekers. But only 30 million net new jobs will be created . A focus on labour- intensive sectors in manufacturing will lead to creation of numerous job opportunities. 21
Inception of Make in India • International marketing campaigning slogan coined by the Prime Minister of India • It was a campaign directly coming from the PMO, after winning full majority in the general elections in 2014, the nation was highly ambitious and eagerly waiting for a turnaround • It did not require much of parliamentary approvals, passing any bills in the parliament was easy as the government had full support • It was supported by a series of budgetary allocation in the fiscal years of 2015-16 and 2016-17 22
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