India’s corporate sector, which is the engine of growth, is in need of serious reforms. Embedding the concept of shared value is the way forward
The present Government's strategy to completely transform the corporate sector into a robust industry in a way that it becomes an alternative vehicle for generating more employment and also contributes towards the growth and development of the country, has been praiseworthy.
Prime Minister Narendra Modi has on numerous occasions acknowledged, in uncertain terms, the need to strengthen the corporate sector, without which the country's progress is not possible. The Government cannot do this alone. The Prime Minister is, hence, determined to provide the corporate a hassle-free environment, without bureaucratic red-tape and political manipulations. His efforts are bearing fruit too — India’s rank on the scale of ‘Ease of Doing Business’ showed a massive jump this year.
However, the corporate sector has often been perceived as a conglomerate of selfish, exploitative, super-rich idlers prospering at the expense of the broader community. The unfortunate fact is that there is a grain of truth in this characterization. There were large-scale scams, like the Adarsh housing society scam, the coal scam and the Delhi airport scam, that mired the reputation of the UPA Government. There were many rogue elements who used the corporate sector in a quid pro quo relationship for vested interests. This led to financial frauds, tax evasions and underperformance. This needs to change. But that is a task easier said than done and will take time. In spite of all good intentions and hard work, malicious propaganda by political adversaries and public ignorance is contributing more to this perception.
First and foremost, explicit and unambiguous rules must be set not just for the Government officials but also for the private sector. A conducive environment is what is needed so that they can work more efficiently, transparently and in a time-bound manner.
Second, an exponential increase in the banks’ Non Performing Assets is a big hurdle which results in reluctance on the part of the banks to give loans. However, with result-oriented working, timely deliveries, and transparent and unambiguous rules, the banks too can provide a helping hand.
Third and the most important prerequisite is the creation of a functional infrastructure, which includes construction of roads, continuous supply of electricity and raw material and large telecommunications facility, which has always been a big impediment in a country like India.
Fourth, is the availability of skilled work-force. There are a number of unemployed graduates who have been looking for jobs but are unemployable as they lack the required skilled and are unsuitable for the job. The Modi Government keeps talking about skill development, but so far, it has not been able to prepare a concrete road-map to skill India’s youth. Our policy-makers are working overtime to open skill coaching centers for them and are giving incentives to institutions that offer these courses.
In many foreign countries, like in Germany, those students who do not want to pursue academics, often opt for skill-learning courses, which gives them employment in related industries without a graduation degree. The Government can make provisions like these mandatory for every industry where they can pick young people at the school level, train them as per their requirement and then absorb them.
As the situation exists today, partially literate masons, plumbers and electricians are earning much more than graduates, who are toiling hard to get jobs. This is due to the malady of the middle classes, where even today, working with hands is still considered to be below dignity. White collar jobs are considered to be more respectable. Unfortunately, such jobs are very few.
It would be relevant at this stage to talk of a modern business model termed as ‘concept of shared value' for sustainable growth in the competitive capitalistic market. It already has many takers. Basically, it propagates that there is a synergistic relationship between the producers and the consumers; between employers and the employees so that social and economic development goes hand-in-hand. It is different from philanthropy as it aims to create a situation where an employee perceives growth of the company as his own growth, and is confident of being rewarded suitably.
(The writer is a freelance commentator)