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Azim Premji to Revolutionize Indian Education System – To Open Two Schools Per District

Ankit Agarwal — Mon, 31 Oct 2011 07:50:51 +0000

Talk about Swinging For The Fences! The corporate honchos have often voiced their not-so-positive opinions about the education system in India and how despite consistent improvements, the current education system in India is inadequate for nation’s growth. Mr. Narayana Murthy’s remarks on the quality of IITians is only a few weeks old.

Well, fret not! Azim Premji is setting about on a plan to revolutionize the Indian Education system. Mr. Premji has decided to take matter into his own hands and decided to walk the talk when it comes to developing and nurturing talent in India

Azim Premji foundation (Mr. Premji’s self-funded foundation) plans to start 1,300 schools across the country- two per district – which will be free, impart education in the local language and be affiliated to the state board

The project has an estimated capital outlay of Rs. 9000 crore and the estimated timeline for completion of 1300 schools is by 2025.

A phased-wise approach will see seven schools being opened within the next 1.5 years in Karnataka, Rajasthan, Uttrakhand and Chattisgarh. Audacious plans but Mr. Premji is not just another guy in the park.

The interesting concept here is that the AFP foundation schools are not going to impart free education, the onus is to provide real quality education which can hopefully be replicated by other public and private schools over time.

Train Them Young !!

While a majority of corporate initiatives around education are focused on partnering with technical universities and training young graduates, Mr.Premji plans to cover pre-school to class 12 education in the schools that the APF opens.

Personally speaking, this is a welcome change and a great move. I firmly believe that the education system at the primary and secondary levels needs to improve and if that happens, the quality of talent when it comes to pursuing graduate courses will go up drastically.

The private sector has benefited the education sector to a certain extent but a for-free initiative managed with a private establishment type rigorousness and I think APF could do the nation’s education system a world of good.

One can only hope that Mr. Premji’s plans see execution because the scale of the project can really shake the education system in India from the ground-up and for the better.

One good thing about the initiative here is that, this is not a part of the CSR initiative of Wipro which then could have made me wary of the whole initiative. Mr. Premji intends to use his own funds and further the cause of education in India which makes me believe in the project even more.

What are your thoughts on the Mr. Premji’s ‘two schools a district’ education project. Do you think an education initiative at this scale will be achievable?

How India’s Rich spend & invest their money!

Arun Prabhudesai — Thu, 09 Jun 2011 03:51:00 +0000

As of today, India has record number of Billionaires, second only to India U.S and China according to the Forbes India Rich List – 2011. And the combined wealth of these 55 Indian stands at a whooping USD 246.5 Billion (that is close to 11 Lakh Crore rupees….did I get that calculation right?).

Now, the question is what do they really do with so much of money? Indian Billionaires are not really not known for their philanthropic activities – So whether do these Ultra rich Indians spend their monies?

Crisil Research and Kotak’s Wealth Management arm launched a new report – Top of the Pyramid – that gives you a fair bit of idea on what India’s Rich do with their money.

Overview of India’s Rich

India’s Rich list is rapidly bulging – India is currently estimated to have 62000 households who have net worth of over Rs. 250 Million (25 crore rupees) and these wealthy households are expected to rise to 219,000 in next 5 years!

Wealthy Indian Households by 2015-16

Compared to the wealthy households, the ultra wealthy (the Billionaire club) ones will grow even faster – Their collective wealth will move from 45 trillion rupees currently to over 235 trillion rupees, a big 5-fold jump!

Spending Habits of India’s Rich

If you thought, India’s rich splurge their money on Fancy Ferrari’s & Lamborghini’s, you are wrong – According to the report, the biggest spend that India’s rich do are for customized exclusive vacations – and this is common thing for all (100% of) the Ultra wealthy Indians. The next item which is splurged by most (98%) is expensive watches and third being the jewellery & precious stones (90%).

Surprisingly, very few Indians splurge on expensive cars and automobiles !

Here is another interesting nugget from the report – Many of the rich fear buying goods, or even booking flights and holidays online because of potential credit card fraud. So, many of them tend to use their corporate credit cards rather than their own personal cards.

Investments of India’s Rich

India’s wealthy like Real Estate – Over 37% of all their investments are in Real Estate, while equity makes up for about 33%.

The report also mentions that about 1/5th of the their income goes into increasing their personal wealth, while 28.4% is put back in their business as investment!

Only 6.3% of their wealth goes for Charity or Philanthropic causes!

Indian Billionaires & need of the hour…

guest — Tue, 24 May 2011 06:55:15 +0000

Ratan Tata, the scion and one of the most successful and worthy chairmen of Tata Group was in the news again. This time it was not his calls to Niira Radia or his letter to A Raja but it was his comment on the extravagant lifestyle of Mukesh Ambani, his 27 floors of residence, Antilla, his private airliner and so on.

The precise comment was

“It’s sad Mukesh lives in such opulence ……India needs people to allocate some of their enormous wealth to finding ways of mitigating the hardship that people have”.

That got me thinking and soon I was in deep web of frustration that gave me a headache just because of all the questions and no answers. How much is too much? With personal wealth in billions of dollars what have these businessmen given back to their own country which has made them billionaires? Best business practices probably!

Bill and Melinda Gates and Warren Buffet donated almost half of their wealth to charity how much has Mukesh Ambani donated? Or how much has Ratan Tata himself Donated? The two biggest business houses in India have been acquiring companies, expanding business, multiplying the wealth. To sum it up they have grown multifold in last two decades since Indian economy has been liberated. The very obvious answer is number of jobs they opened up but will they have created organizations without giving out jobs? I guess plenty of jobs are only the by-product.

I am not against their lifestyle. They have all the right to spend money whichever way they wish, after all they have earned it. But the recent case of 2G scam hurts me as an Indian. How easy it is for people with lots of money to influence the whole system. There have been accusations, trials and even detention, but has it changed the way business works? How many organizations that were awarded telecom licenses have retained those? Most of the companies are either sitting pretty with the licenses or have sold majority stake to a multinational.

Himachal Futuristic (HFCL) that sold its license to Bharti, is almost non-existent today whereas Airtel is India’s biggest Telecom operator. Wrong example probably but where is the Telecom regulatory authority of India, what’s the role they have played? Don’t we need to change the rules for the betterment of our country? When we have examples why can’t we make case studies out of it?

I think, I digressed from the topic but more than giving back to nation isn’t it about what we do, we do it ethically and yes keep in mind the common good for all the people. Mukesh Ambani, Ratan Tata, Kumar Manglam Birla, Sunil Bharti Mittal, Shiv Nadar, Azim Premzi, Vijay Mallaya, Narayan Murthy and all the honchos need not give a penny back to India or Indians. What they need is to ensure that the best business practices are implemented ethically across all deals that take place. If corporate lobby acts ethically and responsibly we would not be deploying resources to locate the Swiss bank funds for billions of dollars.

Isn’t it a very small thing to give back to your country?

[This post has been written & contributed by our regular reader Prashant Mishra]

Only 17% thriving in India? [Gallup]

Aseem Rastogi — Sat, 23 Apr 2011 11:47:18 +0000

Are you happy with the way your life is chugging along? Are you happy with your job? Does your city have the basic facilities like hospitals, malls, schools etc.? Can you get all your jobs done easily in this city? How well do you assess your future here?

These are some of the few questions which were posed as part of Gallup Wellbeing Survey to more than 1000 adults over 15 years of age by telephone or through face to face interviews across 124 countries. The results of this survey make for some interesting reading.

People are characterised as thriving if they rate their current lives as 7 or higher on a 1-10 rating scale and also if their lives after five years is rated 8 or higher. Individuals who rate their lives as 4 or below are suffering while the rest are struggling.

Top Thriving Countries in the World

Overall the numbers show a median of around 21% people thriving across the 121 countries participating in the survey. Majority of the people in 19 countries mostly in Europe and the Americas rated themselves as thriving.

This proves that nations which have a high GDP, a high per–capita income and are much more developed have people who are happy enough and thriving. Denmark (72%), Sweden (69%) and Canada (69%) lead the pack among the thriving countries.

Least Thriving Countries in the World

But rest of this world is lagging behind miserably. In 67 countries, less than 25% of the people are thriving. And as you can see in the above table, people in the African continent are the least thriving with no country crossing a thriving percentage of 19%. Large tracts of the continent are still undeveloped and the thriving percentage shows this.

As far as India goes – The survey shows that only 17% in India are actually happy. In our neighbouring country Pakistan, 32% are thriving and happy – which really surprises me given the fact that it is a nation torn by terrorism. On the other hand, superpower-in-the-making China has only 12% people thriving.

Most of the South East Asian countries fare quite badly on the survey, with majority of them coming in the lower half of the ranking. I was also quite surprising to see Hong Kong has only 21% people thriving, which generally is regarded as a well-off place.

So, do you agree with the findings that India has only 17% population thriving ?

[All tables sourced from Gallup]

Inflation impacts Middle Class Consumer severely!

Arun Prabhudesai — Tue, 05 Apr 2011 06:37:53 +0000

Inflation is probably the biggest bottleneck that is facing India and its Economic Future. The high rate of inflation has remained untamed for quite a few months now and it has taken serious toll on Aam Aadmi.

One of the biggest reasons for inflation currently is the higher fuel prices. In last 12 months alone, the fuel prices have gone up by as much as 25 percent – And when fuel prices go up, everything is affected.

ASSOCHAM recently released findings on how Inflation has affected spending of Indians and some of the findings are quite startling.

The survey finds that Middle Class consumers across the country have slashed their spending’s on entertainment, shopping and eating out by 65 per cent to manage their limited monthly budgets. The Middle Income group consumers used to spend about 5000 to 6000 rupees monthly before the high inflation set in – But, now they spend about Rs. 2,800 – nearly 65% cut from earlier.

However on the other hand, High Income group seems to have been least affected – as there is nearly no change in their spending habits. On average HIG was spending about Rs. 20,000 p.m earlier and even now the spending remains the same.

The ASSOCHAM survey was conducted in a period of three months beginning January to March 2011 in major places like Delhi, Mumbai, Kolkata, Chennai, Ahmedabad, Hyderabad, Pune, Chandigarh etc. A little over 500 employee were selected from each city on an average. Delhi ranks first in curtailing their expenses followed by Ahmedabad (2^nd) Chandigarh (3^rd), Mumbai (4^th) and Chennai (5^th).

Here are some of the other findings of ASSOCHAM report

Nearly half (49.5 percent) of MIG either avoid shopping altogether or shop only for those things that are absolutely needed
34 percent said that their shopping has been restricted to only necessities
75 percent of MIG have cut back on everyday expenses by packing their lunch, car-pooling, cutting down on gas and electricity use.
69 percent of MIG have revealed decreased spending on eating out.
55 percent reported decrease in the amount they spend on clothing.
54 percent indicated fall in the amount they spend on vacations.
49 percent plan have decreased the amount they spend on home appliances; 44 percent for home and personal electronics; 42 percent for automobiles; and 35 percent for real estate.

The biggest thought that comes to my mind after seeing these survey findings – If middle class people are suffering so much due to Inflation, what about poor and BPL citizens. Imagine the hardships they must be going through just to ensure that their family is fed 2 times a day.

More the country’s average IQ, more is the GDP!

Aseem Rastogi — Tue, 22 Mar 2011 14:39:29 +0000

Intelligence quotient (IQ) involves a series of tests to predict a person’s intelligence. The tests include a mix of observations, analytical, quantitative and qualitative questions which judge his / her ability to react to situations. And the higher the IQ of a person, the more he / she is regarded as having done something great or being a part of an esteemed society of people. But since intelligence is something which doesn’t have one particular definition, many people are of the view that it comes only by solving real problems in the world out there. Don’t know how many people are listening to that though.

To prove the importance of IQ for a nation’s economy and productivity, Chemnitz University of Technology recently conducted a study of more than 90 countries and tried to find the link between intelligence and the growth of the economy. The contribution to science in these countries in terms of research, number of patents, universities etc. was found out too as one of the ways to judge intelligence.

Some interesting results were thrown up. It has been found that the country’s IQ is directly related to its economic productivity and development. For each point increase in the IQ, the per capita GDP of the nation increases by US $229.

The increase is even higher when it came to smartest people of the country. If even 5% of them get more smarter, the per capita GDP increases by US $468. Interestingly, the question here is on what defines smartness. Is it the number of patents a scientist gets? Is it the number of scientists in a country? Is it the number of research papers presented? Is it the number of entrepreneurs in a country?

This is a debatable topic for a lot of people. But the results show the increasing importance being given today to human capital and cognitive ability by economists all across the spectrum. Today though government which doesn’t interfere in the functioning of a country is important, what is more important is an innovative, clear thinking and strong headed workforce; A workforce which can lead the nation to greatness with its productivity and hard work.

So how much are you adding to your country’s GDP using your IQ ? :)

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Mukesh Ambani dethroned from Richest Indian Tag… 7 Indians in Forbes Top 100 Billionaires List!

Viral Dholakia — Thu, 10 Mar 2011 11:33:00 +0000

While the NRI industrialist Lakshmi Mittal has been ranked as 44^th most powerful person on the globe by the Forbes magazine; what really stands out is his emergence as the world’s richest Indian with a net worth of $31.1 billion powered by recovery in steel demand and higher margins at ArcelorMittal.

While topping the charts for India, the steel-baron has successfully toppled Reliance’s Mukesh Ambani who enjoyed the coveted most richest Indian tag for three years in a row. In fact, Mukesh Ambani has seen a slight de-growth in his wealth to $27 billion, down from $29 billion a year ago.

India’s Billionaire Club

While LN Mittal ranked 6^th amongst the world’s top billionaires, Mukesh Ambani came in at 9^th on the global podium. The elder Ambani sibling was ranked 4th last year.

Microsoft founder Bill Gates and Berkshire Hathaway chief Warren Buffet, both of whom are currently pursuing active role in philanthropic activities, turned up the heat at 2^nd and 3^rd spot in the Forbe’s billionaire club.

Surprisingly, Carlos Slim Helu & family, the Mexican telecom mogul, has managed to cling on to the numero uno position for the second consecutive year with a net worth of $74 billion, up from $53.5 billion last year. His overall wealth has more than doubled from $35 billion a couple of years back.

At 36^th ranking in the billionaire list, Wipro’s founder Azim Premji has witnessed a setback from 28^th rank last year, with his net worth remaining almost stagnant at $16.8 billion this year.

The Ruia brothers of Essar Group – Shashi and Ravi Ruia – with interests across steel, power and telecom businesses have clocked a net worth of $15.8 billion to be ranked 42^nd amongst the Richie-rich list of billionaires. Gautam Adani of diversified Adani Group came at a distant 81^st rank, followed by Kumar Birla at 97^th spot.

One bad news for Anil Ambani fans! The wealth of this ADAG-honcho has witnessed sharp erosion from $13.7 billion during previous year (36^th rank) to $8.8 billion this year, failing to figure even in the top 100 billionaire’s list of Forbes. Its a fall!

At best, Indians can just hope that Mukesh Ambani will make to the world’s Top 5 billionaire list next year. That will ensure enhanced visibility for India on the global stage; of course, over and above the glory that the nation is witnessing right now.

Any special comments on India’s billionaire club?

Philanthropy – Why Indians lag behind?

Viral Dholakia — Wed, 12 Jan 2011 07:19:03 +0000

Though it is no where in the writing; a humble belief – for individuals and corporate both – is that more you give, the more you get (the rule of reciprocity). That’s being alive!

In the corporate world, this conscience is better known as Corporate Social Responsibility (CSR) – having responsibility for some aspect of corporate philanthropy – in a bid to make this world a better place for living and being convinced that communities need corporate support and partnerships for social initiatives to make that happen.

In India, the business tycoons have huge appetites for lavish lifestyle spending; but little to show when it comes to community development goals that were perceived as separate from business objectives, until now.

However, things are gradually changing on the organizational front as they realize that cutting-edge innovation and corporate well-being can result from weaving social and environmental considerations into the business strategy from the very beginning – be it in the form of charities along the lines of corporate resource contribution, public safety initiatives, health benefits programs or going green environmentally.

So, what has kept the tycoons of India a laggard when it comes to committing their fortunes to charity, along the lines of Bill Gates and Warren Buffet – who have given more than $28-billion to their foundation and have pledged to give a significant portion of their remaining wealth to good causes?

Going back into pre-liberalization era a decade ago, India’s true potential was still unrealized, and the growth of the Corporate India was fragile and future potential largely restricted to domestic operations. Under such economic scenario, Indians had little motivation to feel charitable, as they were already pre-occupied with holding out money for the rainy days, fraught with the era of license-raj.

Furthermore, this also reminds me of how I was preached in my childhood to maintain a piggy-bank and inculcate the habit of savings in form of contributing a coin into the kitty on a daily basis. This very aspect has ensured that we Indians could sail through the recent global recession through high savings rate.

However, along with this boon of saving religiously also came the sense of financial security (or rather insecurity) that limited our mental approach towards philanthropic activities. Though good deeds were initiated in the form of small donations to temples or offering help to poor housemaids or less privileged ones at local level; the cause of charity never reached a scale that formed a majority chunk of one’s personal income.

This does not mean to say that Indian corporate entities do not undertake corporate social responsibility. We already have older firms like Tatas and Birlas and many others imbibing the case of social good in the form of public hospitals, education institutions and other social causes.

But, CSR and Philanthropy activities are still at a very nascent stage in India and needs to grow by leaps and bounds until a substantial goal of alleviating poverty; and giving back the society as much as is acquired from it is achieved.

your views ?

Tatas Donate Rs. 220 crore to the Harvard… Justified?

Viral Dholakia — Sat, 16 Oct 2010 10:14:31 +0000

This morning my eyes popped with disbelief when I read the news of the Tata Group donating a whooping $50 million to America’s Harvard Business School (HBS). This is by far the largest gift ever from a non-US donor to this prestigious school. The very next moment this unusual thought struck me, “Harvard ko Rs.220 crore aur India ko kela?”

Naturally, the above thought came to me as an Indian first. Well, before I write anything against the said donation; the Tata Group – which is involved in most of the business lines ranging from tea to telephone and from cars to hotels – is widely respected for its integrity, benevolence and social cause in India and abroad both. No taking away from the same.

But, I am sure IIT or probably other similar institutes in India could have as well used that money, if given a chance. There is no dearth of top category B-schools in India waiting to get a makeover, aided by such huge sums of freebies. Are Indian institutes saturated for their funding requirements? Or for that matter even increasing the capacity of the existing schools – in an era, when procuring education for a child has become an increasingly expensive affair?

Are you sure that the charity begins at home?? What if your Alma mater is situated abroad – Will you donate overseas or choose to support an institution closer to you at home?

In India, there are number of industry titans that are alumnus of the HBS including Ratan Tata himself. More recently, another well-known industrialist, Anand Mahindra, had donated $10 million to the Harvard’s Humanities Centre – which would help in the task of bringing in a critical and humane concerns into the core values that enlighten the world of business.

Further, in past, even the Murthy family had donated a generous $5.2 million to Harvard to establish a new publication series, the Murthy Classical Library of India, in dual language which aims to serve the needs of general reading public and to enhance scholarship in the field.

In this case, the Tatas will fund a new academic and residential building on the HBS campus for participants in the School’s broad portfolio of Executive Education programmes. Thus, in all the above case, the nature of funding to the HBS university has been under different causes – but has done little to serve the purpose of Indian students directly back home.

Well, detractors might argue that aren’t we forward looking for the donations that come in from those rich people situated abroad? Yes! Rightly so, but, It’s a different proposition when the likes of Bill Gates and Warren Buffet donate their money towards poor nations.

But, for Indian rich people gifting money in favour of well-to-do foreign universities sounds more like a philanthropy – at a time, when millions of children back home are still uneducated and struggling to get a seat in the under-capacitated Indian education system.

No doubt, India is a self-sustaining growth story; but the spread of growth is still not inclusive. India need trillions of dollars to uplift the poor and provide them with the basic healthcare, education, potable drinking water and an infrastructure that could aid in a speedy growth. We have a lots more battle to be fought on our own pitch yet.

Lastly, donation is completely a personal choice and positive gesture. Just that the big honchos need to keep in mind that India has little to boast in terms of world class educational institutions – in which an ordinary middle-class family’s student can fulfil his dreams.

When will Indians learn to donate in India itself? Can’t we make IIMs better than Harvard?