Nano lesson: Pricing should drive production

he presentation of the Tata Nano prototype priced at Rs.1 lakh ($ 2,500) — the cheapest (after adjustment for general price inflation) four-wheel motor car in global history — at the automobile exposition in New Delhi on January 10, is a watershed development which signals the coming of age of Indian industry. To assess this landmark event in its proper perspective, it is pertinent to bear in mind that the cheapest motor car manufactured by the mighty American automobile industry which pioneered the automobile revolution of the 20th century, is priced at $9,995. And even Japan Inc, which pioneered the compact car revolution of the latter half of the last century, can’t manufacture a four-wheel motor car with a sticker price below $6,000.

The successful manufacture of the Nano prototype which has received high-voltage media publicity around the world, opens up a range of possibilities even as it offers several valuable lessons for the over-lionised captains of Indian industry. For one, the successful manufacture of the Nano at the never-before targeted price of Rs.1 lakh has offered the neglected majority in the outbacks of rural India, crippled by high transport costs — a consequence of irrational over-taxation of petrol and diesel — a good chance to engage with the mainstream, fast-track Indian economy. Its low sticker price apart, the Nano also offers unprecedented fuel economy of 20 km per litre of petrol/diesel.

Moreover the rock-bottom priced Nano offers an important lesson in development economics to captains of Indian industry. It graphically demonstrates that with technological and managerial ingenuity, it is indeed possible for India Inc to mine the dormant purchasing power trapped at the bottom of the country’s iniquitous social pyramid, a metaphor coined by business management guru Dr. C.K. Prahalad, who advocated this economic development philosophy in his best-seller Fortune at the Bottom of the Pyramid (2006). Nor is Dr. Prahalad the only individual to advocate this prescription for national development. As editor of the country’s first two business magazines, this writer often argued that in developing countries characterised by low per capita incomes, market economics (i.e. pricing) should determine production costs rather than vice versa. Unfortunately this prescription which is the secret of success of Western economies, was unheeded.

Therefore the most important lesson to be derived from the dramatic arrival of the one-lakh people’s car which has socked it to the global automobile industry, is that the market/pricing should determine production planning and processes in developing countries. In particular it should drive home the message across Indian industry — especially to the country’s pathetic public sector enterprises and utilities — that the good old days of take-it-or-leave-it, cost-plus pricing are over. Indeed the Nano is a huge advertisement for market-driven capitalism and the benefits it confers upon the poor, a fact deliberately ignored by retrograde Soviet-style central planners. No public sector organisation could possibly have produced it.

Petty bourgeois sexual morality outcome

The series of sexual assaults on women across India beginning with the widely publicised new year molestation of two women in Mumbai by a mob of 70-80 lumpens, and the spate of rapes and molestations reported against women tourists in Delhi, Rajasthan, Goa and other parts of the country, is indicative of a rising tide of frustration and rage within contemporary Indian society, which requires intelligent diagnosis and curative prescription. It’s astonishing that in the plethora of editorials, television talk shows and analytical comment in the media following the Mumbai outrage, the root cause of this spreading malaise has not been adequately identified.

Quite clearly the fundamental cause of violence against women in Indian society stems from the unnaturally delayed interaction between the sexes, the norm in working and lower middle classes, including village India. The Islamic and/or conservative mindset of these social classes results in millions of households across the country effectively locking up their daughters and denying them the social freedom and rites of passage into adulthood which are commonplace the world over, particularly in developed western societies.

Coterminously contemporary India also boasts a relatively better educated and growing urban upper middle class which accords girl children social freedoms and right to courtship which are the unquestioned prerogative of male youth across all classes. This arouses anger and resentment among underclass youth against their own regressive social milieu, which is directed at teenage girls and young women of the progressive middle class. Within the bleak mental horizons of poorly educated underclass youth, their brains addled by stereotypes projected by popular Indian cinema, socially confident young women exercising constitutional rights and freedoms are of easy virtue and tolerant of molestation.

Therefore quite clearly the curative prescription for this creeping social malaise is to educate middle, and base of pyramid citizens to ease up on their girl children and allow them reasonable freedoms of normal social interaction with the opposite sex. It is eminently arguable that the youth who assaulted and sexually molested the women on new year’s eve in Mumbai would have been on their best behaviour if they had their own wives or girl friends with them. This is why such incidents of molestation are not reported during public celebrations abroad.

Indian society needs to come to terms with the reality that under the guise of protecting Indian culture, the patriarchy persistently denies the overwhelming majority of the country’s youth the ordinary joys of coming of age and courtship rituals. The creation of artificial men-without-women societies impacts itself heavily upon young men who tend to react violently towards the small minority of girls and women exercising constitutional rights and freedoms. Lay citizens as much as education institutions need to practice sexual equality rather than merely preach it. This is the prerequisite of making the nation’s streets and public spaces safe for India’s women citizens.