The Indian State Falls Behind, and Indian Businesses Eagerly Take the Lead
When the government fails to provide, the savvy entrepreneur fills the gaps—but not without criticism.
India’s government has long failed to keep up with its own rapid development, leaving rural regions without electricity despite abundant coal reserves. Gautam Adani, an Indian entrepreneur, stepped up to develop the much-needed electrical infrastructure that encourages India’s growth, says a recent New York Times article.
His operation is far from homegrown. His coal mines are based in Indonesia and Australia and his transport ship is Korean-made. His ability to tap into the global market allows him to do what the government can’t, faster and cheaper than it could.
This global approach allowed Adani to circumvent logistical and political barriers within India. The rail system is ill equipped to transport coal, the New York Times reported, and mining requires uprooting protected forest areas and tribal groups, something politicians are hesitant to permit.
But despite the development, local fishermen argue that Adani may have done more harm than good. He has brought in few jobs and is blamed for the depletion of sea life essential to the region's economy.
India’s rural poor may have electricity now, but many remain skeptical that it came at too high a cost.
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Comments
A trend?
I imagine that this will be a growing trend that must be watched closely in the future. Government funds around the world are undoubtedly dwindling and will continue to do so for the foreseeable future. While we can commend the work of private individuals and organizations when they step in to pick up slack from lagging government programs, we are left with a lack of oversight to ensure that resource efficiency and overall benefits are maximized. The invisible hand of private entrepreneurship may, at times, be a heavy one, but perhaps it is better than a nonexistent one? Time will tell, but the private sector will need the kind of vigilant observation and criticism as that embodied in this post to ensure that it can viably substitute for government programs.
Falling Star?
I'm curious about how recent anti-corruption protests are affecting India's economic stability. It appears that the BJP leader, BS Yeddyurappa, has failed to secure the trust of his fellow Indians. Corruption and under the table deals in both the mining industry and telecom scams have resulted in a significant loss of tax revenue. If such political and economic irresponsibility continues on this trajectory, will the people be driven to overthrow the ruling party? How will this impact "The Rising Star" of India's economy? Perhaps the sun is slowly starting to set for one of BRIC's most populous nations.
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