People ask me why do I write books when nobody reads them. If you were my student I could tell that it is in the syllabus and make you read it. I can tell you to read chapters 12 and 15 which are very important. But the student would say Chapters 12 and 15 are ok! But which page numbers in the chapters to read.
The second question people ask me is: “what made you think about writing on the unorganised sector?”
Near my house, there is a lady who comes in a TVS 50. She sells all kinds of vegetables, day after day, everyday. I used to wonder, under what category she is classified. I started to probe, spoke to many people, read many books. Finally I chanced upon a book, which categorised her belonging to the unorganised sector. She does a great job and knows the taste of her customers and customer relationship. But she is categorised as unorganised.
I further read the book to find that government is categorised as organised. That highly increased my cholesterol level. I investigated further to understand the nature, various definitions and how many classification were there; found that a large part of them are categorised under unorganised, ‘residual sector.’ These people contribute 45 - 50 per cent of India’s GDP. Many times they are referred to as residuals. How can someone contributing so much to GDP be classified under residual category?
FDI and FII together account for less than 6% of domestic investment...
People everywhere talk about FDI and FII. People say “don’t sneeze , otherwise FII will not come.” FDI & FII put together so far, has not crossed 6 per cent of domestic investment. Domestic investment comes primarily from domestic savings. The average Indian household is responsible for domestic savings and for the growth of our economy. Aggregate savings rate in India comes to 32 - 35 per cent. We are among the highest savings economy in the whole world. Of that household savings constitute 70-80 per cent.
You can’t make women spend!
I was attending a seminar which raised the question: “how to make Indian women spend?” You cannot make them spend. They will only save. There are reasons for this: 85 per cent in India are not employed in large corporates or government enterprises. Only 15 per cent work under government. This 85 per cent has concerns over security and will have to save more in the context of declining joint family.
Education in good schools is very expensive. Fee for LKG is more than fee paid for engineering courses. And loans are not available for paying high KG fees. Women in India are quite obsessed about education. Hence the need for savings. These require almost 25 – 35 per cent of our savings. Our country cannot compromise on these factors.
Everyone talks of reforms at higher levels like corporate reforms, derivative market reforms, FII reforms, MRTP reforms. But corruption at lower level is affecting this sector. Nobody talks about reforms of commercial taxes, food adulteration, Shops and Establishment Act... Corruption is really affecting these sectors. Reforms have not taken place for this unorganised sector.
70 per cent credit for this sector is made available only by the non-banking sector at usurious rates. We should create institutional framework so that adequate finance is available for them. If we are to sustain the growth rate of our economy, we should enable credit availability and curb corruption.
It is only because of this unorganised sector we have food on our table and they work 80 hours a week. This book is my contribution to those working in this sector.