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India has not made real progress: Murthy
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August 12, 2006 17:38 IST
Software icon N R Narayana Murthy, who has often termed Infosys [Get Quote] a shining example of economic reforms initiated in 1991, said economic liberalisation has not touched the poor and makes no sense unless it addressed their basic needs.

"I keep telling my colleague Nandan (Nilekani, CEO of Infosys) that it's funny in this country that we can buy whatever...BMWs...We can have 800 channels on TV...all of that," the chairman and chief mentor of Infosys said.

"But the real progress in India has not taken place simply because the reforms have not touched the poor people," he said at a book release function in Bangalore.

"Unless you address the basic needs of the poorest of the poor, which are decent primary and secondary education, decent health care and decent nutrition...all of this (reforms) makes no sense".

Murthy, one of the most admired business leaders of the country, sought to find fault with authorities for not delicensing primary and secondary education in the country.

"One of the strangest things that I have not understood (and) which I have asked many ministers in the Centre including the Prime Minister - I have received no answer - why we delicensed our industrial sector in 1991. But even today our primary and secondary education is not delicensed".

"If you want to start an English medium school, you have to get permission from the state government. If you want to start a university, you have to get permission from the central government. It makes no sense," he lamented.

"Unless, we completely delicense the primary and secondary education, unless we create an environment where more and more investment get into primary health care, I don't think we can truly claim to have embraced reforms".

Murthy expressed the view that in urban areas, where there is market and competition, government need not participate in the primary and secondary education area. However, in villages the control of schools needed to be handed over to parents' associations.

Pointing to a study that said it takes 89 days to start a business in India, he rued that there are disjointed responsibilities at the government level; no accountability in government and bureaucracy.

Highlighting the positive impact of the economic reforms Murthy said India is showing signs of becoming a powerful market in the world.

"Whoever thought that a private sector bank like ICICI Bank [Get Quote] would overtake SBI [Get Quote] in market capitalisation?"

"Who would have ever thought that people would come to your home to sell phones? Who had ever thought there would be advertisements, saying 'we will be giving 800 TV channels'".

He recalled how three foreign banks declined to grant a Rs 50 lakh loan to Infosys to import computers in 1982, and how a year later the company failed to secure even a telephone connection.

"Whoever thought that you would have (today) banks coming to Infosys and Indian Institute of Management-Bangalore day after day to give loans?"

He said the economic reforms have created a paradigm where the focus has shifted from producers to consumers. "That's the first sign of a powerful market where the consumer is the differentiator," Murthy added.

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