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Promoting foreign investment

Published : Jun 17, 2005 00:00 IST

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Making available an objective assessment of the ground situation with regard to public peace and encouraging the private sector to play a role in raising the standards of law enforcement are among important ways to attract foreign investment in India.

THE recent explosions in two Delhi cinemas have again pushed up the fear of crime and disorder among the capital's citizens. Coming close on the heels of a college student's rape, there is a general feeling of insecurity here that will stay for a while. It will require a lot of hard work from Commissioner K.K. Paul and his deputies before they can restore public confidence in a police force that has many achievements under its belt, alongside a few failures in the past that had tarnished its image. The two incidents will definitely receive considerable international attention, especially from those who are eyeing India for investment. The rape of a young girl in broad daylight a few weeks ago by a Mumbai policeman on Marine Drive belongs to the same category. It will not be music to the ears of foreign entrepreneurs enamoured of India, at a time when things are really looking up for our country.

In my present role in the Information Technology industry, I labour to explain to many of my counterparts abroad, particularly those from the United States that a rape here or a murder there should not deter the average investor who wants to park funds in India. I remember telling a friend in an American bank that the naxalite problem in Telengana in Andhra Pradesh was no reflection of the state of order in Hyderabad city. Nor did a Veerappan's doings in the forests adjoining Karnataka speak poorly of safety levels in Bangalore. The same way I told my friend that things in Chennai were so stable that there ought not to be concerns at all about personnel safety or plant safety. Kolkata was similarly advantageously placed, despite a distinctly negative past. As a patriotic Indian, I do a hard-sell to promote India from the public order point of view among those who view India as a good destination for business collaboration. I know it is easier to sell the southern States more than some parts of the northern and the northeastern States, because of the relative peace and greater political stability that prevails in the south. Nevertheless, as a whole, if you ignore the Lalu Prasads and the Narendra Modis, there is so much positive about India now that it has become a favourite destination for many who have funds to plough into industry.

Talking of political stability - something that is intertwined with issues of public order - there is often concern abroad about the dependence of the Manmohan Singh government on the Left. I tell my friends that their worry could not be dismissed as something of a psychosis that afflicts many in the West, and particularly the U.S. But then I also tell them that the Left has a huge stake in the longevity of the present government, given their antipathy to anything that smacks of communalism, and the fact that the only political alternative now is a Bharatiya Janata Party-led or supported coalition of parties. I add that the Left will, no doubt, slow down economic reform and also take the government to the brink of collapse at periodic intervals without, however, actually breaking up the coalition. My assessment is that it is better to have the Left in a broad pro-government coalition than in the Opposition where it could pose many more problems, including periodic street-level agitations, which would disturb public order and peace. This analysis seems to carry conviction with many of my captive listeners, most of whom continue to be drawn to India despite their misgiving whenever the communists threaten to reconsider support to the United Progressive Alliance or when a rape takes place in one of our metropolises. A lot of us, genuinely worried whether there will be a continued flow of investments into India, are, therefore, smug. Notwithstanding certain negative features, there is nothing so alarming about the current polity that will deter the foreign entrepreneur from keeping India as the most agreeable option.

I MAY sound euphoric. I must, however, confess that I am not at all happy about two features of the Indian scene. First, I am not very sure whether there exists any system inside government, especially our embassies abroad, whereby an objective assessment of the ground situation with regard to public peace is made available to those who contemplate coming into India to set up businesses or collaborate with local companies. Such an assessment that is available either on the Net or in the form of pamphlets is absolutely essential if we want to see more and more funds coming in. To carry credibility, the assessment that I visualise should be accurate and up-to-date. Its language should be strikingly direct. There is no scope here for obfuscation or half-truths that will be too obvious to even those not familiar with India. The Union Home Ministry, assisted by the Intelligence Bureau, can undertake this simple exercise and send a monthly note on the law and order situation in different parts of India to all our embassies, for being shared with prospective investors. In the absence of such an analysis, investors currently make do with press reports that are not always balanced, even when they are not alarmist or sensational. I am aware at the same time that government handouts are often suspect. The report that I am suggesting here will, therefore, have to be extremely carefully prepared, with the highest concern for transparency and readability.

This approach to giving a clear picture of contemporary India will not only bring in more investments but more tourists as well. I still recall how a major international conference on environmental crime slated to be held in Hyderabad a few years ago was called off at the last minute, following some disturbances in some parts of the north that triggered an unintelligent advisory from the American Embassy in New Delhi. While a few were willing to come ignoring the advisory, a majority were too scared to make the trip. It was too late for the organisers and well-wishers of the conference to do any damage control. I discussed this much later with some friends in the teaching community who were to come. They were not only disappointed but were scandalised when I told them that the area affected by some terrorist incidents at the time of the conference was nearly as far from Hyderabad as Los Angeles was from New York.

Misinformation and misconceptions are the order of the day in many parts of the world, and it is in our own interest that the Government of India takes the initiative in a crucial area of communication. Depending purely on the media to do this on behalf of government could prove disadvantageous. Neither will risk analysis reports of many leading agencies convey the real picture because they do not have facts or the expertise to comprehend trends in law and order.

A SECOND dismaying feature of the Indian scene is the private sector's apathy to the issue of raising standards of law enforcement. There is rarely evidence of an effort to understand what policing is all about. Many corporations are content with hiring a security agency and entrusting all related work to it with few questions being asked. All contacts with the local police are through such an agency or are left to the lower echelons in a corporation. Unless there is a massive crisis that brings daily production in a manufacturing plant to a halt, the higher echelons would seldom make an effort to establish contact with the police brass. There is little realisation among captains of industry that industrial progress is directly proportional to peace in society and generally to investors' perception of community safety and police effectiveness.

It is the belief in many parts of the world that business has a high stake in the quality of policing. This is why we find many projects being conducted there to make policing sharper. Launched at the initiative of business, these aim at fusing police efforts with industry and community needs. The history of New York Police chronicles the contribution of a small group of private citizens who were provoked by high levels of corruption and politicisation in the department in the late 19th century and who came together to bringing about systemic changes in police administration that drastically changed police image.

Current efforts of the private sector in some countries focus on further professionalisation of police work in the areas of computerisation of police routine and scientific methods of investigation. There are some, which introduce elements of community participation in policing. This is especially true of the U.S. In India, unfortunately, all private endeavour generally stops with constructing a police station building or donating a traffic sign or umbrella. There is little realisation that with more liberal government funding for modernisation, police forces do not any longer need material support, as much as they did in the past. What they want are private initiatives to altering community attitudes to policing and influencing large segments of the population to actively participate in police chores such as traffic regulation and crime prevention. Also required are schemes to expose policemen to modern principles of management so that they bring a professional approach to customer management. Efforts to make the big names in the country's large industrial houses interest themselves in problems of policing have been of little avail. This is sad.

A FEW words here about police reforms in India, as outlined in the National Police Commission (NPC) reports. Some major recommendations, which aim at greater operational freedom to the police - without in any way diluting their accountability - are gathering dust in government racks. My strong belief is that governments will be willing to have a look at them if only captains of industry can go on a delegation to the Prime Minister and select Chief Ministers and convince them that these are basic reforms required to professionalise police work, a prime requisite for fostering industrial growth and generally preserving peace in society. They should plug the line, that if implemented, NPC recommendations will certainly enhance investor confidence in India as a territory where they can do business without fear of violence and disorder.

Business leaders enjoy enormous clout vis-a-vis government in the post-liberalisation era. They are consulted by the government from time to time on a variety of matters affecting business and industry. This dialogue becomes especially strong on the eve of the annual Budget.

My point is that captains of industry now have an equation with government that can be put to good use in strengthening policing in the country. Unfortunately, several efforts to bring business leaders under one roof so as to brief them on the NPC have so far failed. This is tragic. As a result of the failure of this first move, further initiatives to use them in the cause of the police have not taken off the ground.

We have legends among former policemen who are still active in community service. I have in mind the likes of Julius Ribeiro. It is to them we look up for support to marshalling the brains in private industry for strengthening police professionalism and triggering vibrant police-business connections. Such a nexus will not only enlarge law enforcement resources but will help to launch new initiatives in policing the community. Once we establish this strong partnership, we can confidently tell foreign entrepreneurs that they can set up businesses in India without the fear of crime and disorder.

(This story was published in the print edition of Frontline magazine dated Jun 17, 2005.)

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