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The Gospel Of Saintly Capital

The virtues of compassionate capitalism can go a long way in solving problems that have plagued India

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The Gospel Of Saintly Capital
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These questions have been troubling me right from that day when I spent a lonely, hungry, cold and introspective 21 hours in the guard’s compartment on a freight train going from the historic city of Nis, in what was then Yugoslavia and is now Serbia, to Istanbul, way back in 1974. I have had some success in demonstrating the power of entrepreneurship in solving the problem of poverty through my experiment of creating Infosys. Yet, when I look at the big canvas of India, I often feel confused, agitated and powerless—but also motivated to find solutions to this problem.

It was pretty early in my deep introspection into the phenomenon of equitable economic progress in developing countries that I was fortunate to read three seminal books that have influenced my thinking deeply. They are: The Protestant Ethic and the Spirit of Capitalism by Max Weber; My Experiments with Truth by Mahatma Gandhi; and Peau Noire, Masques Blancs (Black Skin, White Masks) by Franz Fanon. In many ways, my entire philosophy of economic development is based on these three wonderful books. Many of my speeches are based on the lessons I have learned from them. Max Weber’s book is a complex one. His thesis is about the importance of good values—hard work, honesty, austerity—and focus on entrepreneurship in bettering the life of an individual and society. While it appears very elementary today, it was not so for me in the early 1970s. I had been brought up in an environment of hard work and good values. In my naivete, I had assumed that all societies and nations were similar and did not include these factors in my analysis of why India was different from France. Therefore, Max Weber laid the foundation for my belief that decent and hard-working people with high aspirations make great nations, no matter what the odds are. This was the first piece of the development puzzle for me.

Mahatma Gandhi opened my eyes to the importance of good leadership in raising the aspirations of people, making them accept sacrifices to achieve a grand vision, and most importantly, in converting that vision into reality. Gandhi realised that trust in leaders is extremely important if the followers have to commit to sacrifices. He unleashed the most powerful instrument for gaining trust—leadership by example. He ate, dressed, travelled and lived like the poor. Maintaining Gandhi’s simple style did pose lots of logistics and security problems. In one of her lighter moments, Sarojini Naidu, his compatriot in the freedom struggle, is reported to have said that it took a fortune to keep Gandhi in poverty. But walking the talk was extremely important to the Mahatma who understood the pulse of our people like no other Indian leader. The biggest lesson for me from Gandhi’s book and life is the importance of leading by example. I realised fairly early that this was the second piece of the development puzzle.

I thought I understood the power of Weberian and Gandhian philosophies in the economic development of nations and societies. I had seen good values and good leadership, at least among the early group of our politicians and bureaucrats. However, I continued to be puzzled why my country was not making the kind of progress that seemed so natural. This is where Franz Fanon’s book came in handy. His seminal book on the coloniser mindset of elites in a postcolonial society opened my eyes to the role of the bureaucracy and the elite in decelerating the progress of the poor and the disenfranchised. The colonial mindset of the ‘dark elite in white masks’ in a postcolonial society—the mindset that the ruled and the rulers have different sets of rights and responsibilities with a huge asymmetry in favour of the rulers—was indeed the third piece of the development puzzle. I see this attitude of the Indian elite every day in how they send their children to English medium schools while forcing the children of the poor into vernacular schools, extol the virtues of poverty while living in luxury, and glorify the rural life while they sit comfortably in cities.

Perhaps many readers may be surprised that the traditional ingredients of capital, material resources, technology and talent do not appear as pieces in this puzzle. I do accept that these four are important for economic progress. However, I rate these ingredients below the three I have listed earlier for two simple reasons; first, right from my primary school days, I have been taught that India has abundant material resources and developable talent. Second, I have seen many examples of countries, without one or more of these ingredients, design solutions to acquire them in plenty. Japan and Switzerland import vast amounts of material resources and produce world-class technology and other goods for export. Countries like China attract huge capital. In the recent past, India has designed appropriate policies to scale up foreign direct investment and portfolio investment several-fold. We have done pretty well in certain areas of technology. Open any newspaper or magazine, and you will see articles on how countries like China, Singapore and South Korea have been able to move up the global rankings in advanced talent development. I am convinced that visionary leadership in India can easily overcome the shortage of capital, material resources, technology and talent.

When I returned to India in the mid-1970s, I was determined to conduct an experiment to demonstrate some of these beliefs of mine. I was toying with the idea of joining a political party and had even discussed this with my then friend and later my wife—Sudha. While Sudha was sympathetic to my idea, many others in my inner circle—friends as well as relatives—were, perhaps, not equally enthusiastic. I realised pretty quickly that I had to first validate some of my beliefs on a smaller canvas. That is when I decided to test the power of entrepreneurship in solving the problem of poverty in India.

Excerpted from A Better India: A Better World by N. R. Narayana Murthy; Allen Lane (Penguin India), Rs 499

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