A piece of news that I read recently about Taiwan, itself a world leader in semiconductor manufacturing, deciding to invest in a Lithuanian manufacturer, and another news about Norway’s sovereign wealth fund’s exposure to some of the Adani Group companies prompted me to write this over the weekend.
Often, my mind brings up some striking parallels and contrasts between Punjab and with different parts of the world and our states. We are, after all, all humans – and yet, I find it important to ponder over how some societies have managed to progress better compared to others.
This does not mean that other parts of the world do not have problems of their own – but at least the advanced economies are not still solving the same ones they had 75 years ago.
One measure of a society’s progress is the variety, complexity, and types of organisations they create, and how well they collaborate with one-another at a large scale for solving their own problems first, and then attempting to contribute something unique and useful to the wider world.
What should have been:
What is our aspiration for Punjab? As a minimum, we would want most infrastructure, goods, and services requirements for Punjab to be fulfilled by companies owned, operated, staffed, and tax-resident in Punjab.
If Punjab was once a major wheat producer, has it now progressed to more value added products that could use its past strength in agriculture? Say, world-class baked goods corporations selling their products domestically within Punjab, while also bringing in revenues from exports?
In the same period since Punjab’s partition in 1947, The Netherlands, with a similar land area and population as Punjab, rose from the ashes of the Second World War to became the second largest food producer in the world, and a major innovation hub of agricultural technology.
A healthy domestic industry does NOT preclude benefitting from a healthy mix of foreign capital, labour, and talent where needed, in the same way that English, Swiss, Scottish, Dutch, Scandinavian, or other advanced economies have benefitted from these, according to their local needs.
But the core of Punjab’s infrastructure and industry needed to have grown organically, from the ground up, owned by local stakeholders, paying local corporation taxes within Punjab, with demonstrable attachment to Punjab’s past and a stake in its future – “Skin in the game”, as Nassim Nicholas Taleb puts it.
What actually happens:
• East India Company (EIC) practically scavenges Punjab and its resources – of course, I use the EIC reference figuratively, to illustrate the phenomenon of “extractive institutions”, which can be thought of as exploitative wealth-extraction institutions with little accountability, ownership, or roots in a local culture or community. The prevalence of such extractive institutions has a direct historic correlation with economic and later social declines of societies.
• There is a perception of net outflow of capital from Punjab. By capital I mean not just monetary wealth, but overall wealth with dimensions such as economic, human, cultural, spiritual, ethical, and natural resources. One can argue ad-infinitum on statistics and numbers, but these are observable phenomena that alarm many for good reason.
• International investment looking for “growth” , instead of being more spread-out, with Punjab receiving its fair share, finds its way into East India Company, as somehow they are presented as the only “public face” of the “India growth story”….
• People seem to have been psychologically groomed since 1849 to believe that “sarkar” overlord is plenipotentiary, making them highly prone to manipulation via herd-behaviour and ‘carrots and sticks’. It is only the vague collective memory of concepts like ‘kirat’, ‘langar’, and the importance of agriculture and food production that keeps their collective soul as Punjab alive.
As we often say, “Punjab vasda Guraa de naa te” and the truth behind this is more profound than we realise if we haven’t interacted very closely with many different parts of the world. Without this collective memory, culture, and the momentum left by the Gurus’ mission, Punjab is at best a cheap copy of something unrecognisable, a skeleton discarded by scavengers.
• After their independence from the Soviet rashtra, many former Soviet states have developed healthy organisations serving their local economies and also increasingly innovating and exporting goods and services. It helped that they escaped another few decades of dystopian fate under post-Soviet Russian oligarchies.
Finland, which secured its independence from the Russian empire well before the Soviet period, had a head-start, made even greater strides during the century of its independent existence. They excel in their education system, overall quality of life, and they’re the nation that created the pioneering corporation Nokia! This came from a nation whose own language was treated as second class under foreign rule.
• The Baltic states of Estonia, Latvia, and Lithuania have already produced some good technology companies, and attracted foreign investments. I recently saw news of Taiwan investing in Lithuanian manufacturer Teltonika to start semiconductor production locally. That’s from three decades of hard effort as an independent state, and an aspiration for the country to ”…match the world’s strongest players and realise its ambitious goals…” (to quote their Economy and Innovation Minister).
• The Central Asian states seem to be making promising advances in developing their infrastructure, and some of their corporations are already performing well. Who knows, one day, ancient Silk-route trade routes could thrive again – which, for decades & centuries have been blocked by empires.
• Norway itself is a society of ~6 million (1/5th of Punjab by population) but had full control over its petroleum industry developed some 60 years ago. Their sovereign wealth fund invested those proceeds wisely on behalf of their people.
Of course, somehow, some of their investment found its way into Adani Co – can they be blamed if India’s own trusted “stewards of public wealth” institutions like the LIC & public banks like SBI have been propping up these “preferred” oligarchs and as a result, presenting them to the world as elite “Indian” corporations?
However, had such investment and associated risk been more “spread out”, it could have benefitted Punjab alongside other states – for Punjab to reach such a position could require decades of hard work, and demonstrable excellence in some fields, via locally grown and owned corporations.
A village, town, region, or country is really an extension of one’s home, what differs is only the scale and complexity.
People not only have a responsibility for their own homes, but also need to have the authority to put things right that need to be put right. And to put things right, you need the means to afford it. It’s only after getting one’s house in order that one can meaningfully contribute to bigger objectives.
If your house has a leaky roof, you either need the skills to plug the leak or the economic means to afford the material and labour costs of getting someone else to do so. In turn, your own skills might be useful to someone else who might pay you, so you can pay the person who mends your roof.
You could, for instance, be a farmer, baker, tailor, shopkeeper, former shopkeeper who now runs a supermarket chain, carpenter, mason, former mason who created a building company that won the contract for building roads in your town, CEO of a cellular network operator that you founded to offer mobile services in your city or district, inventor of cloud-computing who created a global business generating hundreds of billions in profits, and so on.
Either that, or East India Company’s offers to fix your roof in exchange for some ‘authority’. Of course, the offer initially looks good, and you thought EIC has your best interests at heart as it said in their advertisement. The advertisement used all the right keywords such as freedom, customer service, peace, democracy, and so on.
But soon you realise that you cannot enter or exit your corner room without their permission – said permission to be sought in their language, not yours. Even as a shareholder of the EIC, you have no say, as your 13 votes count for nothing compared to the actual real stakeholders.
You also do not have a say in who else enters and uses your home or uses its water and electricity that you pay for. You try to challenge it legally, but then find out that East India Company is also running the administration in your locality, your town, your country.
The only exit they offer you is to sell your house to EIC at a price determined by them, and find a new home elsewhere (pass IELTS first).
Everything starts from simple, basic concepts, and eventually adds up to “The Wealth of Nations”. We must not lose track of these basic concepts that are as true in Punjab, as they are in Canada, and never allow ourselves to be confused by complicated-sounding jargon.
The financial statements of your neighbourhood cycle-puncture repair shop (assets/stock, revenue, expenses, taxes, net income) are, in essence, conceptually similar to those of Hero Cycles or Hyundai.
If we lose track of these basic concepts, we become prone to shirking responsibility, and assuming or expecting “sarkar” to fix our roof. In fact, such an attitude in an individual or a community points to a failure of education, regardless of how many advanced degrees one might have, or whichever sarkari titles one might boast of.
It is every citizen’s responsibility to keep track of Punjab’s balance-sheet, and think of it as an extension of your home, then locality, village, town and so on…
There are some important assumptions in my premise: a healthy balance of responsibility, authority, and means, and a fair environment. I think societies of a similar size that have done well, got this balance right to various degrees while having developed some positive cultural traits like hard-work, transparency, dignity of labour, and trust.
I hope this compels more of us to think more strategically, elaborate further via similar writings, and hopefully support tangible steps forward.
(Content in this article is based on my personal study and observations. Nothing in this article should be treated as financial advice and I have no affiliation or contact with any specific company, state or organisation mentioned here. – Jang Vijay Singh)
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