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Applying Rambam to the Indian Business World

January 10, 2010 – 9:31 pmNo Comment
Homeless In India

Homeless In India

By Yaakov

I’m sitting in a bare concrete room, no telephone, no computer, only a desk, a couch, a few battered chairs and two cupboards stacked with dusty papers.  The ceiling fan isn’t running because the power’s out.  Ten bankers have joined me for a coffee; intense women in colourful saris, some with silver chains on their ankles, some with wedding rings on their toes.  Welcome to Mandya, South India.

The main connection I have to this organization is that their roof body, Vikasana, incorporates textile producers and my wife and I are textile importers in Australia.  But it has come to mean more than just having suppliers- if we wanted regular, easy suppliers we’d restrict our supplier list to Chinese factories.  We believe in fair trade, and we like to go to the “limit of the law”- (li-fenim mi-shurat hadin) – “there are 8 degrees of charity, one above the other, none is greater than … making a partnership or giving somewhere to work” (Rambam, Rule of Gifts to the Poor, 10: 40). We want to encourage fair-traders by giving them some idea of what our clients want to buy, then paying for their training, and then through their co-operative bank, lending them the money to start production.

The Bank’s President, Mrs K, initially took a loan of Rs 10 000 (now around A$250) to modernize her home kitchen so that she could start making the rich, milk-based sweets Indians so love for local cafes.  She lives in a rented home, which costs her Rs 1000 a month.  She’s middle class – her husband is a factory foreman earning Rs 12 000 a month who owns his own motor-cycle.  She has two girls- one doing 11th year of school – and a black and white TV. Her 30 square metre home has one bedroom, the kids sleep in the lounge which is also where everyone eats, and a small kitchen.  The bathroom is shared with two other families.  There’s no fridge.

For the working class, wages are low here. Waiters here – and even some semi-professionals like teachers’ aides – get Rs 2000 a month plus basic board and lodging. Vikasana’s target wage for employees is Rs 4000 a month but many work for somewhat less.  Mandya does have some wealth, however.  It’s a fairly typical small Indian city of 130 000 people, rumoured to be the “Malgudi” immortalized in the RK Narayan stories of 50 years ago, with large educational and manufacturing infrastructure .  The main street boasts electrical appliance stores and there are two new western-style supermarkets selling items which by their very price are out of the range of most working Indians.

“Be self-employed & help others to become self employed”…. That’s the motto of the Shakthi Self Employment & Co-operative Group Bank for Women, Mandya , a contribution of Vikasana Institute for Rural & Urban Development for women’s empowerment. Vikasana has set up over 330 self employment groups in Mandya district in the past 5 years.  Shakthi  pools the money from its stakeholders to have its own capital & by using that capital it will provide loans for the productive activities of the stakeholders.

Very few members of the self-help groups have earned an income before.  It’s the rural Indian custom to keep the women in the home with the children. Many are locked up and not allowed out by their husbands, and there are so many fights when women join self-help groups that Vikasana has had to employ a “Distressed Women’s Officer” to assist those who wish to become self-reliant. Indeed, quite a few women have been abandoned by their husbands.

Despite our achievements it’s not all sweetness and light, my friends.

Part of it is cultural …we look at things through the eyes of Westerners, from countries where appointment is on merit and good pay follows good performance. In Australia and in Israel, money follows audit trails and goods are listed in asset registers.  Regular accounting standards are applied.

India is not a Western country, however, and in the state of Bihar over 300 public servants, many of whom have spent time in prison for corruption, have unexplained personal wealth in excess of $2.5 million per person – this in a country where $1250 a year is a reasonable salary for a factory worker.  In some cases salaries continue to be paid during the period of imprisonment!

So why did it surprise us that the organisation to which we had given so much money, time and effort had such an inefficient management structure, including the Director’s brother-in-law employed as a very ineffective Training Manager?  Why did it surprise us that goods given to the organisation were seen, during a visit to the home of the Training Manager, to be in his kitchen?

Let’s not play “holier than thou” – this is real life and not a tabloid newspaper.  The names of Olmert and Sharon are signal reminders to followers of Israeli politics.  Our dilemma is the extent to which this knowledge ought to influence whether we continue to work with the organisation.  Would endless transparency audits merely add a level of bureaucracy to the organisation which would smother its work?

On a personal level, what makes the waste, poor planning, and nepotism of Vikasana distressing is that … it’s our own money, not some amorphous mass of taxpayer funds.  It’s the gas cooker and kettle we bought in 2008, which ought to have cut the working day of the training centre cook down from 10 hours to 8 hours, ending up not in her kitchen (where she cooks on firewood on 45 degree days for 50 people whilst sitting on a concrete floor) but in the home of the training manager..

We have not resolved this dilemma.  It does qualify our commitment to the organisation.  On the other hand, given the lack of resources and the huge inequalities in Indian society, it may be that nepotism is not the biggest problem facing organisations such as Vikasana.  Nor can we, who come from a culture where time is money, necessarily complain when people who have never used a computer, people from regions where 40% of the population do not regularly excrete into toilets but wherever they can, don’t quite want to pump the same number of widgets out of a working day as do we.

By 1936, remember the Jews in Palestine were only one-seventh of the population but had a productivity outstripping that of the Arab population; we became independent from the British only 9 months after the Indians did, but the work ethic which made us outstrip the Arabs is also very different from that of the Indians.  Indians in India are very different from Indians in the USA or Australia or Singapore – but as an Australian-Israeli who’s lived and worked in Singapore, knowing that doesn’t help me understand the cultural differences.

Fortunately, there are some signs of light and change.  The women in the programs are exercising self-empowerment and are no longer in need of the same degree of “assistance” from the largely male administrative structure.  Under our external pressure, some appointments are being made on merit.  The most productive units of Vikasana are now able to function independently.

The group’s founder, Dr P M Keshavan, is of the view that it can’t be changed in short order and that the smart thing to do is to take it in one’s stride and get on with it.  From our perspective it is hard to agree, yet we are unable to find any other project that has demonstrably better outcomes… and is any outcome better than no outcome at all? Transparency is a great organisational goal but it contains no protein.

Yaakov really just wanted to meet people and have fun, something he should have been doing in his 20s instead of cab-driving to pay his way through law school.  He certainly is meeting plenty of people working in a fair trade textile project in South India, which somehow fits into the textile importing business he and his wife operate in inner Melbourne’s Fitzroy.

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