Monday, January 29, 2007

Paper Footprint - Reduce it and save Forests

Last year alone, as per my approximation, I may have gotten about 350 lb (159 kg) of marketing bulk mail from USPS. As per the 2000 census there were 105,480,101 households in the United States. This means that there was at least 36,918,035,350 lb (36 billion) of marketing material, called junk otherwise, generated across the nation in just one year.
Paper Addiction
To give you an idea of what that means - it takes 24 trees (40 feet tall and 6-8 inches in diameter) to produce one (1) ton of writing/office/print paper. Saving you the pains of calculations this translates to about 443,949,606 trees being clipped every year so that someone can print a promotion with a few pretty pictures only to be thrown in the trash can by you. Assuming that each of these trees is planted 6 feet apart to be able to grow 40 feet and 6-8 inches in diameter this means a forest area of about 3,995,546,454 sq. feet or about 371,198,412 square meters, which is a land area of about 12 miles by 12 miles.
At this rate, an area of the size of Yosemite National Park can be wiped out in 8 years and the state of Rhode Island in just 7.
Friends, this is what you junk mail can do to forests. Let's not forget that paper is also used for:
  • newsprint,
  • magazines,
  • books,
  • office stationery,
  • packaging, etc.
Althought it is difficult to actually guess the affects of this on the forests around the world, I can only imagine the havoc we as humans are wrecking on nature just because we love paper so much.

Let's Play the Blame Game
While these are considerable changes I am noticing in the newprint and publication industry towards a market induced shift to electronic formats, there is very little that is being done in our offices and warehouses. 20 years ago I heard/read somewhere that the world will be paperless in the next two decades with the advancements in technology and I still hear that today. What a shame!

I am not very upset by that trend. There is some progress, it's just that the rate of adoption of paperless means is very slow and the technology is still very expensive. Someone somewhere is to be blamed for it. Direct Marketing Association and Consumer Data Banks, maybe.

Time to Change
Junk mail is something I just don't understand a need of. I am sure that like me a majority of people who receive these promotional material discard it immediately. It's a pity that so many trees are fell every years only to end up in our trashcans and landfills without generating any value.

It is time that the marketing industry really does some study and get convinced that they are wasting time, money, resources, and most of all the environment/forests and getting no returns for it.

So, what I am suggesting here? Should these companies close their doors, lay off workers, shut down their business and contribute to a slowdown of the economy and high unemployment rate. No, that is not what I am suggesting. I am rather hinting that its time to move ahead and come up with electronic means of marketing the promotions. How sweet would it be that I have a hand held device where I receive all my coupons and promotions electronically, that get wiped off the device automatically as they expire, and remind me when I am in a mall. How easy and organized would that world be where people just beam their coupons and promotions electronically rather than having to sort, fumble, gather, scan, and debate the validity of already expired promotions.
How can you help?
Well, one of the first things you can do is to start discarding your paper trash into the recycling bin. Shred your junk at home and carry it to your office to discard it as recyclable material, if you don't have a separate recycled trash collection at home. This is the least you can do. But the problem is much bigger in scope than apparent. There are so many players and industries involved that you as a consumer might just feel helpless.
If you can:
  1. Do not checkmark the options to receive promotional material in post/snail mail, USPS at any of the websites that you register at or buy stuff from.
  2. Subscribe electronically, if you can, to your periodicals.
  3. If you don't get a newspaper thrown at home, you are already my hero.
  4. See if you can get your bank statements online and stop the paper being mailed to you.
  5. Whereever you get a service or product from please insist that you name and address not be traded to other companies.
  6. Register yourself at the Direct Marketing Association's Mail Preference Service (MPS) at
The above few steps can reduce your "paper footprint" a little. I think there should be a law in this country that prohibits merchants from selling consumer information to anyone. And by law they should stop sending marketing material in print if requested by the consumer(s).

Wednesday, January 24, 2007

Pink City Express

Rajasthan with its land area of 342,239 sq. km. is the largest state in India and has a State Domestic Product 0f almost $21 billion.

But that is one state in India, which in my impression has done the best so far when it comes to sustainable development of its people. It has identified its core strength (tourism) and is developing with a zeal that I have never witnessed before in any part of the country. It has become such a mainstay for the government that it was declared to be an industry by the state government in 1989 and has since been regarded as the "people's industry". The rate of growth for tourists in Rajasthan has been 7% and 5% respectively for the past few years for domestic and international tourists repsectively. Rajasthan, which is predominently a desert land (Thar), has a rich heritage that is spread far and wide in the state, from Jaipur in the east to Jaisalmer in the west and Ranthambore in the north to Mt. Abu in the south. Unlike other states, different cities across the state have emerged as centers of tourism, which has made this industry as a instrument for sustainable development in the state:

  • employment generation,
  • environmental regeneration,
  • development of remote areas,
  • social integration, and
  • poverty alleviation

Every rupee spent by a tourist in Rajasthan circulates 13 times in the state and every hotel room generates employment to three people directly and eight indirectly. Tourism worldwide is a $3.4 trillion industry with a tax revenue of $655 billion in 1999 with a directly employing 144 million people the prospects for Rajasthan are very good considering that:

  • India constitutes only about 0.4% of world foreign tourist movement,
  • It ranks 44th on the top 60 destinations of the world,
  • Rajasthan has emerged as the single largest tourism destination in India attracting over 40% of foreign tourists in India,
Rajasthan in the last few years under the government of Vasundhara Raje has shown the potential of becoming an example state for the development of India. Infrastructure development in state is on a full swing. With roads like I have never seen before in India - 3 lane highways that have restroom facilities every few miles road travel in Rajasthan is probably amongst the best, if not the best in the country in any state. Unlike the trend in India where infrastructure (whatever exists) seems to be falling apart due to poor maintenance and is in sqalor, Jaipur has presented me with a different picture for the last couple of years. Not only have I witnessed improved roads and pubic spaces from previous visits, the upkeep has been good and city has suddenly leapfrogged in appearance.

  • Roads are wider,
  • Traffic is regulated better,
  • Major roads don't have dirt and rubble piled alongside,
  • Sidewalks have been upgraded,
  • Walls alongside all major roads in the city are now painted in pink,
  • All tourist attractions are now well lit in the nights,
  • There's less homeless people in the city. And this is what impressed me the most about the city. There are now Rein-baseras (makeshift tents) for about 100 people along side the roads that can be used by the homeless to spend the nights instead of being uncomfortable on the sidewalks,
  • Most of the heritage tourist sites are being maintained on a large scale.
With the new Initiatives taken by the Govt. of India to promote tourism (Incredible India campaign, etc.) and the industry growing in popularity worldwide, Rajasthan is poised to the tourist magnet. It is poised to become the jewel in the crown of Indian tourist industry, a place that'd be attractive to tourists like none other in India.

On the industrial front Rajasthan has the promise that on paper is one of the most attractive in India. It has:
  1. 2nd largest non-ferrous mineral deposits in India,
  2. 2nd largest deposits of limestone,
  3. Stable government
  4. Outstanding law and order situation
  5. Excellent electric power availability. It is the only state in India to produce power from three sources - hydro, thermal, and nuclear.
  6. With a large availability of land there are significant reserves of natural gas and high potential to harness solar and wind energy.
I have seen capital cities of a few states in India, including Bangalore and also the national capital, New Delhi. But none oozed the pomp and struck the awe like Jaipur. It has been a sweet surprise to visit Rajasthan in the last few years, something I recommend to everyone.

Sunday, January 21, 2007

Farmers Markets - Economic and Environemental Benefits

They say that the rich are getting richer and the poor are getting poorer. I can't say when that started to happen, but I see that happening almost everyday right where I live. The prices of vegetables and fruits that I get from the supermarket have increased dramatically in the last 5 years. But I don't hear of any farmers getting richer, except of course, the corn growers who have been getting hefty subsidies from the US government. Basically, every major supermarket blames this hike on increased oil prices. But is it just that?

The next time you shop at your local supermarket think about:

  • Why is it located where it is, what does the supermarket have to pay for it?

  • Why are there so many lights on even when it is a bright and clear day outside?

  • Do you really need to be in an air-conditioned environment picking your greens from freezers? Where's the money coming from to power all these?
Shouldn't I just go ahead and tell you that you are paying for it all; even for the 100s of parking spots, automatic water sprinklers, and even the 50 page color-printed paper promotions that you receive in the mail almost everyday from your favourite supermarket. That is what you are paying for. When you pay $6.99 for a lb of cherries, that is what you are paying for. And your local Farmers Market charges you $3.99 because they don't have to pay any executives or a spot on primetime TV or even for a 10'x10' picture hanging over the vegetables section. It's not just the Oil always, fellows. And anytime someone says to me that vegetables are expensive because crude has become expensive, I say, "get over your obsession with oil, open your eyes, think a little for God's sake, look at the world around you and stop behaving stupid". Yes, I actually say that and even to myself when I break my own rules. And I do so because there's an alternative to all that frustration and venting. You need to go to a farmer's market.

Yes, my friend, that is the reason that the Farmers Markets are fast catching up in the last 20 years. There were 340 in 1970 and the number grew to over 4000 in 2004. And since so many of us don't know what they are let me spend a few lines. A farmer's market is an alternative to the industrialized and specialized food retailing industry in the modernized western societies. This is where the farmers sell their produce directly to the public, without any middlemen. No-frills, person to person direct selling - somewhat old fashioned.

What's in it for....
A trip to your local farmers market is all it'd take you to understand the benefits for it. There's something in it for everyone, i.e. the farmer, the enviroment, and for you.


  • Every dollar you spend there will go directly to the farmer. It helps the local economy and you are actually putting your money into the hands of people from your own area. In other words, you are not spending money that goes to the supermarket chain which is actually headquartered in the neighboring state and to the transporter which is based out of Nowhereville in the state of Far-away. The multiplier factor is high, which means that the money you spend will go through many hands in your city/county before it gets out of there.

  • Farmers in the USA have reported that they can sell 22% more food in a farmer's market which would otherwise have been rejected because of supermarket's packaging standards, or last minute requriements change from the supermarkets.

  • Farmers can get higher prices for their produce selling directly to the consumers that what they'd get being at the bottom in the supply chain of a supermarket.


  • Since a typical farmers market does not open from 7AM to 10PM are normally organized in open areas they burn less lights, spend less electricity on AC, and don't have large power consuming freezers and chillers.

  • The food you get in these places also has very little and sometime no packaging at all, which means that you won't have to peel plastic wraps, stickers, only to throw it all away moments later.

  • And think of how many less gallons of fuel would have been burnt to get it from a farm nearby instead of it being hauled cross-country.

  • Prices are lower than supermarkets.

  • More food variety than what's available at SuperGrocers. There's lot of unusual choices.

  • Fresh food, since farmers market's don't have freezers.

This is a win-win situation for everyone involved. And did I miss to tell you that the ambiance in these markets are just fabulous, sometimes even live music, crafts, etc.? Just take that trip to your local market once and see if you sense a pride of entrepreneurship in a farmer and a satisfaction of being a patron to a farm business.

Locate your nearest
Please visit the follwing link to find a market near you and don't forget to spread the word around.

Time Magazine, in its March 12 2007 edition, has a related article on eating local food. It is titled, Eating Better Than Organic. This can be accessed at. The picture on the right is the cover shot of the magazine.

Thursday, January 18, 2007

India - Building a Nation or Building an Economy?

As the decade of 1980 was about to dusk the world was in middle of a turmoil. USSR was collapsing, Germans were ready to tear down anything and everything that stood againts their unity, USA was in political triumph as they saw almost two decades of cold-war diplomacy bear the fruits, Canada was struggling with the Quebec Sovereignty Movement, and Mexico's Carlos Salinas de Gortari was planning denationalization of state enterprises and deregulation of the economy. India, at the time, was silently stuggling trying to end the License Raj and transitioning into a market-oriented economy. Rajiv Gandhi was planning a new India with his lieutenants (economic advisors) like Manmohan Singh, Montek Singh Ahluwalia, and LK Jha.

India was in as much of a political transition than an economic one. Considering that throughout the decade it was ruled by the Gandhi family, the previous statement sounds like an anomaly. But the fact of matter is Indira Gandhi in the 1980s was different from Indira Gandhi on 1970s. The 60s and 70s were all about a socialist India, an India that was pro-poor, feared business monopolies, was uninterested in big corporations, followed a statist model of development, and was committed to distributive justice with the motto of Gareebi Hatao (Eradicate Poverty). On the other hand Indira Gandhi in the 1980s was all about Growth First; she was pro big-business, against labor, and restructured state's role in economy building, which was to support the private enterprise in achieving economic growth and supporting it with policy and procedures. She was first and formost commited to economic growth and socialism was least on her mind.

In about 20 years since Indira Gandhi got on the track of liberalizing India economically, the politics of the country took a U-turn. The India of 'common-people' was changing to the India of 'corporations'; slogans like Jai-Jawan Jai Kisan (Long Live the Youth/Soldier, Long Live the Farmer) were being replaced by Indian Shining. Or so it seemed until the electorate rejected the latter and sent the ruling party back to opposition benches. There was a message in this rejection - do not to forget the common man and concentrate on issues other than 'India, Inc'. This was one of the most surprising election results of 2004, if not the most surprising worldwide (George W. Bush's re-election comes close). So, what happened and what's the big surprise?

Announcing the Arrival
In 1991 India adopted significantly important economic policy reforms. These included devaluation of Rupee (Indian currency), removal of import quotas, lower tarrifs, better external financial transactions, domestic industrial policy reforms (delicensing, removal of monopoly constraints, tax concessions, etc.), and abolishment of petroleum and fertilizer subsidies for farmers to control government expenditure. These were some of the measure takes to generate faster industrial growth, to make Indian industry more robust and competitive. It was an effort to merge Indian economy with the world economy. The collapse of Soviet Union eliminated a big trading partner for India (almost $6 billion annual trade) and the balance-of-payment crisis, and very shallow reserves were threatening India. Struck with these hard realities a lot of the reform decisions were made overnight as Executive Decision rather than by an act/vote of the Parliament, which would have delayed the process. The overall pattern of that period was parleys between Govt. of India and the different chambers of commerce, confederation of industries or the big business houses. Not surprsingly, the common man was missing from the equation. With almost one-third of the world's poor, the down trodden and the financial weaker classes, the labor, farmers, etc. were not represented. Neither was there the time nor the need. Afterall, they'd be the beneficiaries in the end and with the expansion of the industry employment would be generated, and wealth would be created and redistributed. This was an inconsequential matter at that time. Some would have thought about it but the excitement of playing on the world stage stymied its importance and others simply had lot on the table to take care of.

15 years have passed by since India declared its arrival in world's fair. The new avatar of Indians is not new anymore. Investors around the world now recognize names like Reliance, Infosys, and Ranbaxy, and companies worldwide now either fear or aspire to be taken-over by Mittal, Wipro, Tata. This list of names is growing every quarter and, if pundits are to be believed, is expected to grow for another 3-4 decades. They say, "The age of India is here" and they are not wrong. This is what any one will feel like in India. The enthusiasm, exhuberance, and confidence of young people is inspiring and contagious. The nation is young, energetic and optimistic.

All that Glitters.....
15 years have passed by and for a big chunk of Indian population very little has changed. And for some it has changed to the worst. There have been instances where farmers have committed suicides in Andhra Pradesh due to poverty. Others have been migrating to cities in search of jobs risking their lives engaging in trades that are unhealthy and living in slums. Overall, India is suffering the pains and is in a transition of unprecedented scale. The gap between the rich and poor is increasing at an alarming rate. Inflation is high the growth is unevenly distributed. There's the state of Gujarat with 8.11% economic growth in 1990-2004 on one hand and Assam on another, which has barely managed 3.00% in the same period. And, let's not forget states like Bihar where investment has been such a low priority for successive governments that there isn't even an investment council in the state.

But this is all hidden and overlooked. Why not, afterall India as a nation now has enjoyed 6% growth between 1991 and 2001 and averaged 8.1% in 2004-2006. India is now compared to China and some have even gone as far saying, "21st century belongs to India". India the Next Superpower has become what used to be Jai Jawan Jai Kisan. And this is not entirely baseless.

Since 1991, the Indian IT industry has shown a growth of 20% with some subsectors showing a growth of almost as much as 60%. India produces 350,000 engineers every year, which is the largest by a single country in the world. This also means that overnight, every year, those many people join the middle class and most of them join the IT industry. To contrast it here are few other figures:

  • Employment had increased only by 1.6% between 1993-94 to 1999-2000
  • There were still 260 million poor people in India in 1999-2000
But, to make the situation a little worrisome, here are two other statistics:

  • Foodgrain production has stagnated and the output in 2005-2006 was lower than the peak reached in the last ten years.
  • Growth in India over the last 3 years has been consumption driven, which is basically financed by loans from the banking system.
What does this mean? Well, two things; first that we as a country have peaked as an Agrigarian economy and will soon start a downfall, and second that Indian economy is in a little trouble unless its nature changes from consumption to investment. Let's face the reality, foodgrains is what built the civilizations over thousands of years. India has been a and can continue to be the grainery of the world.

Sustained Universal Growth
If India has to develop and eradicate poverty it has to start focusing on sustained universal growth. The two key words here are sustained and universal. In India the focus is so much on IT that who don't belong to it don't seem to belong anywhere. India today substaintially exports only IT. A few million people no matter how well paid cann't run an economy. India has to have people from other trades exposed to opportunities/markets outside; labor-intensive industries like manufacturing and farming.
The share of employment generated by Manufacturing has remained unchanged in the last 20 years
One of the ways to make that happen is to encourage exports of food grains, handicrafts, cash crops, textiles, etc. Get these sectors the same policies as IT has. Get those engaged in these trades to earn the foreign exchange like IT does. Once this happens the over wealth distribution in the country will become more even and make the domestic market even bigger. Unlike China, whose economy depends on exports India's economy today is domestic. If, however, non-IT sectors in India get export oriented like China, the domestic market will sustain itself and be universal. Get those Starbucks and Whole Foods of Americas to procure and process their coffee and organic food product from India. If not that, get the organic manure from countless Indians farms to the Farmland, USA and target the Chinese market for grain and vegetable export. The whole idea is to develop infrastructure and get the investment from foreign companies for it. And develop it for people in rural India as well. 100 miles of 6 lane freeway around the city won't lead people to countryside where 700 million Indians still reside - the real and needy India is still outside in the country side.

Tuesday, January 16, 2007

OK folks, let me start with a confession - I had to struggle a lot to come up with a title for this post. And the reason is that I got this title in my head, which I just couldn't let go. But the problem is that title was very cheesy, kind of which you'd read in tabloids at the check-out counters in a supermarket. And, I shall come to it later.

Let me get to the point first. I was reading FORTUNE and came across an article on Walmart and its efforts to save some precious $$$ turning green. Later that evening I went to their website to check out what they're upto. Let me tell you this; I am impressed with the efforts so far.

In the past I had heard, read, and seen on TV a lot of negative press for Walmart which I have so far not commented upon. Walmart is such a big phenomenon and economy in itself that it would be naive of me to comment upon its policies and strategies without first studying the other developing and underdeveloped economies and countries that do business with and how it affects their equilibrium. That topic apart I have always been impressed by how they have been an early adopter and a catalyst in industry standardizations of technologies like bar-codes in the past and RFID (Radio Frequency Identification) at present. Walmart has been such a big market for the vendors that very few of them have any options left to negotiate with Walmart. If Walmart mandates bar-codes on all its product packagings, that's it; either you do it or you lose it. But decisions like this have not only changed the nature of retail in the US, but have also changed the nature of supply-chain in economies like China, Asian Tigers, and now in countries like India. That is what I meant by the "phenomenon" of Walmart.

Latest Buzz

Well, to start with Walmart is educating (or shall I say forcing) its 60,000 strong vendors to reduce the packaging by 5%. This is a significant number considering that:

  • The initiative is expected to save 667,000 metric tons of carbon dioxide from entering the atmosphere. This is equal to taking 213,000 trucks off the road annually, and saving 323,800 tons of coal and 66.7 million gallons of diesel fuel from being burned.
  • Just by reducing the packaging of fewer than 300 toys, Wal-Mart saved 3,425 tons of corrugated materials, 1,358 barrels of oil, 5,190 trees, 727 shipping containers and $3.5 million in transportation costs, in just one year.
  • With new modified and reduced packaging Walmart diverted 1100 tons of plastic from landfills, saved 730 container trips, which saved 1,100 barrels of oil and 3,800 trees.

While still exploring ways to help the environment further internationally, Walmart has decided to conserve at least one parcel of priority wildlife habitat for every parcel developed over the next 10 years in the US. ( ).

At the store level, Walmart is:

  • experimenting with Solar Panels and Wind Turbines at two of their stores in Texas and Colorado, and
  • testing benefits of switching fork-lifts from lead-acid batteries to hydrogen fuel cells.

In the supply-chain they have installed Auxiliary Power Units in 6,800 tractors that now saves 10 million gallons of diesel and eliminates 100,000 metric tons of CO2 emissions.

At the product-offering Walmart is promoting:

  • Organic Food,
  • Biodegradable products - Case in point Corn-based clothing hangers, and
  • Fabrics made of waste and recycled material (such as plastic bottles, waste yarns, and lint)

Big Deal!

Nothing new! - a lot of you will say. But consider how these new policies will affect the market in the US and Canada. Let's not forget what Walmart does will be adopted by Target and Sears/K-Mart and other big players. Together, these big retailers have the power to change the consumer habits in this country and worldwide.

Let's not overlook these

So, overall, I am happy with the initiative that Walmart has shown. There are however some other basic items that can be replaced without adding much cost.

  • Consider a plastic bag for instance. I have no idea how much plastic is consumed in Walmart annually, but my guess is thousands of tons. Change it to something bio-degradable. What will it cost, an extra 10 cents. Pass on that cost to the consumer. Even if each bag holds 4 small items like a can of peanuts which itself is about $5, the consumer won't mind an extra 2.5 cents on it.
  • Stop opening more 24 hour stores. The area I live has 3 Walmart stores that are open 24 hrs. within 3 miles of each other. This is a waste.
  • Even if you open 24 hrs turn those lights off in the liquor section. What good are the lights when you stop selling liquor at mid-night.

Green is the Color

I have no idea why Walmart is doing what's its doing. Obviously, there's a lot of economic benefit that it sees, which also happen to be eco-friendly. To top it all, this will also earn it some good will with large environmental groups. But should we even care what the motivation is. But I can now predict a trend, atleast with the big retailers. Green will be the fashion soon. This bring me to my opening comment - the cheesy title. I had the following in mind:

Walmart turns Walgreens

Seriously, they should take over Walgreens and change the name of the coporation to Walgreens. As a CEO I would do that. There's a lot that the latter has to offer, albeit for namesake.

Saturday, January 13, 2007

Capital Gains on Renewable Energy - Time to Index

Have you noticed that in almost all of the leading finance portals, starting with Yahoo Finance and Google Finance (which is still in Beta) the industry classification doesn't list renewable energy companies seperately. They are still listed under Energy segment.

In a capitalist economy like that of US one of the easiest ways to get a technology out on the road and get attention is to get the Wall Street to rally behind it. And one of the easiest ways to do that is to first of give the renewable energy sector its due respect, exposure and platform it deserves.

Another way to drive investors and promote renewable energy companies in the investment communities is to lower the capital gains tax by, let's say, half a percentage point. Not only will this divert money to, often, cash strapped communities, the financial interests of institutional investors will drive a market generation/conversion. Also, all the capital gains for this industry segment should be indexed and inflation-adjusted, unlike the norm which is the nominal capital gains. This will induce an affectionate inventment in the renewable energy market where investors will make decisions purely for economic reasons and will not be swayed by tax considerations.

The figure on the top-right is from Tax Foundation, which it released in its special report in November 2006. It tells you that if you bought a stock worth $45.35 in 1956, it'd be worth $1228.81 in 2005. With a capital gains tax of 15% on $1183.46 (1228.81 - 45.35), an investor would owe $177.52 . However, taking inflation into account the current value of the asset would have been $263.64 the actual capital gain would have been $965.17 (1228.81 - 263.64) and the tax owed would have been $144.78. That means an investor lost $32.74 (177.52 - 144.78), which is roughly 3.4% of indexed capital gain of $965.17. Hence, instead of 15% capital gain that investor actually paid 18.4% capital gain. This would have been so accetuated in 1984 when the same investor would have actually paid 306% capital gains tax instead of the statuatory (nomial) of 20%.

It is an unprecedented opportunity for Congress to act. With inflation being tamed for past two decades and an industry needing support, which can break the clasp of mid-East oil on USA, the Congress not only bootstrap the energy-future of this country but can also improve the fairness of capital gains tax system with minimal risk.

Friday, January 12, 2007

What is Development?

After World War-II if there is one topic gathering most attention in the circles around us, it is “Development”. While a lot has been said and written about development, there is no consensus on a single definition of what is an dhow it is measured. However, there is no doubt that the term “development” is used for countries, regions and societies that are technologically not as advanced as many of their western counterparts. This seems to be a very narrow view of development for a simple reason that the scope of development is reduced to just technological advancement and its measurement.

Is development the same as economic growth? Let us consider one fact before delving into the development any further. Of the world’s 6 billion people. 1.2 billion live on less than $1 a day. About 10 million children under the age of five died in 1999, most from preventable diseases. More than 113 million primary school age children do not attend school – more of them girls than boys. More than 500,000 women die each year during pregnancy and childbirth. More than 14 million adolescents give birth each year[1].
[1] World Development Indicators – The World Bank Group

Development and Economic Growth
In his book, Society, State, & Market, John Martinussen argues that it is a myth that the early development economist maintain that they viewed growth as identical to increasing per capita income[1]. On the contrary, increasing production and consumption was thought to increase employment and improve the standard of living. Hence, the national income translated into the average per capita income was thought to be the right indicator of economic development. However, the World Bank found a flaw in the approach and argued against the view on several grounds. The reasons varied from being unable to gather right data in developing countries to a situation where the high-income groups witness growth and low-income groups face stagnation on decline in incomes. Uneven distribution of growth socially as well as geographically too contradicts the fact that the increase in aggregate per capita income is an indicator of economic development. But there’s a consensus on the notion that growth in per capita income of a country over long periods of time with simultaneous reduction in poverty and inequality in society reflects economic development.

Most economists believe that economic growth benefits all the citizens of a country equally and hence reduces poverty. However, besides the notion in being wrong in itself there is a fundamental flow even if it is accepted. If economic growth raises the income of everyone in the society in equal proportions, then the distribution of income does not change. Growth is most likely to lead to the reduction in poverty when the economic assets of a country are distributed relatively equally and or when economic growth is based on intensive employment of abundant factors of production, which for most countries is labor[2].

While economic development is just one aspect of the over all development process human development has also been argued to be an additional objective not to be omitted. The first human development report from the United Nations Development Program (UNDP) defined human development as a process of people’s choices. For these, the attention is concentrated around the opportunity to lead a healthy and long life, the opportunity to acquire knowledge, and the opportunity to have access to resources needed for a decent standard of living. In addition to these, political freedom and human rights, human development for men and women, environmental and other aspects of sustainability, and themes regarding citizen’s participation and opportunities to affect the political decisions in society have also been added.

With the same argument as before, development again cannot be restricted to just the two spheres of economic and social conditions. To justify the cause, it must of holistic in approach and must at least include:

  • Economic development,
  • Social development,
  • Political development,
  • Technological development,
  • Development of formal institutions, and
  • Development of informal institutions.

Echoing the concerns of many scholars like Amartya Sen, Mozaffar Qizilbash in his paper on Ethical Development[3] very rightly expresses that development must be:

  • Consistent with the demands of social justice,
  • Consistent with the demands of human freedom, and
  • Concerned with human beings as ends rather than means and with human well-being.

Amartya Sen argues that justice and poverty should not be thought of in terms of commodities and incomes. Those who live the most “constrained lives” are those who suffer from a failure of basic capabilities.
[1] Society, State & Market – A Guide to Competing Theories of Development. John Martinussen. Pg. 36 ISBN: 1 85649 442 X.
[2] Does Economic Growth Reduce Poverty?
[3] Arizona State University e-Journal. World Development 24:7 and the references within.

Developed Nations and Development
It is a very important observation that most of the individuals see a picture of the developing and underdeveloped world when thinking about development. While it is true that development as we know it is most needed and sees most activity in those parts of the world, the development of formal and informal institutions should also be considered in the developed world. Development in the developed world is not an end in itself. It is a never-ending process where a continuous struggle for improvement in conditions is necessary.

Development in true sense is a relative phenomenon, where in a country and a society envisions reaching a goal. While some of them set goals for technology related issues, others set them for issues related to society as a whole. With the economic might that the western developed countries have got, they continuously evolve in the technology they use and make their societies more productive. In the process, if by any means, the standard of living falls or the proportion of national population below the poverty line increases or remains constant, it is negative development. There is a concern in these developed societies about the diminishing occupational opportunities because of a globalization of markets and the division of labor on the international stage. Is this development in true sense? Are these governments ensuring that there are enough opportunities being created in the country and the employment rate is decreasing?

Development in the developed societies is perceived to be an oxymoron. It is not; granting voting rights to African-Americans in the United States of American in the 1960s is development in true sense. Even after being technologically advanced for decades, until 1963 only men could get Harvard degrees. The manifestation of these laws into affirmative action, today, is a reflection of social development in the developed societies. Australia is one of the technologically developed countries that has underdeveloped social formal institutions. The native Australians (Aboriginals) still do not have equal rights and are segregated from the mainstream.

Hence, development in true sense should be nationally responsive. There are certain benchmarks that have to be achieved before national responsiveness can take precedence. Development is its true essence does not necessarily require elements of westernization and modernization beyond a certain threshold.

What should be developed?
Development is the emulation of the developed western societies to achieve positive freedom[1] and to recognize the dignity of human being. In his paper, Ethical Development Mozaffar Qizilbash has written:

In the context of development debate, I suggest a list of prudential values: (1) certain, at least minimal levels of health, nutrition, sanitation, shelter and security (2) certain at least minimal capacities including (a) literacy and (b) certain basic intellectual and physical capacities (3) self-respect and aspiration (4) positive freedom or autonomy (5) negative freedom of liberty (6) enjoyment (7) understanding or knowledge (8) significant relations with others and some participation in social life, and (9) accomplishment.

In order to achieve the above said, emphasis should be laid on educating people. This education should not only encompass awareness of the surroundings, political conditions, human rights, but also literacy so that every person is able to read and write.

The spectrum of development is very broad. The scope of development starts from the very embryonic effort of a literacy drive in countries like India and Bangladesh and goes as far as formulating and implementing laws for protection of intellectual property in the relatively technologically developing countries like China and Russia. Whereas the efforts in the underdeveloped countries should be towards decreasing the infant mortality rates and ensuring that every child that is born grows up into a healthy human being, the efforts in the developed western societies should dedicate steps towards taking care of ageing elderly. For the developing countries like India and South Korea, the next steps should be to concentrate efforts in directions previously unthought of, like prevention, rehabilitation, and equalization of opportunities for the disabled.

Considering the social setup of societies in different countries and taking into consideration the stage of evolution they are in, both socially and technologically, development policies should be framed that best help them emancipate the sorry conditions they are in and takes them to the next stage of developmental evolution. International organizations like the World Bank, International Monetary Fund, and the United Nations have all been actively monitoring and aiding numerous developmental projects across the globe. As expected the projects are very well divided into different areas of execution and there are various parameters that reflect the success of developmental efforts. While these statistics are a boon to us in order to understand the intensity of underdevelopment in a society and decide the magnitude of efforts required, we should not mistakenly use these statistics to misinterpret the extent of development in different societies. While a simple statistic like the number of ‘internet users per thousand people’ is a good indicator of development and should be used to compare the extent of development in countries like Norway and the United States, they are meaningless in countries like societies of East Africa and Asia, simply because there is a generation gap between the development stages in technology in both these cases. Hence, while each and every parameter used by these international organizations carries a lot of weight and significance, care should be taken in selecting the right set of measures to evaluate developmental progress.
[1] Ethical Development. Mozaffar Qizilbash
World Development, Volume 24, Number 7, July 1996, pp. 1209-1221(13)

Development is one field that has been attracting attention of all around the world. Every one of us thinks of development in some aspect or the other. Many of us are still held up with notion that it is just the developing and the underdeveloped that need development. Keeping in mind the next wave of shift (to the knowledge economy and society) in the drivers of growth around the developed world consider the following statistics about the United States:

  • Forty three percent of the fourth-graders cannot pass a basic reading test,
  • Forty two million adults are functionally illiterate,
  • Ninety percent prisoners cannot read,
  • Over twenty percent children live in poverty, and
  • Purchasing power of a thirty year old individual with a high-school diploma has dropped by over one third over the past two decades.

Hence, development is needed ubiquitously and at different levels and arenas. Development is the building process where the foundation, which is composed of basic human needs and rights and not necessarily economic growth, has to be laid foremost. Everything else stands on it. If this foundation is weak it would not be long before all other efforts collapse.

Thursday, January 11, 2007

Redefine "Renewable"

I was reading the Annual Energy Review, which is the official energy statistics from the US Govt. and noticed something that I hadn't before. Renewable energy sources has WOOD listed in it. In my honest opinion wood should be delisted from the renewable category.
Agreed that wood can be regrown much faster than coal or petroleum, but as long as it is counted as renewable source of energy, we are fooling ourselves. Look at the figure on the right (click it to enlarge). The red line indicates wood consumption in this country from 1949 to 2005. In the last 56 years the total consumption of wood has stayed almost the same. The only way you can save forests is to treat them the way we treat the endangered species. Actually, it is time that wood be declared a categoric threatened life form. No matter what kind, you just can't burn it. Use it for picture frames, furniture, etc. but don't just turn it to ash.

Lovely Technology - Microbial Fuel Cells

Dr. Derel Lovely at UMass Amherst is working on something that I had no clue about; a Microbial Fuel Cell. To get an introduction of what that is you can watch this 4 min video on PBS site which is available at ( video # 4). Dr. Lovely's website is available at

I always wondered as a child (and I still do, very less often though) how the bugs glow. That has always enticed me and made me think that we should generate electricity from them. Well, that was 20 years ago, when I was ignorant of the energy problems and had no clue that it's even a possibility that some scientist will heed any attention to. But with this new development that I got to know of my thought process is again being dragged to that possibility. Why is it that the scientists are concentrating on microbes when we have bugs that are capable of generating visible light and electric shock. This brings me to my second point, are there people seriously considering it? Is it the size to energy ratio that plays a role here.

My new quest is now to find out if someone had already compiled data of organism size to electric potential difference or charge that the organism generates.

Wednesday, January 10, 2007

Fuel Cell Magic

In this year's Consumers Electronics Expo in Las Vegas a marvelous piece of technology was revelead; Jadoo. Its a portable Fuel Cell based power generation unit ( ), which as expected is very expensive right now. The unit is about $8000 (USD) and provides 2000 W-h runtime capacity. Like any other technology, the prices will fall steeply once the production technolgy gets mainstream and the demand increases. One thing that caught my attention was the future business model of Jadoo. Here's what their website says:

In our new model:
• Your home has a built-in power interface, similar to our existing Fuel Cell Power Unit.
• Each interface holds several fuel canisters, which might look like our N-Stor canisters.
• You buy several of these canisters and click them into place to power your entire home.
• When the canisters are empty, you drop them in the mail to Jadoo.
• We send you new, full canisters, delivered right to your door.
• You’re free from high utility bills, power grid outages, polluting fossil fuels, and all the limitations associated with the way you get your power today. It’s the way you get DVDs today. Soon, it will be the way you get the power to watch those DVDs as well. If it seems a bit far-fetched, it isn’t. This exciting new model is a top priority for us, and we’ve already taken great strides in making it a reality. Once again, we’re revolutionizing the industry with what this amazing technology can achieve.

  1. The model is no doubt good but there are some that I can forsee in it:
    The unit owner will still be not fully independent; (s)he will have to depend on an external entity for fuel supply.
  2. The unit will not be fully portable. If I have to take the unit to a remote area for extended period of time, there are chances that I may run out of fuel.
  3. What if the user runs out of fuel and has no spares at home. Does the consumer wait for the mail carrier to bring new?
  4. Isn't there a big risk in the whole supply chain? If the mail carrier goes on strike, that's it; darkness all over.
  5. What happens in cases of disasters when all the transportation to a certain part of the country is cut off?
  6. There'll be precious energy wasted by the carriers to supply energy to the consumer. This is not a very sustainable process. It is like burning gasoline to supply gasoline to gas stations.

Why can't Jadoo have it's own Hydrogen fuel generator power by PV in it? I guess, this is Jadoo's model of having a continuous revenue stream that is hampering production of an innovative idea. Now that I think about it, this business model will provide such an obvious hole in the consumer expectation and product feature cycle that very soon new players will enter the market and the technology will leapfrog.

How do I become environmentally friendly?

For a long time I used to wonder how I can contribute to protecting the environment. The two easy (pragmatic) and the only clear paths I saw were to save/plant trees and burn less fuel (gasoline, diesel, firewood, etc.). And I must say that that I have been very faithful to my ideas; I plant trees and I don't burn firewood unless I am camping of course.

But, is this enough? Am I done, is the environment safe? Probably not. It's safer but it is not protected from me, yet. And, this is because there are certain other habits I have cultivated over the past few years that are detrimental to the environment. A friend of mind recently forwarded this article to me, which exposed a number of ways I may be harming the environment, ranging from drinking bottled water to eating excessive meat.

So, here's what you can do to help protect the environment:

  1. Take luke warm showers instead of hot ones.
  2. Avoid hot drying of dishes in dishwasher. See if you can handwash small utensils rather than dumping them into the dishwasher.
  3. Run large loads of laundry instead of smaller loads more frequently.
  4. Dry clothes on the lines in your garage. Does that bedsheet/kitchen towel/curtain really needs an electric drier? Can your shoes/sneakers be air dried?
  5. Avoid using anti-weed spray/feed in your lawns. See if you can take some time out to weed the weeds out of your lawn manually.
  6. If your house is not on an acre of a property or more you can use electric garden tools rather than gasoline powered.
  7. Have you considered opening blinds and curtains on your windows and doors to let the sunlight come in and warm the house in winter months?
  8. Using fans inside of your house reduces electricity consumption.
  9. Set your garden sprinker system to run every 3-4 days instead of twice a day during wet/rainy season.
  10. Use organic manure in your garden/lawn.
  11. Reduce your shower time from 15 mins to 10 mins. Turn the shower off when you are using body soap or shampoo.
  12. Turn the water off when you are brushing your teeth.
  13. See if you can use brooms and mops to clean your hard floors instead of vaccum cleaners.

All of the steps above either help reduce gasoline, water, and electricity consumtion or reduce the toxic chemicals that we introduce into the ground water and natural streams.

Becoming eco-friendly and green is not an overnight transformation but a change in lifestyle that takes several months or even years. Get green and spread the word and practices around.

Google Founders are in a good company

There was a news article a few months back that mentioned Larry Page and Sergey Brin having invested in Nanosolar, a company that makes thin-film solar cells. I am not sure who is influencing whom, is it Vinod Khosla guiding these two or is it the other way round. Whichever way it is, it's a good development.

I have been a fan of PV (PhotoVoltaic) for a long time and Fuel Cells have caught my attention in the last 3-4 years. This is for the first time I am witnessing a sense of urgency in wealthy investors to get a fair share of these alternative energy producing device manufacturers.

But, at Google the developments are taking a different turn. It now has a position on its payroll that I have never hear of before; Corporate Environmental Programs Manager. Here's what Robyn Beavers, the Corporate Enviromental Programs Manager, at Google has to say:

Soon we plan to begin installation of 1.6 megawatts of solar
photovoltaic panels at our Mountain View campus. This project will be the
largest solar installation on any corporate campus in the U.S., and we think
it's one of the largest on any corporate site in the world. The panels will
cover the roofs of the four main buildings of the Googleplex, and also those of
two additional buildings across the street. There will also be a portion of this
installation on new solar panel support structures in a few parking lots. The
amount of electricity that will be generated is equivalent to powering about
1,000 average California homes. We’ll use that electricity to power several of
our Mountain View office facilities, offsetting approximately 30% of our peak
electricity consumption at those buildings.

So, what's new about it? Well, nothing except that this is yet another commitment for renewable energy and enviromental friendliness at a Google, one that will now directly affects thousands of educated employees at a prestigious center of technical excellence. The other thing to notice is the capacity of this installation, 1.6 MW.

Tuesday, January 09, 2007

Vinod Khosla and the 'new alternative energy' sources

Quite honestly, I had no idea that Vinod Khosla has his time, energy, and money dedicated, at least in part, to alternative energy source(s). It is indeed very encouraging to know that venture capitalists are now beginning to take interest into alternative energy sources. To me it seems that we are in time where the PC and software industry would have been in the late 70s. There a technology out there that we all know is the future, there's a few people and big companies invested, the technology is still expensive, and the market is not yet ripe, but the imperative is huge, and small time players are experimenting with different products. Isn't this exactly how it was with the PC industry when the, then small, players got into it; Microsoft, Apple, etc.

I had always heard of how big companies lobby and eat out or threaten small new entrants. But Vinod shares a story where a big European oil executive threatens to lower the oil prices so low that the whole biofuel industry will become economically implausible. Quite a statement to make, but one that reveals how difficult and challenging it can get for innovators to get going. But the interesting thing out of this all is Vinod's proposed tax structure that can be used as a hedge against this price manipulation. Smart idea!

This is the presentation ( ) that Vinod shared with Google folks. It's a good one to go through because there are some amazing statistics. At a lot of points during the presentation it raised questions in my mind about a lot of things. Also, this is a good introduction to how legislations are made and how they can be influenced by the influential few.

But this presentation and several others still leave me with a question, why biofuels only, why not PV or Fuel Cells?