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Tuesday, September 22, 2015
A Fellow IITian's Humble Request to Chetan Bhagat - By Mohit Sinha
Being a fellow IITian of roughly the same timeframe as you (B.Tech(EE), IIT-Kanpur,1992) and also a P.G., but in Physics (TIFR-Bombay, 2003) and not in Financial Management like you, I felt really happy and proud when years ago I came to learn that “Three Idiots” by Aamir Khan & Co. was actually based on an IITian’s (your) novel “Five Point Someone” , which is when I went ahead and read it and realized that you had written straight from the heart; a plethora of feelings / sentiments shared by more than 90+ % IITians (irrespective of being 5-pointers or 10-pointers or somewhere in between) of our days when there was no 3G/4G to seek instant emotional support from home while going through the grind.
I humbly implore you not to devalue your own analytical and deep-thinking credentials along with that of our tribe, who have created it globally over half a century by the dint of their sheer merit and hard work. My objection is not as much to the opinion/stand taken by you, as to the lack of depth of analysis as well as the frugality in the breadth of the aspects which you have covered to put forth your viewpoint, giving an impression of you being in a tearing hurry to publish, which leaves room for people drawing unnecessary conclusions about your motivation with some even going to extent of tarnishing our reputation in general. Here’s how I feel something from the head of an IITian should look like (my response to you in the following paragraphs).
As you were a finance guy before picking up the pen, let's look at it first from a purely ROI, then enterprise and finally the socio-economic angle. We start with the Flat or Bungalow you may be living in and look at the price you pay for the flat itself vis-a-vis the price for all the belongings inside (which would be totally defenceless along with your family members, from thieves, robbers and marauders without the security the four walls and roof of your flat/bungalow provide!). You might argue that the cost of bricks and mortar along with the payment to the construction staff is a minuscule fraction of the cost of land in an up-market locality, which actually raises the cost of your flat/bungalow. However, that's where the key lies, i.e. if we want to be counted among the premium members of the real-estate of the comity of nations, we need to spend accordingly on the ”walls & roof” of our strategic defence , especially considering the kind of hostile neighborhood we live in. Abject Failure to do so in the immediate post-independence era, resulted in our humiliating defeat at the hands of the Chinese in 1962, a defeat which is a blot in the history of modern India and still stares us in the face via the various international maps of India, lest we choose to forget it at our own peril.
As citizens of India we are a large family and our nation India is our home with all our historical, social and economic/industrial/financial assets being like one’s belongings on a mega-scale, when viewed from a global perspective. Even if you argue that a nation is more like an enterprise where only productive activity is to be rewarded, military pensions/benefits are like an insurance policy with pension-benefits whose premiums are paid in kind and not cash, a “kind” for which there is simply no cash equivalent because the “kind” in concern is the very life of the fauji! Before writing what you wrote, did you for one moment consider, what is the price you put on your own life? You can argue that, in which case let’s reserve the best rewards and compensations we can offer to the best of our capability as a nation for those of our honourable soldiers who are martyred or maimed, but the problem then is that before one goes into battle and until the action is long over, that list is not known. So the strategy followed globally by armies of respected democracies on the global stage (read USA, UK, France, Australia etc.) is to have the best possible same financial package for all soldiers to keep all of them equally motivated before going into action and reward special bravery via presidential scrolls of honour and military medals /crosses on the glorious setting of National celebrations like the Republic Day, rewards which are again invaluable like the supreme sacrifices they are given for.
Taking the Nation as an enterprise analogy further, you need to hire the best and get the best out of them by providing them the best and the latest infrastructure to stay at least abreast, if not ahead of your competition, the goal always being to have a plan and strategy to race ahead of the competition and work towards achieving the same. To hire and retain the best, you need to offer the best pay & emoluments package you can with a promise for better rewards, bonuses & honours based on a combination of individual performance and organizational (read national) growth vis-a-vis your competitions’, which in this case happens to be the nations you aspire to be counted among.
No wonder that we are 20% short on officers in our armed forces on an average, and more so on fighter pilots and squadrons because we are no longer able to attract the talent which can make the cut, and hiring substandard talent is worse than having vacant posts in this business, like other fields which require specialized skills and aptitude besides extreme motivation. Our veterans, who are jawans in a large majority are on “Dharna” for OROP (a name given to a pre-existing payment structure in approximation pre-1973 when Indira Gandhi withdrew it arbitrarily!!), because they are made to retire by 35 years of age to maintain a young and mean fighting machine, while most officers are effectively made to retire by the time they are aged 40+ to 50+ owing to highly angular pyramid management structure at the top.
This sorry state of affairs has come upon us, NOT because our honorable soldiers seek pay-pension parity in USD terms with their US/UK counterparts, but just because they seek to restore parity (lost systematically since independence & esp. In 1973) in terms of honour, structure and ratios w.r.t. various parameters like Status & Position, facilities, emoluments-pension packages vis-a-vis the nations we aspire to be among, and desire to remake them as they used to be before Nehru and Indira systematically dismantled them in active connivance with the bureaucracy and politically appointed pliant military top brass, due to their paranoia of sorts with the armed forces and Bose/INA post independence (Please read my post: https://www.linkedin.com/pulse/civil-military-imbalance-root-cause-analysis-mohit-sinha ), which is not only de-motivating our serving personnel but also deterring talent from even considering armed forces as a career option..., and we aspire to compete with the best and be a player on the global stage!!
Stretching this enterprise analogy even further, on the Global stage agreements are done in the form of treaties, best done by negotiating from a position of strength (as applicable in any sphere) via diplomacy which is meaningful only when backed with raw military strength & deterrence closely intertwined with the nation’s geopolitical and economic /business strategy and objectives. We don’t have to go far and look at our northern neighbour China to see how they have upgraded the Karakoram Highway, built a tunnel to shorten the distance to Pakistan right in the middle of Gilgit which lies in erstwhile unified Kashmir which we claim as our own, and are building a highway right through Baluchistan to access the Arabian Sea ports in Pakistan also built and upgraded by them; none of which they could have done without having the military strength to back their activities. Similarly they have built enormous Railway and allied infrastructure in Tibet and are working towards reviving the old silk-route.
Similarly the US & UK primarily along with the NATO bloc control the world’s oil and their military strategy is indistinguishably intertwined with their economic/business strategy (US has made profits from every external war they have fought except Vietnam, through defence-sales/supplies, reconstruction, controlling Oil/Gas and other natural resources etc.), with Russia now and USSR earlier acting no different when it came to their geopolitical and economic interests.
In stark contrast, our pilgrims to Kailash-Maan Sarovar have to pay hefty amounts of Hard Currency and obtain a Visa from China and we can’t build a pipeline for Iranian/Central Asian Oil and Gas because Pakistan falls bang in between and the Northern territory part of erstwhile United Kashmir is not in our control to engineer a work around. All this is courtesy the sterling performance of the “peace-loving & development-oriented” Nehru-Krishna Menon duo and their “esteemed self-proclaimed know-all babus”, who even fooled an iron lady like Indira into equating civilian and military pensions in 1973, despite the military delivering such a momentous victory like 1971, and who have since independence progressively become the “Bhagya-Vidhaatas” of our Defence Forces in the MoD without having ever spent a moment on the front (leave alone action)!
Tell me which Hi-Tech industry/company cutting across spaces, segments and verticals (e.g. IT- Hw/Sw, Semiconductors / Chip-Design, Oil & Gas, Airlines... etc.), will have guys without bottom-upwards hands-on operational experience, deployed in key senior positions for Ops, R&D, Technical, Modernization, strategy etc. Even in your own erstwhile space of Finance, guys become Fund Managers with hundreds of millions of dollars of funds under them only after they have spent a minimum of 12-15 years starting bottom-upwards from Junior Analyst positions and earned their promotions at every level from day-one.
Let me tell you that it this bossing around by Babus in MoD who know Zilch about stuff on the ground and still never miss an opportunity of throwing their weight around, which is at the root of all this disenchantment, while OROP is just one manifestation which resonates across officers and Jawans with specific reference to the 1973 injustice meted out by Indira Gandhi and the then bureaucracy primarily. You should look at how the MoD is manned with senior defence personnel in key ops/modernization/strategy positions in any country of any strategic significance.
With our MoD structure post independence, it is simply impossible to survive as a nation in the kind of neighbourhood we have, leave alone finding our place in the comity of nations.
Lastly we come to the socio-economic angle, to prove why 1973 civil-military pension equalization was a horrendous blunder, especially after the momentous victory in 1971.
First of all it was like penalizing instead of rewarding when someone delivers beyond expectations of the call of duty, which has been the biggest de-motivating factor in itself.
Leaving this emotional let-down factor aside, let’s get down to the realpolitik.
A jawan retiring at 35 years of age in the prime of his life with kids to bring up and a host of other responsibilities, can’t be compared to someone who is 60 years of age whose kids have grown up to possibly take care of him and whose pension anyways would also be rationalized to his last drawn salary, which itself would have been as per the latest Pay commission he would have seen during service.
Besides , a jawan is an “attack to kill machine” with a “one bullet one target motto” and his only employment option after retiring at the young age of 35 (still old enough for the army to retire him to maintain its killing/winning edge in combat), is being a security guard with a private security company which dishes out peanuts (salaries of less that INR 10K p.m.), besides being singularly insulting, as the job-profile requires him to salute any Tom, Dick and Harry.
I recall this guard we hired from a private security company when I set up our company in Bangalore, whom we called “Khan Saab” as he turned out to be an ex-serviceman and I felt very embarrassed when he saluted me on his first day on duty. I saluted him back and requested him never to do it again as his salutes were reserved for the nation and our flag. His eyes went moist, and he continued to stand-up every time I came to and left office, and every time I used to stop and greet him.
However, the majority in our society respects money and position in this day and age of blatant consumerism and these guys have to face frequent mis-demeanours and the occasional humiliation at the hands of virtual nobodies, with the peanuts they get in return rubbing salt in the wounds. Ours being a growing economy with a continued high rate of inflation, pensions frozen in time become pittance in no time, especially for jawans.
When we consider the officers’ plight, majority of whom are effectively made to retire in the age-band of 40-54 years, it is not always easy to find a job at the senior/middle management level as is the case for any of us in that age-group, irrespective of our civil-military background.
If setting up own business is considered an option, being a finance guy you must be well-aware that 1 in 10 is the global benchmark of VCs for the average-chance of a venture giving any kind of positive ROI.
Besides these factors, rank and file are at the foundation of the chain of command in the armed forces and ingrained in the officers and jawans from their teenage, which simply can’t be forgotten overnight or even in a lifetime after retirement.
It in this light that we should view the kind of humiliation a Colonel who retired 12-15 years before a major who then draws more pension than him would experience. Thus the name “OROP-One Rank One Pension” duly approved by parliament and ordered by the SC and should be implemented in letter and spirit.
Going for modernization and reducing hiring in lieu thereof in a phased manner is the way forward to reduce burden on exchequer and not denying our brave men their due.
The ideal approach at the very outset of nation-building would have been to retrain, re-orient and re-deploy the retired jawans and officers in paramilitary forces especially BSF, CRPF etc., so that they too could work till the age of 45-55 years for jawans and 60 years for the officers. Those from the armed forces who would choose to go that way would be given a choice between the military/ paramilitary pensions post their respective retirements.
This most logical step which would have minimized expenditure and maximized efficiency, was again not taken by our political masters who created BSF & other paramilitary forces with parallel hiring ensuring they had no loyalty to the army to surreptiously create a counterbalance , just because they lived in an irrational fear psychosis of the armed forces for the first 3 decades post independence, a fear which was exploited at every step by bureaucracy to attain and maintain their overarching supremacy in the MoD and over the armed forces in general (Rank asymmetry to the extent of Brigadier equivalent to Joint Secretary being just the starting point!!).
Thus we have jawans in both army and paramilitary forces, both disenchanted as limited resources have to be distributed among nearly double the numbers and the state also feels unnecessary burden. This could still be corrected in a phased manner henceforth to reduce the burden on exchequer.
To conclude my arguments I come back to the basic premise that it is not the average income/facilities/standard of living/pride & honour, but the standard deviation about the mean, i.e. the degree of skew in the distribution of these parameters which leads to socio-economic disenchantment and unrest.
A prime example of such a skew (besides the aforementioned aspects) is the NFU (Non Functional Upgrade) which is a contradiction of sorts from a management viewpoint (why upgrade if non functional??), has been bestowed upon all other central services including themselves (where service is assured to continue to 60 years of age) by the IAS lobby while the armed forces have been left in the lurch due to its pyramid structure and the unreasonable rank-asymmetry.
To top it all Netas get full pension benefits for serving just 2 years as MP/MLA etc., while they don't even deserve their salary for the kind of ruckus they create in the parliament/assembly.
Add to that the brazen and rampant corruption Netas & Babus indulge in making their inflated salaries, pensions and NFUs look like kids' pocket money!!
Looking at the liberalization of our economy we should also allow and encourage setting up of Private Defence Equipment Manufacturers and Private Defence Contractors who can sell their specialized goods, skills & services globally to Oil/Construction etc. companies and Governments alike in hostile operating environments as allowed for in US etc., which will be the ideal post-retirement avenues for our retiring services personnel.
Being from the financial industry and having made a significant amount of bucks out there, you should be the last guy writing what you wrote on OROP, considering that that guys from the financial community get obscenely paid to create all the booms and then the inevitable busts while playing around with others’ money (never their own!!) and fleecing the hardworking class and retail investors in the process, via speculation and fitting data to pre-conceived financial models instead of doing vice-versa (which itself is nigh impossible given the non-linear nature of the models and thus the emergence of behavioral finance post 2008), along with highly immoral kinds of toxic investment packages, backroom dealings, insider-trading... the list goes on and you name it.
Then your community has the temerity to ask for more handsome salaries even from Taxpayer Money based bailout packages running into Hundreds of Billions of Dollars to clean up the mess of which it was the creator in the first place.
Thus the “Main Street Vs Wall Street” debate and demonstrations on the brink of turning violent when the whole world felt cheated leave alone our armed forces, which have every right & reason to feel cheated, given the current predicament they have been forced into both financially and otherwise, more so when people having a finance background with investment banks cry foul over an additional INR 12000 Crores p.a. for the armed forces veterans, in an economy with GDP of lakhs and lakhs and lakhs of crores and annual growth rate between 7-9%, a growth-rate which will ensure that the additional pension load along with its desired revisions will always be roughly the same ratio of the GDP by the time we have modernized our armed forces and cut back on manpower, by which time our growth-rate may also start to taper.
Being a fellow IITian in the same age-group, I hope I can safely joke without offending you: “If it’s not from the heart as claimed and not from the head as just proven, then we all know where from it is... :-) ”
I urge you to write an article again after thorough study and analysis, irrespective of the stand you take, so that you do justice to your intellect and honesty besides restoring the credibility and image of your tribe of IITians.