Why do we think NRIs, PIOs better than us?

The biggest investment our better-off NRI brethren make in India is by investing in high-interest-bearing NRI deposits in Indian banks.

I recently received an email whose operating part was: “I would like to sum up our performance in the 20th century in one sentence. Indians have succeeded in countries ruled by whites, but failed in their own. They are flourishing in the United States and Britain. But those that stay in India are pulled down by an outrageous system that fails to reward merit or talent, fails to allow people and businesses to grow, and keeps real power with netas, politicians, and assorted manipulators. Once Indians go to white-ruled countries, they soar and conquer summits once occupied only by whites.” There is an essential truth in this. The relative success of Indians in the US has more to do with the quality of the American system, which affords the opportunities to all to pursue their dreams and professional quests.

Typically such self-laudatory messages which list the Indians who have scaled high heights in the US, people like Indra Nooyi, Sundar Pichai, Satya Nadella, Lakshmi Mittal and other such who are lauded and honoured ever so often during their fleeting visits to India, do not mention S. Chandrasekhar, V. Ramakrishnan, Hargobind Khorana and Amartya Sen, all Nobel laureates who brought India much honour. Other nationalities too do well in America. George Soros is Hungarian. People of Chinese origin have won the Nobel eight times. US scientists of Japanese origin have won as many as five science Nobel prizes. Even Pakistan has a couple of Nobels. So it’s not just Indians who are a special people. What are special are the societies and systems that allow talent and genius to flourish.

This success of some Indians in foreign countries has given rise to a certain NRI mentality which makes them believe they have answers to all our myriad problems with their complexities just because they have done “well” overseas. They forget they are not as special as the societies that give them a better deal in life.

They think they are successful because they have realised a Western lifestyle and Western income. Our political and bureaucratic leaders too seem to have been considerably impressed by these “achievements” and the annual fests hosted by the Government of India to laud our NRIs are typical of this mentality. We don’t seem to realise that NRIs and PIOs cannot do much and actually do very little to benefit India. They have few investments here in India and our investment in them by what we have provided them and what we have let them take with them is still far greater.

Most of the non-corporate FDI in India is by resident Indians who round trip their illegally ferreted out wealth from overseas havens. The biggest investment our better-off NRI brethren make in India is by investing in high-interest-bearing NRI deposits in Indian banks. Most of them simply borrow from US banks at low rates and make a good pile each year on the interest differentials. The problem is that such funds now constitute a huge Damocles’ sword that by being able to take flight fast is a constant threat to our house of cards – Aadhaar, PAN, debit and PIO included.

Of the about $370 billion of foreign exchange reserves now, over $130 billion is reckoned to be the combined contribution from the Indian diaspora through deposits. Remittances are about Rs 70 billion mostly from our less-privileged NRI brethren who toil in the most adverse conditions in the Middle East, Africa and other hard places to be able to support their families in India.

The NRIs who talk at our NRI fests and who we laud hardly remit any money back home. But they talk and talk telling us what to do.

Typical is a friend who holds a modest job in the US and who visits me every now and then. But when he comes here he is full of suggestions, most of them ranging from stupid to asinine, on how to make this country great like America. He thinks he can comment because he thinks he has achieved something in life. (I drink Scotch every day- kind of standards.)

This logic makes me retch. These fellows forget that India adds a dozen billion dollar companies each year and at the last count we had over 250 of them. Indians head almost all of them. An Indian today has become the chairman and major owner of the world’s second biggest mobile telephony company here in India.

Indians can do well and do well in India. They send up rockets to the moon and Mars, perform heart transplants, design satellites, splice genes, write codes and so many of the things that are considered at the edge of the new frontiers of technology. And they can do this far more frugally than anyone else. The Mars Orbiter cost us just Rs 450 crores, or about $73million, and Isro succeeded in the very first attempt.

There is a lot that is wrong with India. We can and should be doing much better. Nevertheless India’s per capita GDP has grown six times over in the past two decades. It has grown annually at about seven per cent since 2000. Its GDP in PPP terms is the third-largest in the world now and many Western financial institutions like Citibank and Standard Chartered Bank forecast it will become the world’s largest by 2050. That’s just 33 years from now.

Finally, I end on a personal note. Tom Mullen, the janitor of the building where I lived when at Harvard, came to work driving a car and had passion for expensive racing bicycles. He lent me one for a while and had me over to his place for Thanksgiving. My Indian friends used to rib me about my friendship with the bhangi. Tom still probably makes more money than me. Harvard now pays its unionised staff a minimum of $16 per hour. Tom was a great guy, but does his income make him a better man than me?

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