INDIA’S rich, powerful and the elite need to take responsibility and demonstrate that rising inequality in the country can be reduced to ensure peace and harmony in the society or risk violence, the founder of one of India’s top software services firm, N R Narayana Murthy, has said.
Given that the Gini coefficient — which measures income distribution among countries —has been rising, a fact which has been flagged by the International Monetary Fund and economists such as Thomas Piketty, it is important for the rich, the powerful and the elite which includes politicians and the media to recognise this and work towards reducing the Gini coefficient. “When does violence pervade a society? When people lose hope. And who is responsible for hope? It is the rich, the powerful and the elite who can enhance hope. Therefore, it is their responsibility to keep hope alive. The day, the rich, the powerful and the elite do not take responsibility for this and for ensuring peace, you will have violence,” he said in an interview to The Indian Express.
Leaders of capitalism too in the country need to exercise self-restraint in granting benefits to themselves or their friends. “If this does not happen, you won’t have peace and harmony in a society. In some cases it has not happened. My hope is that good sense will prevail.”
The International Monetary Fund, the World Economic Forum and others had flagged rising inequality in economies such as India and China. The IMF had said that Gini coefficient for India rose to 51 in 2013 from 45 in 1990, reflecting the rising concentration of wealth at the top.
Murthy has, in the past, criticised the level of inequity including at Infosys in which case he had publicly disapproved of the wide differentials in salaries or compensation between senior management and those at the basic level. “Something is wrong in a society when this happens. All of us have to open our eyes and do something about this,” he said.
Similarly, the elite have an onerous responsibility to exercise self-restraint when it comes to using social media, he said. “It is like the power of a gun. It depends of the quality of the heart. If you give a gun to a person with a good heart, he or she will use it to defend people. But a person with a bad heart will use it to kill people.”
On the current discourse on jobs, Murthy said that unlike a decade ago when software services companies were top recruitors, sectors like information technology cannot create a large number of jobs now. He cited the case of Infosys which as late as 2014 used to have an annual intake of 25,000 which has now dipped to 15,000 owing to slower growth, leaving an impact on the number of jobs which are created. Productivity improvements too have also contributed to this lower recruitment by firms posing a challenge on the jobs front. “It is a worrisome trend,” he said.
With 400 million semi-literates and 400 million illiterates in a country like India, job creation will have to come from manufacturing and low tech services, he said. “The Prime Minister’s emphasis on Make in India is very good .But we have to reduce the friction to Indian entrepreneurs and foreign companies to start new manufacturing entities in India as manufacturing has considerable scope for even semi-illiterates and illiterates too.”
It is in this context that the government — both at the federal level and in states — and the bureaucracy ought to end the tyranny of factory inspectors, eliminate conflicts around GST and other issues and reduce the time frame for a host of approvals to a fortnight to boost entrepreneurship. That is why it was important for politicians, bureaucrats and corporate leaders to sit together and think of how to accelerate growth and create more jobs, he said.