India's claims to remove red tape since this government took over can best be summarised as "three red tapes in a trenchcoat"
I tried starting a manufacturing unit in India (2020)
101–110 of 456 posts
Re: I tried starting a manufacturing unit in India (2020)
#102India's obsession with paperwork is unceasing and baffling. Everything requires an application, even when everything can be done digitally. You need letters and stamps to get anything done. Case in point: the "company stamps" that are required for everything you do with your business. From getting a debit card to changing the maturity instructions for a corporate deposit, you need to sign your name AND stamp it with…
Reminds me of a surreal example[1] of Indian bureaucracy from Jim Rogers’ Adventure Capitalist:
Rogers and his wife had left India's State of Manipur and were safely across the border in Myanmar. But wait, here comes an Indian official running after them, who says that they can't leave, because, they didn't have permission to be in Manipur. "He was telling us — I am not making this up — that we had to return to Manipur, because we were not allowed to be in Manipur, and thus we could not leave it," Rogers relates. The debate lasted for two hours before, "someone made a phone call and took the subinspector off the hook, and we were free to proceed."
Re: I tried starting a manufacturing unit in India (2020)
#103There are two big problems with bureaucracy (apart from never knowing how to spell it). The first is that bureaucratic processes always seem to get bigger/longer/more complex and secondly, by its nature, it is hard to improve because the same bureaucracy you want to remove requires just as much effort to change as the effort you are trying to save.
It would make more sense to time-limit some of these things and make the various departments reapply every 2 years if they think the process serves a purpose still. Perhaps they pay $1M as well. As soon as the cost is more than the benefit, all of a sudden we realise that we don't really need 100 differnt people to sign off on everything.
Another easy win in this example would just be to make more of it electronic e.g. you apply in one place and they send out the relevant permissions to the various departments, some of whom could fill them in immediately/automatically and wire them back.
Re: I tried starting a manufacturing unit in India (2020)
#104Earlier quoted context omitted.
Countries with high paperwork and bureaucratic burden are famous for also being highly corrupt. This is probably not a coincidence. Likely all the excess paperwork makes it easier to hide what's really going on, easy to provide roadblocks for those who don't pay, and easier to generally hide bad activity in a sea of noise.
I wouldn't consider Germany and Switzerland that corrupt.
Ahem. We're talking about a country where a chancellor that pushed for building a gas pipeline from a foreign country went straight to the board of the foreign company running that pipeline after ending his term as chancellor.
Corruption is everywhere, it's just on different levels. Usually in more "developed" (I don't like that word) countries you see corruption on the highest levels, and people actually get away with it.
Re: I tried starting a manufacturing unit in India (2020)
#105India's obsession with paperwork is unceasing and baffling. Everything requires an application, even when everything can be done digitally. You need letters and stamps to get anything done. Case in point: the "company stamps" that are required for everything you do with your business. From getting a debit card to changing the maturity instructions for a corporate deposit, you need to sign your name AND stamp it with…
I was in Tunisia at the airport in Tunis for a departing flight. Having already checked online, I tried going through security with my electronic boarding pass. The security told me I needed my boarding pass. I pointed again to the electronic copy as politely as I could. The security said “this is Tunisia, you need the paper copy.” XD
Re: I tried starting a manufacturing unit in India (2020)
#106India's obsession with paperwork is unceasing and baffling. Everything requires an application, even when everything can be done digitally. You need letters and stamps to get anything done. Case in point: the "company stamps" that are required for everything you do with your business. From getting a debit card to changing the maturity instructions for a corporate deposit, you need to sign your name AND stamp it with…
I remember dropping my bag at a luggage store at the big train station in Mumbai. Bags needed to be scanned before being stored, not uncommon. Except the scanner was on the other side of the station. So I was sent off and queued up to get my bag scanned and more importantly get my receipt stamped to say it'd been scanned walked back through the crowds where I could have done anything with the bag - to the luggage dro…
Ah yes, it's the "yessir" bureaucracy, the "magical piece of paper" bureaucracy. Designed to keep privileges and maybe as a job program
Re: I tried starting a manufacturing unit in India (2020)
#107Earlier quoted context omitted.
>Why? I have no idea! Legacy of British civil service and bureaucracy ?
"No, you don't understand, we have to operate like this seventy plus years after the end of British rule - not because we are incapable or we aren't agents - no no but because the British set up this system, and who are we to change it?" See also, "no you don't understand, we had to start a war with the Muslims in the West because the British didn't tell them to be our second class citizens fast enough"
Indian civil service do have stronger gravitas compared to other civil service. Looking from Indian Civil Services Examination, it really attracts huge amount of talents and required preparations.
Re: I tried starting a manufacturing unit in India (2020)
#108Earlier quoted context omitted.
Countries with high paperwork and bureaucratic burden are famous for also being highly corrupt. This is probably not a coincidence. Likely all the excess paperwork makes it easier to hide what's really going on, easy to provide roadblocks for those who don't pay, and easier to generally hide bad activity in a sea of noise.
The paperwork is an attempt(usually misguided) to stop the corruption. The idea is that if you have to account and document all actions you will have act in the proscribed manner and not in a way that benefits you. This usually fails for the reason you posted. I am not really sure how you are supposed to stop corruption once it gets rooted in your society. It is a vile and subversive menace that turns every one into…
> I am not really sure how you are supposed to stop corruption once it gets rooted in your society.
Well, assuming that all people are roughly the same as each other, the answer would be to adopt traditions and systems from countries that aren't corrupt. Attempt the sisyphean task of convincing people that giving power to the middle class is going to lead to a better future.
As your comment reveals, the instinct when confronted with corruption is ... centralise power and try to force it to be used for good. That doesn't work, so try to convince people to decentralise power. Political and bureaucratic elites are regularly revealed to be corrupt, so stop making them the bottleneck for handing out the "allowed to run a business!" stamp. Centralising power just gives corrupt people a target to aim for and increases the blast radius when they worm their way in to a position.
How you convince people to do the sensible thing and decentralise power is beyond me though. The instinct to push power to a single leader is remarkably strong in humans.
Re: I tried starting a manufacturing unit in India (2020)
#109~5 years ago, I hired three Indian developers. They asked me if we could set up an Indian legal entity, so that they could just get regular salaries in India with tax payments, deductions etc taken care of. I agreed and we got it done.
One of the worst business-decisions of my life. The amount of red tape, stupid rules, corruption, signatures, stamps, showing up physically in a certain office etc etc... Mindblowing.
I will not tire you with all the details, but to this day, Indian tax authorities still hold money hostage, that they agree my Indian company is owed (GST refunds). But all attempts to actually get the money back falls on deaf ears. We have sent experts to the relevant tax offices etc, but the ONLY guy who can handle it is never there, refuses to deal with it, then says we need to go somewhere else - where we are sent back etc etc. Sent around in circles, basically - with everybody recognizing the money is in fact owed...
I will never do business in India again. Happy to work with Indian developers (I still do), but they will get paid as freelancers and deal with the red tape on their end.
Re: I tried starting a manufacturing unit in India (2020)
#110Earlier quoted context omitted.
Countries with high paperwork and bureaucratic burden are famous for also being highly corrupt. This is probably not a coincidence. Likely all the excess paperwork makes it easier to hide what's really going on, easy to provide roadblocks for those who don't pay, and easier to generally hide bad activity in a sea of noise.
I wouldn't consider Germany and Switzerland that corrupt.
At least for Germany... we're not overtly corrupt: you don't need to bribe policemen to get out of fake charges or traffic stops, you don't need to bribe city officials for building permits.
But at the large scale, we are absolutely a corrupt nation: our former Chancellor Schröder sold us out to Russia, there have been dozens of millions euros worth of (shockingly ruled legal) corruption during the pandemic, the large companies ("Deutschland AG") have an extremely cozy relationship with almost all parties in Germany, not to mention corporate donations and sponsorship of party gatherings (except far-right AfD whom no one serious wants to donate money to and far-left Linke who refuse to take corporate donations out of principle).