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I tried starting a manufacturing unit in India (2020)

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Re: I tried starting a manufacturing unit in India (2020)

#231

Post by dr_dshiv »

grepfru_it wrote: post #226
primitivesuave wrote: post #156

Earlier quoted context omitted.

I came to the comments to warn exactly this, perhaps more emphatically. Do not set up a legal entity in India. It will become a never-ending void where money and time go to die. The bureaucracy is hilariously inept and bloated, and if you are not willing to pay the bribes or for some entity to navigate the systemic corruption on your behalf, you will end up in OP's situation. Source: hired many Indian developers in r…

When I visited a Cisco office in India, I noticed there was a prominent notice of business application and listed the Indian owner of the company. I thought that was interesting and went digging into India law about ownership. When I came out of that rabbit hole I immediately had zero interest in starting up in India. Simply because of the bureaucracy and would be way more wink-wink-$$$-nudge-nudge than what I'm even…

Well, I expected this article to be about bribes, because I assume it happens a lot. However, there were no bribes. Does anyone have actual experience with bribes in India (not traffic police)?

Edit: sorry, one person openly asked for a bribe, the Panchayat. I would like to understand more about this. Do they just ask for an amount?

Re: I tried starting a manufacturing unit in India (2020)

#232

Post by dopidopHN »

as someone else said, it looks like rezoning and that might be hard in many other place. For instance in France, you could be per-empted until late in the process by the SAFER, the entities managing agricultural land. They might buy it from the vendor at market price when you try to buy the land, and sell it for another price they see fit to a farmer of their choice.

Not as frustrating as what OP described. Still. Simple Administrative formality can fuck up your plan badly.

CF a fine piece of self reflection on our own adminstration. ( I love our admin, it's a fine piece of Napoleonic technology. But. yah. ) https://youtu.be/JtEkUmYecnk?t=34

Re: I tried starting a manufacturing unit in India (2020)

#233

Post by Ironlikebike »

etaioinshrdlu wrote: post #10
spaceman_2020 wrote: post #8

India'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…

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.

Every new piece of paperwork that requires an additional face-to-face hand off or brings in a new entity provides another avenue for corruption to occur and a place for money to disappear.

I've had employees (in Brazil) who don't ever claim reimbursement on personal expenses because if their paycheck varies too much their bank freezes their funds (in the name of preventing money laundering) and then the employee has to go to the bank and bribe someone to get the funds unfrozen. Just showing the cause for the variation in payroll doesn't cut it. As the employee puts it, every requirement to show up in front of an official for anything requires a bribe.

Re: I tried starting a manufacturing unit in India (2020)

#234

Post by pelorat »

franciscop wrote: post #46
giva wrote: post #6

> Yes, you need to obtain “permission” before you build any manufacturing structure on your own land with your own money. This permission is called the NA or Non-Agricultural Certificate. Well, I though it was this way everywhere in the world. In Europe, at least, you cannot build anything on agricultural land unless it is a n agricultural structure or you get the classification changed, which is not easy.

I have a funny story from Spain: My father's has an orange field, so at some point he wanted to dig a well to get some water. He went to the City Hall, got all the tricky paperwork and applied for permission to build it. Months passed by without hearing anything, and at some point he just forgot about it, assuming he'd be denied silently. There's some people in the city hall don't like him too much BTW. Few years lat…

A friend of mine in Spain bought a masia, but was not allowed to tear down the old building to build a new house (protected heritage or something, even though it was junk). So the way around it was to do it in steps. Replace it whole building part by part. So now he has a new house (but it looks like the old one in shape), but there's nothing left of the original.

Re: I tried starting a manufacturing unit in India (2020)

#235

Post by giorgioz »

franciscop wrote: post #46
giva wrote: post #6

> Yes, you need to obtain “permission” before you build any manufacturing structure on your own land with your own money. This permission is called the NA or Non-Agricultural Certificate. Well, I though it was this way everywhere in the world. In Europe, at least, you cannot build anything on agricultural land unless it is a n agricultural structure or you get the classification changed, which is not easy.

I have a funny story from Spain: My father's has an orange field, so at some point he wanted to dig a well to get some water. He went to the City Hall, got all the tricky paperwork and applied for permission to build it. Months passed by without hearing anything, and at some point he just forgot about it, assuming he'd be denied silently. There's some people in the city hall don't like him too much BTW. Few years lat…

don't ask permission, ask forgiveness

Re: I tried starting a manufacturing unit in India (2020)

#236

Post by jkestner »

miroljub wrote: post #188
leidenfrost wrote: post #161

Earlier quoted context omitted.

But the parent comment is right. The knee jerk reaction against corruption is to centralize power: "X institutions are corrupt, we will give more power to this candidate who demonstrated to be a good person, so he will vanish those institutions and saves us fron corruption". That's what Bolsonaro did in Brazil. In his campaign, he demonstrated to be a good christian and a person of faith. In Brazil, people strongly a…

> That's what Bolsonaro did in Brazil. In his campaign, he demonstrated to be a good christian and a person of faith. In Brazil, people strongly associate that with being a good person. Wasn't Bolsonaro elected because the previous president and his main opponent (Lula?) was so corrupt that he even landed in jail, which is a rare event for a prominent politician? > Guess what happened after. Care to explain to non Br…

I don't know if Lula committed corruption, but he apparently wasn't more corrupt than the judge who tried him, who became Bolsonaro's Minister of Justice. All the charges were dismissed eventually because of court bias. https://en.wikipedia.org/wiki/Luiz_Inácio_Lula_da_Silva

Re: I tried starting a manufacturing unit in India (2020)

#237

Post by skippyboxedhero »

otikik wrote: post #158
ricardobayes wrote: post #122

Earlier quoted context omitted.

It's actually kind of disturbing how there are basically only a handful of countries on the planet without systematic corruption. Maybe there are none. Perhaps it's a human trait.

I would go as far as to say that a little bit of corruption is healthy. It adds flexibility. For example: you don't want to register your neighbor's daughter for taxes just so that she can babysit your child once or twice. That is crazytalk. And yes, a lot of countries make sure that small payments don't require registration or taxes. This was just a quick example to make the point, sometimes the general law is just…

> I would go as far as to say...

In the UK, it wasn't corruption. These people were paid money for products, they delivered those products, the price paid wasn't excessive.

The UK has an independent auditor that found no evidence of corruption, and that (where product was delivered incorrectly) it was due to problems with contract specs.

Afaik, there is only one case where a person was directly involved in politics and was related to a vendor, they went to great lengths to hide their connection to a vendor, repeatedly lied to civil servants who questioned them, and is now being charged criminally (for some reason, the person who made the original comment about the UK chose not to mention it, it was PPE Medpro).

The issue was that at the start of Covid, the govt called up all their suppliers asked for PPE, and they said they didn't have any. So the govt started using suppliers who often had other businesses that imported product from China (and had to set up new companies). The level of profit on the contract was normal, the price was higher but that was related to the pandemic (how quickly forgotten, in the UK there was literally no PPE for most of 2020, you couldn't buy masks at any price).

So the flexibility already exists...the UK is not corrupt, things happen naturally. Corruption is only necessary where there are supply-side bottlenecks due to politics (i.e. Qatar, Russia, India).

Re: I tried starting a manufacturing unit in India (2020)

#238

Post by JohnJamesRambo »

sam_goody wrote: post #45

I do not understand the authors issue with paying bribes. You want your factory, you are willing to pay lots of money for it, and the system works with bribes. Fine, so be it. Pay the bribes and get to work. I once lived in such a country*. The unfairness is built in, but if you have the money, you can get whatever you need relatively quickly. If you are trying to save money, fine. But you are willing to go to court,…

Sometimes people just stand up for what is right and expect officials to do their job?

Re: I tried starting a manufacturing unit in India (2020)

#239

Post by riskable »

eastbound wrote: post #176
otikik wrote: post #158

Earlier quoted context omitted.

I would go as far as to say that a little bit of corruption is healthy. It adds flexibility. For example: you don't want to register your neighbor's daughter for taxes just so that she can babysit your child once or twice. That is crazytalk. And yes, a lot of countries make sure that small payments don't require registration or taxes. This was just a quick example to make the point, sometimes the general law is just…

Well for small payments we need a simple tax box, no country is doing that, all countries require a ton of paperwork for each new “employee”.

Why not just have one payment system to rule them all run by the government that is required by law for all payment of employee-driven services? Businesses could save a TON of money on payroll systems and HR.

A government-run system--presumably--would take care of withholding the correct amount of taxes and also making sure the business/person paying a salary never has to worry about running afoul of the law (having the IRS or equivalent) come after them.

Re: I tried starting a manufacturing unit in India (2020)

#240

Post by elmomle »

dr_dshiv wrote: post #231
grepfru_it wrote: post #226

Earlier quoted context omitted.

When I visited a Cisco office in India, I noticed there was a prominent notice of business application and listed the Indian owner of the company. I thought that was interesting and went digging into India law about ownership. When I came out of that rabbit hole I immediately had zero interest in starting up in India. Simply because of the bureaucracy and would be way more wink-wink-$$$-nudge-nudge than what I'm even…

Well, I expected this article to be about bribes, because I assume it happens a lot. However, there were no bribes. Does anyone have actual experience with bribes in India (not traffic police)? Edit: sorry, one person openly asked for a bribe, the Panchayat. I would like to understand more about this. Do they just ask for an amount?

Not the OP but typically bureaucrats will talk about fees and fines, which continue without documentation of their purpose (at which point they are explicitly bribes).

Baksheesh, whereby people expect a tip ahead of time if you want decent service, is quite common in India and is essentially another form of corruption, especially when practiced by police, bureaucrats, etc.

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