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I tried starting a manufacturing unit in India (2020)

superr.in

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

#281

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…

In India they optimize for maximum employment. It's the only place I've seen 7 people needed to refill a soda vending machine. Once I ordered some drinks brought up to my hotel room around 10 in the evening. It took forever - turned out the guy who made the drinks was sent home for the day. So the hotel called him back and had him return just so he could come and make the drinks and bring them to my room. Because tha…

Weird question: Did you feel embarassed when you learned driver was sleeping in the car? I would be. You: Sleeping in a 5 star. Them: In an uncomfortable car seat. When I traveled to Seam Reap, Cambodia, I was constantly embarassed when my driver did not come to eat with me. It was a weird, unpleasant peasant-ruler divide that I did not enjoy.

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

#282
post #267

Earlier quoted context omitted.

US citizens bribing foreign officials can be convicted of a felony under (I think it is) The Foreign Corrupt Practices act. Whether DOJ chases down three-developer scale stuff, or has only the staff for multi-zillion class bribes, I don't know.

Paying an official to do something they were going to do (eventually) anyway does not qualify as a bribe.

citation please :-)

To me...if I have to pay someone to do their assigned job it seems like a bribe to me https://www.merriam-webster.com/dictionary/bribe (using money to affect the conduct of a person)

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

#283

Earlier quoted context omitted.

The video talk about Russian military handing out Million dollar contracts to companies registered weeks before the tender. Well, guess what, the exact same thing happened in UK for PPE contracts: "Within weeks of the company’s incorporation on 12 May 2020, PPE Medpro was awarded contracts worth £203m to supply millions of masks and gowns." https://www.theguardian.com/politics/2022/jan/07/michelle-mo...

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.

> 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.

More disturbing (to me) is how easy it is to eliminate corruption in any given area - without any brutality or anything else extraordinary. Just setup the process correctly, incentivize workforce - and the same people who were building roadblocks to milk money will switch to earning money by helping you get your task done.

There was a “widely known in narrow circles” libertarian setup in Troitsk, Russia - of all places. The setup was related to the topic of the original post - registration of businesses. The post-Soviet business registration law was rather liberal. The amount of documents needed was not zero, but doable. But there was a catch - businesses should have been registered locally, and each locality was allowed to add their own requirements on top of federal ones.

You can imagine what followed. Our own city, the I was a counsel member was: just prove to us (“us” in reality means -a clerk) that your business will be useful to the city - and we will register you. But there was a small city named Troitsk, home to some physics scientific institutions, which elected a libertarian mayor, Gennady Lebedev. The city council decided not to ask for any additional documents and just register any business that complied with federal guidelines.

But - any clerk has any good intention in his own hands, right? Mayor said: register everyone? but I am too busy, come tomorrow, and by the way go to… uhm police station, do a background check on yourself for me, I feel a sudden need to be extra cautious in your case. Why not? Seen it everywhere, like you’ve said.

Here comes handy a proper construction of checks and balances:

1. Salary for registration office clerks was paid from a percentage of the (federally fixed) registration fee, nothing else, no safety cushion. If you delay an application- your salary will be delayed too. In the starving Russia that percentage created a - potentially - extremely well paying job.

2. The clerk will be fired if he asked - not just for any unnecessary documents, but just for asking any legally unnecessary question.

3. The clerk will be also fired if he accepts a registration that does not confirm to federal guidelines.

So clerks have the incentive to work fast, help people correct their documents to comply with the federal law and the opportunity for any additional “milking” was too risky and simply not worth it. In short time - small Troitsk had more businesses registered than any other small city in Russia, and comparable to Moscow. Imagine a tax base they’ve got?

First-hand account by Gennadi himself here (in Russian): http://www.sapov.ru/g_v_lebedev/texts/gvl1992_12_troitsk01.h...

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

#284

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…

I remember buying a train ticket in Goa. This involved showing the passport and filling out multiple forms. It was pretty crazy.

Real question: What year? I notice there are lot of stories online about "20 years this crazy thing happened to me in India", but now no more. Example: You can do eVisa for India travel. Super easy online. Most train tickets you can buy online or via "concierge" (minor fee). Hotel booking? Yeah, that too, even smaller places via Internet "aggregator" websites. Travel in India is not so backwards as people think!

I think the funniest and most embarassing story I have about travel in India: The first day in downtown Mumbai, I go to the train stain to buy a ticket for a Churchgate station a few stops away. Honestly, I have no idea what the price will be, but I assume 20-30 rupees. I only have 100 rupee notes. I go to the ticket window: Lady tells me: "5 rupees". I gasped, and looked at my 100 rupee note. She rejects my 100 rupee note! (She was not disrespectful; said: you will take all my change! Wait here; after next person, I can sell it to you.) Next person pays with enough change, then me. All good. We both laughed. To put that in perspective, that is about 2-3 Euro CENTS to ride the train!

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

#285

~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.…

Two anecdotes from me (based in USA).

1) India's IRS still owes me tax-refund from 1998, 1999, 2000, 2001. I gave up trying to recoup long ago.

2) I inherited an inheritance in India from someone passing away (who died without a will). A family member managed to have everything put in their name.

Mindboggling.

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

#286

~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.…

It's a signal you need to pay a bribe, sorry. That's the only way to get something done.

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

#287

Earlier quoted context omitted.

We had company stamps and sole proprietor's stamps in Russia too but they became optional 7 years ago. It was Soviet legacy and it's surprising that India still hasn't got rid of it.

Singapore still has company stamps.

I guess it is a legacy of (inherited?) Chinese bureaucracy. Hong Kong has it too.

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

#288
post #267

Earlier quoted context omitted.

US citizens bribing foreign officials can be convicted of a felony under (I think it is) The Foreign Corrupt Practices act. Whether DOJ chases down three-developer scale stuff, or has only the staff for multi-zillion class bribes, I don't know.

Paying an official to do something they were going to do (eventually) anyway does not qualify as a bribe.

Maybe. From the multitude of FCPA training I’ve had to endure, you can pay to have processing expedited if there is an official policy for it. You cannot pay $1K to the head of the office because he hints that it will speed things up.

Technically, you’re not even protected if you hire a local agent to do all of this for you.

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

#290

Earlier quoted context omitted.

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

This happened to me in Mumbai several years ago. I had thankfully been forewarned, but there were military police checking boarding passes for entering passengers outside the airport, and no one without a paper boarding pass + appropriate government ID was allowed into the terminal. This was right up there with the "requirement" that business travelers in India provide a physical business card to the hotel when check…

What year? I cannot believe this was in the last 20 years. The "physical business card" thing never happened to me.
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