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I tried starting a manufacturing unit in India

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Re: I tried starting a manufacturing unit in India

#101

Post by blntechie »

rohan_shah wrote: post #30
blntechie wrote: post #24

I think what the OP went through is pretty much re-zoning of an agricultural land to commercial/industrial land which probably will run into similar roadblocks in Western world too? Of course, not saying it will take this long but have heard about similar bureaucracy. Small town governments in USA at least are very strict with their zoning codes and based on things what I have heard, changing the zone sometimes requi…

Yes that's right. It's similar. But the problem is that the whole of India is made up of hundreds and thousands of small towns. And there are hardly any land banks zoned as industrial land because almost all of India is fertile land.

Agree to an extent. Only the industrial parks and other similar areas are zoned as industrial and I guess it’s hard to setup your warehouse for example there? Of course, you had the land which was the primary motivation, if not, SME industrial parks would be the way to go.

Re: I tried starting a manufacturing unit in India

#102

Post by padiyar83 »

blntechie wrote: post #24

I think what the OP went through is pretty much re-zoning of an agricultural land to commercial/industrial land which probably will run into similar roadblocks in Western world too? Of course, not saying it will take this long but have heard about similar bureaucracy. Small town governments in USA at least are very strict with their zoning codes and based on things what I have heard, changing the zone sometimes requi…

Thats right. Majority of the problems here are from re-zoning agricultural land into an industrial one. If you build your manufacturing unit in an existing industrial area you can skip a lot of this type of paperwork.

Re: I tried starting a manufacturing unit in India

#103

Post by s_trumpet »

jeffreyrogers wrote: post #27
asdfasgasdgasdg wrote: post #4

It's interesting because you can see how theoretically any of these requirements would be a reasonable step before starting a manufacturing operations. I know in silicon valley for example many environmental problems were caused by insufficient oversight of manufacturing. However, the road to hell is paved with good intentions, as described in the article. I'm sorry to hear this is happening and I wish you good luck…

There's an economist who calls this "premature imitation". Basically India has adopted a lot of ideas that (arguably) make sense in more developed economies but that prevent India from developing to the point where those policies are actually beneficial.

"Premature Imitation and India’s Flailing State" - Shruti Rajagopalan and Alexander Tabarrok

https://www.independent.org/pdf/tir/tir_24_2_01_rajagopalan....

Re: I tried starting a manufacturing unit in India

#104

Post by oasisbob »

jeffreyrogers wrote: post #27
asdfasgasdgasdg wrote: post #4

It's interesting because you can see how theoretically any of these requirements would be a reasonable step before starting a manufacturing operations. I know in silicon valley for example many environmental problems were caused by insufficient oversight of manufacturing. However, the road to hell is paved with good intentions, as described in the article. I'm sorry to hear this is happening and I wish you good luck…

There's an economist who calls this "premature imitation". Basically India has adopted a lot of ideas that (arguably) make sense in more developed economies but that prevent India from developing to the point where those policies are actually beneficial.

> "premature imitation"

When I worked at a young startup in Seattle we went through a stretch of hiring ex-Microsoft PMs who were great at solving all sorts of ten-years-old Microsoft-flavored problems.

I wish I knew this term then.

Re: I tried starting a manufacturing unit in India

#105

Post by de6u99er »

This sounds worse than Eastern Europe. My wife once had interactions with Polish authorities and the first official told her immediately what amount of bribe money will be necessary to get it done quickly, contrary to everybody involved sitting it out as long as possible. When she asked why the bribe is so high, the government employee explained to her whom of his colleagues he has to pay himself to get it done quickly.

I respect your refusal to pay bribes, but I believe you would have already received your approval if you were willing to pay a bribe. Not sure much those delays cost you in regards of your time invested and lost opportunities.

I'd go to the first person you talked to, ask how much needs to be gifted to him personally so he/she can take care of this. Then pay half of it at the beginning and the second half once you have received your approvals.

Re: I tried starting a manufacturing unit in India

#106

Post by pradn »

KineticLensman wrote: post #56
pjc50 wrote: post #32

Earlier quoted context omitted.

It's hardly new; the colonial system was set up to prevent India industralising, but was so beneficial to those taking bribes that it was carried on even after independence. Known as the "license Raj".

> the colonial system was set up to prevent India industralising Hardly. The colonial system started to evolve from approx 1600 [0] but industrialisation [1] didn't start in the UK until at least 150 later [0] https://en.wikipedia.org/wiki/East_India_Company [1] https://en.wikipedia.org/wiki/Industrial_Revolution

Colonialism didn't seriously arrive in India until 1750, and it took until 1800-15 for the British East India Company to consolidate it's control over the subcontinent. Before 1750, the Company was a straightforward trading company, sharing trading rights with the Portuguese, French, and the traders of the Indian Ocean rim. After 1750, they were able to seize tax-collecting rights in Bengal, one of the most prosperous areas of the Mughal Empire. They used tax revenue on agriculture in the fertile Bengal delta to fund further trading and military activities around the subcontinent. Their policy was often mercantile. They forced wages down, drove exacting standards for manufacturing textiles, and engaged in monopsonistic policy.

So, I agree - an accurate statement would be to say "English involvement in India came out of the prevailing ideology of mercantilism, and it then grew into a colonial state". The colonial state did lead to India's deindustrialization - ex: the flourishing textile industries of the subcontinent were not allowed to modernize. But counterfactuals are hard. (I still think an area of the world at the forefront of textile production for thousands of years would not have gone gently into the good night without a fight.)

Re: I tried starting a manufacturing unit in India

#107

Post by cynusx »

addicted wrote: post #10
asdfasgasdgasdg wrote: post #4

It's interesting because you can see how theoretically any of these requirements would be a reasonable step before starting a manufacturing operations. I know in silicon valley for example many environmental problems were caused by insufficient oversight of manufacturing. However, the road to hell is paved with good intentions, as described in the article. I'm sorry to hear this is happening and I wish you good luck…

The problem here has nothing to do with unintended consequences. These consequences are very much intended. The government adds these road blocks precisely so they can maximize the number of government workers who can milk money out of you. Western developed countries have an order of magnitude more permissions that need to be approved. The difference is that the more sensible ones will consolidate all the requiremen…

They will also digitalize and centralize information so that things can be checked directly in the databases of the relevant government agency

Re: I tried starting a manufacturing unit in India

#108

Post by NovemberWhiskey »

steffan wrote: post #29
gaff33 wrote: post #3

Earlier quoted context omitted.

How do you think the process would have gone if you agreed to pay bribes?

One thing to note to, is that any American citizen would be unable to set up manufacturing this way because it is explicitly illegal for U.S. citizens to pay bribes to foreign governments. [Foreign Corrupt Practices Act - FCPA] https://www.investopedia.com/terms/f/foreign-corrupt-practic... (Although given this account from presumably an Indian citizen, I can't imagine in any way recommending a non-local attempting t…

Paying bribes is illegal; but facilitation payments are legal.

If you have an official who is refusing to perform their job, or taking inordinately long about doing it, then it's legal to pay them to do it. As long as you're not influencing their actual decision making process, i.e. causing them to overlook actual legal deficiencies in your paperwork, then it is legal.

It's called the facilitation payment exception to FCPA. Obviously one intending to make such a payment would be well advised to discuss with their lawyer to make sure it is indeed within the scope of the exception.

Re: I tried starting a manufacturing unit in India

#109

Post by selimthegrim »

praveen9920 wrote: post #34
blntechie wrote: post #24

I think what the OP went through is pretty much re-zoning of an agricultural land to commercial/industrial land which probably will run into similar roadblocks in Western world too? Of course, not saying it will take this long but have heard about similar bureaucracy. Small town governments in USA at least are very strict with their zoning codes and based on things what I have heard, changing the zone sometimes requi…

It is not just about red tape, it is about corruption. Govt. Employees in India join the Govt job only for "alternative" revenue ( bribes ). This process is usually handled by "agents" who knows how much these govt employees expect and provide "easy" services to whoever wants to get shit done. To take an example a simple thing like driving license takes couple of months to get if one is planning not to involve an age…

Apparently in PK these days government competes with agents on service and will take same money and deliver DL to your house
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