Atanu Dey On India's Development

Aakash, blue skies vaporware

| 9 Comments

In the information technology sector, the two well-known categories of goods are hardware, the stuff you can hold in your hands, and software, the bits that have no weight. The third category is termed vaporware: hardware that exist only in the fevered imagination of their promoters and which will never hit the stores.

The government of India recently unveiled a tablet computer which they claim will revolutionize education. Perhaps vapor does not translate well into Hindi and therefore they settled on the word for sky, or Aakash, for the tablet.

Vaporware does not condense into hardware because it fails the pitiless test of the marketplace that the product’s benefits exceed its costs. That constraint does not apply to the government sponsored Aakash because they can choose to ignore inconvenient costs through the simple expedient of spending other people’s money.

The Aakash can be priced at any arbitrarily low number but that does not change the cost. The difference will be paid for not by Mr Kapil Sibal but by the average citizen of India. And for what? To eliminate digital illiteracy, an entirely artificial malady conjured out of thin, blue air.

The failure of the Indian education system must count as the Indian government’s greatest failure. Over 90 percent of students drop out of school by the 12th grade and only six percent go on to tertiary education, to cite just one dismal statistic. We have to understand that the failure is primarily due to flawed policies that the government has consistently imposed on the education sector. Aakash, like its predecessor the “$10 laptop”, is just another distraction, but a very costly distraction.

It is costly in many ways. First, the government should not be subsidizing consumer electronics. Electronics is the most competitive industry in the world and extremely competent huge corporations are constantly innovating with the result that costs move downwards monotonically. Governments are incapable of choosing winners in technology, and the Indian government has demonstrated particular ineptitude in that regard.

Second, the lack of real commitment to fix primary education is especially hard on the poorest sections of the society. Promoting digital gizmos at immense public costs only widens the gap between the haves and the have nots. Something like half the 7th standard students cannot read, write or do simple arithmetic. Where a hundred million suffer illiteracy, attempting to promote digital literacy cannot but be a cynical exercise in self-promotion and aggrandizement.

A press conference saying that India has invested in providing blackboards and teachers in 100,000 schools that lack them would not be as headline grabbing as one which parades a me-too device hyped as an “iPad killer.” A policy of funding toilets in schools (needed to alleviate the suffering of girl children especially) does not have the sex appeal of a policy of handing out digital gizmos. But the production and distribution of hi-tech gadgets offer immense opportunities to profit for the producers and the government – never mind at what cost to the public.

Press releases that repeat the claim by the government that the Aakash tablet will be sold in tens of millions of units fail to do basic arithmetic. The subsidy costs could run into billions of dollars. Like so many other government schemes, the Aakash tablet, in the unlikely event that it is actually produced, will ultimately be funded by the poor through increased inflation. Unlike Mr Sibal, the poor suffer when the government runs the printing presses at the mint overtime.

Our focus has to be on the urgent and important matter of education. The government has a critical role to play, which is to provide the regulatory environment for needed massive investment by the private sector. That role is as a facilitator and not as a competitor to the Apples and the HPs of the world.

Public support for education, particularly education for the poor, is absolutely necessary and beyond doubt. Basic economics argues for subsidies because there are enormous social benefits to an educated population. However that public spending has to be targeted and the interventions have to be sequenced properly.

Perhaps digital illiteracy should be a cause for concern, but I doubt it. Like tens of billions of others, I too was a digital illiterate but that did not interfere with my education in the least. However, basic illiteracy is a critical concern. That is the weakest link in the entire chain of education. Strengthening any link other than the weakest link will not make the chain stronger. A government that has failed to achieve universal literacy cannot be trusted to eliminate digital illiteracy.

When entrepreneurs and start-ups peddle vaporware to get funding, the losers are private investors that are taken in by hype. The rough and tumble of the marketplace eliminates the incompetent or the simply greedy, and rewards true innovators. But when the government gets into the game of funding vaporware at massive public costs, and away from the discipline of the marketplace, it adds one more chain around the citizens, already imprisoned by the shackles of inflation and government control.

The penalty for wrong-headed policies is paid not by the government officials but by people like us. No matter what promises they make about eliminating digital illiterary, we cannot afford to pay the price.

{This appeared as an op-ed in the Indian Express on Oct 8th, 2011.}

  • Ram

    Atanu ,

    I can trust you to find extremely reasonable sounding arguments against everything done here by the GOI, but I don’t agree with you.
    Yes the akaash will not help the poorest in the “xyz”purs of rural india .. But it will surely help the students on the outskirts of bangalore, hyderabad etc. These are the children who already have blackboards and toilets in schools and parents paying their fees hopeful that they make it big

    Ironical as it may sound , but the poor welfare schemes will not reach the absolute bottom because of our existing system. All the people who are capable of changing this are passing out of our IIT’s and running away from the systems to make foreign businesses richer, and keep blogging from safe corners in the world.

    What the aakash will do , is create a broader middle class, Give opportunity for the otherwise simple job boys to gain real knowledge (on the wikipedia?) and give them a hope of making it big. Ofcourse not everyone has it in them to make good use of opportunity but whoever has it will be better equipped. Besides a hit aakash will also generate a lot of other businesses around education which may not benefit the poorest , ( without the toilets ), but will surely present opportunities to small enterprises in India

    I realize that Mr Sibal is spending tax payers ( including mine ) money and claiming headlines , but what are you doing to stop a unworthy,corrupt government .. Are you even using the 1 vote you have ?

  • Bhaskar

    The maker claims that the tablet does cost less than $35, then is it subsidized by GOI , or is he lying ?

    http://youtu.be/_OzVbjxn2XE

  • DJ

    I was eager to find out who was behind the Aakash development and was amused to find out that it is being ordered from Canada. So, I’m not sure why there was so much fanfare on its “release”. I think it was misleading for Sibal to publicise the Aakash as a government initiative when it was merely ordered from a private party by the government. Its like them publicizing the iPad after ordering it from Apple. Stupid!

    From routers to laptops, nothing in the IT hardware sector is built in India. Not quite sure why it is so, very sad! It would have been more useful to have policies to favor manufacturing here rather than to order a tablet from somewhere else.

    Ram:

    All the people who are capable of changing this are passing out of our IIT’s and running away from the systems

    Blame the system, not the individual. And, you need to understand that the people would not be able to use their capabilities here due to the system. Better that they do something of note elsewhere, rather than doing nothing here (due to the system).

    I realize that Mr Sibal is spending tax payers (including mine) money and claiming headlines

    Absolutely, and very cheaply in fact. And, not only that the Indian govt is deeply hypocritical.

    Do you know that a Kindle now costs $80. That a Kindle with free 3G costs $140. And, it is far better for reading wikipedia. Why don’t they partner with Amazon and bring down the costs – Amazon would be more than willing to do it? In fact the older versions of Kindle can surely be ordered for cheaper if they wanted to strike a deal of that sort.

    Instead, I have to pay customs charge of $60 on a $140 Kindle when I want to ship from Amazon to India. How hypocritical is that? On one hand they subsidize a stupid tablet and on the other they charge customs on a better quality tablet? And, they are both built out of the country, so its not like its helping the local manufacturing sector.

    If they really want more people to use tablets in India, how about starting by removing customs on the $80 Kindle first. Then we’ll talk.

  • ram

    DJ

    This is a vicious cycle , the bad system drives away the good people .. And hence continues to remain bad. The cycle has to be broken. If these proficient , brilliant people are not going to do this then who will ?

    Do you expect the likes of Sibal (who claimed there was zero loss in 2G ) to clean up the system for people to do “something of note ”

    Anyway coming back to what Atanu says .. If Aakash is not going to reach the poorest , it is the same for the blackboards or toilets. For the really poor in India schooling is not even on the agenda. His fantasy land ( In “transforming India”) is clearly very far away.

  • DJ

    Ram,

    This is a vicious cycle , the bad system drives away the good people .. And hence continues to remain bad. The cycle has to be broken. If these proficient , brilliant people are not going to do this then who will ?

    This logic is wrong. Simply put, the system will continue to be bad irrespective of the so called proficient and brilliant people staying back. There are enough that have stayed back so, its not like there aren’t any available here to show the way. Arguably, you need some of them outside in order for them to show the ones here the way. If you get what I mean.

    What it would take to break the cycle is some minimum amount of literacy and enlightenment in the majority of people. And, they do not need people sacrificing their personal ambitions for that to happen. In fact, so-called brilliant people are largely irrelevant because the problems are fundamental and not of an exceptional nature (its not like we need an atomic bomb, we need basic infrastructure – far more intellectually mundane). You need people to be able to get to a point where they can buy their own digital equipment.

    No, one cannot rely on Sibal. He is a coward. He has shown that, when he expressed his “fear” at the inadequate education infrastructure in the country to an NRI audience. He was questioned critically by Indira Nooyi of Pepsi on what he was doing to alleviate this fear since it is within his power to craft policies to do something about it, and he had nothing to offer and, had to face further criticism.

    However, his zero loss argument isn’t the worst he has come with.

    One could rely on NaMo, perhaps Nitish Kumar, even Anna Hazare to the extent that he can divert votes away from Congress in upcoming elections.

    Indeed the fantasy land is far away. However, countries often shift dramatically and quickly, so keep your fingers crossed.

  • DJ

    Btw, Aakash is the perfect example of how the cowardly Congress has been functioning for decades. Charge huge customs on all tablets, smartphones, laptops, etc and then announce one of your own in order to funnel money to people they collude with. Crony capitalism, oligarchy, engineered scarcity (to borrow Atanu’s phrase), state corruption at its best.

    One other horrible experience. To get an imported item into Uttar Pradesh, one has to either pay state VAT or get a clearance stating that the item is for personal use. I visited the local state VAT office for my Kindle and it was like I entered the stone age. Horribly dirty bureaucratic offices. I filled up 5 forms (I kid you not) which all were actually the same. It was probably requested to generate business for the copy machine and affidavit writers around. Then I was told that I should come the next day. The next day I was told that they were on strike. They wanted a bribe that I would not pay so I had to return without the clearance and had to return my Kindle back to Amazon. Un-frikking-believable.

    After all this, when the govt releases a tablet of their own, you cannot blame me for being exceedingly angry at them for their hypocrisy.

  • Bhole Baba

    Come come gentlemen, some show of generosity here. You know how, after screwing up everything about India, UPA oh so desperately needs one good story. Just one. Oh pretty please. But they don’t come more crooked than Sibal. If you have seen his sardonic grin, you have seen the smirk of the grim reaper. A very thoroughbred back orifice, that waster.

  • Ninja!

    Atanu,

    Aakaash is only tip of the iceberg. You got to know about it because someone out there made sure it gets some publicity in mainstream media. There are so many initiatives by GoI that claim to have an impact on education but in fact its just burning taxpayer’s money.

    Drop me a mail I can give you a list of examples.

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