C Gopinath

You can’t do a McDonald’s with IITs

C Gopinath | Updated on February 04, 2014

Government can't do it all, all the time



A question often asked of societies that do not allow and encourage equal opportunity for their women is: How can that society progress while using only half of its brainpower? A similar question can be asked of societies that place undue restrictions on their private sector.

The US has historically been a beacon in furthering the role of the private sector in public life. Several states now have privately run prisons. The federal government has awarded contracts to private companies to transport cargo and astronauts to the International Space Station.

The Soviet and Maoist way of thinking laid great stress on government planning and governmental direction. But times have changed even in these societies. Stuck to the State

However, developing countries seem to cling to a dominant state sector for far longer than they should. Governments continue to run distribution schemes, manufacture consumer goods, and undertake industrial activities that are more efficiently managed outside of government.

Unless there is a strong libertarian streak among its populace to check on the growth of the public sector, it becomes very difficult to limit government dominance.

Politicians also love power, and the more turf under them the greater are the opportunities of power and patronage.

There could be yet another reason. Colonisation seriously undermined the psyche of the general public about their ability to do things themselves.

In such an environment, it was easy to think of the private sector as a set of thieves out to rob the public. But India is now 65 years old. Enough time for a generation that may have inherited this psyche to have faded away.

Yet, we still have a prime ministerial aspirant like Narendra Modi who would rely on ‘big government’ to further his vision for the nation. Ironically, he comes from a rightwing tradition of politics that gives importance to free and private enterprise.

I refer, in particular, to his recently unveiled policy of creating an Indian Institute of Technology, an Indian Institute of Management and an All India Institute of Medical Sciences in every state in the country.

No doubt, these are fine institutions and need to be replicated to cater to the great demand for quality education.

But the assumption that the government has the means to maintain the same quality can be seriously questioned.

Trust in quality

There was a reputed rosogolla making firm in Kolkata which, I suspect, faced a family split resulting in several outfits with the same name springing up elsewhere in the city. The parent shop then felt constrained to reiterate its quality reputation by adding a tagline to its name which said, “We have no branches”.

The message sought to be conveyed was that the original quality could not be duplicated. However, McDonald’s and other franchising champions created a model based on offering the same quality at every outlet.

The government cannot do a McDonald’s with the IITs and the IIMs. Their expansion into a second round of institutions has raised a class system of quality and market preference. Having got it right in the first place, the government should understand that the times have changed.

(The author is Dean, Jindal Global Business School, Sonepat.)

Published on February 04, 2014

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