Students, ladies and gentlemen. I think the nation is in a hurry just like I was in a hurry to come to the podium and I am glad that lattice is focusing on India’s road ahead during this third engagement that you are having between academics, between students and industry. Of course, as I was driving into the IIM, one of your colleagues told me that last year Mr Suresh Prabhu, former Rail Minister, was here for this programme. While he was very excited about the fact that now I have become Rail Minister and I have come for the same programme, I got a little worried. Well, I am sure next year you may be planning to have it again.
But IIM has had such a rich history of turning out wonderful professionals fifty five year history I am getting to understand, the first institute of management in India, very proud legacy, a beautiful campus. Even Harvard does not have a campus half as good as yours, and I have asked my colleague to try and get me a Subway sandwich which I can eat on the way back.
Kolkata is a beautiful place. It has lovely memories for all of us. “City of joy” they used to call it? I don’t know whether the joy is still there given the current mood of the state. But I remember all through my childhood we used to look up to Kolkata as that place where all the youngsters can go and have fun and really live it up and I do hope all the students, who have come from outside West Bengal or Kolkata, use this opportunity to really look at a 360 degree experience of Kolkata, because it’s a beautiful place. It’s a city which has so many firsts, so many things. Of course, it was the national capital before Delhi became the capital for strategic reasons when the British moved there.
But so many firsts in your city, the first passenger train in eastern India from Hooghly to Howrah. In fact, State Bank where I was a Director has its headquarters and registered office here. We used to come here every year for our annual board meetings. The first metro started here more than 33 years ago, so it is not as if India has not been able to keep pace with time. But, sadly, India has not been a nation in a hurry for a long time and, therefore, this New India that we are all envisaging is a nation which is looking to transform itself over the next five years just like between 1942 and 1947. Seventy five years ago, India got independence, but the real foundation of that was on 9th of August, 1942 in my city of Mumbai, when the Quit India movement was launched.
And just like from 1942 to 1947, you saw India and the Indian independence movement transform us from a colony to an independent nation. I do hope and believe the next five years, from 2017 to 2022, will help transform our nation, our beloved nation to meet the needs of a billion plus people to make it a society, which is amongst the developed nations in the world. As honorable Prime minister said from the ramparts of the Red Fort on 15th August 2017, many of you may not have heard it, because I don’t know if IIM students get up so early in the morning at 07:30. But if I may be permitted to quote from Prime Minister Modi’s exposition of what he believes is the New India, what he believes is the emerging India, what is that transformation that each one of us look forward to. And I quote, New India where the poor would have houses and access to water and electricity, where farmers would be free from worry and would earn twice of what they earn today, youth and women would get ample opportunities to fulfil their dreams. An India free from terrorism, communalism, casteism, corruption and nepotism, and an India, which is clean and healthy.
And I think that is the dream that each one of us has, that is the dream that India has and that is the dream that each one of us will together, I am confident, succeed in fulfilling. And as President Ramnath Kovindji, when he assumed office said, ‘this vision cannot be translated into reality. This dream cannot be fulfilled, this commitment cannot be met, but for the support of a 125 crore Indians. Until we all participate in making this a national movement and we all collectively contribute to preparing India to achieve its true potential, this mission cannot succeed.’
And if it all I come in here today to Kolkata, it is only to appeal to all my young friends to each one of you that you have to be the torchbearers, you have to be the principal players, who will make this dream happen, who will help transform India into a country where every Citizen has shelter on his head, has 24 hours electricity, drinking water in his home, a good toilet, access through good roads, quality education in his vicinity, healthcare for his parents and children, so that never again do we have to watch on television a citizen of India having to carry a family member on his shoulder in a neighbouring state of Odisha, for kilometer upon kilometer to reach the nearest access of good healthcare. It’s a matter of shame for the nation collectively that 70 years after independence, we still have millions suffering from malnutrition. Our quality of education doesn’t take us beyond probably the last five ranks in the last … study.
Our World Bank rankings in a variety of areas, despite significant improvement in the last 3 years, is still abysmally low. We are still a nation where millions of educated unemployed can be found. We are a nation where corruption have seeped into the, literally into the DNA right at almost every aspect of life. And that my young friends is something we need to change, and I personally am convinced it can change.
I remember when I was given the Coal & Power Ministry in 2014, lot of editorials were written, lot of articles were written. Wherever I met people almost sympathized with me, people almost had words of caution for me, ‘my God you have got the worst Ministry of them all and you are in trouble.’ But at the end of three and a half years, I am not satisfied as if I have achieved everything I wanted to, but I certainly am happy that we have been able to change the mood of the nation, from one of constant despair, a mindset of shortages. And I don’t know if you remember, three and a half years ago, the headlines used to scream, ‘we have run out of coal, we don’t have enough power, everybody is suffering from lack of coal, power plants are not able to run to their full potential.’
More used to be discussed on when power will come back, rather than only when power will go. And I am delighted that we have been able to move from that mindset of shortages of perennial discomfort to a situation where over the last, save and except, the last one month, because of sudden reason we have suddenly got a huge demand for coal. Over the last 18 months before the last one month, we actually had to struggle because of surplus stocks and were not able to sell as much coal as we produce and had to regulate production of coal in this country. Over the last two years, I have been struggling to get new avenues to buy more electricity, the electric vehicle project having come out of that compulsion to sell more electricity, and I am sure we all want to be in a situation where we have surplus coal, surplus power.
We all want to have competition, we all as consumers want to have the ability to choose, the ability to negotiate, which I am sure you have been taught in your institute, and get better terms and a better deal for the consumers of India. And that ladies and gentlemen has been the focus of this government of the last three and a half years. How can we change the mood of the nation, how can we bring back the macho once again into the people of India, how can we once again reignite the investment climate and how can we take this country into an age which at one point of time we used to call ourselves Sone ki Chidiya, the golden age of India.
Can we rethink our priorities? Can we once again plan for an India ahead, where all of us can live a life without fear and a life of fulfilment? In fact, the greatest challenge before us as we embark on this transformation journey is not of resources, is not of our ability to do these transformational changes. It’s not as if the nation has any reason why we should still have one third of our people living an incomplete life, many of them in poverty.
I think we need to really harness the power of youth, the ambition of youth, the ideas of youth, your abilities, and change the mindset of the nation to think with positivity, to believe in yourself, to believe in our own ability, in our ideas, to aim big, to dare to dream as Dirubhai Ambani had said. In fact, many of you may recall Martin Luther King and that famous comment of his, “I have a dream” and unless he had that passion, that vigour, that dream, that desire to change, I don’t think America could have been unshackled from racism. It is that power within each one of us and it is not as if Mr Modi has any more desire and dream then each one of you in this room. It’s not as if I can do any different or more than every one of you in this audience today.
It’s only the collective wisdom and the collective effort that can then have transformational results, and I have come to really appeal to each one of you, and I am actually delighted that many of you are from this PGPX programme, where you spent a few years and then come in to do a one year programme. I myself, actually started my executive education at Harvard in 2013, did my first module, but, unfortunately, could not go back for the second module in 2014. But I am technically still a registered student over there and they promised me that they will allow me to come and complete my programme. And I promise you, I learnt a lot in that first module and I am putting that to good use in this opportunity that Prime Minister Modi has given me, particularly, the power to negotiate, the ability to negotiate better. Otherwise, possibly, we wouldn’t have been able to bring LED pricing down by 87%, otherwise, possibly we couldn’t have devised mechanisms to increase production so quickly, to increase generation of electricity so quickly. Possibly we couldn’t have aimed so big, but for the power to negotiate, because life is all about negotiations. You are negotiating with your wife, your children are negotiating with you, you are negotiating with your professors, citizens are negotiating – well, one can negotiate even with the constable who catches you breaking a signal.
But, otherwise, we are all in negotiation in our life, and I think that must be certainly one of the subjects you are learning and what we now need to do is negotiate a better deal for the future of India, for the people of India, for our future, for our families’ future. And I am particularly delighted to be amongst you as you do your relearning or retooling yourself, because as they say, “Never be afraid to try something new.”
Remember amateurs built the Ark, experienced professionals built the Titanic, the Ark survived, the Titanic didn’t survive. It’s only when you embark on new things, it’s only when you are willing to explore uncharted territories, it’s only when you are willing to look at yourself as a student, possibly in perpetuity, that you will be able to think new ways of doing the same thing. And once this nation starts innovating, after all, what is the strength of the United States of America? Why does Europe have to have, have seen so much progress in such a short period of time, and during that same element of time, we did not progress as much?
Japan and India look back at 1947 and 1948, and we can’t blame it only on our population, particularly, in reference to Japan, and the density of population and the lack of natural resources in Japan. So, it is not as if they are made any differently than us. It’s not as if others had better opportunity than us. India has all the ingredients to make us a super power, to make us a developed nation.
What is holding back India is us, is our ability to look differently, to think differently, to be bold, to innovate, to try out new things. And that ladies and gentlemen is what this government over the last three-three and a half years has been focusing on, creating a solid foundation, a framework on which the Indian future can rest, a framework, which is honest, a framework which will have zero tolerance for corruption, a framework which will have an enabling and regulatory programme to ensure that we can attract the best of talent back to the country, we can attract best of technologies, we can attract investments. A framework, which provides equal opportunity to all and not where there is favour for a few, and each one of you is going to be the champion of change.
We recently had an interaction with about 400 young entrepreneurs, young CEOs, start ups, the Prime Minister and some 12-14 colleagues of his interacting with them in two batches of 200 each, free and flowing discussions. We wanted to hear what are their ideas for the India of tomorrow, and I promise you some of the ideas that come out were brilliant. If you were to compare the ideas between the younger lot, the young CEOs the young entrepreneurs, the young start ups, viz a viz the more experienced persons, I promise you the younger ones came out with better ideas. Not to say that the others were not good, but on a comparison, the younger persons came out with more innovative ideas.
Once all of us get down to becoming those champions of change, after all, just government or government initiatives cannot change the future and destiny of India and the people of India. Change will happen when each and every citizen becomes a part of that change. Today, on the flight to Kolkata, Justice AP Shah, a very-very eminent jurist, was on the flight with me. Many of you may have heard it, many of you may have experienced it, he mentioned it to me that, ‘Mr Goyal, corruption you have been able to eliminate at the top. Now, we don’t hear of corruption in government, you have process-driven governance, all natural resources are given out through a transparent process of auction or nobody selected based on his caste or community or religion or relationship or family or political ideology. You have been able to curb corruption at the top, but, you know, we still have corruption at the lower levels.
Aren’t all of us to be blamed for that? After all, if I have 1.3 million employees working in the Indian Railways, clearly, with all the best of intention and the processes, I will not be able to supervise every ticket collector or every RPF (Railway Protection Force) constable personally. But ताली तो दो हाथ से बजती है ना? रिश्वत कोई देता है तभी किसी को रिश्वत मिलती है| अगर हम सब तय कर लें कि हम कभी रिश्वत नहीं देंगे तभी जाके परिवर्तन आ सकेगा इस देश में|
If we have to become the champions of change, we will have to first make up our mind what we want to do. You may be reading of late about thousands of shell companies, I believe the maximum number are housed in this city of joy, have been detected through the efforts post demonetization, and the crack down on black money and corruption.
Now, Prime Minister Modi, when he was mentioning and talking to the chartered accountants on 1st July, which was Chartered Accountants’ Day. On my request he had agreed to address them. It was also the day GST was being launched, which was a milestone. It’s probably the biggest reform ever embarked anywhere in the world at the scale at which it’s being done in India. And when he accepted to come there, one or two days before the programme, he called me up. And he said, ‘Piyush I want to speak my mind to the chartered accountants. I said, please do.
I don’t know if any of you heard his speech on 1st July at the Indira Gandhi Stadium. It was a chartered accountants’ programme where students who were CA students were also invited. Indira Gandhi Stadium is a big stadium. It accommodates more than 20,000 people. When the SPG (Special Protection Group), which looks after PM’s security went there, 2 days before the programme, they hit their head and told the CA Institute officials, they said, guys, please organize some buses and get some people to fill up these large stadiums, because you guys are not going to be able to get 20,000 people to come into this stadium. In a stadium with a capacity of 20,000 odd people, and audience was only CAs and CA students, mind you. And there are many CA students, across the country; we have about 1.2 million students pursuing CA. In Delhi alone, probably a 100,000 or so.
There were 60,000 people who came there that day. The stadium was full, packed to capacity. We had to open a wrestling stadium in the vicinity of the IG Stadium, about 25,000 people we filled up over there who watched it on a screen. They put up a screen just for an overflow, potential overflow, and there were about 15,000 to 20,000 people outside the gates, which had to be barricaded by the police, because there was no way they could allow them to come in with full packed stadiums.
And will you believe it if I tell you that every time the Prime Minister would appeal to the CAs not to indulge in corruption, not to allow such shell companies to come in, to help us crack down on black money, the whole stadium which was largely CA students, young boys and girls, would reverberate with enthusiasm and claps. The youth of India today does not want to do business the way our fathers and grandfathers and forefathers did. They want an honest India. Young India, today, doesn’t want to have two sets of account books – ये कच्चा खाता है, यह पक्का खाता है|
The young children of tomorrow, of the emerging India don’t want to have shell companies having transactions at high premiums and converting black money to white money. And while some of the CAs were quite hassled while the Prime Minister was speaking, the young audience was extremely enthused by his comments. I remember on more than one occasion I have appealed to the CAs that if every chartered accountant made a pledge and decided I will not bribe anybody, I will not help anybody fudge accounts, we 253,000 chartered accountants alone can transform India into an honest country, just 250,000 CAs across the country.
And, similarly, if all of us young professionals in this country, and I don’t think there will be a single company of size, scale and repute in the country, other than the government companies possibly where you won’t have alumni of IIM Kolkata, Bangalore, Ahmadabad, etc. not a single company I would believe in the country. And you have all excelled all over the world wherever you all went, can we not have that same excellence in our Indian companies, in our Indian atmosphere. It’s possible.
And I would urge you to look at the track record of the last 3 years in every area, what transformational initiatives have been taken, to bring transparency to governance, to remove and eliminate potential avenues of corruption, how projects have been scaled up. I don’t know what is used in the IIM campus, but we have promoted LED bulbs. Now LED bulbs are good for the country, because not only do they save energy, thereby helping consumers reduce their electricity bills, but they also reduce carbon dioxide emission, because energy consumption and, therefore, generation falls. And, by the way, every unit of electricity you save is equivalent to 1.3 units of energy produced, considering the large amount of wastage and AT&C losses, power theft.
Until 2013-14, we had a company called Energy Efficiency Services Limited. It’s a government promoted company. It had a turnover of 35 crores in 2013-14. It was buying 7 W LED bulbs at Rs 310 each, plus taxes; distribution, marketing, all those costs. Therefore, the LED bulb became so expensive that government had to give a Rs 100 subsidy and even with that they were only able to sell 6 lakh bulbs in a year, 6 lakh bulbs in a year. 7 W bulb – Rs 310.
You must have heard about Prime Minister Modi’s comments more before the election when the Gujarat model of governance used to be discussed about Speed, Scale and Skill. We brought that into this programme. We made a target that in the next 4 years, from 6 lakh bulbs per year, we will ensure that India changes 77 crore bulbs to LEDs over the next 4 years. We made that in 2015. We are now two and a half years into that programme. You will be happy to know that EESL alone, in the last two and a half years from 6 lakh a year in the last two and a half years has sold 26 crore LED bulbs. The private sector sold another 41 crore. 67 crore LED bulbs have been sold only in the last two and a half years.
And you know the price? What used to be purchased at Rs 310 for a 7 W bulb, we now procure 9 W bulbs, 30% more light (lumination) for only Rs 40. 87% reduction in price! By the time we sell it to the consumers, it’s probably Rs 65 or thereabouts. The payback, the savings in your bills gives you a payback at least for people in this room, probably, of two months, because your electricity bills, consumption would be on the higher side. 2 months it pays back and then it has a life of 5/7/10 years.
Somebody wants to guess what would be the saving annually of electricity, just with this one LED programme? 112 billion units of electricity, annually! What will be the saving in your, all the consumers’ energy bills? Rs 40,000 crore, annually! When all the bulbs in India are changed to LED, we would not have spent more than 10-12,000 crores, may be 15,000 crores for replacing all the bulbs and tube lights in the country, maybe not even that much, at these prices I think not even 10,000 crores. Under 10,000 crore investment, annual saving of Rs 40,000 crore, carbon dioxide emission falls by 80 million tonnes because of this saved energy, and we will avoid a peak demand of nearly 22 GW, which means we save a 1,40,000 crores of investment to set up that much more energy capacity or generating capacity.
Just one single programme, reflecting the speed and scale – what was sold 6 lakh in a year at 87% lower prices is now sold 6 lakh in a day, every single day! And EESL, which did 35 crore turnover in the year 2014 by 2019, in 5 years, of which the first year we didn’t do anything, I was still getting the ropes of the work, we will do Rs 10,000 crore turnover. I hope some IIM Kolkata graduates think of joining that company. It will be the fastest roll-up, you tell me a private company with this kind of a roll-up, scale-up, with prices falling 87%, turnover going up from Rs 35 crores to Rs 10,000 crores. They are doing other things also now – energy efficient agricultural pumps, audit of buildings to convert them to efficient buildings, etc.
But I gave this example only to reflect the scale and the skill with which these programmes are executed speedily, just to reflect the mindset of change that is possible in the New India of tomorrow, which each one of you has to implement. Policymakers can be enablers, we can run a few programmes like this, but each one of us has to think differently.
I have just been given charge of Railways. Accidents has been in the news. I had a review meeting day before yesterday where some decisions were made; almost 21 major decisions were made related to safety, 3 or 4 of them I gave out in the press also. Unmanned railway crossings – we have had this story for years and years. Even now railways has a plan that over next 3 years, they will eliminate unmanned crossings. Now I am arguing with them, actually I am negotiating with my team in railways – why it can’t be done in one year? There are about 5000 of them left, why can we not do it in one year, such a large infrastructure; 5000 places. And we all know what a level crossing is like, it needs a barricading, needs a …… structure where a man can sit, it needs telecommunication. And we have RailTel optic fiber all across the railway network. Period.
Probably, the investment and all of this in 5000 locations when done together will also bring down the cost on every location, because of economies of scale and speed of execution, just like happened in the LED programme. I think if we spend maybe 300-400 crores, we would have rid India of probably 30-35% of cause of accidents, so all the accidents that take place, 30-35% of them are because of unmanned crossings, can be eliminated in a year at a very low investment. Why should we wait for time to implement this?
One of the causes they told me is there is a shortage of rail track to execute speedily all the safety requirements. I said we should float global tenders and get more material in, how can we compromise on safety? Expedite the process, have transparency, allow people internationally to compete, so we get the best of prices and bring in more equipment and bring in more goods or rolling stock. And let’s focus on safety.
And during the meeting it struck me that I can possibly delay some new projects by 2 or 3 months till the new tendering process and new purchases, use whatever stock we have, divert it from new lines also to the repairs for the next 3 months or 4 months, make up for it later through procurement of additional material. But try and reduce the risk to my passengers.
You will be amazed, how do we check the railway lines. There is a linesman who walks along the track. He uses something with which he checks the track and by the sound of it he knows whether there is a fracture or its okay, and his mandate is to do 6 kilometers every day. They even told me I need to hire 260,000 more people if I want to make Indian railways safe, day before yesterday.
I asked them why can’t we employ new technology. Forget something very fancy, even if you had a small rail car with sensors or a small X-ray equipment or microscope or whatever which reading can through communication, again RailTel is available, be available both for the person running it and also in the control room for the experts to see. I think we can do the same job with 1/10th the number of people and may not have to burden the railways with more inefficiency.
Some press asked me that passengers are being subsidized 33,000 crores. I said yes, there may be some element of subsidy, but I don’t think it’s 33,000 crores. I can’t pass on my inefficiency to the passengers of India. I mean, just imagine, if I produce a motorcycle and professor Sarkaar produces a motorcycle. He does it efficiently. I am inefficient in my work. I consume 30% more electricity in my factory than him. I have 20% more labour in my factory than him. I drive in a Rolls Royce and a private plane. He uses the Indian Railways. His motorcycle with his profit margin cost Rs 70,000. Can I come and tell you, look guys, I am an inefficient producer of motorcycles, kindly pay me 85,000 for my motorcycle, don’t buy it from him. And, can I expect any consumer to pay me 20% more for that motorcycle just because I am an inefficient producer of that product or service, or will I have to set my house in order and compete with them and offer something to you at 68,000, so that I can take away market share from you. A simple management principal which you are all being taught here.
And that is what we need to bring in to the working of government – simple management techniques. After all, if at all there has been a turnaround in the last 3 years, Prime Minister Modi has only and only employed simple management tools that each one of you learn in the working of government. I don’t know if you are aware when he took charge as Gujarat Chief Minister, are you aware what was his first stop? IIM Ahmedabad! The entire government, all his Ministers, and the then Chief Minister, 16 years ago, went to IIM Ahmedabad and literally took classes.
When I became Power Minister, my second day in office I had flown down to Ahmedabad, not to IIM, but to meet with the officials of Gujarat power companies, because in two and a half years they turned around Gujarat to a 24×7 surplus power state. And all that is required is to bring simple management techniques into government. What are those management techniques? Do a root cause analysis, so that you do your work smart. I could not have solved the power problem unless the coal problem was solved, and there was adequate coal going to the power plants.
If we go even further into root cause analysis, possibly, I couldn’t have done half as much as I think I did, you all are the best judge for that if Prime Minister Modi had not done a root cause analysis and kept coal and power under one Ministry, which was the need of the hour at that point of time. And, frankly, yesterday we were assessing why he kept coal and railway under one Ministry today, because the power-coal integration has already given results, now we need railway and coal to work together. And today I did a review with coal and rail officials before I came here and the first slide they showed was Coal India plus Rail India is equal to New India.
So, you do a proper root cause analysis, you prioritize your mission, your programme, bring in accountability, monitor the progress of your work, hold people responsible, accountable for their work, bring in transparency, use innovative financing models, engage with stakeholders, partnerships with stakeholders, make consumer the central focus of all your work – consumer is king in this real world – retool people and processes, as they say zero based budgeting in a way, prepare the country for innovation for the new way of doing things. After all, nature of jobs in India are not going to be what they were 30 years ago, you are not going to see 4000 MW and 2000 MW power plants in the future in this age of distributed energy distribution, you are not going to see large factories giving, kind of, organized labour jobs. You are going to start ups, you are going to see young entrepreneurs, you are going to see innovation, artificial intelligence is going to be the order of the day, 3D manufacturing will come in instead of large plants manufacturing products, electric vehicles will probably take over from diesel and petrol vehicles, not only saving us precious foreign exchange, not only saving the cities and India from pollution, but also bringing down the cost of transportation.
I don’t know if you know, a combustion engine in a diesel car or a petrol car has 2000 moving parts, an electric engine has less than 20, so much less maintenance, so much less repair, so much more life of that vehicle. So, the new age of India, which is emerging, is going to be something completely new, a new way of doing things. It’s like there is that story, and while we are doing all this, the country’s engine has to keep moving. It’s not as if I can say, okay, stop everything, now we will retool, we will re scale, start afresh and then we will restart in a new way. Everything has to be done while the engine is moving. And there is a small story around it – it’s like a mechanic says to a surgeon that while both are doing the same job, a mechanic and a surgeon. They are fixing problems in a very complex structure. A surgeon is probably doing a heart surgery, it’s a very complex structure, a mechanic is working on a large machine, it’s a very complex machine. But the surgeon gets paid 10 times more than the mechanic. And the mechanic asks the surgeon, ‘I check how it’s running, open it up, fix the valves and put it all back together, so it works as good as new again. We basically do the same job, why are you paid more than me?’ And the surgeon gently smiles and replies, ‘try it with the engine running’.
And that, ladies and gentlemen, is the job at hand for us. We have to create, together, I am not saying us as in me or the esteemed professors and management of IIM alone. It’s the job of all of us how we are going to create, how we are going to make this New India, this mission for New India, this vision of New India become a part of our mindset, become a part of our journey in the next 5 years and beyond, how each one of us is going to be a partner in this journey, a stakeholder, how each one of us is going to dream that New India, how each one of us is going to live to fulfill that dream. And that’s, ladies and gentlemen, the only way when 125 crore Indians move one step forward, India will take 125 crore steps forward.
Thank you very much.
August 31, 2017 Speaking at FICCI Business and Climate Summit 2017, New Delhi