Foundation for Democratic Reforms in India

WWW.FDRI.ORG

WWW.FDRI.ORG

• Twenty-five year Wall Street veteran

• Chief Investment Strategist of Wachovia Securities (formerly First Union Securities)

• Recognized twice by the Wall Street Journal as best asset allocator among the top 13 U.S. financial service firms

• Regular appearances on CNBC, CNN-FN television, quoted extensively

• Charter Member – The Indus Entrepreneurs (TiE), Midwest

• Founder, TANA Foundation, a philanthropic organization that disburses over $1MM annually

• Chaired two business conferences of TANA

• Chicago, 1995

• Cincinnati, 2001

• Education

• MS, Chemical Engineering, University of Akron

• MS, Polymer Science, University of Akron

Rao Chalasani– President, Chicago

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• Founder Versata and CEO JumpStart

• Education

• BS, BIT, Ranchi

• MS & MBA, University of California, Berkeley

• India experience – Hindustan Motors, NEI

• Resides in the United States since 1966

• Standard Oil

• TRW

• Ameritrust Bank

• Versata, etc.

• Charter Member, The Indus Entrepreneurs (TiE), Silicon Valley

• Desire to give back

• Committed 3 months per year in India since 2000

• Champion of TiE, Jaipur

• Board of Directors – ICC, Hume Center

Naren Bakshi– Director, Silicon Valley

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“Democracy, disciplined and enlightened, is the finest thing in the world.”

- Mahatma Gandhi

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• Root causes vs. symptoms

• Holistic vs. piecemeal solutions

• Inclusion of all stakeholders

• National in scope and scale

• Collective assertion

An Empowerment Movement

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• Difficult but achievable

• It fits into the Indian psyche

• Marathon – not a sprint

• Needs determination and confidence

• Collective assertion

Challenging but Within Reach

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• Governance reforms is an empowerment movement

• Healthcare, education etc. will all be positively impacted

• The success of this movement ensures multi-fold returns for other causes

Governance Reforms – A fulfillment of India’s freedom struggle

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USA• Oldest democracy

• Secular state

• Good opportunities

• Systems mostly in place

• Governance facilitating

growth • Individuals can excel

easily

India• Largest democracy

• Secular state

• Excellent opportunities

• Systems still developing

• Governance hindering growth

• Individuals have to struggle to excel

Why Governance Reforms?

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The Scale of the Problem

Union and state governments combined spend

Rs. 1,800 crores daily

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Problems in Perspective - Is this a system lacking funds or a conscience?

Primary School Education

1.6 million classrooms needed Capital cost : Rs.16,000 crores – 9 days government

expenditure Recurring expenditure : Rs.8,000 crores – 5 days

government expenditure

Sanitation

140 million toilets needed Cost: Rs 35,000 crores Equals just 20 days expenditure

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• In India: work with mature, registered, non-profit organizations working towards Governance Reforms

• In US: work primarily with NRI institutions to promote awareness of Governance Reforms in India.

FDRI’s Approach

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(FDR) – Leading think tank that provides strategic direction

Lok Satta – A grass roots people power movement that works

to implement FDR’s vision

Foundation for Democratic Reforms (FDR) andLok Satta – a dual top-down, bottom-up approach

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The relationship between FDRI, FDR, Lok Satta and affiliate organizations

FDRIFDR

Lok Satta

Affiliateorganizations

Funds, research

Funds, research

Funds & in-kindsupport

NRIInstitutions

NRIInstitutions NRI

Institutions

Funds, researchOther Sources

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Putting the Pieces Together – Lok Satta partner organizations in India and abroad

• National Council for Electoral Reform (NCER) • People’s Union for Civil Liberties (PUCL), New Delhi• Association for Democratic Reforms (ADR), Ahmedabad• Association of Local Governments in India (AGLI)• AGNI, Mumbai• Federation for Empowerment of Local Governments (FELG)• CERC, Ahmedabad• Association of Voluntary Agencies for Rural Development (AVARD)• Mazdoor Kisan Shakti Sangathan (MKSS), Rajasthan• Public Affairs Center, Bangalore• Sri Anna Hazare and colleagues, Maharashtra• Cooperative Development Foundation (CDF)• Parivartan, New Delhi• Foundation for Democratic Reform in India (FDRI)

WWW.FDRI.ORG

1. Comprehensive electoral reforms

2. Empowerment of local governments

3. Instruments of accountability

4. Speedy and efficient justice

5. Best practices identification and implementation

The Five Pillars of Good Governance

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• Disciplined and enlightened democracy in India

• Empowerment of citizens to realize their full potential

• A confident, prosperous India that is a global leader

The Outcome

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“Never doubt that a group of thoughtful, committed individuals can

change the world…

Indeed it is the only thing that ever did ”

- Margaret Mead

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Lok Satta – Its founder and mission

Dr. Jayaprakash Narayan – his life and mission

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Dr. Jayaprakash Narayan – Hyderabad

• Founder, Foundation for Democratic Reforms• National Convenor, Lok Satta

• Graduated from Guntur Medical College 1979• Ranked 4th, Indian Administrative Service 1980 • District Collector, Prakasam and East Godavari Dts., AP• Secretary to Governor, Andhra Pradesh• Secretary to Chief Minister, Andhra Pradesh• Chairman, Industrial Infrastructure Corporation, AP• Resigned from IAS at age 40 to start the Lok Satta movement for

governance reforms in India

A Physician by Training, A Beaureaucrat by Choice, and A Democrat by Conviction

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WWW.FDRI.ORG

Murali K. Prahalad – Director, San Diego

• Director of Business Development, Sequenom, Inc.

• Experience in IT and management consulting

• Extensive involvement with the Network of Indian Professionals (NetIP) since 1997

• Spoken on the role of second generation NRIs and India’s development at the Confederation of Indian Industry’s Annual Summit in 2002 and 2003

• Co-authored a white paper on second generation Indian Americans and their relationship with India for the Prime Minister’s Commission on Non-Resident Indians and People of Indian Origin (2001)

• Education

• M.Sc. Honors, University of Michigan 1992 with majors in Cell and Molecular Biology, Japanese and Economics

• Masters of Medical Science, Harvard University, 1995

• Doctorate in Biochemistry, Harvard University, 1998

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WWW.FDRI.ORG

“ ... out of the past is built the future. Look back, therefore, as far as you can, drink deep of the eternal fountains that are behind, and after that, look forward, march forward....Our ancestors were great. We must first recall that. We must learn the elements of our being, the blood that courses in our veins; we must have faith in that blood, and what it did in the past - and out of that faith, and consciousness of past greatness, we must build an India yet greater than what she has been. There have been periods of decay and degradation. I do not attach much importance to them...such periods have been necessary. A mighty tree produces a beautiful ripe fruit. That fruit falls on the ground, it decays and rots, and out of that decay springs the root and the future tree, perhaps mightier than the first one...”

- Swami Vivekananda

FDRI / Lok Satta are About Hope and Action

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1. Identify high impact problems

2. Research and document root causes

3. Educate and train citizens

4. Develop focused and measurable action plans

5. Share successful, sustainable and scaleable solutions with like minded groups across India

Surgical, results-oriented, direct

The Lok Satta Approach

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The Five Pillars of Good Governance How Lok Satta is Making a Difference

1. Comprehensive electoral reforms

2. Empowerment of local governments

3. Instruments of accountability

4. Speedy and efficient justice

5. Best practices identification and implementation

WWW.FDRI.ORG

Problem: Political parties fielding candidates with criminal records. Citizens are unaware of candidates’ criminal

backgrounds.

Solution: Citizens have a right to know if candidates have prior criminal histories. Enact legislation forcing parties

to provide background information on candidates they field.

Impact: - Lok Satta and coalition organizations challenge flawed bill concerning disclosure of candidates’ personal

assets and criminal records

- The Indian Supreme Court rules in favor of the coalition

- Indian Election Commission issued guidelines in line with the Supreme Court directive

- Voters can judge candidates on personal merit

- SC directive to be enforced in December elections

Comprehensive Electoral Reforms – the decriminalization of politics

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Solution: Establish citizens groups to research and publicize the background of candidates. Create a forum to

collect and verify criminal records. Publicize the records with those who have criminal pasts.

Impact: - 1999, Lok Satta identifies 45 Lok Sabha and AP assembly candidates with criminal records.

Political parties get the message.

- 2002 Hyderabad Corporation elections

- 34 candidates

- 12 drop out for fear of exposure

- of remaining 22, 14 found with criminal records - of the 14, only 1 with criminal record is elected

- Model taken to states that go to the polls in Dec. 2003

Comprehensive Electoral Reforms – Election Watch

Problem: Political parties field candidates with criminal records

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Problem: Political parties’ illegal expenditure on campaigns is often 5-10 times the legal ceiling. Most of the money goes

to buy votes and is a major source of corruption.

Solution: Enact a bill for tighter scrutiny of election expenditure.

Impact: - Lok Satta drafts bill for tighter campaign finance reform and gets bipartisan parliamentary support

- Bill recently passed by Parliament largely unchanged

- The Election Commission will implement the new law

- The buying of votes and illegal fundraising curtailed

Comprehensive Electoral Reforms – campaign finance reform

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Solution: - Genuine devolution of power

- Transfer 50% of state tax revenues to local governments

- Create local government cadre in civil service

- Abolish unconstitutional bodies such as Urban Development Authorities (HUDA etc.)

- District wise allotments in state budgets

- Independent ombudsmen for errant local officialsImpact: - Government petitioned; no positive response yet

- Campaign for 10MM signatures completed

- Massive public education in AP on the issue; 800K pamphlets, 300K signature sheets, 107K posters etc.

Decentralization of Power – empowerment of local government

Problem: Excessive centralization starves local governments of funds and feeds an increasingly bloated bureaucracy

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Problem: Grossly deficient public services with no recourse

Solution: - Make citizens aware of services entitled to them through citizens’ charters

- Establish minimum standards for public services

- Force compensation for delay in rendering of servicesImpact: - AP government recognizes charters with respect to

four public services in municipalities across AP

- property tax assessment 15 days

- house construction permit 15 days

- water connection 30 days

- birth & death certificates 05 days

- Rs.50 compensation per day for delays in services

- In 97% of cases, services delivered on time

- 200 citizens receive compensation for delays

Instruments of Accountability – citizens’ charters

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Problem: Short delivery and adulteration of gasoline at filling stations. Economic cost in AP of Rs. 1 crore/day

Solution: - Mobilize citizen volunteers with pre-calibrated measures to verify pump readings

- Inform local media and government officials

- Citizen groups conduct ongoing, random checks

Impact: - AP department of weights and measures voluntarily fixes meters at all 1500 gasoline stations in the

state

- Citizens spared Rs. 1,000 crore of fraud over 3 years

- 100,000 trained citizen volunteers by 2004

Instruments of Accountability – creating watchdog groups

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Problem: Justice delayed is justice denied. Upwards of 25MM cases pending in Indian courts. Resolution can take

decades eroding credibility of the legal system. Street justice often results.

Solution: - Build more courts cost effectively

Impact: - Lok Satta has prepared draft legislation that would

- build 1 court per 25,000 citizens in rural areas

- build 1 court per 50,000 citizens in urban areas

- mobile courts with proceedings in local languages

- courts headed by Nyaayaadhikaaris

- deliver verdicts in 90 days

Speedy Justice – expanding the legal infrastructure

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Putting the Pieces Together – building a vibrant civil society

ElectoralReforms

EmpowerLocal

Government

Instruments ofAccountability

SpeedyJustice

ImplementingBest

Practices

Holistic, sustainable and scalable

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Very little goes a long way – expected versus actual costs for 10MM signature campaign

Expense Market Value (Lakh Rs.)

Volunteers 204.43

Training 8.12

Transport (people and materials) 41.015

Mailings 2.20

Printing 6.25

Campaign Meetings 59.5

Media (print, radio cinema, TV etc.) 159.25

Administrative 19.25

Total 500.01

Total actual expenditure Lakh Rs. 21!

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HDI vs. CPI

y = 8.5667e -0.0099x

R2 = 0.863

0

1

2

3

4

5

6

7

8

9

10

0 20 40 60 80 100 120 140 160

Human Dev. Index

Co

rru

pti

on

Per

cep

tio

n I

nd

ex

India

Sources: UNDP, Transparency International

In Case You Still Have Doubts – governance quality and the fate of nations

Nigeria

Malaysia

U.S.

China

Brazil

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V. Chowdary Jampala, MD – Secretary/Treasurer and Founder, Chicago

• Professor and Associate Chairman, Department of Psychiatry, Chicago Medical School• Chief, Mental Health Services, North Chicago VA Medical Center• Graduated from Guntur Medical College 1979

• NARSAD Young Investigator Award 1991 • Scientific Achievement Award, IAPA, 1995• TANA Community Service Award 1995, 1999• MATA Community Service Award, 2001

• Chief Editor, TANA Patrika • Chairman, TANA Publications Committee 1997 – now• Editor, Indo American Psychiatric Association Forum• Past President, MATA• Past President, GMCANA

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Five Ways NRIs Can Help

1. NRI institutional support

2. Awareness campaigns – changing the debate

3. Financial support and support-in-kind

4. Research, comparative studies and seminars

5. Promoting a positive attitude to promote individual and societal confidence

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Five Ways NRIs Can Help

NRI institutional support• Reach out to existing NRI organizations to build a broad consensus on

the need for governance reform in India

• Reach out to existing NRI organizations to tap the talent and expertise of like minded individuals towards the FDRI cause

• Organizations FDRI will reach out to• Umbrella organizations• Service organizations addressing causes in India• Foundations and charitable institutions• Trade and professional organizations• Cultural organizations

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Five Ways NRIs Can Help

Awareness campaigns – changing the debate

• Raise awareness of the need for governance reforms in India

• Raise awareness of how governance reform can amplify the many causes that NRIs work for in India

• Reorient US-india dialogue from policy reform to governance reform

• Aid awareness programs in India that highlight the need for governance reform

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Five Ways NRIs Can Help

Financial support and support-in-kind• Raise $400,000 by the end of the next fiscal year for Lok Satta activities

in India and FDRI activities in the US

• Encourage NRI’s to contribute time and talent towards the cause of governance reform

• 1.7 MM NRIs in the US – 2% involvement means 34,000 people• 2 hours a week and $100 per year yields 68,000 hours of service

and $3.4 MM . An immense amount can be accomplished

• Increase the financial base with which FDRI can assist sister organizations across India – currently 35-40% of Lok Satta expenses

• Scale-up for a nationwide governance reform campaign

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Five Ways NRIs Can Help

Research, comparative studies and seminars

• Select a few, core issues critically dependent on effective governance• The link between the quality of governance and growth• Air and water quality• HIV/AIDS and its societal impact• Agricultural policy, food distribution and its consequences

• Highlight the short comings of the status quo• Move from dogma to data – conduct hard edged, analytical research

into root causes and identify solutions• Identify best practices from around the world that addressed similar

problems• Formulate recommendations appropriate for the Indian context

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Five Ways NRIs Can Help

Promoting a positive attitude to improve individual and societal confidence

• Promote a “can do” spirit in the US and India by highlighting success stories of collective assertion and personal initiative

• Develop “Role Model” awards for individuals whose drive, perseverance and leadership results in positive change

• Use the media in the US and India to spread the message of self-help and hope

• Create forums for like-minded people to exchange ideas• FDRI Yahoo Group – [email protected]

• Websites - www.fdri.org, www.loksatta.org

• Publications - Lok Satta Times, FDRI Newsletter

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“We must be the change we wish to see in the world.”

- Mahatma Gandhi

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Problem: AP government launches a Building Regularization Scheme (BRS) to ratify minor deviations in

construction through a compounding fee

- Many applications received

- Only 1000 of 8000 cases resolved due to demand for bribes

- Rs. 150,000 bribes collected from 300 citizens with no resolution

Solution: - Establish a transparent peoples court method of adjudicating BRS applications

Impact: - All remaining 7,000 applications adjudicated

- All bribes collected were actually returned!

Instruments of Accountability – rooting out corruption

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Problem: State electricity boards (SEBs) are notoriously inefficient and corrupt. In 2001, the combined losses of

SEBs totaled $5BN. In some states SEB losses are up to 60% of state deficits.

Solution: - Privatize power generation

- Trifurcate generation, transmission and distribution

- Transparency in contractsImpact: - Lok Satta is working with authorities to improve the

quality of power while sustaining affordability

- Four pilot projects established to test different modes of distribution in a franchise model

- Projects work with government, concerned citizens and farmers

Research and Implementation of Best Practices – power reform