Mohandas Pai Slams India's Economic Policy: 'Taxpayers Compete With Govt-Run Businesses'
Mohandas Pai, a prominent Indian investor and former Infosys board member, has spoken out against the current economic policy in India. He argues that the country is unique in funding government-run businesses that directly compete with taxpayers, and he criticizes the lack of accountability and fair competition in such enterprises.
Pai took aim at the National Aerospace Laboratories (NAL), stating that it has underperformed despite being funded by taxpayers. He believes that private enterprises like Tata Motors or L&T could have achieved better results in building a jet engine. Pai also criticized the structural dysfunction in economic policy, comparing it to Germany's state-owned enterprises like Deutsche Bahn, which receive ongoing government involvement and subsidies despite competing with private taxpayers.
Pai is not opposed to Public Sector Undertakings (PSUs) but advocates for fair competition and accountability. He pointed out that at NASA, taxpayers' money is used to fund high-risk, innovative technologies, not to compete with taxpayers. In India, however, most innovation spending goes to DRDO and public labs like NAL, with minimal funding for private sector innovation. Pai believes the root issue is the fear of accountability and a culture of political safety that props up inefficient institutions. He also highlighted the disparity in pay between a public sector chairman and a private sector software engineer, demonstrating flawed incentives in the current system.
Mohandas Pai has identified a deep structural flaw in India's economic policy, where government-run businesses compete directly with taxpayers. He advocates for releasing technology to the industry, allowing everyone to compete, and believes in fair competition and accountability to drive innovation and efficiency.
