Daily Archives: February 7, 2022

Sustainability is the buzzword amongst corporate boardrooms, policymakers & regulators, enterprises, institutions, and business advisors today. In the pursuit of aligning to the Sustainable Development Goals (SDGs), stakeholders are continuously trying to develop multi-dimensional approaches effectively analyse complex macro and micro dynamics of sustainability, for them to be able capture emerging opportunities and responding to likely challenges and risks. The interdependence between stakeholders in the society casts the spectrum of Sustainability very wide, and the endeavour is to systematically piece together elements that make up the Sustainability puzzle (often represented by ESG) that underline the wider socio-economic transformation that are already impacting individuals, enterprises, and nations.

Education is fundamental to socio-economic development and there is need for systematic and ongoing sustainability assessment of the education sector. Specifically, enormous private and public resources are invested each year by various stakeholders including students, parents, governments, institutions, teachers, researchers etc. to equip managers with skills to qualify and contribute to the economic development of the country. In the post covid era, it is critical to re-evaluate and embed the sustainability perspective in Management Education. The Covid induced socio-economic problems have further increased the pace of significant alterations in the dynamics that once made management qualification one of the most preferred ways to build a corporate career.

Covid-induced flux

The unrelenting array of Covid induced socio-economic bumps and speed breakers has induced an enormous socio-economic flux on a global scale, which is translating into significant turbulence across social, political, economic, trade, and geo-political ecosystems.

Transitions are painful and as the as Covid continues to thrive, the short-term and long-term impacts are now increasingly imminent. Covid has accelerated sustainability focussed fundamental policy-level changes that will define the life and economics of the post-covid world. It will create new opportunities, require new set of skills and competencies, and require managers to be equipped by critical soft skills and high emotional quotient that will enable them to manage teams and resources of the sustainable, digital first working that may transcend from physical to the metaverse.

The McKinseys 2021 report The future of work after Covid-19 forecasts a massive overhaul of working environment after analysis of 800 work categories across sectors, with a clear correlation projected between impact and the level of proximity involved in the delivery of work. Segments and sectors involving the highest physical proximity like Healthcare, BFSI, Retail, Leisure & Travel are likely are forecasted to face the maximum disruption in their business model, as they strive to build in business sustainability by significantly enhancing dependence and adoption of Artificial Intelligence (AI), Machine Learning (ML), process automation, and advanced data analytics. Significantly, the concludes that the Covid impact and accelerated changes in business models including with transition to newer technologies would cause an enormous workforce transition, requiring almost 25% workers to switch jobs and/or go in for upskilling in markets like the United States.

The BFSI, Retail, Healthcare sectors are also important sectors for the Indian economy and fundamental changes therein are likely to have significant implications for bussing managers, existing employers, education instructions, policymakers to undertake comprehensive analysis from think from long term perspective, analysing if existing skills, products, courses and policies will be relevant, viable and sustainable needs, challenges, risks likely to emerge in post covid era.

Towards sustainability

The covid induced transition landed educational institutions and students a complete flux, with the initial panicky response severely impacting fresh recruitment even in growing developed countries like United States (according to GMAC survey). India meanwhile witnessed significant covid induced deceleration causing substantial job losses that added to employability challenges. Over time the transformation has very rapidly altered the impacted the priorities, skill requirements in addition to the way they allocate resources, define skills, and operate. New management graduates and management institutions specially in India, are hence facing sustainability questions that had long been avoided, as employers demanded for managers with excellent technology competencies, and sought knowledge of social and environment dynamics, data flows, policy dynamics etc; besides the enormous focus now on strong soft skills to overcome digital working challenges.

From Flux to Sustainability

Irrespective of the sector or geography, the path to sustainability has often been marked by conflict between vested commercial interests of well-entrenched players (including the rich and powerful), and that of the fundamentals that underlie the ESG matrix (in this case represented ensuring Environmental Impact/Readiness, Social Impact, and Governance). A management education system and its stakeholders guided by an effective ESG matrix equipped to create a positive social impact by focussing on effective governance by through transparency, due delivery, and systematic process led monitoring as it equips them to capture future opportunities and future ready skills, minimize wastages like redundancies, unemployability and wasteful social expenditure.

Despite sitting on billions of dollars of alumni funding, large research & consultancy-based incomes, and government support, Covid has forced even the IVY League colleges to rethink their business models to stay relevant in the face of competition from the likes of Coursera, edX, LinkedIn etc.; and have already rolled a variety of interesting and engaging formats, course structure and curriculums that are likely help they believe would best meet needs of post covid digital-led business environment requiring fundamentally different management competencies and soft skills.

To achieve the $5 trillion economy goal, India will need a sustainable management education infrastructure that is market-driven and can see beyond the strong institutions of excellence (behind the ISB and IIMs). The sustainability assessment will help uncover the real state and future readiness of management education that otherwise essentially remains hidden, possibly on purpose to serve vested interests. The outflow of talent and resources to foreign lands endorses the poor governance, accountability, employability, and future content readiness of Tier-II management education, which should be of concern to all stakeholders. Clearly, the New Education Policys (NEP) proposals need a necessary push from policymakers to enable a meaningful flow of world-class content, institutions, and faculty into India.

Risk Management

It has become crucial for all stakeholders to carefully research and analyse all risks with a long-term perspective. It is often that the industry complains of Indian engineers and management graduates at are being literally churned out each year being unemployable, even in present times. It only creates a basis for socio-economic unrest in the country, besides wastage of enormous public and private resources, which is a huge public policy risk, in addition to the economic challenge for the country and industry of not having adequate skilled manpower to meet growth needs. Budding managers also have their responsibility, to their own sustainability assessment by ways of all the necessary due-diligence and research, across the world to select the course (not necessarily limited to MBA), as they would be investing their most precious resource in many years or potentially this lifetime of professional career.

Pivot or Perish

We are now in the era of winner takes it all, be it individuals, companies, education intuitions, or even nations. Whoever excels in their ability and commitment to business sustainability will surely be much better equipped to capture the new wave of opportunities, or to withstand increasingly unforeseen risks and challenges.

While 2022 may mark the beginning of better times, as India enters Subhkrutta (Year of light) and China prepares for the Year of Tiger; the shrillness of the third wave highlights, it would be only wise that all stakeholders interests align and they systematically work to mitigate risks by supporting the development of Indias management education sector into a future-ready, strongly governed, internationally competitive, and market-driven management sector equipped to attract international students, research, and faculty. It could well be the movement of pivot or perish.

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We must produce MBAs appropriate to the era we live in, says expert - Business Standard

The issues faced by tourism in India An overview

There has been a lot of praise for India as a tourist destination. Even so, tourisms in India face a few challenges. Communication in India is one of them. It is challenging for tourists to communicate in a language they barely understand in foreign countries and states. Learning English may also not be helpful in some circumstances.

The poor form of sanitation, safety, and transportation is a few other issues dragging down Indian tourisms reputation.

Many foreign tourists have stopped visiting India. The government must promote Indias diversity and rich heritage to re-establish its position as a tourist paradise. The roots of Indian culture are firmly rooted in tradition, even though her roots may have branched out to modernism. Many foreign tourists are drawn to these traditions.

The lack of safety in India is among the most important reasons foreign tourists avoid visiting it. The locals have sometimes refused to aid foreign nationals who have experienced harassment because of communication problems. Foreign tourists must therefore feel safe from harassment by the government. There should also be strict punishments for those who harass foreign tourists.

As there will be fewer chances of tourists being defrauded by frauds with the governments appointment of trained tour guides, tourists will gain from it. We will attract foreign tourists to India if we take these and other precautions regarding their interests.

In the ever-expanding world of tourism, the federal and state governments are increasingly emphasizing proper planning. As such, the Ministry is striving to balance the promotion of tourism (which has proven to increase the GNP in developing countries in particular) with concern for safeguarding the physical, social, and cultural environment in the destination areas.

To balance tourism-related activities and the local environment, planning is vital for the development of tourism-related activities. Development countries are especially vulnerable to this. As a result, the impact is powerful here since they must develop a key infrastructure to maintain the existing unique cultural characteristics and promote overall socio-economic development. Furthermore, by preserving and enhancing their physical environment, they will encourage tourism.

Before any development decisions are made, it is essential to evaluate and analyze whether tourism promotion and infrastructural development will impact the habitat in socio-cultural, socio-economic, physical, and environmental terms.

These structures are more noticeable in hill, beach and wildlife resorts with an acute ecological setting or other culturally sensitive retreats. It is thus essential that any program to promote tourism development emphasizes the benefits and minimizes the negative impacts on the social, economic, and physical environments of the destination areas.

Tourism is an essential thrust area for development in both macro and micro contexts of the National Five Year Plans.

(1)Instead of spreading limited resources over a significant number of circuits or centres, develop selected tourist circuits and centres that are popular among tourists.

2) In India, the tourism industry is diversifying away from traditional sightseeing tours oriented (primarily places of cultural tourism interest) to a more rapidly expanding market based on the countrys atmosphere and environment, emphasizing the aesthetic, environmental, and socio-cultural implications of projects.

(3)There are many nontraditional areas of tourism, such as trekking, winter sports, wildlife tourism, and beach resort tourism, which would enrich the tourism resources of the Himalayas, the vast coastline with sandy beaches and abundant wildlife, and encourage more tourists to stay longer in these areas.

4) Promotion and balanced development of national heritage projects with cultural, historical, and tourism value to leverage the unique advantages of Indian culture as a tourist destination and make use of tourism to preserve the countrys heritage.

As part of the formulation of tourism complexes, the macro-and micro-level planning and development need to ensure the integration of tourism resources and tourism activities to maximize social, economic and environmental benefits and meet tourists needs for infrastructure, leisure and recreation.

Tourist nodes, areas, and networks are examples of how tourism resources and tourist facilities interact spatially. It is essential to develop tourism complexes in an organized manner so that in their regional or area-wise context, investment benefits and performance are optimized.

The Tourism Development Plans will have to accommodate various destinations types and tourism activities based on the diversified demand for infrastructure. There are several tourism activity areas, including:

1) The beauty of nature is high enough for passive recreation,

2) Beach resorts, recreation areas, etc.

3) Areas with comfortable climates such as hill resorts

4) Culturally significant places including museums, monuments, sites of fairs and festivals

5) Places of pilgrimage and temples for religious tourism;

6) Areas designated for adventure tourism include trekking, rock climbing, mountaineering, skiing, etc.

7) Specially designated areas of interest, including sanctuaries for wild animals, areas containing exotic flora and fauna, sanctuaries for birds, etc.

Carrying Capacity :

As a resource-based industry, tourism needs resource assessment to promote tourism in a way that is compatible with other demands. In addition to identifying and assessing the resource under competing demands, it is also essential to arrive at a capacity that will be matched by the supply, both locationally and according to its activity.

For planning tourist facilities and infrastructure, carrying capacity is essential, particularly concerning sensitive destinations such as hilly areas. There is a threshold beyond which the tourist industry becomes overly saturated (physical power), the environment deteriorates (environmental capacity), or visitor enjoyment drops (perceptual ability).

Despite their acceptance today, carrying capacity has been largely unused in planning because of difficulties measuring the thresholds (except perhaps physical ability). Recreational areas are determined at an optimal capacity by combining factors that decide on their biological and ecological capacity with those which decide on their social (perceptual).

It is recommended that guidelines for ecological capacity be developed with an emphasis on hilly environments and nature reserves since these areas are ecologically sensitive, and the habitat forms part of the environment within them. Developers largely ignore these recommendations out of greed, and there is no reason for this to continue.

Only through the combination of natural and manufactured attractions can an area offer visitors that any successful tourism development is formalized. The following are some of our resources. The merits of this system are often overlooked or not considered without a complex systematic inventory and analysis of its values, potential, and limitations.

There are two issues at stake here:

a)What are the techniques for identifying a regions resource base? And

b) how can these resources be assessed for their intrinsic value in the market?

An inventory is necessary for the first, while appropriate evaluation techniques are required for the second. Tourist resources are valued in diversity, attractiveness, and sustainability based on supply and demand (tourist preferences, which are assessed through surveys) with a minimum impact on the local economy, society, and the environment. Environmental impact studies must precede any tourism development program.

Infrastructural Development :

Developing tourist-related physical infrastructure is imperative in order for tourism to function effectively as part of any regions development package. It is also essential to think of infrastructure from the perspective of the overall needs of an area and the host population.

Tourism spots must be attractive enough to draw tourists, which is vital for their development. Three key components can characterize tourism in a tourist centre:

i) Accessibility :

In terms of accessibility, tourist spots or tourist destinations are defined as:

As applicable, there should be local access to the specific places of tourist interest within the town from the closest transportation interchange point, such as an airport, a railroad station or a railway terminal, or the towns entry point. Furthermore, it involves connecting roads from one place to another and providing adequate parking, servicing, and garage facilities in the city and its environs.

Accessibility to the tourist centre and tourist destination area from the nearest point of embarkation for tourists within the region by the three conventional modes of transportation, namely road, rail, and air, as well as opportunities for connecting tourism to other important centres within the region.

ii) Accommodation Facilities and Services:

An important factor is the availability of adequate accommodations in tourist centres and destinations that meet tourists quantitative and qualitative needs. These accommodations can encourage tourists to spend more time at a destination. There is a more significant deterrent to tourist influx in India due to the lack of this basic amenity than the accessibility to such facilities. There would be a need to gauge the amount and kind of accommodation in each of the individual centres based on an assessment of local conditions. By and large, tourists should be able to find comfortable accommodations and have access to all utilities and services and choose from an array of affordable options.

To make a tourist complex attractive, it is essential to ensure an uninterrupted power supply, safe water supply, sewerage, drainage, and sanitation. Additionally, civic infrastructure includes health clinics, telephones and telegraphs, and banks. However, tourism forms and destination locations influence critical aspects of these factors.

iii) Recreational Aspects:

Accommodation availability can be a critical factor in influencing a tourists stay in a tourist centre, but adequate recreational elements can also prolong the tourist season whole. This aspect of development is vitally essential for relaxation and diversion. Tourism encompasses a broad range of recreational activities, including both active and passive outdoor recreation and all commercial recreation activities.

The problem is simplified in some ways in metropolitan and central cities because visitors can take advantage of indoor and outdoor recreational facilities that are legitimate necessities for the local population. However, for small palaces with even more tourist attractions and interest, tourists should have access to exclusive recreational amenities.

To do so, one must consider the socio-cultural environment and milieu of the destination. A tourist centres infrastructure must also include ancillary infrastructure facilities and services to be developed comprehensively. Generally, these consist of facilities for the growth of traditional and indigenous arts and crafts, tourism-related cottage industries, housing for artisans engaged in such activities, and an appropriate amount of land set aside for such purposes.

Accommodation and other ancillary necessities of the service population needed to staff the tourist and hospitality facilities and amenities are essential. Slums with inhumane conditions can result from ignoring this aspect.

The development of tourist infrastructure has been the focus of all nations throughout the world that has developed a systematic approach to tourism development. Many factors have influenced this development. Here are a few of them:

(1) Factors that influence or have the potential to influence proper exploitation of the specific tourism resource (positive and negative).

(2) Effectiveness of a particular resource in supporting tourism development in terms of its impacts on the environment, the ecology, and the socio-cultural aspects at a macro and micro level.

There are also problems relating to access and infrastructure provision financing and management.

Designating favourable zones for tourist infrastructure and safeguarding their natural and manufactured resources are essential elements of a Corsican Tourism Master Plan, along with an Access and Land Control Policy for development in and around the designated areas. An overall macro-level policy plan should direct programming at the micro-level.

Regarding the development of the coastal tourism industry in France, the Master Plan emphasizes:

These initiatives have been aimed at protecting the environment while conserving tourism resources and natural resources.

However, it can hardly be overstated how vital a Physical Development Plan is to the overall Tourism Master Plan on both a macro and micro level.

The critical components of a full-fledged tourism master plan should include:

A fundamental development policy should address how to regulate, reduce, or reduce the pressure on a limited resource, such as a tourist centre, hill resort, or beach complex, which is affected by inappropriate uses.

First, a study of the tourism resource characteristics and potential would be needed to develop a Master Plan. The destination areas physical, social, economic, and environmental attributes should be analyzed. Tourism Master Plans establish the framework for planning, developing, and managing tourism destinations through the following components:

This component of the Master Plan includes:

An essential part of a Master Plan is measuring and planning environmental protection, landscaping, and site development. Further, it should be clarify that the complex is linked to the hinterland and measures to prevent action on its perimeter.

In addition, it is crucial to integrate the growth of the tourism complex with the socio-economic development of the smaller settlements that surround it.

An integrated Physical Development Plan for phasing the complexs construction and providing tourism infrastructure is required to specify these policies and programmes in detail.

Physical Development Issues:

Many aspects of tourism development are not entirely related to economics, such as geography, sociology, anthropology, and the ecology of the area and its inhabitants. To achieve optimum socio-economic gains for the local community and tourist activity, all of these factors need to be thoroughly understood and analyzed. Tourism planning should be conceived as an integrated approach, especially when products are made from vulnerable natural resources.

There is high crowd density at tourist spots and destination areas, so they need to be adequately provided with parking facilities, pedestrian routes, crosswalks, and regions for pedestrian movement and assembling, as well as tourist infrastructure features such as boarding and lodging, civic services, tourist shopping, leisure, and recreational activities, depending on the location, attraction, and projected tourist demand.

The standards and scope of tourist infrastructure will differ from one place to another. It is nevertheless necessary to organize infrastructure facilities in a spatially logical manner. Having proper physical planning and design is also crucial to the success of the tourist spot.

Regardless of whether the tourist spot is a resort or a township, the activities associated with tourism are by definition spatial, whether it is part of a development zone or an isolated complex. A focus should be placed on the integrated development of the tourist centre, with all individual development schemes for various tourist destinations forming part of an overarching plan for the area.

As part of this discussion, it should also be noted that metropolitan and major cities can meet tourists needs, particularly in infrastructure development, mainly by utilizing existing buildings and facilities that are already in place and planned.

However, in small towns and isolated areas, tourists infrastructure needs and services must, by extension and augmentation, be made readily available to locals as well as tourists. In turn, the tourist spots in these small towns may benefit from investment in tourism in an overall positive way.

Furthermore, the development scheme must implement in phases according to its involvement, and a future expansion and augmentation should be built into the design.

City Spots for Tourists:

An essential first step is to zone a tourism activity area. Whenever possible, tourist sites within the city should be zoned and the adequate surrounding area. Special tourist zones. There is a need to identify even larger integrated zones encompassing several such tourist spots in one complex in a city with several tourist destinations, such as historical cities and pilgrimage towns, to allow integration in physical development.

When planning and developing individual tourist spots, such plans should consider the overall tourism development strategy.

It should include the following:

In zoning passive uses in the immediate surrounding of a tourist spot, keeping the spots identity and sanctity should be a paramount concern. Whenever possible, the tourist destination itself needs to stand out in the designated area for infrastructure development without engulfing the infrastructure.

As much as possible, the infrastructure complex of the selected site should be directly accessible from the main road, leaving a sufficient amount of greenery between tourist spots and the complex.

Therefore, a low-profile development is necessary to maintain the integrity of the designated site. Additionally, it is not desirable to distribute infrastructure over a large area but rather to plan all the facilities as a complex to minimize waste and maximize energy efficiency while keeping as much land as possible green for development.

Conservation Through Design :

As part of preserving tourist centres, the tourist character is also preserved. This aspect is more crucial for maintaining small towns, which, owing to their history and heritage, are more frequent attractions for tourists.

The physical expansion and economic diversification of these towns must plan to maintain their historical and cultural heritage. It would be beneficial to keep enough green buffer zones surrounding the new development and around them to promote tourism.

A tourist spots physical conservation may be manifested in a general enhancement and restoration by constructing well laid out gardens, pavements, curio stores, and kiosks and providing tourist equipment, such as tourist literature and guides. Although this topic deserves the most attention, restraint, and design sensibility, the focus should be on preservation over renovation and beautification on a large scale.

Natural features must be preserved when developing a site, especially for tourist-oriented activity zones. Furthermore, a properly designed landscape plan should include the generous planting of trees as an integral part of the site development programme. Buildings should be designed in a low-rise development on the portion of the site allotted for infrastructure facilities.

Spatial Design Aspects :

Developing an area for tourism has the primary aim of attracting tourists. As a result, they have a visual design aspect and aesthetic consideration crucial to their formulation and implementation. It includes the construction of an approach road, landscaping, remodelling, general beautification, or providing tourist housing.

Therefore, the development of tourist spots and complexes must incorporate bare land and infrastructure planning principles with Urban Form and Landscape Design parameters to develop functional and environmentally friendly products and visually and aesthetically appealing.

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The Issues Faced By Tourism In India - An Overview - Inventiva

Muhammad Mahmood | Published: February 05, 2022 20:37:27

All least developed countries aim to become middle income countries and many have succeeded like Bangladesh, which achieved the status of a lower middle income country in 2015 and now officially will graduate to become a developing country in 2026. Bangladesh also aspires to become a high middle income country in 2031 and a developed country by 2041.

Only a few like South Korea and Singapore have managed to gain the status as high income countries while countries like Malaysia, Argentina, Uruguay and South Africa have become stuck in the upper middle income trap. And countries like India and Indonesia seem have entered into the lower middle income trap. Overall, most of the middle income trapped countries are located in Asia and Latin America. It is estimated that half of the world's population by 2025 will live in Asian middle income countries. Many of these middle income trapped countries also suffer from persistent pockets of poverty and remain vulnerable to sudden changes in income.

The term middle-income trap (MIT) usually refers to countries that have experienced rapid growth and thus quickly reached middle-income status, but then failed to overcome that income range to further catch up with the developed countries. The MIT is a narrative of growth stagnation. Therefore, the MIT is also characterised by reform stagnation.

Equally, low income countries can also face the prospect of getting trapped into a low income trap or otherwise described as the "poverty trap". In a low income country it is difficult to escape poverty. But poverty trap is not merely the absence of economic means. It is created due to a combination of factors such as the lack of employment, access to education and health care etc.

The MIT was mentioned in a World Bank study titled "An East Asian Renaissance: Ideas for Economic Growth" published in 2007. The report suggested that Medium-income countries have lower growth trends when compared to rich and poor countries.

It is generally postulated that countries at the initial stages of growth start with an agrarian base. From there on, a country over time transits to an industrial economy with the help of surplus extracted from the agriculture sector, then onto a predominantly services oriented economy.

As a result output increases which contributes to rising per capita income. Therefore, the growth process enables a country to move from low income to lower middle income to upper middle income and finally to a high income country.

Many economists, in particular Dani Rodrik expressed concerns over premature de-industrialisation of developing economies where a growing services sector bypasses manufacturing sector with industrialisation peaking at a relatively small share of GDP around 20 per cent or even below. Such a transition path would further distort the long term structural adjustment process causing very slow growth to economic stagnation. It is generally agreed that growth slowdowns are primarily productivity slowdowns.

In fact, some growth models do suggest that the existence of low productivity equilibrium in middle income countries is characterised by low shares of highly skilled workers in highly skilled activities. Many countries also fail to put in place active policies for firms to move their resources from protected domestic to globally competitive export sectors and to upgrade skills of workers working in those sectors.

Economic transformation process implies an increase in productivity of available resources, with the transition to middle income status generally characterised by the movement of resources between activities. Transitioning to high income status leads to levelling out productivity across firms within sectors. This in turn leads further resource reallocation resulting in most productivity growth taking place within certain sectors.

The growth process does not have an automated impetus propelled by time. Empirically, growth performances of countries around the world by and large demonstrate that they remain in a specific income group for extended periods, some even may regress from a lower middle income country into a low income country if the required level of growth momentum can not be maintained.

Overall, it appears developing countries experience great difficulties in their transition from the middle income to the high income. Most empirical studies on the MIT use either the absolute approach or the relative approach.

The absolute threshold approach tends to interpret the MIT as a growth slowdown and it is generally suggested that growth slowdowns typically occur at two different per capita ranges, namely between US$10,000 and US$11,000 and between US$15,000 and US$16,000 range. Out of 101 middle income countries in 1960, only 13 countries became high-income countries by 2019 based on per capita income relative to the US.

The relative threshold considers the MIT as a failed catching up process relative to a developed country like the US or Japan. There are a number of ways in which this can be measured such as the Catch-Up Index (CUI) or like the World Bank which considers a country experiencing the MIT if it stays within the range of about 5 percent to 45 percent of the US per capita income.

The notion of MIT has gained currency in recent years and because it is a very easy to interpret the concept makes it very useful in public policy discussions. In fact, the MIT has provided a theoretical construct to understand why so many countries seem to stagnate at the middle income level. But such a theoretical construct does not provide us with a uniform policy prescription for avoiding the MIT. It is not a destiny but an obstacle that needs to be overcome.

The MIT has shown us that middle income status does not mean that economic growth trajectory gets easier to deal with, if anything, it appears more difficult. Various arguments have been put forward to explain the existence and persistence of the MIT. These arguments include diminishing return to capital, exhaustion of cheap labour and imitation gains, poor quality of human capital, distorted incentives and misallocation of resources, lack of advanced infrastructure, capital, inadequate contract enforcement.

Furthermore, middle income countries also find the transition to next level doubly challenging because the institutional arrangements that helped them to achieve the middle income status created vested interests who benefit from the status quo. If these vested interests are not shoved aside, these countries will fall into the trap and stagnate.

At the heart of it all, the MIT is a governance failure, an inability to take realistically achievable goals of growth and development. Therefore, avoiding the trap can take a careful preparation for implementation of policies and programmes over a required period of time because there is no quick fix for the MIT.

There is no uniform policy prescription for avoiding the MIT. Therefore, addressing the challenges posed by the MIT will require different policies for different countries around the world but underneath there are a number of commonalities standing in the way of becoming a high income country.

Middle income status can be considered as a signal for a successful trajectory for moving the country ahead. That will require to accelerate productive investment and a complex set of skills development, fostering innovation and most importantly of institution development because institutions suited to growth and development differ at different stages of development.

Therefore, the key problem for many countries looking to move forward to achieve high income status is the ability to generate the political will to make needed reforms. Vested interests will strongly oppose any change that threaten their economic power.

Meanwhile, shifting comparative advantage resulting from advances in manufacturing technologies further add to middle income countries' woes along with increasing concerns over wage competitiveness. The new manufacturing technologies have already enabled the sports apparel company Adidas using the 3D technology to re-shore its production from Vietnam to its home country, Germany.

New strategies may require for countries like Bangladesh rebalancing towards domestic demand while export orientation remains in place and levelling the playing field for all firms domestic or foreign. Also, these countries face challenges of altering the course to reflect their shifting comparative advantage in the face of resistance from vested interests that have grown rich and powerful from the status quo.

Bangladesh is the only country so far that has bucked the trend in South Asia by continually increasing the manufacturing share of GDP as measured by the widely used measure of "share of value added by manufacturing" in GDP over the last two decades.

But Bangladesh still remains a capital scarce country. To face the challenges of emerging manufacturing technologies, Bangladesh will have to boost the productivity of its abundant labour force with investment in productivity enhancing skills development, efficient infrastructure, machinery and technology supported by a well functioning and efficient financial system. Also, openness to trade and investment will remain the key instruments to foster innovation to achieve competitive advantage.

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Middle income trap the way out - The Financial Express

Bob Kaster| The Septugenarian Speaks

Its been almost a year since my last rant against the proposal to remove four dams along the Klamath River.

My attention was recently again drawn to that topic on Dec.14, when the Siskiyou County Water Users Association made a presentation to the Siskiyou County Board of Supervisors, asking the board to adopt a resolution nominating an area called the Ancient Beswick Forest and Cultural Area for inclusion on the National Register of Historic Places.

The declared reason for requesting the inclusion of the area was to provide for the protection of the areas resources now and into the future for the citizens of Siskiyou County and the nation.

The proposed area includes the reservoirs created by the Iron Gate Dam and the two Copco dams, all situated in Siskiyou County.The board heard the presentation and took it under advisement, referring it to the countys administrative staff and attorney for analysis.

The primary objective of the measure is to give the designated area, and the dams situated therein, some protection from the irrevocable and potentially disastrous impact on our county that could result from the dam demolition project presently advocated by special interests.

Over the past four years, I have written seven columns for the Siskiyou Daily News outlining the many reasons why I believe taking out the dams is a bad idea, not just for Siskiyou County, but for people everywhere who are concerned about climate change, drought, preservation of water resources, fire suppressionand greenhouse gas emissions.

Ive talked about the dams benefits, including generation of electric power in a manner that doesnt burn fossil fuels or pollute the atmosphere, facilitation of flood controland creation of some great recreational facilities.

Entire communities have been established around the reservoirs created by the dams.People have invested their life savings into buying property and building lake-front homes.These are just a few reasons why dam removal is a bad idea.

Yet the bandwagon to yank out four dams, which do what they were designed to do, still persists.Everyone is on the bandwagon; everyone, that is, except for the majority of those of us who actually live here in the California and Oregon counties where the dams are located.

The Klamath River does have problems, but anyone who thinks that the rivers ills will miraculously go away once the dams are gone, will be sadly disappointed.

Poor and sporadic salmon and steelhead runs, dying fish, poor water quality, and algae existed before the dams were there, and they will still exist after they are gone.

Since at least 1850, the river quality and fishery havent just been impacted by the dams (if at all), but also by many other factors, such as hydraulic mining (no longer legal), overfishing in the Pacific Ocean, intensive water diversions, erosion caused by roads, climate change, logging, floods, agricultural activities, forest fires, ocean atmosphere climate variability, and nutrients in the water caused naturally by the areas volcanic origins, just to name a few.

The Klamath River reservoirs have become a part of Siskiyou Countys wonderfully diverse beauty and landscape, and are important to its recreation-based tourism, a mainstay of our struggling economy.

It's pretty obvious that my rantings in the Siskiyou Daily News have had little if any impact on what seems to be the foregone conclusion that the dams will be taken out.

Over the years, the Board of Supervisors has courageously taken steps to avert the removal of the dams, an important county resource.The voters of the two counties directly affected by dam removal, Siskiyou County and Oregons Klamath County, have overwhelmingly expressed opposition to their removal.

None of these things appear to have made a difference.The powerful forces from Washington, D.C., Sacramento, and Salem, Oregon, and from some Indian tribes, appear to have the clout to overcome any opposition that the local residents, who are most deeply affected, can muster.

Im glad Im not a county supervisor these days.They have a huge responsibility but with limited resources to do their job.

I can understand why they may have some hesitation about expending county funds and resources to oppose dam removal, seemingly inevitable, when such resources are limited.

The board must allocate its resources for the best interests of the county.But they shouldnt give up without a fight.Its too important for the county.

The proposed resolution under consideration, which recommends that the Ancient Beswick Forest and Cultural Area be considered for inclusion on the National Register of Historic Places, is one way the board can make a statement about the issue without a significant expenditure of county funds.

The ultimate decision, of course, is up to the California and federal offices of historic places, and is beyond the countys control, but at least it is a demonstration that the county government has the resolve to fight to defeat a proposal harmful to its citizens.

But I would go further and encourage our supervisors to continue to put county resources on the line in the future. Its that important.For example, there are still several steps in the Federal Energy Regulation Commission process before the dam removal proponents and KRRC, the corporation formed to remove the dams, can proceed.

The draft Environmental Impact Report for the project originally scheduled to be issued in February has now been delayed a month or more and will likely be issued late March. That will trigger a 60-day period for public comment before it is finalized.

I would encourage the board to aggressively participate in the EIR process, even if it is costly to do so.The potential environmental devastation caused by release of sediment down the river is difficult to imagine or quantify, and has been consistently understated by KRRC since the beginning of its involvement in the project.And that is only a portion of the potential environmental detriment.

The water users presentation to the board pointed out some environmental concerns not discussed much until now. The primary focus has been on the fish, specifically salmon.

KRRCs claim is that the decline in anadromous fish population is caused because of the dams alleged prevention of the fish from traveling farther upriver to spawn, although there is considerable evidence that other natural impediments historically prevented them from doing that.

But, as the water users presentation pointed out, its about more than just the fish.The presentation included a map of the proposed Ancient Beswick Forest and Cultural Area.The map contains a legend that is a Biome Resource Classifications Index.

When I first saw the map, I wasnt familiar with the term biomeand sought to learn its definition.The National Geographic Society defines a biomeas a large area characterized by its vegetation, soil, climateand wildlife.

The map submitted to the board depicts 26 biomes along the river within the proposed area, and identifies 26 wildlife species associated with those biomes. Some examples are Canada Goose, sandpiper, Western pond turtleand crayfish, to name just a few.

Not all of the 26 species of wildlife on the list depend on the reservoirs to flourish, but some do.My point is that there should be more to the conversation than just the fish, a point clearly made by the water users presentation.

I urge the members of the Board of Supervisors, in carrying out their difficult task of stewardship of the resources under their control, to consider the importance of the dams to the citizens of our county.

Bob Kaster is a long-time Yreka resident and retired Superior Court Judge. In retirement, he has taken up creative and journalistic writing, including novels, short stories, and columns for the Siskiyou Daily News. The Great Yreka Courthouse Gold Heist, originally a series of articles published in the Siskiyou Daily News, has recently been published in book form by the Siskiyou County Historical Society. Sales proceeds benefit the Historical Society. Bobs website is http://bobkaster.com. Email him at bobkaster3@gmail.com.

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Column: Don't give up trying to save the Klamath River dams. It's about more than the fish - Siskiyou Daily News

The World Bank recently released a report entitled Resilient Development: A Strategy to Diversify Cambodias Growth Model as the latest Cambodia Country Economic Memorandum.

The report revisits Cambodias growth model, with the objective of identifying constraints and opportunities for sustained economic growth and proposing policy options to address them.

Claire H Hollweg, a senior country economist for Cambodia at the Washington-based multilateral lender, sat down with The Posts May Kunmakara to discuss the Kingdoms economic performance in 2020, export diversification and skills development themes touched on in the recent report.

The report mentions that Cambodias growth slowdown in 2020 in the wake of the Covid-19 pandemic was among the most pronounced in the East Asia region. What brought about such an enormous impact on the Kingdoms economy?

The report shows that Cambodias economic slowdown lies in the countrys growth generating process. Cambodias growth has been remarkable, but insufficiently diversified in products, markets, and factor inputs.

Five products garments, footwear, rice, cassava and tourism accounted for 80 per cent of total exports; two markets the EU and US accounted for 69 per cent of merchandise exports; and foreign capital through foreign direct investment (FDI) and official development assistance (ODA) accounted for 72 per cent of gross fixed capital formation in 2018.

Not surprisingly, when the pandemic disrupted the cross-border flow of goods, services and capital, Cambodia was ill-positioned to absorb the shock.

Youve talked about the countrys inability to diversify its development. Can you explain more?

Cambodias inability to diversify its development through alternate products, markets and financing sources predates the pandemic, and has its roots in low and declining productivity, low quality and weak export linkages, and high FDI but low domestic investment. The Covid-19 crisis exacerbates these challenges.

The first component is low and declining productivity: Cambodias inability to grow the product basket is explained by low labour productivity, or output per worker, which lags behind most countries globally when at Cambodias development level.

Low labour productivity, at least in part, reflects low human capital. But the largest contributor is low and declining total factor productivity (TFP).

This reports analysis suggests two primary causes. First, resource misallocation within sectors, likely caused by shortcomings of market institutions where market signals governing resource allocation need to be generated in more competitive and well-regulated markets, and an incipient public investment management (PIM) system where greater value for money in domestic public investment is needed.

Second, and more important, low within-firm productivity growth, explained by a challenging business environment that imposes significant obstacles to firms operations. Poor access to finance, inefficient business regulations, prevalent informality, and inadequate electricity are found to be the main constraints to firm productivity performance in Cambodia.

The second component is low quality and weak export linkages: low competitiveness and limited integration within global value chains (GVCs) have led to concentrated markets and trade.

A primary cause of low diversification and inability to upgrade is the quality of FDI, where FDI firms do not create backward linkages or share knowledge, limiting opportunities for technology transfer and productivity spillovers.Barriers in the business environment and the current investment and tax incentives regime influence the quality of FDI.

Other constraints to diversifying and upgrading Cambodias trade are low firm and worker capability, costly trade-related regulatory barriers particularly affecting agricultural products, insufficient trade-related infrastructure, and nascent use of regional trade agreements to support greater market access for exporters.

The third component is high FDI but low domestic investment: the countrys low private savings rate, and as a result low domestic investment, has led to reliance on external financing sources.

Rather than how many households save, how much households save and more important how households save appear to be key factors impeding greater domestic investment.

While 51 per cent of adults reportedly saved some money in the past year, only 22 per cent had any savings at a point in time, and only five per cent participated in formal savings where it can earn higher returns, be better protected, and, from an efficiency perspective, be intermediated to the most productive uses, significantly below other countries at Cambodias level of economic development.There is a relatively lower share of adults with a savings account in Cambodia.

Low formal savings by households stems from inefficiencies in the formal financial sector that pose high barriers including financial sector regulatory gaps, low financial literacy, low technology adoption and therefore limited access to financial services, and underdeveloped financial instruments beyond banks and microfinance institutions (MFIs) that would otherwise support savings.

What recommendations would you offer to diversify development?

Urgent action is needed to support Cambodias economic recovery from Covid-19 in a way that addresses the diversification problem to build back even stronger.

Cambodias policymakers have the opportunity to forge a new growth path by enabling productivity of firms and workers, diversifying exports, and harnessing domestic investment.

An ambitious reform agenda is needed one that focuses on improving capabilities, strengthening regulations, and investing in infrastructure.

Would you mind explaining each of these hypothetical growth paths?

A focus on firms and their workers is key to unleashing productivity. Policy reform in target areas can help the country meet its potential, including: investing in human capital through health and education; supporting more efficient resource allocation through improved market institutions and public investment management; easing the regulatory burden for firms thereby reducing informality and its negative impact; and improving the performance of key services inputs to strengthen domestic linkages.

Diversification of exports can continue driving growth during the recovery from Covid-19. A cross-cutting and medium-term policy agenda to diversify Cambodias trade is structured on upgrading in manufacturing global value chains, creating value addition in agriculture, and increasing competitiveness to export modern services.

Harnessing domestic investment can help finance the next phase of growth. Policy areas include promoting FDI into productive and export sectors; promoting higher domestic savings rates; improving financial inclusion through greater access to savings institutions; supporting digital access through digital technologies; lowering the costs of savings accounts; and supporting financial sector stability and development more broadly.

This interview has been edited for length and clarity.

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Long road to resilient development - The Phnom Penh Post

The Herald

Ruth Butaumocho African Agenda

Entrepreneurship means Africans no longer have to find a job or be trained to be employees. Instead, it will enable our young people to create their own jobs, become employers, and take charge of their futures, instead of letting the future happen to them.

The above quote from Nigerian Tony Elumelu, one of Africas most prominent philanthropists is a clear submission of the role of entrepreneurship in economy growth and job creation in Africa.

With a majority of African nations diversifying from traditional sources of income, entrepreneurship is increasingly seen as a key to economic growth.

Armed with abundant natural resources, human capital, cultural diversity and self-determination, Africa has in the last few years recorded a boon in entrepreneurial projects from Cape to Cairo.

Enterprising Africans who are spreading their tentacles on the continent and beyond, offering various goods and services, continue to drive home the opportunities inherent in entrepreneurism and, especially at a time of rising competition abroad and commodity pricing fluctuation.

From continental-grown hubs of innovation, mobile service provision, energy, robust farming and food provision projects and a growing network of transportation service, Africa has in the last few years become a hive of business activities.

The trail of success and growth in some of the sectors would have further progressed had Covid-19, not had a huge pinch on the global economic activities.

Notwithstanding the negative impact of Covid-19, the entrepreneurial passion of many Africans is unmatched.

A growing wave of grassroots self-starters are leading by example and raising the bar for Africa in competitive entrepreneurship, a development that has kept the economic activities alive, despite a number of challenges Africa has had to contend with.

Although the investment, innovation hubs may not match that of the Silicon Valley in the United States, the zeal and level of determination among some of the already established and emerging entrepreneurs on the continent is what Africa needs, to attain its potential.

Brilliant young men and women are showing high levels of ingenuity, taking risks and defying obstacles to bring their start-ups to life.

What also gives them a competitive edge is that the established and emerging crop of African entrepreneurs do not only have an eye for business, but they are among some of the most confident in the world in their ability and skills to start a business.

Recently publicised innovations from young Africans in different sectors points to a clear vision and determination to give the continent a competitive edge among other established economies.

Hardly a week passes without the continent recording a success story of new invention, launch of a competitive product on the market and better still, some brainy African joining high tech global companies, which on its own is an affirmation of the abundance of talent, skill and knowledge.

Recently, a Zimbabwean molecular biologist made news by creating over 600 unique ice cream flavours using indigenous produce.

Tapiwa Guzha, who is based in Cape Town used his PhD in Molecular Biology to make more than 600 inventive ice cream flavours, ranging from baobab to edible clay.

In an interview, Guzha said he was on a mission to change the way Africans see their food, hence his decision to create these various ice-cream flavours for Africa.

He said he opted to use indigenous African flavours because he wanted Africans to embrace and be proud of their heritage.

Success stories of entrepreneurship have also been recorded elsewhere in Africa, giving hope that Africa is on a positive trajectory.

Nigerian Jason Njoku, the founder of iROKO Partners, and iROKOTv, the leading online streaming platform in Africa, is among Africans, who are also positively contributing to entrepreneurship in Africa by providing entertainment.

In Rwanda, Jean Nzeyimana is a young and brilliant innovator who is transforming waste in his community into briquettes, a greener alternative to wood charcoal, after forming a cleaning and renewable energy company called Habona.

With the abundance of success innovative stories in Africa, entrepreneurship can best be described as the spark of prosperity, that needs the support of everyone to keep it burning.

It is paramount that African enterprise needs to be matched by public-sector commitment, because Government cannot go it alone.

On their part, governments would need to continuously provide conducive environments, where entrepreneurship can thrive with minimum challenges.

Indigenisation policies, which Zimbabwe and other African countries have, open up windows of opportunities by availing natural resources and enabling policies to promote start-ups.

Policy implementation on existing laws becomes the glue that is needed to create flourishing environment for entrepreneurship.

However, like any other venture, entrepreneurship is not without hurdles, because of confounding challenges that often confront a number of start-ups.

Lack of proper funding models, unavailability of cheap money and stifling operating conditions are among major challenges emerging entrepreneurs face across the continent.

All those obstacles can be overcome by creating sustainable and user-friendly policies and platforms that support start-ups.

Governments involvement is crucial to ensure that there is structural support and resource mobilisation from different platforms.

Successful entrepreneurs also have a role to play through mentoring, providing market linkages and creating revolving funds for viable start-ups.

Africa, is at a stage where it needs to debunk the importance of foreign donors to bank-roll continental projects, who in the end, will claim intellectual property rights on home grown projects.

Local funding from established entrepreneurs, financial institutions and private-public partnership are crucial in keeping the entrepreneurial spirit alive.

On the hand, Africa needs to put its resources where its future lies its own people.

The continent cannot continue to export its raw materials and resources, at this juncture, as these can be used to provide employment and add value to the continent.

The advent of intra-African trade through the African Continental Free Trade Area (AfCFTA), is a huge business opportunity and has the potential to further promote entrepreneurship in Africa.

By promoting trade among African countries, AfCFTA would be strengthening the continents industrial base and ensuring that Africa produce goods for itself through its fast emerging entrepreneurs.

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Start-ups in Africa need fiscal support to take off - The Herald

Mumbai-based Avaana Capital is one of the few venture capital firms to focus on climate action and sustainability in India. It invests in early-stage sustainable venturesstartups building technology-driven solutions for mitigating and building resilience against climate change.

Founded in 2018 by veteran investor Anjali Bansal, who previously was a partner and managing director at TPG, Avaana has backed more than 35 startups, including hydroponics vegetable grower Eekifoods and air purification system developer Praan.

In an interview with KrASIA, Bansal talked about why she thinks sustainability will become as integral as digital technologies for the local startup community.

The following interview has been edited and consolidated for brevity and clarity.

KrASIA (Kr): What is Avaanas thesis around sustainability?

Anjali Bansal (AB): We believe if you apply technology and innovation to large-scale problems, you can get solutions and impact at scale while creating supernormal returns. For the next 20 years, climate change will be the biggest problem for the world. I feel that we owe it to our next generation to leave behind a better planet. Beyond that, I believe sustainability is going to become as integrated as digitization in any business model.

Two decades ago, most large companies didnt consider technology to be core to their business. Technology was a function that sat somewhere on the peripheries like ERP (enterprise resource planning) systems. Today, most companies are digitized and technology is embedded horizontally across business verticals.

Digital technologies defined the evolution of companies in the last 20 years. For the next two decades, sustainability will define new trajectories. It will be integrated into business models across the value chainwhether it is product development, R&D, manufacturing, or supply chain.

We invest in early-stage tech companies that address three pillars of sustainabilitymitigation, adaptation, and resilience (while facing climate change)and are at the commercialization stage.

Kr: Why do you think sustainability will become as critical and integral as digital technologies?

AB: There are three reasons. Global capital is shifting toward ESGenvironmental, social, and governance. When capital moves, action happens.

Second, consumer preferences have started shifting toward opting for affordable, sustainable products.

Lastly, there are some employees, particularly the younger lot, who are increasingly seeking to work with companies that are more sustainable and responsible.

Consumers, employees, and shareholders have shown their preference. Hence, we believe companies will have to shift their business strategy.

Kr: Which themes do you focus on?

AB: Food and consumption, mobility and supply chain, and resource management.

Within food and consumption, a lot is happening in agriculture on the consumer side, with products that are better for the consumers as well as the planet. The agriculture industry is a big carbon emitter, so there is an opportunity to mitigate climate change by reducing its carbon footprint and wastage. Sustainable agriculture is taking off in the country due to a combination of factorsentrepreneurial talent, availability of capital, policy support, and digitization.

The mobility and supply chain segment is another major emitter of carbon. We look at ventures that work on large-scale digitization of the supply chain across industries. Digitized supply chains lead to higher efficiency, reduced wastage, better circularity, and income enhancement for stakeholders. EVs are also in this bucket.

Under resource management, we back startups that work on transitions to green energy, or that are building solutions for land, water, air, and waste management to cultivate a circular economy.

Kr: Do you think sustainability will become a priority in Indias startup ecosystem?

AB: I see a positive movement among entrepreneurs who are looking to solve the next big problem. There is more action outside India, like climate-focused funds being set up. In India, we dont have many investors in this space. Capital remains the biggest challenge for climate tech and sustainable startups. But that will change, once we start seeing successes emerge.

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4 observations on Indias climate tech and sustainability investments from Anjali Bansal of Avaana Capital - KrASIA