Geography Reference
In-Depth Information
of those rules and laws, or if the government applies the laws in a fitful, selective or capri-
cious manner, you have a society in which institutional capital is lacking. In such a society,
contracts are not binding, corruption and bribery are an accepted fact of social life, and the
laws and norms are followed when it suits an individual. It is in such a society that teachers
do not teach, students are not trained, and health-care is not provided because the resources
“leak” away before they reach their intended recipient ... If unchecked, this lack of institu-
tional capital spreads from one sphere of activity to another - from business to education
to politics, the society becomes a nonchalant accepter of this way of life.' This links with
the fact that the way to get things done in India - especially if a government is involved -
is not to follow a process or a procedure but to find someone who can fix something.
Ahuja acknowledged that India had learned to innovate frugally but said that 'quick fix'
represented three failures. The first was the system not working. Second, the more often a
system failure was solved through a jugaad, the more likely it was that the system would
completely break down. 'Systems work through processes and routines being followed, not
by exceptions being created,' he wrote. 'Every jugaad introduces an exception into the sys-
tem. With sufficient jugaad over time, there is no worthwhile process left and the system
eventually collapses to ineffectiveness.' The third failure was that 'a person who gets used
to jugaad, or short-circuiting one given system, often then moves down the slippery slope
and loses respect for other systems too', and that led to the collapse of other systems. 'Thus
the practice of jugaad can lead to a vicious cycle, in which institutions are steadily under-
mined.'
'Master of Jugaad'
In the private sector, the licence and quota-based controlled economy introduced by Nehru
after independence in 1947 made it inevitable that companies would look for jugaad-style
ways around the controls, setting Ahuja's 'vicious cycle' trend that continues today in a
partially liberalized economy. The Reliance conglomerate, which was founded in 1966 by
Dhirubhai Ambani and is now run by his sons Mukesh and Anil as two separate businesses
(Reliance Industries and Reliance Group), has been a leading practitioner in Ahuja's cycle
of using jugaad to undermine institutions.
Reliance Industries is one of India's biggest groups with interests stretching from poly-
ester, petrochemicals, oil and gas exploration and refining to retail stores. It has thrived
through well-placed contacts, as Hamish McDonald, an Australian journalist, has recoun-
sympathetic friend as minister of commerce, the Bengali politician Pranab Mukherjee'.
7
(Mukherjee became finance minister in 1982, a post he returned to between 2009 and 2012,
having also been external affairs and defence minister in a career that culminated in him
