Thursday, February 05, 2009

Cheap and Chalu - 2.0

Cheap and Chalu seems to be the new mantra of modern India.
Today Indian government unveiled the new $10 laptops which would give a big boost to the education facilities at our rural and backward areas.

While the world was going gaga over Nicolas Negroponte’s One Laptop per Child (OLPC) and the XO machines, launched with a mission "To create educational opportunities for the world's poorest children by providing each child with a rugged, low-cost, low-power, connected laptop with content and software designed for collaborative, joyful, self-empowered learning", here is India's answer to it, that too at one-fifth of the price.

Before this this, it was Chandrayaan, our satellite developed by ISRO which silenced all the critics from all corners of the world and proved itself to be 100% efficient is its very first attempt. May be it’s the confidence of the ISRO team, that they launched it without even taking an insurance cover!

Last year, Indian IT and Computer hardware major, HCL created news with the then cheapest Laptop called MiLEAP X for just Rs 13,990.

Indian telecom player Spice unveiled a groundbreaking product range of mobile including the world’s cheapest phone, called the People’s Phone - a mobile handset, sans screen display for as less as Rupees 500. The people’s phone coincidentally also comes in a braille edition.

Even Indian defense weaponry is one of the cheapest in the world. The new American F/A-22 Raptor stealth fighter costs Rs 480 crore. The Rafale multi-role jet being inducted into the French Air Force and Navy, in turn, notches about Rs 270 crore. The price tag for the French Mirage-2000 and the Swedish JAS-39 Gripen also hovers between Rs 130 crore and Rs 160 crore. In contrast, despite huge time and cost overruns, the indigenous Light Combat Aircraft "Tejas" costs only Rs 100-110 crore. Can't comment of their relative performance though..

Now I needn’t quote TATA Nano here, the whole world knows about it.

What’s common between all the above is that, we try to develop our indigenous technology which is cheap and efficient just like the famous incident – while Russians used pencils, NASA spent millions of dollar to develop a “space” pen for its astronauts.
From an economist’s point of view, what can help India further in this cause - is that we have such a huge domestic market that we can go for higher economies of scale. With the growing economy and the increase in purchase power of people we can expect sales for all products and services to grow higher. The establishment cost for all such productions are just one time investments.
Thinking of it, if we plan to make every citizen of our country get essential clothing, we can actually make it is possible. All we need to do is establish a large loom and continuously generate the same cloth (same texture and colour), now this cuts a lot of cost and then adding a little subsidy or cross subsiding it, we can make sure that we do not have any naked Indian.
Likewise we can have shoe factory, producing the just 1 type of shoes (or chappals) for all.
Similarly for food, if we have a baking house to manufacture the same type of bread for all people below poverty line and distribute it through out the country via proper distribution channels and reach it would solve the starvation to a great extent.
The list is endless; if we keep encouraging innovations and also try achieve such economies of scale we would definitely be able to provide better services and more importantly at very low cost.


Vinay Kumar said...

soory mate ..but all ho..ha..about the $10 laptop is over..if you have gone through today times of will be shocked to know that the $10 laptop is just a simple computing device which is still very very far from bridging the digital divide and make access to computer litrecy affordable for poor childrens.
this act of goverment has shamed the nation.

Harsha said...

@vinay kumar..
True, all hype fizzed out in no time, but then the idea behind the post was rather to appreciate Indian governments' focus on innovation and render cheap but efficient products and services to all sections of the society..