The economic and demographic effects of corruption.
Cost of land in our urban areas is far higher than what our GDP per capita would dictate. The ratio of land value to per capita GDP is probably higher in India than anywhere else. As an example, land prices in Chennai or Bengaluru rival that of cities like New York which has a vastly higher per capita GDP.
The key reason?
First, vast sums of political corruption money is parked in real estate. This raises real estate prices and high real estate prices affect everything downstream.
Second, corruption in building approvals and the like - the famous DTCP - raises construction costs, on top of already higher real estate costs.
Third, corruption in private school regulatory compliance enforcement raises school fees.
Fourth, corruption in private hospital regulatory compliance enforcement raises health care costs.
Fifth, household goods need sales outlets and those pay higher rents due to high real estate prices and construction costs.
So housing, education, healthcare and household goods - all of these now cost higher.
As a direct consequence, the economic burden on the average person gets worse. Young people, facing all these costs, postpone marriage, and postpone children or have fewer children.
That directly affects our demographics.
While this issue exists in many parts of India, Tamil Nadu, being the most urbanized of the bigger states, is particularly hit hard.
So corruption is becoming an existential threat to our society.
If you worry about the super-low birth rate in Tamil Nadu, way below replacement, understand that corruption raising our cost of living is one of the major causes, not the only cause, but a big one in our context.
Have a break but don’t have a KitKat because
I compared a KitKat sold in Australia with one sold in India, and the numbers are sadly not surprising.
The Australian version contains:
-Milk solids – 20%
-Cocoa – 22%
-Added sugar – 21.7g
The Indian version contains:
-Milk solids – 16.1%
-Cocoa – 4.5%
-Added sugar – 28.9g
Indians are getting a significantly inferior version compared to Kit-Kat abroad. This is not just limited to the Kit-Kat but most packaged food items like Cerelac, Lays etc.
This is because of 3 reasons.
1.India is a price-sensitive country, and as a result companies put low quality ingredients. But costing alone doesn’t explain the full picture.
2.Our regulations are weak and they don’t prevent companies from giving us inferior products.
3.We as consumers do not question what we’re being served. That is exactly why I started Label Padhega India. Because unless we read and ask, nothing changes.
Companies rarely change because they feel guilty. Companies change if consumers unite and ask for it.
So it’s our responsibility, together, to speak up and make sure our voices are heard.
Let’s Make India Healthy Again.