Is Something Missing? - (12 September 2021)


Often we end up focusing on what we see when we should be thinking about what we don’t. Well, here are some things that we thought were conspicuous by their absence.

Where’s the Boss?

The Public Sector Banks (PSBs) in India have over 60 vacant positions on the board. The key positions that remain vacant are shareholder directors, representatives of workmen and so on. This comes at a time when 27 PSBs have been merged into 12 PSBs, and 2 of them are to be privatised.

Unlike the private sector banks, where profits are the main objective, PSBs pursue developmental goals like extending banking services to the poor of the country or providing loans to small businesses. 

The boards play a crucial role in framing and implementing the business strategy, managing the risk and financial soundness of the banks. Many PSBs are not able to meet the quorum at the meetings of critical sub-committees of the board. In the past decade, more than USD 52 billion of taxpayers money has gone into keeping these PSBs afloat. And now, the gatekeepers are missing!


The global financial crisis taught us the importance of meaningful boardroom scrutiny. Smart governance decisions made today can avoid hundreds of billions in losses in the decade to come. We think not just quantity, but also the quality of leadership has to be adequate. To attract top-quality talent, PSBs need to pay top dollar and here is where a mindset shift is most needed. After all, these banks are too big to fail!

Finding Your Purpose

Two- thirds of India's working population falls within the working age and studies suggest that India will remain well within its demographic dividend window until 2025.  India needs to move beyond simply finding jobs for this group, to encouraging entrepreneurship 

Even today, 76% of India’s working population prefers a job over self-employment on account of security and preference for a regular source of income. Clearly, social safety plays a big role! Countries like Sweden now provide a right to leave to conduct a business, wherein employees are allowed to take unpaid leave to pursue an entrepreneurial venture. Similarly, France introduced PARE in 2002, which lets individuals retain access to their unemployment benefits for up to 3 years after starting a business.



While the government can build enablers to encourage entrepreneurship (and some steps are being taken), a real cultural push can be transformational. Education systems have to push the concept of starting up, and corporates need to welcome entrepreneurship too. This will have to be a consistent effort across the stakeholders in the society, and everyone stands to gain.

The Case of Missing Chips

India’s automakers reported a drop of 11% in wholesale numbers in August 2021 compared to one year ago. In fact, two-wheeler and motorcycle dispatches fell 15% and 20% respectively. 

The Society of Indian Automobile Manufacturers (SIAM) put this down to a global shortage of semiconductor chips. With greater technology integration in automobiles, the use of semiconductor chips has gone up substantially: we cannot after all imagine cars now without bluetooth connectivity, driver-assist, navigation and other such systems. The Covid pandemic has increased digital adoption thereby increasing the demand for these chips, and the auto industry accounts for 10% of global demand.



India imports nearly 100% of its semiconductor chip requirements. Although the government has made announcements to encourage semiconductor manufacturing in India, this will take time to come onstream. While large groups like Tatas have set forth entry into this space, their production will likely be used for captive purposes initially. It is therefore imperative for India to use its foreign policy and strategic muscle to secure the sourcing of these critical components, and do so with urgency. The large impact of this shortage on multiple industries and livelihoods necessitates this.

When It's All Right to Miss (Out)

Our podcast- "Insider Investing" aims to highlight the journey of some of the smartest individuals and thought leaders and how they grow and preserve their wealth.  

“When you go after fear of missing out, and you hear a cocktail table(conversation), everybody's making money and you are not. But that's not the truth. Because people only talk about their wins. They don't necessarily talk about the losses, not because they want to lead people in the wrong direction. But what are you proud of your wins, right? Not necessarily your losses. So I think fear of losing out is one aspect where I feel at least I've made the biggest mistake, because then you tend to get impulsive. And you feel that you need a part of the action as well.”


-Amit Jatia (Vice Chairman, Westlife Development: McDonald’s India - South and West)