On Mon, May 19, 2008 at 1:43 PM, Anil Kumar wrote: >> > My response is in reference to Point - 4: > I quite disagree with the 'less government 'support' the better' argument. > In India, good examples (IMHO) are the development of the Information > Technology sector, now followed by the Business Process Outsourcing sector, > both having benefited from various forms of government (both Central and > State) support including but not limited to support in procuring land and > buildings, reduced to nil stamp duties and registration fees on real estate > transactions, tax free income generation. There are a few other benefits > and support on administrative and regulatory levels. This support > (particularly from Central Government) is administered through the Software > Technology Parks of India Scheme. >
Maybe some of these regulations were incorrect to start with ? or maybe businesses would have still come despite these regulations..? or maybe there are other regulatory mechanisms not directly related which are to blame...? Some years ago i was shocked to see five mobile operators competing successfully in Somaliland (formerly british somaliland... an un-recognized breakaway republic from Somalia... http://en.wikipedia.org/wiki/Somaliland), the telecom sector there had little in terms of entry barriers... all that was required was a single approval from a government functionary. This meant a lot of competition, low mobile charges (30 cents to call any country in the world...) and very low operational overheads in a country with very poor infrastructure. Compared to that neighboring Kenya had better communication infrastructure, but an extremely pervasive regulatory environment which meant that the 2 mobile operators had atrociously high calling rates. Note that Kenya has had a software-technology-park, nil-stamp duty initiative etc. for quite some time now... but the real problem has been the presence of other stifling laws and regulations...(for e.g. the city council / municipal council has some arcane laws/ fees / and powers which make operating any kind of business very expensive....)
