8 ms·

The real reason for India’s brain drain

32 points by denzil_correa 13y ago

deleted 13y ago
[deleted]
senthilnayagam 13y ago
in those Indira Gandhi days Govt assumed everyone under reported the income so tax slab had to be high, also agriculture was not taxed. from 1991 lot of headway has been made, but still Interests rates are significantly higher than international rates. real estate prices, rentals are very high, infrastructure is poor(you need to own a generator) employee attrition rates, salary hike expectations are significantly higher. if work visa's were easier more people would be migrating it is tough to be a successful and profitable entrepreneur in India
jrmenon 13y ago
Not sure if it explains everything though. The comparison may not be fair, but the tax rates in US ~ the 50s and 60s were fairly high too, and yet it led to post-WW2 boom: Dwight D. Eisenhower Marginal Tax Rate on Regular Income over $400,000: 92% - 91% Maximum Tax Rate on Long-Term Capital Gains: 25% Source: http://news.yahoo.com/eisenhower-obama-wealthiest-americans-pay-taxes-193734550--abc-news.html http://news.yahoo.com/eisenhower-obama-wealthiest-americans-...
- arbuge 13y ago
  Of note: $400k in 1953 dollars when Eisenhower was president is equvalent to around $3.5m today. Source: http://www.usinflationcalculator.com/ http://www.usinflationcalculator.com/
pritambaral 13y ago
Mirror: http://pastebin.com/dmgGbRhM http://pastebin.com/dmgGbRhM
parennoob 13y ago
The author forgot to mention: * Massive overpopulation, caused in part by over-aggressive family planning measures adopted by the same Indira Gandhi government. There is extreme scarcity of basic resources like food, water, electricity in India. * Rampant Regionalism -- India is less like the USA (a collection of states) and more like the EU (a collection of countries with very distinct cultures). People find it hard to always have a strong sense of ties to the nation. Will, say, a Greek person feel sad about leaving "Europe"? Probably not. :P * A political system plagued with dynastic politics and ruled by old people (the average age of a Minister in India is 65) who still retain outmoded adherences to their own specific brand of religions / regions / castes / whatnot.
- walshemj 13y ago
  And if you look at sites like http://workplace.stackexchange.com/ http://workplace.stackexchange.com/ there's a lot of employment practices in india that are almost pre Victorian in their harshness. I am not surprised that a lot of Indians want to move to the USA.
- deleted 13y ago
  [deleted]
- r0h1n 13y ago
  > Massive overpopulation, caused in part by over-aggressive family planning measures Eh?? How does over-aggressive family planning lead to massive overpopulation? > Rampant Regionalism -- India is less like the USA (a collection of states) and more like the EU (a collection of countries with very distinct cultures). People find it hard to always have a strong sense of ties to the nation. Double eh?? Because India is a collection of distinct and heterogeneous states, unlike the homogeneous US, it suddenly becomes like the EU? > Will, say, a Greek person feel sad about leaving "Europe"? I don't know. But people don't emigrate because they're feeling sad or happy, but because they feel they may have better career prospects. > A political system plagued with dynastic politics and ruled by old people (the average age of a Minister in India is 65) who still retain outmoded adherences to their own specific brand of religions / regions / castes / whatnot. True, but pray how did you come to the conclusion that this was what caused people to emigrate? Fact is talented people emigrated from India because they found better value for their skills in the US. That's pretty simple. But if you're going to link Indian emigration to every ill that plagues India, from its political system to its "overpopulation" (which btw many others call a "demographic dividend") and "regionalism" (which others call "federalism"), then you'd better have some evidence or sources.
tete 13y ago
US having a comparatively bad welfare and extremely expensive education system, while being a good place for people who enjoyed this and therefor have amazing education isn't exactly news. And India going down in the last century and being the major victim of capitalism also isn't news. Okay, this sounds quiet anti-capitalist socialism thing, but these are the fact. Every system has winners and losers and usually the enforcing party is the bug winner while the opposition (India was communist) was the loser. On the other hand educated people enjoying a great social system are the big winners, just because they were born there and people who don't enjoy are the big losers. It's not true in every case, but you can see this by the difference between people in India and people from India in the US. Just like you can see it by how much the richest/poorest people in the US earn (or GDP compared to various expenses and forms of income). Okay, sorry that sounds really anti-US, but there are so many good things about the US and I really don't wanna sound like it, because I love to visit it and think about moving there. Just the US in the past decade or two didn't do as well as it could have been and while I am the least to judge I just really know from people living there that everyone wants to change something to better and you know the whole world has been looking up to and I think the US still is the most "motivating" country if you can say it that way. Or in other word it just has the most/best opportunities. I mean SF is like amazing, but I don't know. It's the whole country. Like, you are more motivated in the US and I know my friends (from both US and Europe) feel the same way. In my opinion all this country stuff isn't really a good thing for the globalized world. I say that as someone who by what I said definitely could/should have brought it further, so I really hope this doesn't sound too much US bashing. We have that more than enough. That's at least my person opinion when western countries have to deal with economic refugees.
- realrocker 13y ago
  India was never Communist. It was Socialist(it still is to a large degree). Big difference.
  - monsterix 13y ago
    > India was never communist. I'm not too sure about that. If you look at the actions, and not just merely words, Indian Government has always leaned towards communism. Emphasized social equality for all, focused very little on reward and innovation.
realrocker 13y ago
The current trend in India. The middle class here seems to be finding faults with the socialist setup everyday now. The common complaint is that the "opportunity cost" is still too high for the middle class folks. Funny, they should say that since the 60 Naxalite(http://en.wikipedia.org/wiki/Naxalite%E2%80%93Maoist_insurgency http://en.wikipedia.org/wiki/Naxalite%E2%80%93Maoist_insurge...) affected districts seem to be saying the same thing and no one is paying attention.
brianbreslin 13y ago
This is a fascinating article. I wonder if France will face the same type of issues with their ultra-wealthy taxes (75%+ over 2M).
qwerta 13y ago
Tax over 100% was in Sweden as well. Astrid Lindgren's tax rate reached 102%/ https://en.wikipedia.org/wiki/Astrid_Lindgren#Politics https://en.wikipedia.org/wiki/Astrid_Lindgren#Politics
- berntb 13y ago
  ... and Sweden went down lots of places in the economic comparision charts a bit after the high tax economy was implemented.
seivan 13y ago
Gotta take the good with the bad. If you're saying Microsoft has 34% Indians... "34% employees of the employees at Microsoft are Indians". Windows ME, Zune, Windows Vista, .NET, Webforms...
hnruss 13y ago
A marginal tax rate of 97.75% on the top tier does not mean that a person in that tier would pay 97.75% of their total earnings. It means that they would pay 97.75% of their earnings on income above a certain threshold. For example, if the marginal tax rate on income above a billion dollars was 97.75%, and you earned 2 billion, you'd "only" get to keep 27.5 million dollars of the billion you earned after the first billion. I'm not saying that a 97.75% tax on any income tier is entirely reasonable, but I hope that if you had the choice between keeping 2.25% of a billion dollars vs. keeping 100% of ten thousand dollars, you'd make the right decision.
simula67 13y ago
I have been thinking about this a lot recently and here are a few theories I have struck upon: Climate in Europe and most of Western Civilization during the industrial revolution When the industrial revolution happened in Europe, the political climate was very intense, these countries were constantly at war with each other and any advantage, however miniscule, was seeked out at any length. War has been made unprofitable with the advent of nuclear weopons, therefore there no more competition from cultures to one-up each other after India gained Independence. Nehru + Gandhis and Socialism Nehru and the Gandhi family's socialist mentality ensured that India did not benefit from the Industrial boom after the World War II and ensured decades of inefficient central planning guided the Indian economy. Thankfully, this is changing since the 1991 liberalization, globalization and privatisation push. Country founded by lawyers and not scientists While countries like USA were founded by prominent scientists like Benjamin Franklin and Thomas Jefferson, India was founded by philosophers and lawyers. This means that crictical thinking and scientific enquiry is not prized. This is compounded by the fact that the education system is inherited from the British colonial perid which was designed to train law ranking officers from the population to govern the colony. Diverse nature of India More than 2000 etnic groups, all major religions, more than a score languages spoken means, it is hard to effect any change that can sweep throughout. How to effect change must be studied for each group and implemented. Post-colonialism People thinking that oppression is a way of life is problematic when Prisoner's Dilemma type of situations arise. To end on a postive note, India is projected to have a very low dependency ratio in future and there is work underway to modernise the infrastructure. Many people are working on improving things and in my conversation with older people I think things have gotten better.
bhewes 13y ago
Why would the best and brightest of India who master English not leave? Indians who work in the US/UK reach their global maximum. I don't see how this is a net negative on India.
sakethbsv 13y ago
I am in one of those universities in India which are prone to Brain Drain. I feel a lot of people tend to go out of India for starting their careers etc since they feel it builds their status/prestige in India. But again, career prospects there are better too.
hangonhn 13y ago
You can't simply say that a country has a lot of people and therefore represent a massive economy. India's economy, even today, is comparable to Mexico. Then you take that total output and divide it by the number of people you have, the actual surplus leftover from basic needs like food and shelter is tiny. The US on the other hand, has about 1/4 the population while its economic output is 16x. So each American represent 64x the wealth of the average Indian. If I was selling something, I would rather spend the effort to convince Americans to buy my goods while charging them a ton more than I can charge an Indian. People have often made similar mistakes when assessing China. The same criticism in this paper can be applied to India as well: http://belfercenter.hks.harvard.edu/files/Chinas_Century.pdf http://belfercenter.hks.harvard.edu/files/Chinas_Century.pdf
rainhacker 13y ago
After being captivated by a "company" named East India Company for 200 years the governance in 70's and 80'a in India makes perfect sense to me. Remember post independence India was a broken nation. Not even a needle was manufactured in the country. India was in dire need of building massive infrastructure and strengthening its defense to deal with Pakistan and China. Where do you think the money to do all this come from ? The priorities at that time was different. Now, India is an independent nation capable to defend itself and have relatively a stable economy. India is opening up its economy and focusing on creating more opportunities which are entrepreneur friendly (look at the growth of the -obvious- IT sector).
fennecfoxen 13y ago
103% tax rate? Now that is on the wrong side of the Laffer Curve. http://en.wikipedia.org/wiki/Laffer_curve http://en.wikipedia.org/wiki/Laffer_curve
known 13y ago
Is India Most Racist country in the world? http://www.washingtonpost.com/blogs/worldviews/wp/2013/05/15/a-fascinating-map-of-the-worlds-most-and-least-racially-tolerant-countries/ http://www.washingtonpost.com/blogs/worldviews/wp/2013/05/15...
known 13y ago
We lobby Obama Administration to direct New Delhi regime to create an Independent Nation for India's 300 million Untouchable people as per US Congress Resolution 139. Google "Independent Nation For 300 Million India's Untouchable People". https://wh.gov/lZo4o https://wh.gov/lZo4o
- praveer13 13y ago
  damn it man, you have started polluting HN too. Wasn't reddit enough for your hate mongering?
  - known 13y ago
    Leeches cannot live independently.
    - praveer13 13y ago
      true, lower castes are leeches.
      - known 13y ago
        Caste system seeded hatred and rolled-out sadists/savages in India. What makes you think your parents/your children/your women/your houses/your properties are safe from sections of society whom you've abused for thousands of years? Google "jyoti singh pandey".
        praveer13 13y ago
        man, you are out of touch with the reality. Lower castes today don't face any discrimination, but they take advantage of unfair amount of reservation. In fact general castes are discriminated against today, lower castes are exploiting the system like leeches.
        known 13y ago
known 13y ago
People in neighboring Bhutan(17), Sri Lanka(22), Pakistan(24) are happier than in India(35). http://www.rediff.com/business/slide-show/slide-show-1-worlds-10-happiest-countries/20110610.htm http://www.rediff.com/business/slide-show/slide-show-1-world...
known 13y ago
India is an Untouchable Nation where majority people are Untouchables (~300 million). http://india.blogs.nytimes.com/2012/12/17/indias-200-million-strong-dalit-community-faces-discrimination-every-da/ http://india.blogs.nytimes.com/2012/12/17/indias-200-million...

32 points by denzil_correa 13y ago

deleted 13y ago

[deleted]

in those Indira Gandhi days Govt assumed everyone under reported the income so tax slab had to be high, also agriculture was not taxed. from 1991 lot of headway has been made, but still Interests rates are significantly higher than international rates. real estate prices, rentals are very high, infrastructure is poor(you need to own a generator) employee attrition rates, salary hike expectations are significantly higher. if work visa's were easier more people would be migrating it is tough to be a successful and profitable entrepreneur in India

jrmenon 13y ago

Not sure if it explains everything though. The comparison may not be fair, but the tax rates in US ~ the 50s and 60s were fairly high too, and yet it led to post-WW2 boom: Dwight D. Eisenhower Marginal Tax Rate on Regular Income over $400,000: 92% - 91% Maximum Tax Rate on Long-Term Capital Gains: 25% Source: http://news.yahoo.com/eisenhower-obama-wealthiest-americans-pay-taxes-193734550--abc-news.html http://news.yahoo.com/eisenhower-obama-wealthiest-americans-...

arbuge 13y ago
Of note: $400k in 1953 dollars when Eisenhower was president is equvalent to around $3.5m today. Source: http://www.usinflationcalculator.com/ http://www.usinflationcalculator.com/

pritambaral 13y ago

Mirror: http://pastebin.com/dmgGbRhM http://pastebin.com/dmgGbRhM

parennoob 13y ago

The author forgot to mention: * Massive overpopulation, caused in part by over-aggressive family planning measures adopted by the same Indira Gandhi government. There is extreme scarcity of basic resources like food, water, electricity in India. * Rampant Regionalism -- India is less like the USA (a collection of states) and more like the EU (a collection of countries with very distinct cultures). People find it hard to always have a strong sense of ties to the nation. Will, say, a Greek person feel sad about leaving "Europe"? Probably not. :P * A political system plagued with dynastic politics and ruled by old people (the average age of a Minister in India is 65) who still retain outmoded adherences to their own specific brand of religions / regions / castes / whatnot.

walshemj 13y ago
And if you look at sites like http://workplace.stackexchange.com/ http://workplace.stackexchange.com/ there's a lot of employment practices in india that are almost pre Victorian in their harshness. I am not surprised that a lot of Indians want to move to the USA.
deleted 13y ago
[deleted]
r0h1n 13y ago
> Massive overpopulation, caused in part by over-aggressive family planning measures Eh?? How does over-aggressive family planning lead to massive overpopulation? > Rampant Regionalism -- India is less like the USA (a collection of states) and more like the EU (a collection of countries with very distinct cultures). People find it hard to always have a strong sense of ties to the nation. Double eh?? Because India is a collection of distinct and heterogeneous states, unlike the homogeneous US, it suddenly becomes like the EU? > Will, say, a Greek person feel sad about leaving "Europe"? I don't know. But people don't emigrate because they're feeling sad or happy, but because they feel they may have better career prospects. > A political system plagued with dynastic politics and ruled by old people (the average age of a Minister in India is 65) who still retain outmoded adherences to their own specific brand of religions / regions / castes / whatnot. True, but pray how did you come to the conclusion that this was what caused people to emigrate? Fact is talented people emigrated from India because they found better value for their skills in the US. That's pretty simple. But if you're going to link Indian emigration to every ill that plagues India, from its political system to its "overpopulation" (which btw many others call a "demographic dividend") and "regionalism" (which others call "federalism"), then you'd better have some evidence or sources.

tete 13y ago

US having a comparatively bad welfare and extremely expensive education system, while being a good place for people who enjoyed this and therefor have amazing education isn't exactly news. And India going down in the last century and being the major victim of capitalism also isn't news. Okay, this sounds quiet anti-capitalist socialism thing, but these are the fact. Every system has winners and losers and usually the enforcing party is the bug winner while the opposition (India was communist) was the loser. On the other hand educated people enjoying a great social system are the big winners, just because they were born there and people who don't enjoy are the big losers. It's not true in every case, but you can see this by the difference between people in India and people from India in the US. Just like you can see it by how much the richest/poorest people in the US earn (or GDP compared to various expenses and forms of income). Okay, sorry that sounds really anti-US, but there are so many good things about the US and I really don't wanna sound like it, because I love to visit it and think about moving there. Just the US in the past decade or two didn't do as well as it could have been and while I am the least to judge I just really know from people living there that everyone wants to change something to better and you know the whole world has been looking up to and I think the US still is the most "motivating" country if you can say it that way. Or in other word it just has the most/best opportunities. I mean SF is like amazing, but I don't know. It's the whole country. Like, you are more motivated in the US and I know my friends (from both US and Europe) feel the same way. In my opinion all this country stuff isn't really a good thing for the globalized world. I say that as someone who by what I said definitely could/should have brought it further, so I really hope this doesn't sound too much US bashing. We have that more than enough. That's at least my person opinion when western countries have to deal with economic refugees.

realrocker 13y ago
India was never Communist. It was Socialist(it still is to a large degree). Big difference.
- monsterix 13y ago
  > India was never communist. I'm not too sure about that. If you look at the actions, and not just merely words, Indian Government has always leaned towards communism. Emphasized social equality for all, focused very little on reward and innovation.

realrocker 13y ago

The current trend in India. The middle class here seems to be finding faults with the socialist setup everyday now. The common complaint is that the "opportunity cost" is still too high for the middle class folks. Funny, they should say that since the 60 Naxalite(http://en.wikipedia.org/wiki/Naxalite%E2%80%93Maoist_insurgency http://en.wikipedia.org/wiki/Naxalite%E2%80%93Maoist_insurge...) affected districts seem to be saying the same thing and no one is paying attention.

brianbreslin 13y ago

This is a fascinating article. I wonder if France will face the same type of issues with their ultra-wealthy taxes (75%+ over 2M).

qwerta 13y ago

Tax over 100% was in Sweden as well. Astrid Lindgren's tax rate reached 102%/ https://en.wikipedia.org/wiki/Astrid_Lindgren#Politics https://en.wikipedia.org/wiki/Astrid_Lindgren#Politics

berntb 13y ago
... and Sweden went down lots of places in the economic comparision charts a bit after the high tax economy was implemented.

seivan 13y ago

Gotta take the good with the bad. If you're saying Microsoft has 34% Indians... "34% employees of the employees at Microsoft are Indians". Windows ME, Zune, Windows Vista, .NET, Webforms...

hnruss 13y ago

A marginal tax rate of 97.75% on the top tier does not mean that a person in that tier would pay 97.75% of their total earnings. It means that they would pay 97.75% of their earnings on income above a certain threshold. For example, if the marginal tax rate on income above a billion dollars was 97.75%, and you earned 2 billion, you'd "only" get to keep 27.5 million dollars of the billion you earned after the first billion. I'm not saying that a 97.75% tax on any income tier is entirely reasonable, but I hope that if you had the choice between keeping 2.25% of a billion dollars vs. keeping 100% of ten thousand dollars, you'd make the right decision.

simula67 13y ago

I have been thinking about this a lot recently and here are a few theories I have struck upon: Climate in Europe and most of Western Civilization during the industrial revolution When the industrial revolution happened in Europe, the political climate was very intense, these countries were constantly at war with each other and any advantage, however miniscule, was seeked out at any length. War has been made unprofitable with the advent of nuclear weopons, therefore there no more competition from cultures to one-up each other after India gained Independence. Nehru + Gandhis and Socialism Nehru and the Gandhi family's socialist mentality ensured that India did not benefit from the Industrial boom after the World War II and ensured decades of inefficient central planning guided the Indian economy. Thankfully, this is changing since the 1991 liberalization, globalization and privatisation push. Country founded by lawyers and not scientists While countries like USA were founded by prominent scientists like Benjamin Franklin and Thomas Jefferson, India was founded by philosophers and lawyers. This means that crictical thinking and scientific enquiry is not prized. This is compounded by the fact that the education system is inherited from the British colonial perid which was designed to train law ranking officers from the population to govern the colony. Diverse nature of India More than 2000 etnic groups, all major religions, more than a score languages spoken means, it is hard to effect any change that can sweep throughout. How to effect change must be studied for each group and implemented. Post-colonialism People thinking that oppression is a way of life is problematic when Prisoner's Dilemma type of situations arise. To end on a postive note, India is projected to have a very low dependency ratio in future and there is work underway to modernise the infrastructure. Many people are working on improving things and in my conversation with older people I think things have gotten better.

bhewes 13y ago

Why would the best and brightest of India who master English not leave? Indians who work in the US/UK reach their global maximum. I don't see how this is a net negative on India.

sakethbsv 13y ago

I am in one of those universities in India which are prone to Brain Drain. I feel a lot of people tend to go out of India for starting their careers etc since they feel it builds their status/prestige in India. But again, career prospects there are better too.

hangonhn 13y ago

You can't simply say that a country has a lot of people and therefore represent a massive economy. India's economy, even today, is comparable to Mexico. Then you take that total output and divide it by the number of people you have, the actual surplus leftover from basic needs like food and shelter is tiny. The US on the other hand, has about 1/4 the population while its economic output is 16x. So each American represent 64x the wealth of the average Indian. If I was selling something, I would rather spend the effort to convince Americans to buy my goods while charging them a ton more than I can charge an Indian. People have often made similar mistakes when assessing China. The same criticism in this paper can be applied to India as well: http://belfercenter.hks.harvard.edu/files/Chinas_Century.pdf http://belfercenter.hks.harvard.edu/files/Chinas_Century.pdf

rainhacker 13y ago

After being captivated by a "company" named East India Company for 200 years the governance in 70's and 80'a in India makes perfect sense to me. Remember post independence India was a broken nation. Not even a needle was manufactured in the country. India was in dire need of building massive infrastructure and strengthening its defense to deal with Pakistan and China. Where do you think the money to do all this come from ? The priorities at that time was different. Now, India is an independent nation capable to defend itself and have relatively a stable economy. India is opening up its economy and focusing on creating more opportunities which are entrepreneur friendly (look at the growth of the -obvious- IT sector).

fennecfoxen 13y ago

103% tax rate? Now that is on the wrong side of the Laffer Curve. http://en.wikipedia.org/wiki/Laffer_curve http://en.wikipedia.org/wiki/Laffer_curve

known 13y ago

Is India Most Racist country in the world? http://www.washingtonpost.com/blogs/worldviews/wp/2013/05/15/a-fascinating-map-of-the-worlds-most-and-least-racially-tolerant-countries/ http://www.washingtonpost.com/blogs/worldviews/wp/2013/05/15...

known 13y ago

We lobby Obama Administration to direct New Delhi regime to create an Independent Nation for India's 300 million Untouchable people as per US Congress Resolution 139. Google "Independent Nation For 300 Million India's Untouchable People". https://wh.gov/lZo4o https://wh.gov/lZo4o

praveer13 13y ago
damn it man, you have started polluting HN too. Wasn't reddit enough for your hate mongering?
- known 13y ago
  Leeches cannot live independently.
  - praveer13 13y ago
    true, lower castes are leeches.
    - known 13y ago
      Caste system seeded hatred and rolled-out sadists/savages in India. What makes you think your parents/your children/your women/your houses/your properties are safe from sections of society whom you've abused for thousands of years? Google "jyoti singh pandey".
      - praveer13 13y ago
        man, you are out of touch with the reality. Lower castes today don't face any discrimination, but they take advantage of unfair amount of reservation. In fact general castes are discriminated against today, lower castes are exploiting the system like leeches.
        known 13y ago

known 13y ago

People in neighboring Bhutan(17), Sri Lanka(22), Pakistan(24) are happier than in India(35). http://www.rediff.com/business/slide-show/slide-show-1-worlds-10-happiest-countries/20110610.htm http://www.rediff.com/business/slide-show/slide-show-1-world...

known 13y ago

India is an Untouchable Nation where majority people are Untouchables (~300 million). http://india.blogs.nytimes.com/2012/12/17/indias-200-million-strong-dalit-community-faces-discrimination-every-da/ http://india.blogs.nytimes.com/2012/12/17/indias-200-million...