Healthcare is a big opportunity in India

While private players are keenly entering this "social" infrastructure sector, innovative measures are needed to improve financial performance.

The last decade has seen a significant increase in private sector participation in healthcare delivery. Existing players such as Apollo, Wockhardt, Manipal, Care Hospitals and Narayan Hrudalaya have expanded aggressively.

New players such as Fortis, Max, Sterling, Global Hospitals, AMRI, Ruby Hall and Reliance, ADAG have entered the sector with plans to establish national and regional presence. International players such as Elbit, Columbia Asia and Parkway have also entered India with plans of establishing a network of hospitals.

These corporate players together operate around 25,000 beds across the country. Healthcare providers have also attracted investments from private equity players such as IDFC, Apax Partners, Actis, Indivision, ICICI Ventures, and Trinity Capital.

My colleague Monika Sood is an acknowledged thought-leader and strategist in the healthcare space. Over a long fireside-chat, she explained to me the dynamics of the private healthcare market.

Healthcare delivery can be segmented into primary, secondary and tertiary care. Primary care constitutes treatment on an out-patient basis. Secondary care refers to hospitalisation for "non-critical" ailments. Tertiary care relates to treatment of critical ailments and requires high-tech and expensive facilities and equipment.

As of now the corporate sector is focused on tertiary care. The opportunity exists because of the lack of adequate facilities, high investment requirement (which becomes an entry barrier for smaller players), higher revenue realisation per patient, less competition from doctor-entrepreneur led facilities as well as an ability to differentiate product offerings.

Five key factors are currently driving private participation in "for profit" healthcare delivery.

Increasing population base - Population growth of 1.7 per cent per annum for the next five years will result in a need for approximately 30,000 new beds every year.

Increasing income - The number of households with income greater than Rs 2,00,000 per annum is likely to increase from 95 million (8 per cent of population) to 404 million (32 per cent of population) by 2015.

Rising insurance penetration - Private medical insurance penetration has increased from 0.4 per cent of population in 2001 to 1.5 per cent of population in 2006.

Increasing incidence of "lifestyle" diseases - Cardiac ailments, diabetes, and the like result in an increased requirement of tertiary care beds.

Increase in the number of senior citizens - Driven by higher life expectancy, from 59 to 63 in the last decade, senior citizens (around 4 per cent of population) constitute around 20 per cent of in-patients at hospitals.

The above drivers are likely to result in an annual increase of 10-12 per cent in the size of the healthcare delivery market over the next five years.

However the financial performance of players has not been very encouraging. Average operating margins have been less than 18 per cent (and declining), and Return On Capital Employed has been less than 15 per cent. This is a key area of concern.

This rather lacklustre financial performance has been due to:

High capital expenditure per bed: Capital expenditure of Rs 50-75 lakh (Rs 5-7.5 million) per bed for tertiary care and Rs. 25-30 lakh (Rs 2.5-3 million) for secondary care, is essentially driven by high cost of land as well as high cost of medical equipment.

Given the importance of location while establishing a new facility, providers are forced to pay a high cost for acquiring land especially in the metros and Tier I cities.

Medical equipment typically comprises 30-40 per cent of project cost. State-of-the art medical equipment is being deployed to attract "star" physicians as well as being used as a marketing tool. Given the large share of imported equipment, providers have to pay dollar prices on par with international players thus increasing capital costs.

Increasing customer expectations have also resulted in an increased spend on hospital interiors and services.

Ongoing capital expenditure: Significant investment is required on an ongoing basis given the high obsolescence of medical equipment.

Limitations on revenue realisation per bed-night: Revenue realisation per bed-night has been limited by increasing competition especially in metros and Tier I cities. For example, the average price increase in competitive markets over the last five years has been only around 5 per cent per annum.

The large share (greater than 40 per cent) of secondary care patients at most tertiary care hospitals also results in low realisation per bed-night. Thus, while the facility has been created for tertiary care (high capex), it is being sub-optimally utilised to offer secondary care (low realisation).

Increasing share of bulk buyers (insurance, corporates etc.) also limits the ability to increase realisation significantly. The limited size of the population that can afford high-end tertiary care also restricts revenue growth.

Increasing operating costs: While most players in competitive markets have not been able to increase prices significantly, their operating costs have gone up disproportionately. This increase has been driven essentially by increasing human resource costs due to a shortage of trained personnel and increasing competition for talent.

At a key tertiary care hospital in Delhi while the revenue has increased by 5 per cent per annum over the last five years, personnel costs have increased by 14 per cent per annum. High costs associated with attracting and retaining "star" physicians (since they continue to be key drivers of patient volumes) have resulted in high fixed operating costs, especially for new players.

High costs incurred on marketing the facility over and above developing a referral network have also increased operating costs for most players.

High gestation period: High fixed operating costs and slow build-up of occupancy results in operating losses in the first few years. Patients have shown a preference for established facilities and physicians and are reluctant to try new facilities especially for critical ailments, thus increasing the gestation period for a new facility.

High capital expenditure, constrained revenue realisation per bed-night and increasing operating costs have resulted in shrinking operating margins (average range 10-18 per cent) and low asset turnover ratios.

Clearly, innovative measures are the order of the day to improve financial performance. Such measures would include:

• Better planning at the time of conceptualisation: Reducing capital expenditure through innovative hospital design, "optimal" selection of medical equipment, phased rollout, right choice of location, specialty-mix etc.
• Leveraging scale to reduce procurement price - for capital equipment as well as consumables.
• Having the "right" doctor engagement model and building an "institutional" brand.
• Focus on untapped opportunities - geographic locations as well as undeserved segments.

The burgeoning Indian market, if handled smartly, offers a challenging opportunity for value creation.

Healthcare, then, would definitely turn out to be a healthy business!

The Indian armed forces also have a lot to answer for

When the sixth pay commission recommendations came out earlier this year, the reaction in the rank and file of the Indian armed forces was strongly negative as it once again felt let down by the political-bureaucratic establishment. The veterans came out on the streets to protest and the Indian army chief was forced to take his case to the President, much to the annoyance of the government.

The issues related to the Military Service Pay, the exclusion of the rank pay from the pay scale of officers leading to a lowering of officers' status, introduction of running pay bands were, among others, issues that caused a lot of consternation within the services, especially as it reinforced a perception that it's all part of a well-established pattern of behavior on the part of their civilian masters.

Such turmoil within the ranks of any nation's armed services should be a cause for concern but in the case of India that aspires to join the ranks of world's major global powers this is a recipe for disaster.

The government has now decided to implement a modified version of the Pay Commission recommendations and the service chiefs seem to have given their blessings to the proposed changes. The navy chief has been quoted as saying that the concerns of the armed forces appear to have been suitably addressed. One hopes these views are shared by the rank and file of the nation's defence forces.

If the top leadership is indeed satisfied with the government's response, then the onus now is on them to give the Indian defence policy a new direction, a trajectory that does justice to India's rising stature in the global inter-state hierarchy. Blaming the government for all the ills afflicting the defence sector seems to be becoming the default position within the ranks of the military, and taking this too far can be really dangerous for the liberal democratic ethos of this nation.

India's armed forces need fundamental reforms, a restructuring that enables them to operate with utmost efficiency in a rapidly evolving domestic and global context. The armed forces can begin by putting their own house in order.

It is true that big macro issues remain beyond the influence of the armed forces as they have to work within the strategic framework set by the civilian leadership. The Indian economy will have to continue to grow at high rates of growth if Indian defence needs can be adequately catered to. High rates of economic growth over the last several years have given India the resources to undertake its military modernisation programme and redefine its defence priorities.

India, which currently has the world's fourth largest military and one of the biggest defence budgets, has been in the midst of a huge defence modernisation programme for nearly a decade that has seen billions of dollars spent on the latest high-tech military technology. This liberal spending on defence equipment has attracted the interest of Western industry and governments alike and is changing the scope of the global defence market.

A country like India does not have the luxury to make a choice between guns and butter and high economic growth is the only solution that will allow it to take care of its defence and developmental needs simultaneously. India's own version of 'revolution in military affairs' will force it to spend much more on sophisticated cutting-edge defence technology and on trained manpower. Without sustained rates of high economic growth, this will become very difficult to achieve as the defence forces will find it difficult to make demands on the government for greater resources.

The other issue is of appropriate institutional frameworks that enable a nation to effectively leverage its capabilities -- diplomatic, military and economic -- in the service of its strategic interests. India lacks such institutions in the realm of foreign and defence policies. While the prime minister laments the paucity of long-term strategic thinking in India, his government has done nothing substantive to stimulate such thinking.

The National Security Council still does not work as it ideally should. The headquarters of the three services needs to be effectively integrated with the ministry of defence and the post of the chief of defence staff is the need of the hour for single-point military advice to the government. The fact that successive Indian governments have failed to produce a National Security Strategy is both a consequence of the institutional decay in the country as well as a cause of the inability of the armed forces to plan their force structures and acquisitions adequately to meet their future challenges.

Yet, the Indian politico-bureaucratic establishment is not the only guilty party here as the Indian armed forces also have a lot to answer for. Their top leadership has shied away from making tough choices about reducing manpower strength; about adjusting the inter-service budgetary balance; and about restructuring the nation's professional military education system. No military anywhere in the world gets all the resources from its government that it deems adequate but an effective military organisation should be able to optimise the use of whatever is at its disposal.

Resources alone, however, will not make Indian armed forces the envy of its adversaries. It is the policy direction that is set by the military leadership and the quality of training imparted to its manpower that will make the difference. The debate on the wide-ranging changes that India's defence set-up needs should have been initiated long back by the armed forces themselves.

The questions that need to be debated and answered include: Do we have a 21st century military in terms of doctrine and force structure? Have the doctrines and force structures evolved in line with the equipments that the nation's resources are being spent on? Do India's command and control processes reflect the changing strategic and operational requirements? Does the Indian military have the capacity to initiate military actions on very short notice and actually conduct military operations that result in something other than a stalemate, something that India might have wanted to do during Operation Parakram in 2001-02 but could not? Have the Indian armed forces got the balance between capital and labour right?

Though high rates of economic growth have given and will, in the future, provide greater resources for defence, the changing socio-economic milieu will also make it increasingly difficult to attract young men and women to the services. As a result the armed forces will have to find a way to strike a balance between growing manpower shortage and the easing of budgetary constraints. The services have no option but to modernise their human resources policy -- recruitment, retention, promotions, exit et al which will make a huge difference to the satisfaction levels of the rank and file.

The armed forces need to do some serious introspection if these issues are to be sorted out before it's too late. It is disappointing to see the service headquarters continuing to resist greater integration and inter-services rivalry continuing to be as vicious as in the past. When the army came up with the doctrine of Cold Start, it found no support for it in the other services. The other services may have had genuine concerns about the doctrine but they have made no attempt to reconcile their differences, underlining Indian operational weaknesses.

The government, meanwhile, can always point to the malaise within the armed forces as an excuse for not undertaking any meaningful defence reforms of its own. India, for example, finds itself in a peculiar position of having a Strategic Forces Command but no CDS, partly because of the differences among the three services.

The debate has got stuck on the issue of the CDS whereas the nation needs to be thinking seriously about integrated theatre commands, allowing the three services to share their resources and enabling a reduction of manpower at various levels. Today's military challenges can not be tackled without a real integration up to the command level.

India desperately needs a defence policy that can do justice to its rising aspirations and its armed forces need to rise to this challenge. It is time for the Indian defence forces to start producing men and women of intellectual leadership and administrative acumen that this time in India's history demands.

The armed forces face a choice: They can keep blaming the political-bureaucratic establishment and do nothing or they can initiate a process of internal reforms forthwith. India's future, in many ways, will depend on the choice that they make.

by Dr Harsh V Pant teaches at King's College London

Army orders probe against Indian soldiers in Congo

The Indian Army has ordered a probe into allegations of Indian peacekeepers in Congo indulging in sexual and child abuse weeks after the charges surfaced that had left defence authorities red faced. The probe is being conducted by a senior Army officer posted in the central African state, top Army officials said on late Tuesday night. The order for the probe was given by Army's Vice-Chief Lt Gen M L Naidu, who was on a four-day visit to Congo recently to meet the troops deployed for the UN peacekeeping mission there. UN officials have said the alleged incidents took place in North Kivu province, where UN troops have been policing a shaky ceasefire between rival rebel and militia factions and government troops. The allegations surfaced after the UN mission in Congo came under heavy scrutiny due to a report by Human Rights Watch earlier this year, which accused it of covering up allegations of Pakistani and Indian troops' involvement in alleged arms and gold smuggling in eastern Congo. UN Secretary-General Ban Ki-moon said, "an internal UN investigation has found evidence that some Indian peacekeepers may have engaged in sexual exploitation and abuse in Congo”. In a statement issued by his spokeswoman's office, Ban said he was "deeply troubled" by the outcome of the UN investigation and said "disciplinary action to the maximum degree permitted by Indian law should be taken as soon as possible against those found to be involved." The Indians were previously stationed in the Democratic Republic of the Congo as part of the United Nations' MONUC peacekeeping force, the statement said. It added that the Indian government assured the United Nations it would investigate the charges and, if true, "strict and exemplary action" would be taken against anyone involved. The statement contained no details about the suspected "sexual exploitation and abuse." Aid workers in Congo, who asked not to be identified, said in May that the inquiry was focusing on Indian UN peacekeepers accused of paying for sex with underage girls in the country's violence-torn east. Last month, the UN mission in Congo said it was investigating an Indian peacekeeping officer accused of showing support for Tutsi rebels in the east. From The Economic Times, August 13, 2008

India’s Role in the Globalization of the IT Industry

During economic boom or bust, whether for import, domestic, or export, India has helped to drive globalization of the IT services industry; it is likely to create the second largest IT services labour pool after the United States within the next seven to eight years, as per an article published by the global research and analytics firm, Evalueserve.

In the article, Evalueserve provided the following statistics about the India’s IT services industry (which includes exports, as well as domestic IT services, engineering services, research and development services, and those related to software products):

• The Indian IT industry employed 450,000 professionals and earned USD 8.7 billion in revenue (i.e., approximately 1.75% of India’s GDP) in 2001–02.

• It employed 1,316,000 professionals and registered revenue worth USD 30.1 billion 2007–08. Since India’s GDP was approximately USD 1,050 billion during 2007–2008, the IT industry constituted approximately 2.86% of India’s GDP.

• The industry is likely to employ 3,750,000 professionals and record USD193.1 billion in revenue by 2015–16. Since India’s GDP is growing annually at 8.5% in real terms and 14% in nominal terms, this GDP is likely to be USD 2,400 billion by 2015–2016, and hence the IT industry is likely to constitute 8.05% of India’s GDP.

Consequently, if the forecasts by Evalueserve are accurate, then by 2015–2016, the number of professionals working in the IT industry will grow tenfold (from 2001–2002) and the total revenue by 22 times (in nominal terms). In other words, the industry is likely to witness significant growth even as many worry about the tough economic times ahead.

Unlike the Indian IT industry, the IT and software industry in the United States started in late 1950s, gained prominence due to mainframe computers in late 1960s and early 1970s, grew further due to the advent of personal computers in 1980s and due to the Internet that allowed organizations and individuals to be connected to each other in 1990s. Considering that all of these innovations occurred primarily in the United States, its IT industry has dominated those in other countries and continues to be significantly ahead even today.

According to Evalueserve, during 2006–07, the Unites States IT industry generated approximately USD452 billion in total revenue (i.e., domestic, as well as exports), which is almost fifteen times more than theUSD30.1 billion generated by the Indian IT industry. In 2007, the U.S. Bureau of Labor Statistics published its report, which stated that approximately 3.2 million IT professionals were employed in 2006 in different sub-sectors of the United States IT industry and forecasted that approximately 4.01 million professionals are likely to be employed in 2016.
Therefore, Evalueserve’s study concludes with the following:

• With respect to the number of professionals, the IT industry in India in 2016 is likely to be second in the world after the United States, with the latter employing between 1.25 and 1.33 times more professionals.

• Even in 2016, the IT industry in the United States is likely to generate approximately USD 810 billion in annual revenue, which would be approximately five times the revenue of the corresponding industry in India.

• The IT industries in both the U.S. and India have become inextricably linked with one another and with the rest of the world. Both the countries are likely to import, as well as export more IT services and products, at least for the next 7 to 8 years.

Appeasement is never good for a nation

10,000 forest trees are chopped down to build the Mughal road in Kashmir. No one makes a noise.

Acres of land in the Kashmir valley are given to install mobile phone towers. No one screams.

Acres and acres of land in the Kashmir valley are allotted to lay sewage and drinking water pipes. No one objects.

But when 40 hectares of uninhabitable land is handed over to the Shri Amarnath Shrine Board to provide better facilities to the Amarnath Yatra

pilgrims, all hell breaks loose.

Why? Because the Shri Amarnath Shrine Board caters to Hindu pilgrims who want to visit the Amarnath shrine in the valley of Kashmir. It is as simple as that.

Politically correct politicians, policy-makers and administrators might try to tell you that it is not about religion, but the fact of the matter is that it is all about religion. It is a design by communal forces within the valley to completely Islamicise the valley by removing every symbol of Hinduism and other faiths from the valley.

Today, these communal forces are preventing the setting up of facilities for the yatra, tomorrow they will even go to the extent of banning the yatra altogether.

The land transfer fiasco has already consumed the Ghulam

Nabi Azad-led Congress government and is on its way to now adversely damage the state's economy. The fear psychosis has already resulted in a sharp decline of tourists to the valley. Counter-strikes and bandhs announced by the pro-land-transfer parties within the Jammu province have paralysed the life in that part of the state as well.

So far it has been a win-lose situation in favour of communal forces in the valley.

Let us take a hard look at the arguments presented by the locals who opposed the transfer of land:

1. The allotment would have adversely affected the environment around the area. One wonders where these tree-hugging environmentalists were when the same government allowed the felling of 10,000 forest trees to build the 89 km-long Mughal road.

40 hectares of land that was going to be used to provide temporary shelters and night-time facilities to pilgrims was in fact going to help in proper maintenance of the current day waste that actually pollutes the environment. But who can argue with senseless politicians who instigate people to come out on the streets?

2. The allotment is the government's ploy to settle Hindus from outside the state to change the demographics of the valley. Look, who is talking! One has to only go back 18 years in the history and check who changed the demographics of the valley.

Islamic terrorists changed the demographics of the valley by ethnically cleansing Kashmiri Hindus from the valley. I wonder where these we-do-not-want-to-change-demographics-folks were when Kashmiri Hindus were slaughtered and the valley's demographics were altered.

One would like to ask a few questions: a. Is 40 hectares of land enough to settle so many Hindus that it would change the demographics of the valley?

b. By putting this argument of demographic change, are the valley's Muslims implying that Hindus are not welcome in the valley anymore? And I do not mean the Hindus from outside Kashmir. I mean the Hindus from the state of Jammu & Kashmir itself.

What if the Hindus, who hold the state subject certificate of J&K state and are legally allowed to purchase land in any part of the state want to purchase land in the area around the Holy Amarnath? Are the valley's Muslims saying that those Hindus cannot buy the land there and settle down? Is that what they are implying? Are they trying to protect the environment by preventing the Hindus from settling in the valley?

Another argument Kashmiri Muslims present is that the land cannot be allotted to the Shrine Board because Article 370 does not allow anyone outside of J&K to own land. Their argument is that since the J&K governor is the chairman of the board and he is an outsider, this transfer of land is illegal.

How dumb does one have to be to understand that the land is transferred to the Shrine Board which is an institution based in the state of J&K and created by the J&K government. The land is not transferred to the chairman or the CEO of the board per se.

Having touched upon the outlandish arguments of those who oppose the allotment of land, let us look at some facts and the real story:

It was during the first three years of the Mufti Mohammad Sayeed-Ghulam Nabi Azad coalition government that the original proposal of land transfer was initiated and cleared. It was under Mufti Sayeed's leadership that his forest minister Qazi Mohammad Afzal and law minister Muzzafar Hussain Baig originally cleared the proposal. It just so happened that due to red tape, the proposal was finally approved by the cabinet when Azad had taken over as chief minister during the second three-year part of the six-year term.

The same PDP led by Mufti Sayeed was originally okay with this proposal. But as soon as the PDP smelt that terrorist outfits like the Hizbul Mujahideen

were not in favour of the allotment of land and realised that it could become a polarising issue to whip up sentiments to garner votes in the upcoming assembly election, it backtracked.

Since it is an election year, the National Conference and other smaller political parties would not let the PDP cash in on this opportunity alone. They jumped into the fray and whipped up sentiments by fooling the local Kashmiri Muslims. And that leaves the Congress. How could the Congress not try to cash in on this polarising issue in an election year?

Azad did not waste any time and revoked his cabinet's decision to appease the Kashmiri Muslim vote bank. He did not just stop there. In addition to revoking his own order, he also effectively disbanded the Shri Amarnath Shrine Board. Now that is some level of appeasement! That is the real story behind the story.

It is an issue created by Mufti Sayeed to polarise the vote banks. It is his design of playing politics with the religious sentiments of lakhs of Hindus from all over the country.

Now that we know the real story behind the story, how about the Hindu pilgrims who want to visit the shrine and what about their fundamental rights to practice their religion with complete security, dignity and honour?

Isn't it a shame that Hindus living in India, where 80 per cent of population is Hindu, cannot freely visit the shrine and expect better facilities? It is only in India that the majority community has to make all the sacrifices in favour of minorities because our politicians believe in appeasing Muslims at the cost of Hindus.

National Conference leader Omar Abdullah on a television debate on this issue asked why there is a need for land and new facilities when the pilgrimage has been going on for many years.

Does Omar Abdullah mean to say that there is no need to improve the facilities provided during the treacherous pilgrimage? Is he implying that if the yatris were okay for so many hundred years, then why change and improve the facilities?

I have never heard him say such things with regards to the Haj pilgrimage. Every year Muslims from Kashmir and the rest of the country want better facilities and subsidies for Haj pilgrims. But when it comes to providing better facilities to Shri Amarnath pilgrims, it becomes a sore point for Kashmiri Muslims and their leaders.

Heavy rains, snowstorms, landslides and hostile environment took away 256 lives during the yatra in 1996. And Omar Abdullah has the audacity to promote the status quo!

Some of you might argue that it was not the valley's Muslims, but the political parties and terrorists who opposed the land transfer order and forced people to come out on the streets.

I can buy that argument, but that does not absolve the valley's people from their responsibility? They cannot always support these fundamentalist forces and then at the same time claim innocence.

They did the same in 1989 and in the early 1990s when they either stood as mute spectators or as vocal supporters while Kashmiri Hindus were ethnically cleansed. As a good citizen, it is incumbent upon them to raise their voice against these dreaded forces and stop this madness.

If they sincerely believe in peace, then they need to stand up and reject these terrorist outfits and their masters. Conversely, if they don't, then they are as much party to the madness as the principals and thus need to be held accountable.

Appeasement policies are never good for a nation, particularly for a nation like India that is so diverse in ethnicity and culture. Whether it is amending the Constitution during the Shah Bano case, releasing terrorists during the Rubaiya Sayeed kidnapping case, freeing dreaded terrorists during the IC-814 hijacking or continuing the temporary Constitutional provision of Article 370, all such policies will one day result in the nation's doom.

It is incumbent upon the leaders of the nation as well as the citizenry to be on guard and not allow such appeasement policies to take effect in a nation that is based on the concept of secularism, democracy and fairness to one and all.

by Lalit Koul

Corruption, officer shortage dent military's image

An alarming rise in the number of Indian military officers charged with corruption, senior ranks quitting due to frustrating service conditions and increasing instances of 'fragging', in which disgruntled soldiers have shot dead their seniors, are severely damaging the image of the country's defense forces.

There is no rush of youths to join the once-favored military, and the persisting shortage of officers in the 1.1-million-strong army is now around 11,000. The navy and air force too face a shortage of officers but not as severe as the army.

Senior officials cite expanding employment opportunities in the private sector as the reason behind this shortage.

But serving and retired officers said this was only part of the cause and that the services too had to take responsibility for lowering the military's image and overall standing in the country's order of preference for employment.

'Standards have changed. Bribery and corruption have seeped deep into the army ' retired Lt. Gen. Harish Chander Puri said. A larger number of officers in the army, particularly the senior ones, are increasingly becoming as corrupt, if not more so, than their civilian and political counterparts, he added.

Serving army officers say the 'rot' in service ethics has been steadily creeping into the services.

Till the 1980's military officers were considered upright men, respected in society and eagerly sought after by parents as suitable matches for their daughters.

Retired military men talk nostalgically of the days when a mere note from the commanding officer on behalf of any jawan to the local authorities back in his village carried weight.

Those were times when the esprit d'corps in the apolitical service was strong and invitations to riotous, albeit swinging, regimental officers' messes much sought after.

Salaries were low but the lifestyle was somewhat lavish in what was largely a gentleman's army.

'Many officers were, in reality, eager boys trapped inside grown bodies seeking to indulge in passions like shikar, riding, polo and outdoor living and danger at state expense,' said retired Brig. Arun Sahgal, an armoured corps officer. Colonial traditions made military service even more attractive.

From independence till the third war with Pakistan in 1971, there was ample opportunity for the latter.

And it was adequately vindicated, except for the disastrous 1962 war with China in which India came off badly. But in this instance, it was the political and not the military establishment that forced ignominy on the country.

The flamboyance, bravery and tactical brilliance of all ranks in the three wars with Pakistan are well recorded and form the subject of study in combat institutions around the world.

Politics was rarely, if at all, discussed by officers who if passed over for promotion retired gracefully, confident of their status in society.

Promotions were merit-based and, by and large, fair with undeserving candidates adhering to the Peter Principle and rarely ever crossing their limits of incompetence.

Army chiefs and senior commanders brooked no political interference in operational matters and were listened to with respect by the establishment.

When asked by prime minister Indira Gandhi to move into East Pakistan (later Bangladesh) in early 1971, the chief of army staff Gen. Sam Manekshaw (later Field Marshal) firmly told her that it would take at least 10 months before his force would be ready for combat. Gandhi paid heed and Bangladesh came into being in December that year.

In short, the olive green uniform enjoyed an exalted status it was soon to lose.

Its professionalism and apolitical stance began to slowly unravel after the Third Pay Commission in the late 1970's when officer ranks were diluted, ostensibly to enhance career prospects, but their responsibilities reduced in inverse proportion to their promotions.

Periodic cadre reviews further led to a lopsided rank structure, creating a situation where Lt. generals, among the seniormost army officers, and their equivalents in the navy and air force, discharged duties previously performed by middle ranking Lt Colonels and similar ranks in the other two services.

At present there are 732 brigadiers, 213 major generals and 60-odd Lt. generals, around a third of whom are replaced every two-three years. Pressure on promotions also meant that they served 12-18 months in their commands, leaving them little time to effect any meaningful change in the command and control structure.

The cadre re-assessment was the moment for which politicians and civil servants had long been waiting. Having always looked upon the military with suspicion after independence, they were simply waiting to gain ascendancy over the services.

Sadly, succeeding military chiefs and senior officers did not disappoint by seeking political and bureaucratic patronage for career enhancement.

As a consequence, the military's standing deteriorated over the years. It reached the unbelievable stage where it was almost entirely excluded from the 'security loop'.

The service chiefs, for instance, were told about Pokhran II, India's multiple nuclear tests in 1998, just hours before they happened; that too, as an insurance against any 'adverse reaction' from neighbouring Pakistan.

The military was also unaware of India's cache of chemical weapons stored at various Defence Research and Development Organisation laboratories across India that are now being destroyed under the global Chemicals Weapon Convention.

Today India's Mughal-like army, with one of the highest teeth-to-tail ratios, faces a crisis of confidence, most military officers concur.

Besides struggling against the slew of corruption charges exposed by tehelka.com, the news website, in 2001 and the more recent allegations levelled by the Central Bureau of Investigation against senior officers for arms imports, the military has also to battle lop-sided promotion and arbitrary equipping policies as it struggles to re-order and modernise itself within a nuclear weapon state.

by Rahul Bedi a defence analyst

Siachen scam: Army gets final warning

After allegedly failing to cooperate with the Jammu and Kashmir Police, the Army was served with a final notice to produce its officers and jawans for questioning in connection with the alleged pilferage of food and clothes meant for troops on the Siachen glacier.

This is the third and final notice and after this the police will approach a court for issuing non-bailable warrant against the officials besides seeking a direction to the Army for providing details about the scam, official sources said.

Defence Minister A K Antony had informed Parliament earlier this month that after an internal probe by the Army into the pilferage scam, the authorities had initiated administrative action against three officers and three junior commissioned officers.

The entire scam to light after the police found special rations meant for soldiers serving in Siachen Glaciers being sold in open market. Immediately, police wanted to question some of the officials including one in the rank of Brigadier stationed at Leh-based 14 corps.

Officials in Jammu and Kashmir Home Department said the Army top brass had assured cooperation once its inquiry was completed.

Now that their inquiry report is over, neither the report has been handed over to the police nor the officials handed over for questioning, senior officials said.

The army had filed a complaint against Leh's Senior Superintendent of Police Alok Kumar for his alleged aggressive attitude towards its personnel deployed in the Himalayan town located in north Kashmir, a charge vehemently denied by the state government.

An IPS officer of 1997 batch, Kumar was instrumental earlier in alleged Petrol and Diesel scam, where few army officials allegedly entered into a criminal conspiracy with petrol dealers and sold the oil in open market while filling the tankers with water.

In the present case, the Police have registered 11 FIRs since July this year after finding food packets and other equipment meant for Siachen being sold in the open market but the army has refused to cooperate in the probe.

Police arrested 31 people, including shopkeepers, in various areas in this Himalayan town located in north Jammu and Kashmir. Police registered the first FIR against shopkeepers and unknown army officers under various sections of the Ranbir Penal Code related to cheating.

A few of them have made confessional statements before magistrates, during which they named senior army officers who allegedly supplied the materials to them, they said.

The police seized the boots and trousers at a time when the army's high command and the defence ministry are running from pillar to post for meet the requirements of troops in Siachen. The local command too had made a requisition for the special high altitude gear needed by the soldiers.

Recently, army rations including high-calorie food items meant for soldiers defending the borders in inhospitable terrain, were found on sale in the markets of Leh.

Chattisinghpura -Inquiry finds Indian troops did killings

Troops hunting terrorists killed and buried Indian civilians and passed them off as Pakistani militants responsible for killing Sikhs in Kashmir, an inquiry by India's top investigating agency has revealed. When villagers' protests led to the bodies being exhumed, the army doctored DNA tests to show that the remains were those of militants from across the border, India's Central Bureau of Investigation said in its final report two weeks ago. Human rights groups frequently report abuses by security forces in the Himalayan territory claimed by both India and Pakistan. But this was the first case of its kind handed over to the agency for investigation. The bureau found four army officers guilty of killing the civilians.

Hours before then-U.S. president Bill Clinton visited India in March 2000, 35 Sikhs were killed in Chattisinghpura village in Kashmir by suspected Islamic militants in army uniforms. India blamed Pakistan-based terrorists for the attack.

Four days later, 17 Muslim residents from three neighboring villages disappeared. Simultaneously, reports emerged that five Pakistani terrorists involved in the massacre of the Chattisinghpura Sikhs had been killed by the army. Juma Khan, a 45 year old from Brari Angan, was among the villagers picked up without explanation by the soldiers. "I thought they would not harm him because he was a family man and was not involved in anything," Khan's wife, Roshan Jan, said recently.

Two days after Khan's arrest, the army said its sharps******* had shot dead five "foreign militants" during a "ferocious encounter." There were no autopsies before the bodies were buried, but locals determined from clothing and personal items recovered at the gravesites that the bodies were those of missing villagers. As violent protests raged around Kashmir, local officials ordered exhumations. Although the bodies were charred, the army fatigues in which they were clothed were mysteriously intact. Relatives of a local cattle trader said his body was headless. There were no bullet wounds in another corpse. The chopped-off nose and chin of a shepherd was discovered in a grave holding another body.

Farooq Abdullah, then chief minister of the state, ordered DNA tests to determine identities. But that plan came under a cloud when two forensic laboratories said DNA samples from relatives of the dead men had been tampered with. "In one case, blood samples were said to belong to the mother and daughter of one victim. But not only were the samples male in origin, both belonged to the same man," a senior scientist at Calcutta's Central Forensic Science Laboratory told investigators. In three cases, samples allegedly collected from female relatives were found to have come from men. Another woman's sample contained the DNA of two individuals.

Two doctors involved in collecting the samples were suspended by the government, and a new team, headed by a senior police officer, collected fresh blood samples in April 2002. The new DNA tests established the dead men were "not foreign terrorists, as contended by the forces, but innocent civilians," a CBI investigator said this week.

The agency concluded the doctors, under pressure from the army, had tampered with the first DNA tests. "We have irrefutable evidence of at least seven such fake encounters, where Indian security forces killed 13 innocent Indian villagers in the last five years and passed them off as Pakistani militants," said Pervez Imroz, a human rights lawyer who spearheads the Association of the Parents of Disappeared Persons. "However, since 1989 more than 8,000 Kashmiris have disappeared from the custody of the security forces and we know nothing of their whereabouts."