Priorities messed up!!

Kudos to the new Nano by Tata; the Janta car worth only 1 Lakh rupees. Isn't this the dream of every Indian?

With the price of 1 lakh, I will not be surprised to see almost every family driving one on the road. Wait, does it have to be one per family? I mean with the price so low, I can imagine 1 car per earning person or even students whose parents can afford an extra car for their kid. So what is the problem? I thought about this and took no time to understand the evil of this car. To begin with, let me take an average housing apartment building in Mumbai. With about 20 families with an average of 3 people per family, I can see atleast 30-40 Nanos in the parking lot. Mummy and Daddy need 1 each for their daily commute and little Bunty or Nikki needs one for his/ her college. Throw away the bikes as they are risky and here comes the new Nano. This is just an example of the future. Are we ready for this?

The last time I visited Mumbai, I was scared to even walk on the road. The traffic, pollution should be worse than second hand smoking. With exponential increase in the number of cars on the road, it is evident that the Government needs to think about the infrastructure. As one of my friends says, we don’t wipe our ass before we shit. So why are we getting affordable cars on the road before improving the infrastructure. This is not only the story of Mumbai but also of every big city in the country.

We always debate in the US about arm and arm rules. The premise that we usually discuss is of controlling the access to arms to control he crime rate. Similarly, to control the traffic chaos on the streets in India, we need to control the access to affordable vehicles. At least until we have good roads and better traffic rules!!

Chris Rock (a stand up comedian and actor) has correctly said that to reduce the crime, we need to either stop selling guns or hike the prices of the bullets. Thus, every person shooting stray bullets will think twice before firing those expensive bullets. I think the Government of India has got that right. The hike in petrol price should curb the people from buying the inexpensive car. Think about it!!!

I can imagine a person going to the bank for loan. This loan is not for his car, but for the petrol required for the car. The Banks can come up with a new offer:

“Buy a Gas loan of 2 Lakh and get a Nano Car FREE!!!!”

With the car price of 1 Lakh Rupees and gas price of 50 Rs per litre, I can see people paying more on the gas than the car price in less than 1 year.

Finally, I would like the people to think about the consequences of the new wave of cheap cars. Here are few.

- The number of cars on the street increasing atleast 2X times
- Increase in Pollution, traffic and accidents
- Increased consumption of gas will result in higher gas prices
- Finally, we are setting ourselves up for a high inflation bubble