15 Inspirational Rags-To-Riches Stories

ERIC GOLDSCHEIN AND DANA EISENBERG

Some of the world's billionaires took themselves from the streets to the top of the Forbes' list. 

Despite mounting evidence that it's becoming increasingly difficult to build such wealth, these 15 incredible stories are proof that it is possible to overcome life's toughest challenges and create something better for yourself. 

This list includes just a handful of the many "rags-to-riches" stories out there. Let us know which ones we missed in the comments. 

Guy Laliberté ate fire on the streets before introducing Cirque du Soleil to the world

mission_canada viaFlickr

The Canadian-born Laliberté began his circus career busking on the streets: playing accordion, walking on stilts and eating fire. He gambled by bringing a successful troupe from Quebec to the Los Angeles Arts Festival in 1987, with no return fare. The bet paid off, and the circus group was eventually brought to Las Vegas, where they became the world famous Cirque du Soleil we know today.

Today, Laliberté is the CEO of Cirque, a professional poker player and space tourist, with a total worth of $2.5 billion.

Source: Celebs101

John Paul DeJoria lived in his car before John Paul Mitchell Systems took off

Getty Images

John Paul Dejoria with his wife Eloise

As a first generation American, DeJoria had it rough from the beginning. His German and Italian parents divorced when he was two, and he sold Christmas cards and newspapers to help support his family before he turned 10. He was eventually sent to live in a foster home in Los Angeles.

DeJoria spent some time as an L.A. gang member before joining the military. After trying his hand as an employee for Redken Laboratories, he took a $700 dollar loan and created John Paul Mitchell Systems. He hawked the company's shampoo door-to-door, living out of his car while doing so. But the quality of the product could not be denied, and now JPM Systems is worth over $900 million annually. He also created Patron Tequila and has a hand in a variety of industries, from diamonds to music.

Source: Forbes

Ursula Burns grew up in a housing project on Manhattan's Lower East Side and now runs Xerox

Before the Lower East Side was cool, it was a hub for gangs. Burns was raised by her single mother in a housing project there. Her mother ran a daycare center out of her home and ironed shirts so that she could afford to send Ursula to Catholic school. She went to NYU, and from there became an intern at Xerox.

She's now Xerox's CEO and chairwoman. She's the first African-American woman to be the head of a Fortune 500 Company.

Source: Bloomberg

Howard Schultz grew up in the Brooklyn projects before discovering, and now leading, Starbucks

AP

Schultz grew up in the Bayview projects of Canarsie, Brooklyn. He always wanted to climb "over the fence" and go beyond the lifestyle provided by his truck-driving father. Despite destitution, he excelled at sports and earned a football scholarship to the University of Northern Michigan.

After graduating with a degree in communications, Schultz went to work for Xerox before discovering a small coffee shop called Starbucks. Enamored with the coffee, he left Xerox to become the company's chief executive in 1987. After beginning with 60 shops, Starbucks now has over 16,000 outlets worldwide, giving Schultz a net worth of $1.1 billion. He even went on hiatus and came back as CEO to lead Starbucks out of a decline.

Source: Mirror News

Li Ka-shing quit school at 15 to work in a plastics factory and is now the world's richest East Asian

The family of Li Ka-shing fled mainland China for Hong Kong in 1940, and Li's father died of tuberculosis when  he was just 15. Quitting school to work to support his family, Li made plastics and later plastic flowers for U.S. export.

By 1950 Li was able to start his own company, Cheung Kong Industries. While at first manufacturing plastics, the company later moved into real estate. Similarly, Li expanded his ownership of different companies, and today has his hand in banking, cellular phones, satellite television, cement production, retail outlets, hotels, domestic transportation, airports, electric power, steel production, ports and shipping, and investing in cool apps, among other industries.

Source: Harvard Business Publishing

Francois Pinault was a high school dropout who now leads luxury goods group PPR

Flickr

Pinault quit high school in 1947 after being teased for his poor background. He joined his family's timber trading business and in the 1970s began buying up smaller firms. His ruthless business tactics — including slashing jobs and selling his timber company only to buy it back at a fraction of the cost when the market crashed — gave him a reputation as a "predator." He had similar tactics in the real estate business, and did well buying French junk bonds and taking government money to save businesses from bankruptcy.

His self-made worth helped him start PPR, a luxury goods group that sells brands like Gucci and Stella McCartney. At one point the richest man in France, Pinault is now worth a cool $8.7 billion, has historic homes around the world and is the father-in-law of actress Salma Hayek.

Source: xfinity

Leonardo Del Vecchio was an orphaned factory worker whose eyeglasses empire today makes Ray-Bans and Oakleys

Getty Images

Leonardo Del Vecchio with his wife Luciana

Del Vecchio was one of five children who could not be supported by his widowed mother. After growing up in an orphanage, he went to work in a factory making molds for auto parts and eyeglass frames, where he lost part of his finger.

At 23, he opened his own molding shop. That eyeglass frame shop expanded to the world's largest maker of sunglasses and prescription eyeware. Luxottica makes brands like Ray-Ban and Oakley, with 6,000 retail shops like Sunglass Hut and LensCrafters. His estimated net worth is now above $10 billion dollars. 

Source: Forbes

Kirk Kerkorian went from boxer and Royal Air Force pilot to Las Vegas mega-resort owner

scenestriz5viaFlickr

Kerkorian, who learned English on the streets, dropped out of 8th grade to become a boxer. His family was a casualty of the Great Depression, and Kerkorian went about finding skills to help bring income home. He became a daredevil pilot for the Royal Air Force during World War II, delivering supplies over the Atlantic on routes that would crash one in four planes. 

From the money he made running supplies, Kerkorian became a high roller on the craps table and eventually a real estate magnate in Las Vegas: he bought The Flamingo and built The International and MGM Grand, stalwarts of the Vegas scene. His net worth today is at $16 billion dollars.

Source: Smart Money Daily

Sheldon Adelson is another Las Vegas hotels magnate who tried his hand at a few industries

the7eye.orgviaFlickr

Adelson grew up in tenement housing in Massachusetts, where he shared a bedroom with his parents and three siblings.  His father was a Lithuanian taxi driver and his mother had a knitting store. When he was 12 years old, he started selling newspapers and a few years later ran a vending machine scheme on the same corner.

Adelson tried his hand at a few different industries, from packing hotel toiletries to mortgage brokering. His biggest break came from developing a computer trade show. He turned that wealth into a purchase of the Sands Hotel & Casino, and later the mega-resort The Venetian.

Source: Minyanville

Ingvar Kamprad was born in a small village in Sweden and created a mail-order business that became IKEA

Getty Images

Kamprad lived the farm life growing up. But he always had a knack for business, buying matches in bulk from Stockholm to sell to his neighbors. He later expanded to fish, Christmas decorations, and pens.

Not satisfied with the small stuff, Kamprad took money from his father (a reward for good grades) and created a mail-order business that eventually became IKEA (the name comes from his initials plus those of his village and family farm). Furniture became the company's biggest seller, and Kamprad's use of local manufacturers kept his prices low. Once one of the world's richest, his value has fallen recently to a still-amazing $6 billion.

Source: Smart Money Daily

Roman Abramovich was an orphan who turned an expensive wedding gift into an oil empire

Getty Images

Roman Abramovich with his girlfriend Daria Zhukova

After his parents died when he was just four, the Russian Abramovich was raised by his uncle and grandmother. Abramovich got his first break from an expensive wedding gift from his in-laws. He dropped out of college to pursue his entrepreneurial interests, which at first included selling plastic ducks out of an apartment in Moscow.

He managed a take over of oil giant Sibneft at a bargain price in 1995. He continued to flip his investments into even larger acquisitions, including Russian Aluminum and steelmaker Evraz Group. Over the years Abramovich has been accused of shady dealings, from paying out bribes and protection money to having a role in the gang feuds over aluminum smelters. It seems that being ruthless has paid off for the billionaire: he now owns the largest private yacht in the world, as well as a ton of other cool stuff. 

Source: Hubpages

Richard Desmond went from living above a garage to creating an empire that published magazines like Penthouse

Getty Images

Desmond grew up the son of a single mother after his parents divorced. The two of them lived above a garage, during which time Desmond described himself as "very fat and very lonely." He quit school at 14 to focus on being a drummer, working as a coat-checker to help pay bills. Though he never became rich from his own musical talents, he later opened his own record shops.

Eventually Desmond published his first magazine, International Musician and Recording World. The Desmond magazine empire would expand to publications like a British version of Penthouse and Ok!, a worldwide favorite. He now owns publications around the globe and is involved in philanthropic work. 

Source: The Observer

J.K. Rowling lived on welfare before creating the Harry Potter franchise

In the early 1990s, Rowling had just gotten divorced and was living on welfare with a dependent child. She completed most of the first "Harry Potter" book in cafes, as walking around with her daughter, Jessica, was the best way to get her to sleep.

The "Harry Potter" franchise has become a worldwide success and J.K. Rowling is now worth an estimated $1 billion.

Source: Biography

Before Sam Walton founded Wal-Mart, he milked cows and sold magazines in Oklahoma

Walton's family lived on a farm in Oklahoma during the Great Depression. In order to make ends meet, he helped his family out by milking the cow and driving the milk out to customers. He also delivered newspapers and sold magazine subscriptions.

By 26, he was managing a variety store after graduating from the University of Missouri with a B.A. in economics. He used $5,000 from the army and a $20,000 loan from his father-in-law to buy a Ben Franklin variety store in Arkansas. He expanded the chain, and then went on to found Wal-Mart and Sam's Club. He died in 1992, leaving the company to his wife and children. 

Source: Biography

Oprah Winfrey turned a life of hardship into inspiration for a multi-billion-dollar empire

ap

Oprah spent the first six years of her life living with her grandmother wearing dresses made out of potato sacks. After being molested by two members of her family and a family friend, she ran away from home at age 13. At 14, her newborn child died shortly after he was born. She went back to live with her mother, but it wasn't until her mother sent her to live with her father that she turned her life around.

She got a full scholarship to college, won a beauty pageant —where she was discovered by a radio station — and the rest is history. The Oprah name became an empire, and according to Forbes she is worth $2.7 billion.

Source: Academy of Achievement

Source : http://www.businessinsider.com; ERIC GOLDSCHEIN AND DANA EISENBERG

The Starbucks Guide to World Domination

Step 1: Serve coffee, not just coffee beans. Step 2: Offer employee benefits.

By Rachael Larimore

Can you remember the last time you walked down a busy urban street, schlepped through a mall, or reported for day-job duty and didn’t see someone toting a tall paper cup with a green mermaid logo? If not, then you’re living in a world Howard Schultz envisioned more than 30 years ago. But it almost never happened.

RACHAEL LARIMORE

Rachael Larimore is Slate's managing editor.

• Follow

Schultz, now the chairman and CEO of Starbucks, joined the company some 10 years after its founding in Seattle in 1971, when three friends who had met at the University of San Francisco bonded over their shared passion for quality roasted coffee. Back then, you could only buy roasted beans at Starbucks—no brews. But in 1983, Schultz returned from an über-caffeinated trip to Italy having fallen hard for the country’s espresso bar culture—the convivial spots where Italians stopped on the way to work for their morning shot—and for a drink he discovered in Verona: the latte. He dreamed of selling espresso and other specialty drinks at Starbucks.

Starbucks founders Jerry Baldwin and Gordon Bowker—the third partner, Zev Siegl, sold his stake in 1980—said no. Schultz was relentless. As he relates in his 1997 bookPour Your Heart Into It: How Starbucks Built a Company One Cup at a Time, Schultz finally got space in one corner of one store in 1984. The lattes and cappuccinos were a hit. But there would be no expansion. Starbucks was a roasting company, not a restaurant, Baldwin insisted.

So how did Schultz take Starbucks from a small chain—six stores as of 1984—to world domination: 18,000 stores in 60 countries, generating $13 billion in sales? First, he quit. If he couldn’t sell drinks to Starbucks customers, he would start his own chain. In 1986, Schultz, backed by Seattle investors, started a company called Il Giornale, opening three stores in less than a year.

And so why is it that today we all drink Starbucks and not Il Giornale? It’s not because Schultz failed. It’s because Baldwin and Bowker decided to sell Starbucks to focus their energy on Peet’s Coffee, which Starbucks had purchased in 1984. Schultz, who struggled for more than a year to raise the capital to start Il Giornale, now had to go back to his investors—and find some others—to raise even more money to buy Starbucks from his old bosses. He succeeded, and Il Giornale acquired Starbucks’ six stores and its small roasting plant outside of Seattle in 1987. The melded company, called Starbucks, was operating only 17 stores by that year’s end, but it became a big business the day that Schultz took over. He presented his investors with an ambitious growth plan: to open 75 stores in five years.

In his book, Schultz credits Starbucks’ success in those early years—becoming profitable on schedule, opening more stores than originally planned—to several factors. He surrounded himself with good people and learned when and when not to compromise. That’s the kind of thing you read in lots of business books by CEOs. But there is one move that Starbucks made early in the Schultz era that was almost unheard of at the time: In 1988, part-time employees became eligible for benefits.

It’s funny, in a way. Starbucks’ rapid expansion in the late 1980s and 1990s looked to the naked eye like ruthless capitalism in action—the chain ballooned to 3,500 outlets by 2000 (and we’ve all heard the jokes about the Starbucks that’s across the street from Starbucks). But the good-hearted humanitarianism of offering benefits to part-timers—and later including them in the stock program—was actually a calculated and well-reasoned business decision. Schultz described what he saw early in his tenure as CEO:

Morale at Starbucks was terrible. In the twenty months since I had left, divisions had grown within the company. People were cynical and wary, beaten down and underappreciated. They felt abandoned by previous management and anxious about me. The fabric of trust and common vision that Starbucks had had when I first joined had frayed badly. … It quickly became obvious to me that my number-one priority would have to be to build a new relationship of mutual respect between employees and management.

It was also simply something that Schultz, the son of a working-class couple, always wanted to do. When he needed to sell the idea to his investors, he explained that providing benefits to an existing employee for a year cost half as much as training a new employee.

Schultz’s benevolence makes perfect business sense in hindsight. Back then, coffee was still a specialty business. Few people knew how to roast coffee to Starbucks’ standards. Making a perfect cappuccino—achieving the exact proportions of milk and foam—is tricky. If your employees feel a sense of loyalty, they can train the newcomers, and then they become veterans who can train the next round of newbies.

It’s hard to say whether the Starbucks model could work for all other companies that rely on part-time help. A few big companies—namely Target, Whole Foods, and Costco—do offer benefits to part-time employees. Most don’t. But it’s clear that it’s worked for Starbucks. Aside from a Great Recession–era rough patch during which it closed 900 stores (while still opening others), Starbucks has grown every year. The stock is up more than 12,000 percent since its initial public offering in 1992. And the next time I walk into my regular Starbucks, I’m confident that the same barista I’ve seen almost every week for the last four years will know to start my venti Americano.

Source : http://www.slate.com

Why Powai is a hotspot for IT start-ups

Photographs: Courtesy, Hiranandani Group 

Ranjita Ganesan in Mumbai 

Powai, once a distant neighbourhood that only made news when there was a leopard sighting, is today being compared to Silicon Valley.

There is more than just coffee brewing at the cafés on Central Avenue in Powai, a neighbourhood in north-east Mumbai. 

Here, there’s a rush to take the corner tables because these have access to power sockets.

Mobile phones and iPads are plugged in and young men in t-shirts and shorts are often seen hunched over laptops. Some are in groups of two or three, working quietly or bickering over how to fine-tune a website’s layout.

Others, dressed more crisply, show less camaraderie and engage in what seem to be interviews or meetings. Their conversations aren’t coffee-shop gossip, but contain words like ‘e-commerce’, ‘scalable concept’ and ‘seed fund’.

And unlike the routine crowd of romantics and college goers that populate such spots, everyone here looks like he or she has something at stake. “Any time you walk into these food joints, you will hear at least one start-up conversation in progress,” says Zishaan Hayath, co-founder of Toppr.com and Powai Lake Ventures, an angel investment club.

Image: IIT-Bombay
Photographs: Courtesy, sarc-iitb.org

Hayath’s 18-month-old company is among several start-ups that have sprung up in Powai, the result of endless cups of java in cafes there. It was funded by pooling together money from his friends, which later prompted the Indian Institute of Technology Bombay graduate to form a group and support other start-ups in a similar manner. 

Still in their late 20s or early 30s, the members of Powai Lake Ventures seem rather young to be angel investors, but their contributions have helped boost the small ecosystem.

While entrepreneurial businesses have been developing here for the past six years, the recent success of companies such as Housing.com and Ola Cabs has thrust Powai into the limelight and given it the identity of a start-up hotspot.

Powai, once a distant neighbourhood that only made news when there was a leopard sighting, is today being compared to Silicon Valley.

The locality, home to IIT-Bombay and the National Institute of Industrial Engineering (NITIE), is steadily attracting fledgling entrepreneurs for purposes of both work and residence.

Photographs: Courtesy, Hiranandani Group

The reasons are varied - relatively new infrastructure, lower rents than South Mumbai and the proximity to engineering colleges which makes hiring easier. For many IITians, the instinct on graduating is to find work that lets them live in Powai and extend college life in somewhat Peter Pan-style.

“What we love about the college are its people. And you find a heavy concentration of them in Powai so naturally one wants to stay back,” says Rahul Yadav, CEO and one of the 12 co-founders of Housing.com.

Housing.com co-founder Rahul Yadav at his office in Powai In fact, this desire was so strong for Yadav and his friends that they rented a flat in a residential complex that did not allow bachelors by befriending the secretary who was, as it turned out, an IIT alumnus. 

Their map-based housing portal, launched two years ago, operated out of that apartment for some months until residents raised objections. They later moved to a conventional office and have since added 14 branches serving 11 cities.

Photographs: Courtesy, Hiranandani Group

Another Powai-bred start-up Ola Cabs, which moved to its largest market Bangalore recently, has scaled up to cover six cities.

“IIT-Powai is witnessing good start-up energy,” says Suvir Sujan, co-founder and MD, Nexus Venture Partners, which has funded Housing and Sedemac out of Powai. “All kinds of start-ups are emerging from consumer services like restaurants to cloud-based software to ecommerce.” 

Once a heavily wooded agricultural locality around an artificial lake, created by the British in 1799, Powai started moving towards change in the late 1950s when a portion of the area was demarcated for the construction of IIT.

The first modern buildings rose around 1975 and by 1985, after Hiranandani constructed its sprawling building complex, the area began transforming into a moderately upscale residential hub.

Photographs: Courtesy, Hiranandani Group

Residential prices currently range from Rs 12,000 to Rs 22,000 per square foot. While a number of influential builders have already established complexes in Powai, new constructions including by L&T and Wadhwa Group have been coming up too.

Over the last decade, Powai has largely become self-contained, and residents who work here say they seldom travel to other parts of the city. Most of the neighbourhood is clutter-free and presents a pretty picture with Greco-Roman buildings, clean boulevards, a lakefront and hills in the background.

A number of cafes and pubs have opened up, including Singapore-based Harry’s, the first for the chain in Mumbai. The presence of well-known developers like Hiranandani, Raheja and Godrej and schools, including Bombay Scottish, is encouraging for young professionals looking to move in with families, says Ramesh Nair, chief operating officer, (business) at Jones Lang LaSalle India.

Image: Co-founders of Fabbag.com, Vineeta Singh and Kaushik Mukherjee
Photographs: Courtesy, Business Standard

Companies like Yowoto and Quikwallet, started by non-IITians, are also part of the community. Other Mumbai locations such as Ghatkopar, Vikhroli, Andheri-Kurla road or Sakinaka are now coveted because of their proximity to Powai.

“A lot of founders here are those who have looked for space in the western suburbs or south Mumbai, but could not afford it. And Powai’s success is also because they are determined to make this area the best in the city,” says BITS Pilani’s Kaushik Mukherjee, who co-founded FabBag.com with IIT-Madras graduate Vineeta Singh.

Their company, which sends monthly grooming products on subscription, occupies a small 600-square foot space on two floors in Powai Plaza. “Even if we shift, it would be to a better office, but not outside Powai,” says Mukherjee.

Local entrepreneurs have an informal network and are willing to share leads on where to get cheap photocopies or bulk deals on everything from couriers to laptops or adhesive tape. Phone lines and Internet connections are set up within a day. 

Photographs: Courtesy, Hiranandani Group

As a result, businesses can be established and run at a lower cost than in some other areas. “You find a whole gamut — from small, run-down shops to swanky business parks offices,” says Nikalank Jain, co-founder of yowoto.com, a portal for information on raising children.

The company, he adds, has moved office twice so far and has always found accommodation within two weeks. The commercial rentals in Powai are between Rs 60 and Rs 120 per square foot, compared with more than Rs 250 at Bandra-Kurla Complex or Nariman Point. Navi Mumbai rates are cheaper at Rs 40 per square-foot, but these are possibly ignored by businesses, which want to be part of the burgeoning tech start-up culture, feel real estate experts.

There are, however, some challenges. Traffic congestion adds to travel time in the peak hours. Also, Powai is at some distance from facilities like railway stations. Some of these problems are expected to be solved once the metro train system is completed. At the same time, rents are climbing and could slip out of reach of younger professionals, says Nair.

Photographs: Courtesy, Wikimedia Commons

“It could become difficult to retain employees, who have a pay rickshaws for travelling from the railway station to Powai daily unless there are more affordable housing options locally,” says FabBag’s Mukherjee.

The growth of Ola Cabs and Housing.com, which have been raising funds successfully at every stage, has boosted morale and the atmosphere in IIT-Bombay, so much so that that many students want to be a part of start-ups, says Nikhil Jain, co-founder of Enelek Power. 

His two-year-old company, currently incubated at IIT-Bombay’s Society for Innovation and Entrepreneurship (SINE), has no trouble attracting talent from the college.

In its 10 years, SINE, which hosts and mentors early-stage entrepreneurial businesses for up to three years, has spawned more than 50 tech start-ups, including ideaForge and ThinkLabs Technosolutions. However, it only supports product-based companies that involve some intellectual property.

Image: Purple Squirrel Founder Aditya Gandhi.

Purple Squirrel, another start-up incubated at SINE, has been organising field visits to acquaint students with career prospects other than working with conventional industry giants.

Founder Aditya Gandhi says engineering graduates, who often dabbled with big IT firms before looking at alternatives, are now considering an early transition to starting up or working with start-ups.

Housing.com’s Yadav says on occasion, IIT-Bombay freshers have opted out of the campus placements to come to them for an interview. 

Big corporations like Tech Mahindra, Wipro, L&T Infotech and Cognizant lie cheek-by-jowl with a growing number of start-ups. The vibe at these companies is young and energetic.

CEOs wear sweatshirts, carry backpacks, answer calls after only a couple of rings and manage offices where sometimes the average age of employees is 23.5 years. Among the few bits of furnishing in offices are mattresses that hint at long working hours.

Photographs: Courtesy, Hiranandani Group

While they are able to make do with tight budgets, there is a need for investments. But venture capital firms such as Nexus are not packing their bags and moving in just yet.

“(It is) still early days in Powai. More funding and more successes are needed to fuel the ecosystem,” says Sujan. As of now, much of the initial investment for upcoming start-ups is from personal savings or IIT-Bombay alumni who give Rs 5-10 lakh for each project, notes Yadav.  

What separates Powai from other start-up hubs in India is its level of seriousness, feels Hayath. “Considering the higher cost of living in Mumbai, the companies here are generally less frivolous in nature than those in, say, Bangalore or Pune.”

Their growth has been unplanned and natural. Outside of IIT-Bombay, there are no systematic support systems for start-ups and Internet- or mobile-based businesses have bloomed on their own.

Image: Zishaan Hayath, co-founder of Toppr.com and Powai Lake Ventures.

Nikhil Mathur, CEO and co-founder of yowoto.com, says they are looking to offer support systems and incubation to start-ups in the future. 

The winds of change have started blowing in small ways, though. Sand Hill Counsel, which is the legal advisor for many start-ups in the region, recently shifted from Worli to Chandivali near Powai to be closer to clients.

“Mumbai is the financial capital, but it has been losing ground to other cities because of its unaffordability. Powai provides entrepreneurs a viable option to stay put,” says Shantanu Surpure, managing attorney with the law firm. “I expect more people to move to Powai in the future.” 

Start-up founders here welcome the attention that comes from comparisons with Silicon Valley but reject the moniker ‘PowaiValley’.

“We don’t have any valleys here. We need a different title. Maybe Powai Lake or Hills,” smiles Hayath. While things look bullish, it is too soon to be euphoric, adds Gandhi.

“Start-ups cannot be overnight successes.” Then, drawing parallels between Powai and the Aam Aadmi Party, he adds, “There are talented people in Powai with good ideas.

They should be allowed to grow organically without the burden of unrealistic expectations.”

Source:  ; http://www.rediff.com

India’s first river-linking project: Bad science on a grand scale?

India’s first river-linking project: Bad science on a grand scale? 



If  the river-linking project works, Khagaria will be the pioneer of flood management. If it doesn’t, it risks becoming a prime example of how tinkering with nature can lead to disaster. 

Khagaria is the sasuraal of rivers," says Eklavya Prasad, invoking a local idiom to explain the district's singular status in Bihar. The activist likens it to the home of the in-laws, where everyone must visit to pay their respects. But Khagaria could do without some of this familial bonding because it has been a source of woe for a district through which every south and southeast bound river flows. 

That makes it the scene of devastating floods every year, causing untold misery to the people who live there.

But the government wants to change all that, play god in a sense, by altering the course of the rivers. Khagaria is one of three districts—along with Samastipur and Begusarai—where India's first river-linking project will take place. The hope is that the rivers will help drain away the floodwaters and provide irrigation in the dry season. The river-linking idea is one that's been knocking around for a long time - only natural in a country that can suffer from drought and flooding simultaneously and repeatedly to such shattering effect. But the many critics of the programme call it bad science on a grand scale that will cause the irreversible destruction of lives and property, while bringing about environmental catastrophe. They say there is no understanding or clarity about the likely impact of interlinking on the air and water, biological diversity and socio-economic fabric of the area. 

Shashi Shekhar, who works in the areas of flood management and people's rights, describes the interlinking of rivers as a "mad project". He argues that the rivers in the region are already interlinked and artificial intervention is going to give rise to other problems as it runs counter to hydrological norms. 

"You can't play with the environment and win. We have already seen what building of barrages has done in Uttarakhand," where deadly floods occurred last year. "Do you think that a barrage can restrict a river in full flow? Have they forgotten what happens on the Kosi," Shekhar says. 

The Kosi symbolises engineeringled solutions to flooding that don't take into account the knowledge that farmers have gained from centuries of working the land. So, while agriculturists welcome low-intensity flooding that regenerates the soil with the silt that the water carries, engineers build embankments, barrages and dams in a bid to halt the water in its tracks. Nature has altered the Kosi's course over the centuries, and the people who live there have tried to adjust to this. But since the days of the British Raj, engineers have sought to intervene in a bid to try and make life more settled for them. 

It hasn't worked, suggests Prasad, who made the sasuraal analogy above, considering the regularity with which the Kosi floods. "Just look at the Kosi canals, the eastern and western. These were built between 1954 and 1960. Have we assessed the impact of these canals?" he said. 

Prasad is managing trustee of the Megh Pyne Abhiyan, a campaign network that works on "drinking water, sanitation and adaptive livelihood concerns" in the five flood-prone districts of north Bihar. The government seems to be going ahead without assessing the impact of past experiments, he says. 

Former Prime Minister Atal Bihari Vajpayee is credited with giving the interlinking programme a big push in October 2002, though the idea can be traced back to the late 19th century and Arthur Cotton, the Madras Presidency engineer who first conceived the plan to improve inland navigation in peninsular India. 

In 1973, then Union minister for water resources KL Rao proposed the Ganga-Cauvery (Kaveri) Link. The idea resurfaced, bigger in scope, in the late 1970s as the Garland Canal, proposed by engineering consultant Dinshaw Dastur. The government made its first serious move in 1980, when the ministry of water resources framed the National Perspective Plan, which proposed inter-basin transfers. In 1982, the National Water Development Agency was set up to carry out pre-feasibility studies, which formed the basis of an interlinking plan. In 1999, a national commission was set up to review these study reports. It was of the view that there was "no imperative necessity for massive water transfers in the peninsular component" and that the Himalayan component would "require more detailed study." 

Interlinking got a boost when then President APJ Abdul Kalam made a passing reference to the need for finding a solution to simultaneous floods and droughts in his address to the nation on the eve of Independence Day in 2002. 

Last year, the justices of the Supreme Court decided that interlinking was a good idea and forced the government to get moving on the plan.

The National Water Development Agency has now finalised the detailed project report for linking the Burhi Gandak river to the Baya/Ganga river in Bihar. This involves constructing a barrage across the flood-prone Burhi Gandak and a 29 km canal from the barrage into the Baya. Interlinking the Burhi Gandak, Baya and Ganga will reduce the flood potential in Samastipur, Begusarai and Khagaria, according to the plan. Government reports estimate that these three districts alone account for flood damage to the tune of Rs204.73 crore every year.

Bihar is the state that's most affected by floods every year. It accounts for 8% of the country's geographical area of which 17% is flood-prone affecting 36% of the population. 

The state government says the Rs4,200 crore multipurpose project is a significant flood management and irrigation initiative rolled into one. The project report states that diverting floodwaters will save Rs143.31 crore, with the additional benefit of providing irrigation for 1.26 lakh hectares of land during the kharif season. The benefits total Rs587.10 crore, according to this. 

With the state government on the verge of executing the ambitious project, Bihar Water Resources Minister Vijay Kumar Choudhary is upbeat.

Augmenting irrigation potential eliminating flood concerns across 4 to 5 lakh hectares will boost economic activity, the minister says. 

Skepticism about interlinking stems from past ineffective solutions. Flood management in Bihar has been focused largely on embankments. Since the 1950s, some 3,500 km of embankments have been built, along with nearly 400 km of drainage channels, apart from about 50 town/village protection works. While the government claimed that these measures accorded reasonable protection in the flood-affected areas, independent inquiries have failed to confirm this. 

In 1994, the Second Bihar State Irrigation Commission, which analysed flood damage data between 1968 and 1991, found that "although quite significant flood management works had been implemented in Bihar till March 1992, it is apparent from the reported figures of damage in all the 11 flood-prone basins that damages have increased gradually and significantly in recent years." 

Prasad and Shekhar also refer to the displacement that will take place. The state's water resources minister rejects this, saying that while 490 hectares of land would have to be acquired, there won't be any displacement as the benefits will be substantial. 

Officials say the interlinking project has an astonishingly high cost-benefit ratio of 1:54. "The fears are misplaced," says an official associated with the project. "We are not proposing draining of the river, simply allowing for the evacuation of 10% of the excess flood water, which is about diversion of 492 cumecs (cubic metres per second)." 

Critics say aspects such as silting haven't been taken into account. "Has the project plan taken into account the high level of silting in the rivers? What is the plan for desilting and dredging, and how will they dispose of the silt. Will it mean that more cultivable land will be set aside for this purpose? Not addressing the issue of silting is a big mistake, as the channel will constrict over time, creating an overflow situation yet again," Shekhar said. 

At a fundamental level, critics such as Prasad, Shekhar and others working in the field of flood management and water-people issues, say the main objection is lack of transparency. "Why have the people not been taken into confidence? After all, it is their lives that will be affected," Shekhar says. 

Some activists argue that small irrigation projects are the solution as they will drain the flooding rivers as well. Such solutions aren't being pursued, they say. "There has been no work done on small irrigation canals since the British," says an environmentalist working in the region. 

How exactly the interlinking project will roll out is still not clear and questions will be raised about that. But for now the Bihar government is pleased with the way things are moving. "It has been completely a state government initiative. For nearly three long years, we kept on pushing for the project and finally the NWDA ( National Water Development Agency) has prepared the DPR (detailed project report). We will now have to wait for the technical approval from the Central Water Commission before proceeding further," Choudhury says. 

If it works, Khagaria will have the honour of being the pioneer of a new method of flood management. If it doesn't, it risks becoming a prime example of how tinkering with nature can lead to disaster. 

For Reference/Info :

Past and present floods in Bihar

Central Water Commission CWC is an apex body of India to look after the
irrigation and flood control in the country. Any trivial matter regarding these two
issues cannot move any further without the nod of this institution. Ask CWC
which year Bihar was hit by the worst floods in the history, the answer would be
2004. This is because, according to CWC, 2004 was the year when 4.99 million
hectares (MH) of land in Bihar was inundated. This information must have been
given to CWC by Government of Bihar GoB. In fact, 2004 flood of Bihar was
limited to 20 districts of North Bihar (Siwan and Saran faced no floods in 2004).
Area of North Bihar is around 5.4 MH and the combined area of Siwan and
Saran is 0.486 MH. Subtract this area from the area of North Bihar to get a
figure of 4.914 MH implying that the flooded area of North Bihar was more than
the actual area of the region. When this anomaly was reported in the press, the
flood hit area of the state slumped down overnight to 2.772 MH in the reports
prepared by Disaster Management Department of the State. GoB, however,
took precaution in retaining the flood affected area as 4.99 MH when it
submitted a memorandum to the Prime Minister for assistance to combat the
losses that year. Even Prime Minister's Office did not notice the fallacy in
reporting and so did Ministry of Water Resources and the CWC. One wonders
that in future if a relationship is drawn between the rainfall, highest flood levels
of the rivers and the area affected due to floods in Bihar, will it not lead to
erroneous conclusion? The answer is - who bothers? That is the seriousness
with which data are handled by these august institutions.
GoB took another precaution. It has ceased to disclose the district wise flood
affected area ever since to avoid any criticism. Even this year (2007), the flood
affected population of Sitamarhi district is indicated as 27.86 lakhs whereas the
population of the district according to 2001 census is only 26.83 lakhs although
the official website of GoB suggests a population figure of only 20,13,796
persons. One should not be surprised if the GoB stops giving the flood affected
population now onwards. However, accepting the credibility of whatever data
and information is available, let us take a look at various devastating floods in
the State in past.

1954 Floods Talk to any elderly person in North Bihar and he would
tell you something about the devastation caused in the floods of 1954.This flood
was limited to North Bihar only with an affected area of 2.46 MH and a
population of 7.61 million (out of 18.393 million). This flood affected 8119
villages (out of 21,107 villages) of North Bihar leading to the loss of standing
crops over 15.96 lakh hectares. Some 1,79,451 houses were destroyed and 63
persons lost their lives in this flood. 1944 cattle had also perished in the floods
this year. The flood loss was valued at Rs 50 Crores.
This was the year when the first Flood Policy of the country came into being and
the proposal to dam the Kosi at Barahkshetra in Nepal was dropped in favour of
embankments along the river citing the reason that the proposed dam would be
a safety hazard for the people living in downstream areas. After this all the
major rivers of Bihar were embanked and the process continues still. The flood
prone area of Bihar in 1954 was 2.5 MH and the state had only 160 kilometers
of embankments along its rivers.

1974 Floods The impact of this year's flood was felt south of the
Ganga also in the districts of Munger and Santhal Parganas and had a spread
area of 3.182 MH. It had hit a population of 16.39 million and crops over 1.751
MH were lost. 5,16,353 houses were destroyed in this flood that killed 80
persons and 288 cattle. The total losses were put at Rs. 354.59 Crores.
Following the floods, the GoB appointed a committee to look into the flood
damages and suggest means to combat floods under the Chairmanship of
Kanwar Sain, former Chairman of CWC. This committee reiterated the idea of
construction the Barahkshetra Dam on the Kosi and said that the embankments
could only be a temporary solution to the flood problem of the state. Till 1974,
there were 2192 kilometers long embankments within the state and it was
claimed that they were providing protection to 1.5 MH of land. The flood prone
area of the state, however, had shot up to 4.3 MH by this time.
1987 Floods This was the worst recorded flood of the 20th Century, the
records set by that flood have not been broken so far (2007 included). This flood
had not only mauled North Bihar, its impact was felt in South Bihar as well as
Jharkhand (it was a part of Bihar those days) also. An area of 4.668 million area
of present day Bihar and a population of 282.38 lakhs was hit by this year's
flood that had engulfed 23,852 villages and destroyed crops over an area of
2.51MH. It further destroyed 16,82,059 houses killing 1373 persons. The state
had deployed 58 army boats, 14,304 boats in North Bihar, 1366 boats in south
Bihar and pressed in services of 13 helicopters for rescue and relief operations.
The rains that started on the 11th August continued almost non-stop till 19th
August and no food packets could be dropped in Madhubani, Darbhanga,
Samastipur and Khagaria for about 3 weeks. Blocks like Alauli and Beldaur
remained marooned till the end of October. The floods repeated five times in
days to come and Jhanjharpur (Madhubani) was inundated even after Diwali.
There were 3,321 kilometers long embankments in the state by 1987 that were
expected to protect 2.873 MH of land against flooding. There were 104
breaches in these embankments and the flood prone area of the state had gone
up to 6.461 MH. A committee under the Chairmanship of Naresh Chandra was
appointed to look into the causes and remedy of floods in the state. The Report
is gathering dust somewhere in the Central Water Commission.

2004 Floods This year's flood was spread over 20 districts of North Bihar
with an area over 2.772 MH ( 4.99 mh according to CWC) and a flood-hit
population of 2.13 Crores. This flood had engulfed 9346 villages. destroyed
crops over an area of 1.399 MH and swept away 9, 29,773 houses killing 885
persons. Desparate attempts were made to paint 2004 flood as the worst ever
flood in living memory and duping the PM was a part of it.
By this time the undivided Bihar had an embankment length of 3465 kilometers.
24 kilometers went to Jharkhand and another 11 kilometers was swept away.
Remaining 3430 kilometers long embankments are still there with Bihar while
the flood prone area of the state has gone up to 6.88 MH. Government of India
had appointed another Task Force to look into the flood problem of the state
and suggest remedy. This report, too, says that the flood affected area of Bihar

in 2004 was 4.99 MH. One should not be expecting anything worthwhile from
the report which is based on wrong footings. Obviously, constituting committees
and Task Forces etc is just an extension of floods that provides post retirement
employment to administrators and technocrats.

2007 Floods Much has been written earlier and it is not intended to repeat
it here but it must be said here that whenever a phrase 'worst ever flood' is
used, caution must be exercised. It suits all concerned, except the victims, if the
worst ever flood strikes an area. Should miseries be marketed? Marketing
managers could muster a statement from United Nations that Bihar was hit by
worst ever flood this year which, it was constrained to modify later saying it
meant South East Asia and not Bihar. GoB has diluted its wordings and does
not call it worst ever floods in living memory. Will Central Water Commission
modify its information?

Is it natural for a river to shift course? What rights, if any, do the displaced people have? How can India check its surging rivers? TOI finds the answers

When the Kosi reverted to its 250-year-old course last month, leaving 30 lakh people homeless in northern Bihar, apparently due to heavy rains in Nepal, the near-Biblical scenes of havoc left many with just one question: Why?

Why do rivers change course? What happens to the people they displace? Are these refugees of wayward rivers entitled to compensation for the land they lost? And just how prepared is India to check its surging rivers? It’s futile to ask ‘why’, says A K Bajaj, chairman of the Central Water Commission because “it’s very natural for a river to keep shifting its course. It’s a part of its natural evolution.” Bajaj explains that fast-flowing rivers are prone to silting up as they surge down the hills and spread out on the plains, allowing sand and suspended matter to deposit in their slower, wider depths. Over time, the deposits create resistance, forcing the river to move to an area of lower resistance. This is called changing course. Nature’s fury—earthquakes, landslides, hurricanes—can change a river’s course as well.

And then there’s man. Environmentalists now say at least some of the blame lies with human activity. Says IPCC chief R K Pachauri, “As a result of climate change, floods are increasing in frequency and intensity. It’s not possible to ascribe a single event such as the current floods in Bihar to human-induced climate change, but the trend is unmistakable.

These are likely to get more serious in the future if the emissions of greenhouse gases are not mitigated at the global level.” Bajaj agrees that “the volume of water in rivers has been on the rise, resulting in greater force of flow. Therefore, even relatively lesser amount of rain during the monsoon can lead to a catastrophe”. He adds that “in the next 15-20 years, this phenomenon will continue till most of the glaciers have melted.

After that, there will be just minimal flow of water.” The role of natural evolution and nature’s fury in a river changing course may sound like one of the simplest lessons in a child’s geography book. But the effects can be complex. When waterside property suddenly becomes landlocked for miles and new waterfront acreage emerges, havoc ensues. Who owns the new land? Do the people who once farmed along the banks have any rights at all? The government has a 54-year-old formula by which land equivalent to 3.5 times the width of the river on either side is deemed the floodplain.

Embankments are built on it. If a river has changed course, the new floodplain “is considered very fertile and good for farming although this stretch is never safe from floods,” says Bajaj. People want to settle on the floodplain because it is fertile and easily irrigated. Not so the Kosi, the river of sorrow, which brings unfertile soil with it from the higher reaches. Authorities say that once the Kosi waters start receding, the breach in Nepal would be repaired. It is hoped that the river would revert to its original course.

If that happens, the question is whether it would be possible to reclaim the 2.75 lakh acres of farmland, that are under water now. The Kosi has forced public policy review before. It caused devastating floods in 1953-54, forcing the government to announce zoning to demarcate areas prone to flooding. An estimated 40 million hectares across India were classified flood-prone. But 54 years later, less than half are protected by embankments. “Issues like topography, policies and other factors cause delay.

In Upper Assam, for example, we are witnessing rising levels of the Brahmaputra and its tributaries in Dibrugarh district. But the river is so huge and ferocious that it’s very difficult to tame it,” says a CWC official. Officials at the department of hydrology studies say that building dams may be the best way out, as is the case with the Colorado river in the US. It has 30 dams to keep it in check. “In case of the Ganga and the Kosi, the government of Nepal, where both rivers originate, is not allowing construction of dams.

So, we shall remain at perpetual risk,” says Bajaj. It is true that dams have become a symbol of development at great human cost. Environmentalists protest against them. But officials say, “Either you protect human lives or you protect each and every plant and animal on this earth and negate human beings and their development.” IN DANGEROUS WATERS The Kosi river in north Bihar is notorious for the meandering behaviour of its east-to-west course. In the past 250 years, the Kosi has moved westwards by more than 100 km Bihar has a history of rivers changing course because of its terrain.

he Ganga has been changing its course over the years and last year, a new 500-acre tract came into existence between Maner and Mokama. Ownership of this tract became a bone of contention between some landlords in the area The Brahmaputra has a huge volume of water and is quite unmanageable. It keeps changing course and a major shift has been observed in the North-East since the 1960s The Rupnarayan river in West Bengal joins the Hooghly after completing a 240-km course.

It carries huge silt deposits and may be forcing the Hooghly to shift course Areas of Uttarakhand, which are near the foothills, are at risk because the Ganga can change course The Sone river in central India has been notorious for changing course, as is evident from several old beds on its east. In modern times this tendency has been checked with the anicut at Dehri, and now more so with the Indrapuri barrage There is evidence of a steady westward shift in the course of the Indus since pre-historic times

http://biharrelief-artofliving.blogspot.in/

--------------------------------------------------------------------------------------------------------

A Tribune Special
Kosi on a new course
Sorrow for many, bonanza for someby our Roving Editor Man Mohan

IS the Kosi river calamity man-made? This fear has started lurking in the minds of water resources experts in India and Nepal. Or were the rats and foxes responsible for the worst floods in living memory? How about anti-social elements? Don’t laugh — such ‘causes’ have been shown in the past as “ground realty” in the Bihar government records related to river breaches and flood relief money matters.

On August 8, the Kosi picked up a channel that it had abandoned over 100 years ago near the Nepal-India border. Lakhs of people on both sides of the border were affected as the river broke its embankment at Kusaha in Nepal, thus submerging several districts of the two nations. About 95 per cent of the total flow of Kosi is now passing through the new course.

The Kosi, which flows from Nepal into India, is a major tributory of the Ganga. Over the last 250 years, it has shifted over 120 km, from east to west. The unstable nature of the Kosi — one of the world’s most violent river — is attributed to the heavy silt which it carries during the monsoon season. The Kosi figures in Mahabharata and Rigveda.

The flood mafia of Bihar love Kosi-type calamities. Bihar is known for all kinds of mafias — fodder, education, health, irrigation, flood, and so on. Each mafia use government funds to siphon off money.

Tragedies are also a source of making money — the sufferings of men, women and children wading through flood waters mean nothing to the politician-contractor mafia nexus. The picture of a man in waist-deep water, carrying a calf on his shoulders, in newspapers moved everyone.

Questions are asked how is it possible that the people are suffering silently for decades without any protest and how does a government in a civilised society desist from its obligations to the people?

Nepal’s former Water Resources Minister, Dipak Gyawali, told this correspondent that “the entire Kosi project has become a synonym for the corruption that goes by the name of Bihari politics, which ‘New Nepal’ seems to be importing with glee.”

“When the lateral, left-bank embankment (not the barrage across the river) collapsed on August 18, it was not a natural disaster, but a man-made tragedy,’’ said Gyawali adding “it was waiting to happen…it is a man-made tragedy because of embankments’ poor maintenance over the years.”

The Bihar government in the past has passed the buck to rats and foxes for digging holes in the embankments, anti-social elements, Nepal for releasing waters, and now the latest excuse is global warming.

Also known as the “Milk River”, Kosi has now been dubbed as “The River of Sorrow” as it has caused widespread human suffering in the past due to flooding and very frequent changes in course. The river travels a distance of 729 km from its source to the confluence with the Ganga.

The Kosi has breached its embankment several times since India and Nepal signed the Kosi treaty in 1954. Were they caused only by fast surging downstream waters of the river?

Nepal’s experts allege that Bihar’s flood mafia has been responsible for causing many breaches in the past, not only in the Kosi, but also in the embankments on the rivers flowing from Nepal into India. They say that an inquiry must be made to check whether the flood mafia caused the tragedy this time.

Some Indian experts agree with their Nepalese counterparts and point out that there is massive corruption in works related to the taming of the rivers, especially in Bihar. There were 105 breaches in 1987 in Bihar and in 2004 the figure was 60. Many more breaches, like the current one in the Kosi embankment, have taken place since then.

There are many precedents of deliberate neglect by Bihar’s officials resulting in breaches of embankments on the Kosi and its tributaries. In 2005, the District Magistrate of Darbhanga made a statement that two officials in charge of maintaining the embankments deliberately damaged the one at Dewanaa causing widespread damages, but instead of punishing them, the DM was transferred.

Many top officials have been caught red-handed in Bihar’s flood scam from time to time, including an IAS officer. The flood mafia relishes embankment breaches, because flood relief is a lucrative business: there is no regular audit of flood relief.

On the other hand, Indian engineers say that anti-social elements in Nepal do not allow them to repair the embankment. Actually, these so-called anti-social elements are the victims of the Kosi embankments who have been forced to bear Sunami-like floods every year. Now, they are happy that the river is changing its course, away from their homes and fields.

Eight of the 10 highest mountain peaks in the world are located in Nepal, which has three biggest river systems — the Kosi, the Gandaki and the Karnali — originate in high-mountain glaciers and eventually flow into the Ganga. The worst affected districts included Supaul, Araria, Saharsa, Madhepura, Purnia, Kathiar, parts of Khagaria and northern parts of Bhagarpur, besides adjoing regions of Nepal.

A high-level Nepal government team that inspected areas devastated by the floods in the Kosi river has held India responsible for the havoc. The devastation took place as the Indian side did not carry out repair and maintenance work on the Kosi barrage and the embankment along the river, thereby violating the Nepal-India Kosi agreement.

As per the bilateral agreement of 1954, India is entirely responsible for repair and maintenance work and operation of the barrage. Kathmandu has alleged that there was no effort by the Indian officials to save the breach in time, though Kosi took 15 days to make the breach!

Prachanda, who is expected to make his first official visit to India shortly, is likely to discuss the Kosi issue with Prime Minister Manmohan Singh to find out a permanent solution to the problem which has been affecting both the nations for decades.

A Nepali local development officer says that the Kushaha barrage, built with the assistance of the Indian government, had used inferior construction material, causing the quick erosion of the spurs. Calling it the worst flood in the area in 50 years, Dr Manmohan Singh on August 28 declared it a “national calamity” and the government earmarked Rs. 1000 crore in aid for the region.

How seriously the governments take these breaches — or such tragedies — are evident from the fact that when the Moloney embankment breached in Gorakhpur in 1955, an enquiry was conducted by eminent engineer, Dr A. N. Khosla. Now the embankments breach every year and nobody bothers.

While Nepal, India and Bihar state are busy finding excuses, the people continue to suffer. Wherever the Kosi flood waters made their way downstream, wheat and paddy crops stood destroyed., hitting the people hard.

-----------------------------------------------------------------------------------------------------------

How Kosi river Changed its course

Kosi River Changed it course because of the damage in the Barrage in the River upstream in The Nepal

I am Attaching few picture here just to make it more obivious.

 Also go through the articles various magazines in India for which I am providing the links in Below

A snake in knots   

Frontline, Volume 25 – Issue 19 :: Sep. 13-26, 2008

Bihar’s tragedy and the shocking failure

Farzand Ahmed and Amitabh Srivastava

September 5, 2008, India Today

Faces that bore the brunt of Kosi 

September 5, 2008, India Today

http://zakku78.wordpress.com
-----------------------------------------------------------------------------------------------------------

Source : By Urmi A Goswami & Ashok Mishra, ET Bureau; http://www.thehindu.com; http://www.tribuneindia.com; http://biharrelief-artofliving.blogspot.in; http://zakku78.wordpress.com