February 18 - On to Mumbai (still called Bombay here)

A visit to the Indian affiliate of a US-based title insurance company in Bangalore opened my eyes to several realities of the Indian real property market. First, there is no title insurance protection for buyers of land or homes, meaning there is no title insurance industry and property owners do not obtain attorneys’ opinions that they have marketable title. A person buys a home or land with no assurance that his title is not subject to adverse claims. If there is a dispute, the courts are available, but cases involving claims to land can take up to 20 years to work their way through the courts.

A US-India based company is working to change this, but it will be difficult because many title documents are not registered with the government (the transferors and transferees avoid the registration fees) and government documents are not as easily accessible as in the US. There is an Indian right to information act, but one cannot obtain multiple documents at once through this law; rather, one must specify the parcel of land for which ownership and deed documents are desired. This might be a long-term impediment to development of a comprehensive title plant for Indian land, but it doesn’t appear to have suppressed a booming real estate market. Both the newspapers and locals report increases in land values of 30% or more in a single year recently. Even middle class people such as attorneys are renting, rather than buying, because of land prices. Moreover, there is apparently no uniform system for rating a prospective homebuyer’s credit, such as the FICO score in the US. Each bank and prospective lender performs its own examination of a potential borrower’s ability to repay.

Presently, however, at least one major company is offering title insurance on Indian property, but only for properties owned by foreigners, and then only for commercial property (not residential). While the local market is ripening, title searches and initial preparation of title insurance commitments for US property are prepared on an outsource basis by India-based companies that research title based on digitized copies of land records, assessment records and so forth. These are then sent electronically to the US. It dazzles the mind to think of a title researcher in Bangalore reviewing the exceptions to title of a property in Boston, but it is happening. India based companies know that as costs are reduced, their parent companies might be under increasing pressure to reduce rates for insurance policies, so they are thinking creatively about how to make the industry more efficient.

A quick flight from Bangalore to Bombay (Mumbai is the new name) demonstrated the difference between India and US air travel. For a domestic flight, documents and hand luggage were examined three times between the counter and the plane, yet on a 1.5 hour flight, a hot meal was served. Both front and rear exit doors were used to deplane, so the whole process was more efficient than in the US. Jet Airways uses e-tickets and handles luggage efficiently. It is a great relief in Indian airports to be met by a driver from the hotel because the airport terminals are super-crowded and there seem to be 3 porters for each passenger. It’s a scrum among the porters when the baggage arrives, so you have to think fast or your two pieces will be on separate carts under the care of separate porters.

One hour in light traffic to the hotel, and even in half-light, Bombay is a study in contrasts. There are modern high-rises and the sea on one side of the car, and small children begging by knocking on the car windows on the other. People who have visited India before told me not to respond to begging children (for various reasons) but it’s heartbreaking and hard to look away. To reach the car windows, these kids (and some are really small) have to dart in and around some of the most aggressive traffic I’ve ever seen – the traffic here makes Rome and Bangkok streets seem tame. The music of urban India is the din of car horns. Added to the buses, cars, trucks, pedicabs, moto-rickshaws, motorcycles, scooters and bicycles I’ve seen in Bangalore, in Bombay there are also horse-drawn carriages and cattle drawn carts.

Today (Sunday) was a day of leisure, so I hired a car and visited Ghandi’s residence in Bombay (now a museum), drove along Marine Drive and saw the Mosque, shopped for sarees and salwar kameez garments, ate lunch at the Delhi Dhaba, and saw both the dhobi (community laundry) and the red-light district. I talked to Guajarati and Punjabi people and now believe that English is not as widely spoken as I previously believed – almost everyone knows a few words, but except for the educated people, most people I asked said that only half the people speak English. I hope to be able to add photos to my blog soon, because the football field-sized areas where institutional laundry is being washed and dried in public is an amazing sight.

Yesterday, I took at 3.5 hour train trip to Pune, which is known as a university city with quite a few law schools (17, up from three a few years ago). I visited a new legal process outsourcing company and gave a short talk to about 35 staff lawyers who were curious to know how lawyers practice in the USA and how they might help their American counterparts work more efficiently. These lawyers don’t have the luxury of private offices – they work in close proximity to one another, seated in rows, all in one room. The working conditions didn’t discourage them from asking questions ranging from “what is diversity jurisdiction?” to “can evidence be filed electronically in US courts?” It was a wonderful chance to see Indian lawyers in action in an LPO. In 25 years of law practice, I haven’t seen lawyers this eager to work and succeed – the LPO industry (estimated by one businessman at 55 companies) is sure to present a major challenge for the legal profession in higher-priced countries.

The LPO I visited in Pune had meaningful security systems in place to prevent breach of client-related confidential information, such as personal lockers for employees’ possessions (none may be taken into the workspace), client-only computers in the work stations (no servers or disc drives attached), key cards to enter the work area, and personal background checks for all lawyers. Other BPO shops have engine compartment and trunk searches for each vehicle entering their compounds, hand wanding of visitors and employees with metal detection devices (on the way in AND on the way out), surprise sweeps of computers to see what pages have been downloaded by employees, and reward programs for reporting suspected security falws. The VA lawyer who left his laptop containing veterans’ personal information in his car wouldn’t have made it in an Indian LPO.

Still, the trip to Pune and back (7+ hours by train, even on the “easy seats”) was no picnic and the business community is probably eager for the opening of the airport that promises to serve international traffic. The crowd in the Bombay CST train station brings to mind a public emergency shelter, with people sitting and sleeping on the floor, as every available seat is taken and there is simply not enough room for the thousands of people thronging the station. Still, train travel is a way to strike up conversations and I talked to teenagers (reading “Chicken Soup for the Teenage Soul”), a textile manufacturer, and a software engineer – all were open and apparently happy to answer a foreigner’s questions about their lives and their country.