Swiss chocolates, Scotch whiskey, Swedish furniture, American technology, English legal advisories and banking, French fashion and Indian ……..software…perhaps?.The phrases like swiss chocolate show the dominance of countries in certain product segments. A small country like Switzerland claims to have better quality chocolates than its peers. A state like Scotland whose population will not be more than a million or two claims to be a popular name in the world liquor market.But what about India? There are some industries like software which we may like to add but we are still not confident if we have got dominance in the market. While it is good that Indian companies are creating some good name at the global level but the point of concern is that we have still not identified the areas where we need to have dominance. This is a point which should worry Indians in general and policy makers in particular.
India has major development obligations to fulfill. The provision of good quality life to its citizens can come only if India’s corporate sector has a sustainable growth story. And the corporate story is not only of the private sector but also of the public sector. The recent move of amalgamating various state banks into state bank of India is one such good move. However, it is not enough. Such amalgamation is only one step forward. It should be followed by target based and aggressive foray into international markets. India’s dream will be fulfilled only when SBI sits alongside with ICBC and HSBC. India’s has a long way to go to achieve this as there is a lot of homework to be done in this direction.
The first major impediment to India’s Global corporate presence is lack of coordination between Indian diplomacy and Indian industry. Indian foreign offices can no longer be limited to only government working. They should have corporate desks which should help corporates to foray into new markets. Further, any new government that comes should keep India inc’s global presence as a key part of its economic agenda. In fact, India’s share in international exports is a meager 1.6 percent. It should double every five years to expect the least. But let us be very clear this not very easy to achieve. India’s share of total world exports in 1950 was 2.2 percentage points. So even when our exports have grown in absolute numbers, our growth in percentage terms has been much slower than the other countries. Thus, to double the share in international exports will require a tripling of our efforts in this direction.
The second major impediment is human capital, India has underinvested in its human capital. Health and education are imperative for the growth of a country and its institutions. There is no developed country in the world which has underinvested in this sphere and got away with it. It is a big must and will remain so. India should remove this confusion as soon as possible. Delhi ‘s healthcare and education model should be emulated elsewhere in the country. Incidentally, Delhi has also shown growth in per capita income of its residents. While this may be due to multiple factors, investment in health and education cannot be ignored. There is no better investment than a human because it can give you unlimited returns. So, we should not miss this opportunity.
The third major impediment is India’s regulatory and quality control infrastructure. India’s quality control remains very ordinary compared to its global peers. Some argue that India doesn’t need high-quality control as it is a developing country but this also ensures that our industry doesn’t match global quality standards and thus, are outplayed by other countries. Quality is a brand maker in the contemporary era and is one of the key factors in expanding India’s presence at the global scale. Therefore, India should constantly revise is quality standards so that a push to the industry is always there.
Last but not least, India’s anti-industry hysteria should go. The short term populism of subsidy will not give long term jobs, only the growth in the corporate sector can give us good quality life. A fair and just system that creates trust between stakeholders is key to create this environment. This may need a strong political will. It is Indian electorate’s call to choose such politicians who promise a strong revamp in law and order machinery and are committed to fairness in the system. Government, Industry, and citizens will have to partner if we want to live our dream in this lifetime.
Turning any dream into reality takes extraordinary effort. India’s dream of becoming a poverty-free nation hinges on how desperately we want to quell the evil of poverty and live in a nation where every child will be proud to be born. India’s Corporate sector is not just an organization but also a reflection of India’s workmanship. It is our identity and only by building this identity that we can achieve our dream.