December 09, 2006 | 12:45 AM
India the next Super Power ?
Soemtimes I do not get it. India's GDP stands at US $774 Billion. US GDP is at US $12,486 Billion !. Even at a current growth rate of 9%, 3 times that of the US, it will be decades before we catch up. So what's the concept of a Super Power that we believe we soon will be ? Per Capita income in India is still amongst the lowest in the world. Perhaps we should redefine GDP to mean Gross Domestic Potential rather than Product....
It is in unlocking the creative potential of India that explosive growth rates can be achieved. I think we are achieving the current growth rates more through the the export of the service sector. In doing that we are effectively servicing the growth of other economies. I disagree with that. Export, Export Export seems to have been the Mantra of the Indian economists. It cannot be a longer term strategy. Like a country that survives on export of it's raw material till it runs out.
But in the long run we need to service our own industry, expand our domestic economy, increase standards of living within our own economy. We need to be able to withstand economic fall outs that will become more and more common in the globalized world economy. A strong home based economy, fueled by domestic demand and growth is what we need.
So what do we need to do ? We need to encourage innovation, so that the next Microsofts, or the Google's of this world are born out of India. How do we encourage an an atmosphere of Entreprenuership that is willing to invest in Research and Developement. How do we encourage Entreprenuership that needs long term investment ? Our Banking system and the new Venture Capital systems are more and more geared towards qucker returns, or 'exit strategies' as they are called.
Everyone talks about our great Demographic advantage. Soon we will have 15% of the toal population of teenagers in the world living and being Indian ! How do we unlock the creative potential that exists in this explosive area ? Prmary education is low, and of a terrible standard in most places. It is not an unsurmountable problem. By increasing the spread of broadband, we can have every Indian child interactively connected to classroom on the Web. It will ensure that kids in rural areas get the same education as the urban schools.
There are very few Management schools. Fewer still technology schools. Educational institutions that encourage youth to explore their own creative instincts are practicaly non existent in India. It has never formed a basis of our learning process. If we do not address this issue now, at best we will have a work force that services the needs of the rest of the ageing world. At worst a restless population with little education, not enough jobs to keep them occupied. This young population will bring us down rather that lift us to Super Power status.
Primary education is supreme.
On the optimistic side. Imagine 20% of the world's youth (not just teenagers) , all with basic education, Broadband conntected, all exploring and connected globally. All coming from one country and one culture ! They will be the 'tipping factor' and change the cultural and therefore the economic and political dimensions of our planet. In their own favour.
Then, we will truly be the Super Power that everyone talks about. That is our Gross Domestic Potential.