Indian economy has the potential to grow by 10-15 per cent annually and generate 10 million jobs if it harnesses entrepreneurship, innovation and quality, management guru C K Prahalad said on Monday.

"We talked about Purna Swaraj before Independence and we got it in 15 years. Why can't we have Purna Swaraj on the economic front. Our priorities should be 10-15 per cent GDP growth and 10 million jobs," Prahalad said at the CII annual session in New Delhi.

Without such type of growth, he said India would be far behind China. 

Prahalad, a professor of University of Michigan Business School, said demand for consumer goods will explode if India Inc cuts cost by at least 20-30 per cent.

"Companies can double their production as demand would explode if the per capital income of the country goes up to over $600 from the present $500," he said.

Instead of relying on government to create the enabling environment, the management expert said India should focus on entrepreneurship as demonstrated by the IT sector and other companies in the unorganised sectors.

"India's unorganised sector is large and efficient.

Creating an organised sector out of the unorganised sector is an opportunity,"

Admitting that the industry was constrained by lack of resources, poor infrastructure, labour laws, high cost of power, high import duties and taxes, he said "focusing on them would not solve the problem of becoming competitive."

Citing examples of Amul and Aravind Eye Hospitals, Prahalad said India should go for innovations and focus on quality.

"Imagine a situation when we can have a regional network of 10,000-15,000 villages specialised in certain crops with capital intensive technology to subsistence farming, and then connecting the consumers with the farmers," he said, referring to Amul's success story.

Indian companies should also be global-oriented instead of being myopic and cater to the domestic needs only, he said.

India has demostrated global scale markets in sectors like telecom, two-wheelers, trucks, cement, petrochem, personal care, entertainment and TV/audio, the management guru said, adding this can be replicated in other sectors as well.

Prahalad would address a national debate to be participated by over 50,000 individuals across 100 centres of CII on April 30, CII member and chairman of Godrej & Boyce, Jamshyd N Godrej said.

Inaugurating the national conference, CII president Ashok Soota said the dampened growth prospects in US, EU and Japan coupled with the impacts of SARS could cast a shadow on India's growth prospects.

"But India is showing steady and rising economic and industrial growth. Only Agriculture has been affected by the worst drought in 14 years but should see some growth this year," he said.

"We therefore see India evolving into the second facory to the world if we assume that China is likely to be the first factory," he said while pressing for speedy reforms, increase in efficiency and productivity.