By 2020, the race for economic supremacy will be restricted between the US, China and India, predicted Jagdish Sheth, noted professor of management at the Emory University said.
Sheth was speaking at a Confederation of Indian Industry conclave on 'Building a new India through global competitiveness.'
Sheth said by that year, India's growth would have taken its gross domestic product in terms of purchasing power parity past Japan, and will place it next to China and the US.
"The Indian economy will become so big driven not by Indians, but through possible alliances that India will build with other economies," Sheth said.
But for that, he added, India will need to closely ally itself with a global superpower and take advantage of the current shifting of political alliances among the world's largest economies.
"There are already evidences strong enough to suggest that India is beginning to ally with the US, as the US needs to contain China, economically and militarily, in the long run. Hence, India should look at the Mexican model of growth, a strong partner of the North American alliance, which trades over $400 billion every year with the US," Sheth said.
Sheth said Indian companies need to become more competitive technologically, focus on exports as a stepping stone to increasing their presence overseas through manufacturing bases, and build global brands.
"It is alarming though to see traditional Indian business houses getting too diversified. It is almost the same model as that adopted by the Korean chaebols, and look how they have now collapsed," Sheth said.
"In my view they should stay more focused, probably one just one line of business where they can be competitive not just domestically, but globally. Like Toyota did by shedding all its other businesses except automobile, and in my view will grow bigger than General Motors in the next 7 years, and will seriously threaten the existence of Ford," Sheth added.
Speaking at the same seminar, CII president and Mahindra & Mahindra vice chairman and managing director Anand Mahindra said the government should play a proactive role in weeding out all impediments to growth.
Oil & Natural Gas Corporation chairman & managing director Subir Raha said that was distressing about Indian companies was that there was no visible sign to emerge as leaders in technology, but only attempts to match stronger global corporations.
