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Is India winning or losing?
December 23, 2003
With outsourcing tailwinds at its back, India is set to sail. The country is anxious to exploit its newfound strengths to leapfrog to first-world status and win global recognition.
Although this is not the first time that India has edged towards the center of the world's stage, there is excitement anew -- and well deserved -- in India's potential. But, success is not guaranteed. The long march to superpower status that Indians yearn for has barely begun.
Is India winning or losing? We live in an age of manias and phobias. Just as Pax Americana comes mingled with doses of America-phobia, newly-minted Indo-mania rages simultaneously with Indo-phobia, leaving many Indians confused.
Fortunately, this is not a flight to Mars. Other Asian nations have paved the pathway to promise: decades earlier, post-war Japan and the Southeast Asian Tigers took decisive steps to open up their nations to global opportunities and competition, achieving rapid growth in social welfare and economic development.
China and India were late, but they are here, at the starting gates. Sometimes, though, India (like China) appears to be lurching forward and sideways in half-steps and missteps. Therefore, it is essential, for Indians to pause at this juncture to take stock of where they stand, how to position themselves to compete effectively and win their rightful place in the new world order.
This is not an easy task. Like the elephant in the fable, 'Indian' means different things to different people, ranging from a nation of caste-bound and poverty-ridden pack of cattle-worshipping pagans to an Internet-empowered and nuclear-powered marauder of job-stealing tech geeks.
Aware that a kernel of truth lies hidden in each of these bromides, some Indians say India must market itself in new ways, become a new 'brand,' and adopt new 'labels' to overcome centuries-old stereotypes and clichés.
True. Branding, labeling and other marketing techniques are useful. But, one can carry these business-school clichés too far.
What India needs now is not some giant leap, from Mahabharata to Madison Avenue. That would be putting the marketing 'cart' before the product 'horse' to torture this oft-used business analogy. Instead, India should first focus and invest aggressively in its internal strengths and capabilities. Marketing India will then become easier and simpler, without the need for new symbols or labels.
Focus on reality, not perceptions
I am not arguing that India and Indians need to remain passive. Far from it. For years, I have recommended to Indian officials and argued that India can afford to and should be far more forceful than it has been. Read my article on ThinkIndia.com dated September 11, 2000, for example, in which I chided Prime Minister Atal Bihari Vajpayee for missing a golden opportunity to capitalize on his visit to the UN and US three years ago.
As India's long-moribund resources open up to new productive avenues, the Indian government and leaders must proclaim loudly and clearly that the New India has arrived and it means business. India must demand in public, not cajole through private channels, a permanent seat at the UN Security Council. India must publicize its commitment to intellectual property rights and peaceful use of nuclear power and demand unrestricted visas for high-tech workers needed critically in the developed world.
India has a long way to go in these efforts. For centuries, India has remained a subcontinent shrouded in esoteric intrigue and rumored to sport rich cultures and priceless historic treasures. Now, suddenly, a startled world is beginning to hear a cacophony of Indian voices speaking in Yankee and C++ accents of embedded chips and networked ERP.
The world, particularly the West, needs a special band of tools to understand, download and use this massive new subcontinent into its systems, already overloaded with protectionism, mass migration and terrorism.
Developed markets like Europe, Japan and the US are huge and complex. A one-size-fits-all approach won't work in all these markets. English-speaking England, Canada, Australia and America are easier to make inroads into than continental Europe or Japan.
Marketing India to all parts of the world is important, but it cannot start before it becomes abundantly clear that New India means business.
Focus on mission and development
First, as a matter of priority, the Indian government should clarify to its citizens a bold vision of modern India. A vigorous debate, followed by crisp consensus, is necessary on a number of fundamental questions: Will the modern Indian nation be focused on social and economic development, world leadership and cultural advancement? Or, will India continue to be mired in religious rivalries, regional disputes and lopsided economic development? These are important choices. The former calls for rapid political and economic reforms, a reconciliation with a nuclear nonproliferation regime, a settlement of territorial disputes and the assumption of a leadership role in the United Nations and other supranational bodies.
In each of these spheres, India has been taking baby steps, in the right direction, but has not yet articulated to the world a cohesive set of principles and plans conducive to peaceful economic growth.
Second, India must engage in a massive development program, upgrading its social and physical infrastructure in education, healthcare, commerce and industry -- on an unprecedented scale, building schools, hospitals, roads, bridges, ports, power plants and transmission facilities to cater to all sections of the population, not merely the urban centers.
The capital and resources needed to do this are available right now, both domestically and from international markets and agencies.
India enjoys a stable currency and strong foreign exchange reserves and a favorable economic growth outlook. The Government of India should immediately put forth a strong case to the international credit rating services (Moody's, Standard & Poor's and Fitch) for an upgrade of its credit ratings. India's current ratings are equivalent to junk bond ratings. In large measure, this is due to the failure on India's part to develop and articulate a convincing long-term political, economic and fiscal plan.
Even with its current sub-optimal credit ratings, India should take advantage of current low interest rates to mobilize long-term capital by launching an organized borrowing program to mobilize $5 billion to $10 billion. Leveraging funds from long-term bonds, India can afford to undertake a massive infrastructure program, putting to productive employment hundreds of millions of Indians immediately.
This opportunity may not last long. Right now, faced with slow growth in Japan, Europe and North America, global companies from the developed world are ready to bring in the necessary capital goods and technology to work with the Indian government and private sector to make an ambitious development program successful.
But, India must act immediately. For, the current confluence of low interest rates and abundant capital may not last if economic growth picks up globally.
Indian officials point, with justifiable pride, to the many infrastructure projects that have been launched in recent years, such as the Golden Quadrangle road project. But, these are a pittance compared to what India needs. What India needs today is the zeal and grit with which the American government and private entrepreneurs built the transcontinental railroad in the nineteenth century. India's plan must be equally ambitious: take the current government's plans and MULTIPLY it by TWENTY, for starters.
If India takes these steps, namely, 1. the articulation of a comprehensive commitment to regional peace, secular governance and readiness for a leadership role in world affairs and 2. an immediate and massive investment in social and physical infrastructure, these will lead to a dynamic virtuous cycle. The results will be a visible decline in social unrest and injustices and a marked jump in healthcare, education, employment and income. These will automatically transform India to what it aspires to be: a progressive, peaceful and prosperous democracy. Nothing can hold back India's advance to become a leading player on the world stage.
All other efforts to 'market' India should be secondary to these fundamental efforts to transform what India is. A sustained internal focus that markedly improves the 'content' of India is the best way to market India. No company can brand or label an incomplete or defective product with success. Product development comes first, long before marketing, including branding, labeling, advertising, pricing and distribution.
A quick look at how Indian high-technology industry achieved global fame and command should convince anyone of the need to focus on the product or service first, before worrying about perceptions. When the first Y2K specialists arrived in the West over five years ago, perceptions of their Cobol-laden thick Indian accents was noticed, of course, but did not really matter. What mattered really was that these technicians succeeded. They worked, often one line of code at a time, and accomplished their mission: they averted the global Y2K meltdown, which was a real fear among experts at that time. Once the millennium turned over without mishap, when these erstwhile mainframe geeks plugged themselves into broadband and satellites, and transmorphed themselves into online gurus, 'marketing' them was easy: they are the best and the least expensive and, in some trades, they are the only game in town.
This is not to understate the role of marketing. But, the priority and emphasis should first be to develop national capabilities to deliver. Marketing can follow.
Marketing sans manipulations
A coterie of Indians is now trying to reinvent India and introduce it to a world that needs no introduction to India. The recent two-part article in Rediff on this subject (Does South Asian Studies Undermine India? and Repositioning India's Brand) by Rajiv Malhotra is an example of this well-meaning group which thinks that India can simply be carved out of the South Asian subcontinent, cast into a globally branded product, stuffed with remade history, packaged in high-tech clothing and marketed with slogans or spins via the Internet to a gullible world, mostly by the country's emigrants, the NRIs.
I am here to debunk this Machiavellian approach.
It is true that the Indian government and Indians (including many NRIs), who think they are engaged in advancing India's interests, do a very poor job; they have little marketing acumen; they are often tripped up by less relevant historical issues and fail to exploit opportunities to brand and market India and its strengths.
Before one considers how to brand and market India, it is important to be clear about where this responsibility lies. This task, of marketing India and Indians, is best done by the Indian government, by Indian corporations and by the Indian people, not by outsiders, least of all by NRIs.
Marketing India or Indians is not the responsibility of non-resident Indians, NRIs, academic scholars or think tanks, although some of these may occasionally become useful tools in the process.
Part II: India is not a victim
John Laxmi (www.johnlaxmi.com), a former investment banker, is an adjunct faculty member at New York University and is a member of the board of directors of the South Asian Journalists Association. The views presented in this article are his own and are not those of SAJA's or NYU's.