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November 14, 2003
President A P J Abdul Kalam detailed his vision for a developed India, while delivering the inaugural address at the 23rd India International Trade Fair in New Delhi on Friday.
I am delighted to participate in the inauguration of 23rd edition of India International Trade Fair (IITF) 2003.
The Fair provides a platform for a wide range of business opportunities by showcasing technological strength in different sectors of the economy.
I greet the organisers, contributors and participants from various nations of this mega event, which is becoming a reliable barometer of industrial progress.
The theme of the Fair this year is 'Tourism' and 'Promoting Exports by Small and Medium Enterprises.'
When I see the industrialists, entrepreneurs and connected members from different countries, I was thinking what thoughts I can share with you.
I see there are industries from developed countries and also from developing countries.
Therefore, I will be talking to you about the 'Dynamics of Development.'
Law of development
Last two years, I was studying the development patterns and the dynamics of connectivity between nations, especially in trade and business.
As you all know the world has few developed countries and many developing countries. What is the dynamics between them and what connects them?
A developed country have to market its products in a competitive way to different countries to remain a developed country.
The developing country, to get transformed into developed country, they too have to market their products to other countries in a competitive way.
Competitiveness has three dimensions:
- Quality of the product;
- Cost-effectiveness; and
- Supply in time.
Indeed this dynamics of competitiveness in marketing of products by developing and developed countries is called the law of development.
Our technological strength
India is today a developing country and we have a vision to transform India into a developed nation by 2020, using technology as a tool.
With the growing economy and strong internal market, India is destined to make competitive products using technological innovations.
Software and pharma products have shown the lead.
I see the emergence of steel technology, space technology and defence systems going to the international markets in addition to conventional products.
The initiatives taken in solar farming to generate energy, desalination plants to generate drinking water will soon be mission mode programmes offering a large business in India and outside.
I would like to discuss the areas which require attention for transforming India into a developed country.
Transforming the nation into a developed country, five areas in combination have been identified based on India's core competence, natural resources and talented manpower for integrated action to double the growth rate of GDP and realize the Vision of Developed India.
- Agriculture and food processing -- with a target of doubling the present production of food and agricultural products by 2020.
- Agro food processing industry would lead to the prosperity of rural people, food security and speed up the economic growth;
- Infrastructure with reliable and quality electric power including solar farming for all parts of the country, providing urban amenities in rural areas and interlinking of rivers;
- Education and Healthcare: To provide social security and eradication of illiteracy and health for all;
- Information and Communication Technology: This is one of our core competencies and wealth generator. ICT can be used for tele-education, tele-medicine and e-governance to promote education in remote areas, healthcare and also transparency in the administration; and
Critical technologies and strategic industries witnessed the growth in nuclear technology, space technology and defence technology.
These five areas are closely inter-related. Since the theme of the IITF this year is 'Tourism' and 'Small and medium scale industries,' which can be derived from the above areas, I would like to dwell on the role, these sectors can reinforce the national development in particular the rural development.
The vast civilisational heritage of our country -- ranging from the Himalayas to Kanyakumari, Jammu & Kashmir, central India, North-Eastern states, Bihar, western States, the large coastal line, Andaman, Nicobar and Lakshadweep islands -- have a lot to attract the tourists.
In spite of this vast potential, Indian tourism appears to have a very small market share of 0.38 per cent with total arrivals of 2.64 million in the overall global scenario.
This can certainly be increased keeping in mind India's unique positioning as a multi-dimensional country with many tourist attractions.
After my visit to almost all the regions of the country, I have realised that the tourism industry has a tremendous prospect for wealth generation and should operate as a mission with higher targets.
To succeed in this mission tourism has to be developed and promoted as a common endeavour by all concerned government as well as private sector agencies.
A constructive partnership between the private and public sectors has to be established and sustained for growth.
We need to establish innovative products and world-class infrastructure. Thrust is required to be given for inland water navigation, hotels, communication, entertainment and tourist promotion.
The private sector and the state and central government agencies have to work together to create the right environment and act as proactive facilitators and catalysts to promote sustainable tourism.
Tourist management leaders should be trained to create a people friendly approach among the tourists so that he/she becomes a promoter of business through word of mouth and experience sharing.
The places of tourist interest have to be maintained and kept neat and tidy to provide a harmonious atmosphere to the tourists. The people of the region have to have moral strength to welcome the tourist with happiness.
We have to start a 'Welcome Tourist' movement. The Indian-ness has to be packaged from the time the tourist enters into the country till he departs in all aspects of his life during the stay.
Small- and medium-scale industries / enterprises
The small-scale industries sector plays a vital role in the growth of the country. It contributes almost 40 per cent of the gross industrial value added in the Indian economy.
It has been estimated that the turn over to capital employed is approximately 4.62. The small-scale sector has grown rapidly over the years.
The number of small-scale units has increased from an estimated 0.87 million units in the year 1980-81 to over 3 million in the year 2000.
The small-scale industry sector in India creates largest employment opportunities for the Indian populace, next only to agriculture.
The SSI sector plays a major role in India's present export performance. About 45 per cent to 50 per cent of the Indian exports are contributed by the SSI sector.
Direct exports from the SSI sector account for nearly 35 per cent of the total exports.
Besides direct exports, it is estimated that small-scale industrial units contribute around 15 per cent to exports indirectly. This takes place through merchant exporters, trading houses and export houses.
It would surprise many to know that non-traditional products account for more than 95 per cent of the SSI exports.
The product groups where the SSI sector dominates in exports are sports goods, readymade garments, woolen garments and knitwear, plastic products, processed food and leather products.
The strategy for enhancing the exports of goods and services from SSI sector has to be based technology upgradation, value addition techniques, credit support and export marketing zones.
Big industries should ensure timely payments for the products they receive from small scale industries.
Also IITF should find from the international traders where Indian SSIs can fare better in global competition in areas of quality, quantity and schedule.
This promotion will enable the SSI industry to grow much faster towards its target of Rs 5 lakh crore (Rs 5,000 billion) of export performance by the year 2020.
The small- and medium-scale industries need an exclusive umbrella organisation to promote productivity and market their products, including exports.
Providing urban amenities in rural areas
In India there are about six lakh villages and around 70 per cent of our population resides in them. Hence the villages have to play a crucial role in bringing about overall development in the country.
The prosperity of these villages can come only through providing infrastructure, industrial support and employment opportunities. Providing urban amenities in rural areas envisages four types of connectivity: Physical, electronic, knowledge and economic connectivities for sustained development in village clusters.
The government has decided to implement the 'providing urban amenities in rural areas' strategy in 5,000 rural clusters as a model across the country in the next five years.
But the success of this programme is depends on the collaborative efforts and active participation of industries, particularly small scale industries.
Thus providing urban amenities in rural areas provides a seamless connection and movement of molecules (people), atoms (material) and electron (knowledge).
IITF should promote the concept of providing urban amenities in rural areas in the next international trade fair to enable participation of in this programme by the industrial and business community.
India International Trade Fair has to become a window through which we can see the scene of development in different sectors including industry, service and agriculture.
The industry fair raises the hope and aspirations for different industries to field their products in a competitive environment.
With growing economy India is advancing in number of areas with technological innovations. I suggest the Indian industry must develop quality products in time and cost effective manner, for becoming globally competitive and must penetrate into entrenched market.
India has large potential for tourism. I suggest that two to three un-inhabited islands in Andaman, Nicobar and Lakshadweep are to be developed as model tourist destinations with infrastructure, air and sea connectivities.
India with its large manpower needs many challenging missions like this. The driving force for economic development in rural areas is providing urban amenities in rural areas.
The small-scale industrialist should become CEOs and consider each providing urban amenities in rural areas complex as a tremendous business opportunity and provide four types of connectivity.
They should establish the market, run schools, maintain hospitals and above all generate business enterprises generating large employment and producing best products using the core competence of the village for supply to national and international market.
Presently most of the industries are located in urban areas, whereas 700 million people living in rural areas require stable employment.
Dispersion of medium- and small-scale industry in the rural areas can only provide employment to the rural population.
Such dispersion will also be useful to the industry in terms of reduction in cost of manufacture due to availability of raw material at lower overheads and transportation cost.
Trade fair can take a lead role in creating the product market linkages for our village industry.
Transforming India into a developed nation needs wealth generation. Tourism and small- and medium-scale industries should provide the required momentum for the mission.
I wish the India International Trade Fair a great success.