From high technology to the
creative arts, India is rapidly becoming a global player
Forget the India you once knew: It is
gone. Contemplate instead a new, funky, self-confident, resurgent nation,
embracing its role as an emerging Asian superpower. This year, India's growth
rate could outstrip China's and prove more sustainable. From far-off Silicon
Valley to home-base Bangalore, Indians are big in global software development.
In tacky Tinseltown and London's effete Bloomsbury, Indian writers, film stars
and directors are tops. India's core institutions, from an independent judiciary
and a feisty free press to a massive, nuclear but always apolitical
military, are anchored by roots more than half a century old. There is mounting
support for India to become a permanent member of the United Nations Security
Council. The country's scientists plan to launch a moon probe. Then there is the
brightest jewel in India's crown: its firm adherence to democracy. Put all this
together and the surprise is not that India is gatecrashing the elite superpower
league, but that it has not happened earlier.
The changes hit a visitor
right away. In newspapers ads, the tradition of parents seeking spouses for
their offspring continues. But read those classifieds more closely and see the
number that give an e-mail address or even a website for reply. And note all the
telephone chat lines for everything from spicy film gossip to advice on cutting
business deals. Want to celebrate at a spiffy eatery? Then make a reservation,
for while the choice is staggering, the queues can be too. No, this is not Lan
Kwai Fong, Boat Quay or the Ginza. It's Delhi's Pandan Market, Bombay's Colaba
and Bangalore's Gandhi Road. India is on fire and its people know it, from the
dotcom wallah to the man at the top. Says Prime Minister Atal Bihari Vajpayee:
"Together we are building a strong and resurgent nation whose confident march
forward is being keenly watched by the whole world. Let nothing be done that
would slacken the momentum."
What has kicked India's pace up a gear is
its ongoing economic revival. Under Vajpayee, the so-called second-phase market
reforms are completing the unleashing of India's long-shackled economy. It is
happening so fast some believe India may overtake China. It has many advantages,
like facility in English. "Our strength compared to China is that more Indians
know English, the international language," says power minister R.
Kumaramangalam. "So we have a greater reach." That means a lot in this dotcom
age. Says Vinod Mehta, editor of the Delhi-based newsweekly Outlook: "If you
come here as a businessman, you can hire everyone your accountants, lawyers
and so on. If you go to China, you must take the whole lot with
you."
Kumaramangalam says that "the political will to forge ahead with
these faster second-generation reforms is more evident today." It shows in ways
that reach down to all levels of Indian society, but especially the affluent
middle class estimated at over 200 million, or equivalent to the entire
population of Indonesia. "We have perhaps the largest middle class in the world
and it is going to expand rapidly," says law minister Arun Jaitley. As it
does, its children will demand more. Adds Jaitley: "After graduation, every
second fellow is not looking for a job in government, but trying to get into a
higher institution. Many are going to be entrepreneurs."
Of course,
there's no need to go abroad to get a top degree. In this year's Asiaweek
rankings, two of Asia's top ten MBA schools are Indian (Ahmedabad is No. 1 and
Bangalore No. 5), and fully five out of the ten best science and technology
schools are Indian (Bombay, Delhi, Madras, Kanpur and Kharagpur). Recalls
Jaitley: "When I went to school, people would talk of the ten elite schools you
would want to go to. Today, you have a choice in New Delhi alone of 400." Even
Indians who studied overseas are returning. Harvard-schooled Suhel Seth,
vice-chairman of Brand Dotcom, says: "I studied and worked abroad, but I chose
to come back. I believe India is a first-rate country."
Today's new breed
of Indians are embracing a liberating, anything-is-possible atmosphere. Says
Seth: "To succeed in today's India, you don't need a legacy of wealth or
connections." You just need to be good. And that is what a growing number of
Indians are, from CEOs to production-line workers. "After two decades of
decline, manufacturing productivity increased in the 1980s and again in the
1990s," says Isher Judge Ahluwalia, who heads a Delhi think-tank. "So India's
growth is really productivity-led, rather than investment-led." And it is
finally bearing a rich harvest.
Of course, many problems remain. One
concerns the pace of economic reform. New-generation free marketeers like
Jaitley and Seth cross swords with old-guard socialists like aviation minister
Sharad Yadav and Congress legislator Mani Shankar Aiyar. Says Ahluwalia: "It is
a serious problem. There are those two forces, both within the ruling coalition
and the opposition." But Vajpayee, a noted consensus builder, is working deftly
around the face-off.
Another major obstacle is widespread, abject
poverty, especially in the rural areas. According to the U.N. Development Fund,
some 53% of India's population live on less than a dollar a day the World
Bank's definition of dire poverty. That compares with 37% in China. The poorest
Indians are concentrated among landless agricultural laborers, those with
unviably small land holdings, the rural and urban unskilled, the disabled, and
the chronically sick in destitute families. Despite the greater numbers of poor
peasants, urban poverty is causing more concern, says former prime minister V.P.
Singh. "While the rural poor have some space for life and some political
representation, the urban poor are very badly off," he told Asiaweek. The
government expects half of India's population to be living in the cities by
2011. While acknowledging the national consensus on political liberalization,
Singh warns that it could bring widespread unemployment and social
upheaval.
Even so, the positive mood prevails. "India has finally found
its place in the community of nations on the strength of knowledge rather than
size," says Seth. Its knowledge-based competence is on show not only in
information technology (IT) but across a broad spectrum of activities
including the arts. Veteran film actor Om Puri, who starred in this year's
award-winning hit movie East Is East, says: "Indian actors are in demand in the
U.S. and Europe now. But Bombay is still best." And, of course, there are the
writers, from heavyweights Salman Rushdie, Anita Desai and Vikram Seth to newer
lights like Arundhati Roy, Raj Kamal Jha, Jayabrato Chatterjee and this year's
Pulitzer prizewinner Jhumpa Lahiri.
India's expanding middle class, with
its cars, powerbooks, mobile phones and holidays in Phuket and Singapore, is
increasingly unabashed about extolling its achievements and material gains.
Even flaunting success is no longer frowned upon. Says Seth: "I drive a Mercedes
and I am happy doing it." Indians, says Tarun Tejpal, who recently launched a
groundbreaking website (see story page 44), "are increasingly less
inward-looking. Take the Indian Diaspora, it's all over the place. So much of
the U.S. and Canada, as well as Malaysia and Singapore, is India now." Foreign
leaders have noticed. Luminaries like Jiang Zemin and Bill Clinton have recently
visited, and Russia's Vladimir Putin will drop by soon. "They are coming mainly
for economic reasons," says a diplomat in Delhi. "They see the big middle class
and an opportunity to make money in India."
Adding to the optimism is a
perception that the present government, while seeming fragile, is actually quite
solid. Vajpayee, who heads the ruling coalition's dominant Bharatiya Janata
Party (BJP), has cobbled together an alliance of 23 parties, the broadest in
India's history. "It is the first stable government since 1995 and should last a
full five-year term," says a diplomat. "That is a big psychological boost." The
key factor holding Vajpayee's patchwork group together is that it hammered out
an agenda as a team before the election. It also has a safe majority of about 50
seats, contains no capricious mavericks, and none of its members want another
election soon. Moreover, the opposition Congress is in disarray.
Still,
the BJP needs to broaden its base to seek long-term power. With members like the
neo-fascist Shiv Sena group, it has gained a reputation for rightwing
Hindu-chauvinist policies which are viewed as discriminatory, especially by the
nation's 120 million Muslims. (Not a single full minister in Vajpayee's cabinet
is a Muslim.) "That is a wrong perception," protests Shiv Sena minister Suresh
Prabhu. "We are not anti-anybody. We are pro-India and everybody who is a
citizen of India." Notes a diplomat: "Prabhu may belong to a fairly radical
party, but he is very pragmatic and totally pro-development." Indeed, the
energetic former accountant from Maharashtra state exemplifies the new trend of
merit winning out over lineage or wealth. "In certain sectors, yes, you get by
on merit," says Vir Sanghvi, editor of The Hindustan Times. "IT is the prime
example; it's a great leveler. The other is the multinationals coming into the
country so that salaries for professionals have gone up. That has been a huge
boost to middle-class confidence."
Even so, the "old economy"
agriculture, manufacturing, industry, resources cannot be disregarded. "Try
telling the poor that the answer to their problems is the Internet, that it lies
in Microsoft," says Congressman Aiyar. "You'll see the absurdity of the
position. We need the old economy, as well as the new." Also needed is greater
attention to implementation rather than conception. Says Seth: "We are a superb
nation when it comes to thinking and discussing, but perhaps the worst at
implementing."
Underpinning the forward movement is India's commitment to
democracy. That a nation of a billion people, ranging from the super-rich to the
abysmally poor, continues to practice what may be the world's most open system
of government is little short of a miracle. Add on the independence of national
institutions and it is evident that India's civil society has a sturdy moral
backbone. Says minister Kumaramangalam: "Democracy gives a lot of stability to
the economic situation. You are answerable, so you are more careful. But it does
slow the decision-making process." That has been the bane of India's development
in the past. Yet few Indians would sacrifice their freedoms for faster
development. Says Sanghvi: "Indians value things like freedom of speech and
democracy, which some countries in Southeast Asia haven't valued to the same
extent."
Indians also cherish their rich heritage. "Look at the
incredible romantic charm of classical India," says Tejpal. "It may be a mess,
but it's also a dream." Adds minister Jaitley: "India has great resilience. If
you have flooding in one part of the country, India is not paralyzed. We had the
Kargil conflict last year, we had the hijack of an Indian Airlines plane, but
the country became normal within two days. We don't allow ourselves to be bogged
down." Yet many wish the forward momentum were faster. "My only frustration is
that we are capable of much more," says Ahluwalia. "If we would just get our act
together a bit more, we could easily hit 9% to 10% growth this decade." But
commerce and industry minister Murasoli Maran is happy. "We don't believe in
big-bang reforms because we have seen that the countries that did are
suffering," he says. "In Southeast Asia, there was a meltdown."
For all
that, India will continue to be at ease with both East and West. "We've always
believed in interacting with the world," says Aiyar. "We've never gone the Burma
way or the Mao way." Yet India is wary of translating its elevated profile into
a more forceful role in South Asia. And New Delhi, which has traditionally
looked West, is now turning its gaze toward East Asia. "That's changed over the
past five years," says Ahluwalia. "Now, there's much more awareness of the need
to look East." Adds Sanghvi: "We've been concentrating on Singapore. We think
that's where we can make a mark." It is already evident in Calcutta, where the
new Singapore-style Upwan Horticultural Resort, with its conference center,
water sports park, go-kart track, ten-pin bowling, tennis and condominiums, is
taking shape. Its brochure boasts: "Drive 30 kms to Singapore" the distance,
of course, from Calcutta. The idea is to marry Singaporean infrastructure with
Indian openness.
Geopolitically, India's importance is as a bastion of
democracy and a counterbalance to China. "The U.S. has come to understand us
better,' says Kumaramangalam. "We have proved that democracy works in Asia." But
ties with Beijing remain edgy. Yet, the minister adds, "no one is really a
threat to India today. We are growing too fast." Still, it irks Indians that
China often gets better press and more investment. Says Ahluwalia: "The
Chinese always look so much better than they really are because they sweep the
right things under the carpet and say the right things. Whereas India never
looks as good as it is economically, because we are so complex, so open, so
diverse."
Many Indians already think of themselves as second to none in
Asia. Combine that with the economic boom and you have a recipe for the current
mood of euphoria. But it is tinged with doubt. "We've been on the launch pad a
long time; we've now ignited," says Kumaramangalam. "The key is whether we've
got lift-off velocity." There is little likelihood of going back. Says Seth: "We
have traveled too far to tolerate resistance of any kind to the economic reform
process."
Besides, there is a sense that no sector of Indian society
wants to back-pedal. "If you visit villages today, you will find long-distance
telephone booths," says minister Jaitley. "Soon, there will also be a
television, an Internet connection, and they will become communications hubs.
There is no resistance to technology." That is why India is surging ahead. As
Seth notes: "The rapidity of change over the last two years has been far greater
than in the preceding 50 years." Imagine what the next two years will bring, let
alone the following 50. Those who ignore India's rise do so at their own
peril.
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