Bill Gates of India offers 1.2 billion answers

The sheer scale of India’s month long election says it all.

The world’s largest democracy has 714 million registered voters. It will use 1.4 million electronic voting machines and almost 829,000 polling centres to elect 4,617 candidates in 543 constituencies with a staff of about 6.5 million.

They face security threats from the Himalayas to islands in the Bay of Bengal that any country would find daunting.

No wonder markets are on edge. The election’s outcome defies prediction at a time when the global economy is in chaos. It really is anyone’s guess who will next shepherd India through a minefield of global recession, financial contagion and tensions with Pakistan. Not a great scenario for risk averse investors or India’s $1.2 trillion economy.

I’ll leave the guessing game to the bookies and, instead, offer a wishlist for India’s next leaders. The nation’s answer to Bill Gates –– Nandan Nilekani –– is a good place to start.

Nilekani, co-founder of Bangalore-based Infosys Technologies Ltd, is a celebrated entrepreneur. New York Times columnist Thomas Friedman says the Infosys co-chairman inspired Friedman’s 2005 bestseller ‘The World Is Flat’.

Nilekani’s book ‘Imagining India: The Idea of a Renewed Nation’ offers a timely and useful road map. It is, in a nutshell, that India’s future needs to be about more than rapid growth. It must be about bold change, innovation and opportunity in both the public and private spheres.

That may seem obvious in more developed economies, but such thinking has yet to flourish in the halls of power in New Delhi. Given his status as a leader of India’s burgeoning information technology industry, Nilekani has a right to get the government’s attention.

The best case scenario would be for the next leader to boost an economy expanding at its slowest pace in six years. The World Bank expects Indian gross domestic product to grow four percent in 2009, down from an earlier projection of 5.8 percent.

It’s even more important to stop the ‘old economy’ –– poor roads, transportation systems, power grids and poverty –– from holding back the ‘new economy’ of technology startups, gleaming skyscrapers and job creation.

Too much of the old remains. The nation of 1.2 billion must upgrade infrastructure, aim for universal literacy, overcome the ideological battlefields of caste, revamp higher education institutions and push ahead with changes to the labour system. The key is to garner ideas from all levels of society, not just from politicians.

India’s GDP figures look grand to officials in the US, Japan and Europe, where recessions have taken hold. For Asia’s third largest economy, such growth means trouble. The World Bank estimates 76 percent of Indians earn less than $2 a day.

Growth isn’t enough, though. Regulation-happy India is hardly business friendly, ranking well behind China in that regard. India needs to replicate the success of its software and outsourcing industries elsewhere in its vast and creaky economy.

Here, Prime Minister Manmohan Singh, who is running for re-election, and his Indian National Congress party-led coalition have much to answer for.

Lal Krishna Advani and his Bharatiya Janata Party are aiming to unseat Manmohan Singh’s government.

This election is at a decidedly bad time for Singh, a former central bank governor who devised the 1990s market changes propelling India’s rapid growth. His government has made scant progress on what is India’s greatest need: taking on the cumbersome and often corrupt administrative system that keeps economic growth from reaching those who most need it.

For all the backslapping about rising living standards, an appalling percentage of the population is still desperately poor. India has the highest childhood malnutrition rates in the world: 44 percent of children younger than five are underweight, according to the International Food Policy Research Institute.

Atal Bihari Vajpayee knows a thing or two about that. In May 2004, the then prime minister’s election slogan was “India Shining”, and he had strong economic growth and rising stock markets on his side. Hundreds of millions who didn’t feel part of the magic retorted with their own: “We won’t be ignored”. The poor delivered Vajpayee a shocking defeat.

India is growing and is less export dependent than the economies of East Asia.One can’t rule out India even surpassing China’s economy 20 years from now, thanks to an entrepreneurial spirit, young population and sheer determination. For that to happen, the government must make the most of the growth that India does have, not the growth rates it desires.

Granted, India is a daunting place to govern. Singh’s administration has depended on the support of communists at a time when foreign investors want him to champion free-market economics. Talk about a balancing act. Investors are concerned that there will be a political limbo once all the votes are cast. More significantly, the forces weighing against India’s promising future have the ability to dull the nation’s potential in the long term.

The contrast with the US is noteworthy.

There, business executives are now villains and the government is taking a bigger role. India needs exactly the opposite dynamic and it’s heartening to see celebrity innovators such as Nilekani offering sage advice. India’s next leader would be wise to listen.

William Pesek is a Bloomberg News columnist. The opinions expressed are his own.

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM