India on the Move
India surges ahead: exploring new frontiers of technology and development in tandem with age-old philosophies, traditions, and wisdom 

India is a melange of cultures, religions, races and languages, which manifest themselves in the shape of a vibrant, pluralistic society. India nurtures an ancient civilisation within a modern nation. The country has its roots in the 4500-year-old Indus Valley Civilisation, but its vision is poised for the 21st century: the reason why Indian society strides the frontiers of yesterday and tomorrow with consummate ease. Thus it is quite natural that here modernisation takes place in sync with tradition and has greater accent on evolution than on revolution.  

In ancient times, India taught the world the concept of zero, explored the philosophical essence of Karma, and tapped the latent art in erotica. Today modernisation and tradition co-exist, making India culturally opulent, complex, and magical, yet truly cosmopolitan. Eclectic mixes; like traditional wisdom of Ayurvedic medicine along with state-of-the-art medical centres, or ancient temples and their ruins, alongside modern ‘temples of science’ such as technology institutes; are but common. It is a land that may combine tourism and healthcare, or juxtapose the oldest with the newest cities; none seeming incongruous. It is a land, which has evolved out of a billion people’s shared dream of growth in togetherness. It is a land where traditional wisdom walks hand-in-hand with the pursuit of excellence.

Succinctly put, India of the 21st century is as much about Khajuraho and Konark temples, and the Ajanta--Ellora caves, as it is of its IITs (Indian Institute of Technology) and AIIMS (All India Institute of Medical Sciences); it is as much about Rig Veda hymns as it is of Indipop chartbusters; it is as much about inner introspection as it is of the quest for material prosperity.

Today, India, the second most populous country with its one billion plus population, is galloping towards progress and prosperity, imbued with a positive sense of opportunity, self-confidence and ambition. With economic development being the focal point of this progress, India is really on the move... 


A vibrant economy 

India is enjoying a stable political and macro-economic environment, characterised by forward-looking policies. Based on this edifice, the Indian economy is experiencing a new high, facilitated by a turnaround in the agriculture sector. The Indian economy, presently the fourth largest economy in terms of purchasing power parity in the world, grew by 8.2 percent during the last fiscal year (2004-05), making India one of the fastest growing economies. India’s increased global competitiveness can be attributed to the continuing progressive economic reforms, which began in 1991. The reforms helped the educated, skilled Indian workforce to engineer a remarkable change in the sectoral composition of Gross Domestic Product (GDP). Services, now, account for almost half of India’s GDP. No wonder, with such impressive figures, India is equipped to gallop in the fast lane. The second generation of economic reforms is expected to accelerate now with new policy initiatives, which will fuel even higher growth.

We are witnessing an unprecedented phenomenon of Indian companies not only going global, but also acquiring and merging with companies all over the world. A large number of Indian companies have an impressive presence in the global corporate scenario. Companies such as Tata Tea, Reliance, Ranbaxy, Hindalco, Sterlite, and Sundaram Fasteners are already well entrenched in world markets, with many more waiting in the wings. Especially in the arena of computer software, the skilled human resource of conglomerates, such as Infosys, Wipro and TCS, have made their presence felt in the Silicon Valley.  

The ongoing expansion and modernisation in the Indian manufacturing sector is fuelling demand for capital goods and technology. It is evident that to sustain and accelerate higher economic growth rate in the country, India urgently needs to build, upgrade and modernise its infrastructure. Consequently, apart from augmenting public sector investment into infrastructure, the Government of India has introduced a series of reforms to attract private sector participation and foreign direct investment. Here it deserves a mention that India figures among the ten most attractive destinations for foreign investment. The net aggregate foreign investment inflow rose to US$4.5 billion during the last year.

There is ample reason for India’s viability as a destination for foreign investment. A section of Indians, now, have much more disposable income than before, which is again an indication of the economy’s prosperity in recent times; and this has encouraged MNCs to invest in India. The result? All of a sudden we are flooded with a bewildering array of consumer goods. Now one doesn’t need to shop in overseas for Calvin Klein apparel, Gucci shoes or Heinz beams; they are all available at our doorstep.

India is placed comfortably on the balance of payments front as well. The overall balance of payments is at US$7.2 billion. According to figures released by the Reserve Bank of India, the surplus from invisibles, which include NRI remittances, income from tourism, and earnings from software services, is at US$7.4 billion. India’s foreign exchange reserves crossed the 100 billion US dollar mark, for the first time in December 2003 (currently over $130 billion).

The seeds of progress 

However, despite all the developments in India’s manufacturing sector, agriculture still remains the backbone of the Indian economy—employing a major portion of its labour force. Since independence, India has strived to attain self-sufficiency in food, and India’s agro programmes and policies hold valuable lessons for developing countries with similar aims and aspirations. The success of India’s agricultural industry can be attributed to the strong foundation in research and development. India’s agricultural universities and centres for research and development have made valuable contribution by ushering in the Green and White Revolutions, which have put India firmly on the path of self sufficiency in food. 

Today, India is one of the world’s largest food producers, with an annual production of over 600 million tonnes. Agriculture and its allied sectors registered a growth rate of 9.1 percent in 2003--04. The country ranks first in the world in production of milk, tea and sugarcane. It is the second largest producer of fruits, vegetables, rice, wheat, tobacco and groundnuts and is among the top five producers of coffee, spices, cereals and oilseeds. With negotiations on agriculture in the WTO taking a positive turn, Indian agricultural trade is likely to expand in future. 

The allied sector of food processing is one of the top ranking industries in the country. It ranks fifth in size worldwide, employs an estimated 1.6 million workers, accounts for 14 percent of the total industrial output and 18 percent of the GDP. With India poised to achieve leadership position in meat production and distribution, and 20 percent annual growth rate in fruit processing, one may look forward to an exponential growth in food processing, packaging, as well as in the allied sectors of storage, transport and distribution. 

Marching ahead in science 

India’s science and technology programmes have also made tremendous progress in recent years. Presently, India has over 200 national laboratories, 1350 research and development institutions in the industrial sector, 176 universities, and 11 premier institutions of national and international importance.

Indian universities produce over 230,000 science and technology personnel every year. India has its own, indigenously designed and developed, satellites and defence productions like the light combat aircraft (LCA). India’s science and technology programmes are responsible for substantial achievements in agro-biotech, lasers and electro-optics, IT, genomics and nanotechnology applications. In the science and technology arena, we will focus this article on two ‘sunshine sectors’- information technology and biotechnology that have the potential tremendously boost the economy.

Along the information superhighway - The IT industry and in particular the software industry is one of the fastest growing sectors of the Indian economy. Over a short period of a decade and a half, the country has produced such astonishing success stories, like Infosys, Wipro, Satyam, and TCS, in the field of software technology.  Besides that, India’s enviable human resource base in software development and applications have attracted many multinational giants such as Juniper, Dell, Compaq, and Cerent Tellabs to set up shop here. The impact of the Indian IT industry on the overall global economy and businesses is significant. As Indian businesses themselves start to use India’s IT enabled service skills for their own business processes, the multiplier effect in productivity, efficiency, and output could be dramatic.

The Indian telecommunications industry has also come of age. In January 2005, wireless telephony added 1.8 million subscribers, taking the mobile subscriber base to over 48 million. The total number of phone lines in India exceeded 92.0 million at the end of December last year. Mobile phone charges are now below European levels. The impact and advantages of this for India’s small-business people—and India has literally millions of people who can be classified as small-scale entrepreneurs—who in the past had to endure long waiting periods to get even a landline telephone connection, is tremendous. 

Regarding the outsourcing boom and the burgeoning Business Process Outsourcing (BPO) industry, according to a National Association of Software Services Companies (NASSCOM) survey, India is all set to grab more than 70 percent of the global Call Centre market.  Many fortune 500 companies are evaluating and considering outsourcing their business processes to India. The country has emerged as the ideal ground for mushrooming BPOs in terms of quality, cost, and availability of manpower. And of course, the ambit of BPOs is not limited to call centres only. A number of corporates are now outsourcing their IT operations in India as the preferred destination for IT business solutions. In this era of globalisation of technology, many foreign IT firms are also establishing their R&D laboratories in India. However, it would be simplistic to state that only IT firms are outsourcing their R&D to India as many multinationals, who do research on commercial aspects of conventional science, are also establishing their R&D operations in India. A case in point is GE’s Bangalore laboratory; renowned for its material sciences division. 

Biotechnology: Heralding the next boom after IT - Excellent scientific infrastructure, rich biodiversity, and skilled and low-cost manpower, together make India a force to reckon with in the biotech industry. In fact, India’s highly skilled human resource with considerable fluency in English is believed to be the strongest asset for this knowledge-based industry. Moreover, the government’s commitment to a product patent regime in the near future, in total compliance with the provisions of WTO and TRIPS, has given a further impetus to the growth in this industry. According to industry sources, the biotech sector is likely to grow much faster than the IT sector. If IT has its Narayana Murthy and Azim Premjee, biotech has the potential of springing up many more pleasant surprises, like Kiran Mazumdar Shaw of Biocon—a leading Indian biotechnology company, in years to come.

In the agro-biotech segment, India is all set to increase its market value in nutraceuticals. This market currently stands at US$638 million. The genetically engineered seed market was worth US$250 million in 2001. One can also look forward to rapid strides in the fields of aquaculture, bio-pesticides, bio-fertilisers, and mushroom production.

Without a reference to the pharmaceutical industry, the discussion about India’s potential in biotechnology wouldn’t be complete. Today the country is globally recognised as a producer of low-cost, high-quality bulk drugs and formulations.  Globally, it ranks fourth in terms of volume and thirteenth in terms of value. In recent times, Indian pharmaceutical giants such as Cipla, Ranbaxy, Cadilla, and Dabur India have embarked on a rapid modernisation plan. The Indian government has set up a corpus fund for research and development as an incentive for further growth in this sector. 

Towards a knowledge superpower 

All said and done, India is poised to emerge as one of the important ‘knowledge economies’ of the world in the near future, and in this endeavour, IT and biotechnology are destined to play a crucial role. Like all knowledge economies, India has a good number of top-of-the-line educational institutions that can match the best in the world—IIMs, IITs, XLRI Jamsedhpur, and AIIMS are only some cases in point. India of today is raring ahead on the path of progress, fuelled by knowledge.

By any measure, the Indian market presents lucrative and diverse opportunities. While many of the world’s traditional markets are saturated, India’s infrastructure, transportation, technology, energy, healthcare, and environmental requirements are expected to make trade worth billions of dollars. The stage is set to remake the India of tomorrow.