Wednesday, June 18, 2008

INDIA – 2020


The article highlights about the problems and prospects about our country and where India would be by 2020. It focused about the Strengths, Weaknesses, Opportunities and Threats of India. It also compared India with China economically and strategically. It has addressed the areas for improving India. It has concluded that Indians should draw lessons from the V formation of birds and should cultivate a few qualities and characteristics to make India a developed nation by 2020 and as a Super Power by 2050.

KEY WORDS: Introduction, SWOT Analysis of India, India Vs China, Areas to Address, Conclusion and Message.


"A developed India by 2020 or even earlier, is not a dream. It need not be a mere vision in the minds of many Indians. It is a mission we can all take up - and succeed." - A P J Abdul Kalam.


Indian civilization is one of the oldest one in the world and we are proud to have cultural richness and India was one of the richest countries in the past. Gradually many changes have taken place and especially with the Portuguese being strong at navigation, they discovered sea routes to various countries and they set up their colonies. Subsequently, French, and finally British set up their colonies all over the world especially after the Industrial revolution. When they departed India, they fully plundered our wealth and left India in a financial mess.

Ever since independence, India saw many upheavals because British left India with many geographical complications and implications. As a result, we had to face wars with Pakistan in 1948, 1965 and 1971. And also India faced the onslaught of Chinese incursion in 1962. All these things led to many social, economic and political problems. Besides, the policy of mixed economy adopted by Pundit Nehru did not pay off. It has been since early nineties the Indian economy began looking up due to the liberalization, privatization and globalization initiated under the leadership of late P.V.Narasimha Rao when he was Prime Minister. All these economic policies and reforms paved the way for rapid growth of our country and the world began taking India seriously. And there is a powerful talk of India emerging as an economic Super Power in the near future. In this context, let us evaluate India’s potential by conducting SWOT Analysis.



“India, with a population of 1.1 billion and a middle class that is larger than the entire population of US, is one of the world’s largest untapped markets” – Satveer Chaudhary, Senator, Minnesota.

Below are the few competitive advantages India has:

• About 16 per cent of the world population lives in India.
• Gateway to international markets in SAARC countries.
• Well developed research and development (R&D) infrastructure.
• Largest resources of untapped natural resources.
• World’s largest democracy.
• Information technology base, in terms of both software and hardware.
• Technical and marketing expertise.
• English as the preferred business language.
• A vibrant capital market with 25 stock exchanges with over 9,000 listed companies.
• The largest supplier of cost-effective technical and non-technical manpower.
• Conducive environment for foreign investments by providing freedom of entry, investments, location, choice of technology and import/exports.
• A well-organized judicial system with a hierarchy of courts.
• Legal protection for intellectual property rights.
• A transparent approach for promoting domestic and foreign investment.
• Declining share of agriculture and allied industries in the GDP. The Economic Survey 2000-01 reveals that the contribution of services sector to the GDP is 40 per cent whereas agriculture and industry contribute 30 per cent.
• Increased investments in the priority and high growth sectors such as software, electronics, food processing, oil and gas, power, electronics and telecommunications, chemicals, electrical equipment, food processing etc.,
• A well organized banking system with a network of 63,000 branches supported by a number of national and state-level financial institutions.
• Offers a large market (middle class population of over 25 to 35 crore with increasing purchasing power).
• Current account convertibility and capital account convertibility for foreign investors.
• Increase in the number of joint ventures or wholly-owned subsidiaries most of the domestic companies consolidated around their area of core competence by typing up with foreign companies to acquire new technologies, management expertise and access to foreign markets.
• Deregulation of interest rates with a greater freedom to banks to assess credit requirements.
• Large and solid infrastructure throughout the country.
• Simplified systems for administration in government departments.
• Special investment and tax incentives for exports and certain sectors such as power, electronics and software.
• Lower tariffs for trade.
• A transparent approach for promoting domestic and foreign investment.
• Significantly large manufacturing capabilities through latest technologies.
• India’s growth is really productivity-led, rather than investment-led.

Now, India has become a nuclear power and is openly exhibiting its intentions to play a key role at the global level. India has its own brand image across the world. It is different and unique in many ways from the rest of the countries in the world. We survived many shocks and setbacks because we have great resilience.


We have disputes with both China and Pakistan which are yet to be resolved. When British left India, they left many of the border disputes unaddressed. And the onus now lies with India to resolve the same. Because of the unresolved long pending border disputes with Pakistan and China most of our energies and efforts are focused in fighting the issues rather than concentrating on the developmental activities. No nation can develop as long as it has problems with its neighbors.

We have beaurocratic bottlenecks and widely prevalent corruption which hinders the progress and development. Lack of capital is another impediment for rapid growth. Unfortunately we have cross border terrorism arising out of unemployment opportunities. The present slowing GDP growth and increasing inflation is matter of grave concern

At times cultural differences, linguistic barriers and regional imbalances among various regions led to infighting among the people and it has become a big stumbling block for progress. Due to the unemployment the youth take to guns thereby giving rise to terrorism. Although we have huge natural resources we have never exploited the same. Lack of opportunities at the domestic front led the skilled precious human resources to leave our country and work abroad thereby leading to Operation Brain Drain.


“You can’t cross the sea merely by standing and staring at the water”, quoted Guru Dev Rabindra Nath Tagore.

India is the second largest populated country in the world and sooner or later will dominate the world in population. We need to convert quantitative human resources into qualitative one. Presently India has the affluent middle class – estimated at over 20 crores or equivalent to the entire population of Indonesia. Research reveals that by 2020 we can have more than 60 per cent of the people in the middle class who will have disposable incomes. And currently India’s consumption rate is 64 per cent of GDP and mostly it is services driven growth. When the consumption levels go up there will be more demand for production and more employment opportunities for us. Along the way, there will be rotation in business and effective and efficient circulation of money. Therefore, there will be opportunities for the faster growth of our economy. Presently many foreign companies have set up their shops due to the rising population and rising disposable incomes. Sensing the opportunities many foreign MNCs are entering India for reaping the economic benefits. It is in this context, Arun Sarin, ex-CEO Vodafone said, “India is on a roll and we are happy to be rolling with India”.

The Indian companies after the introduction of the New Economic Policy shed from the protectionist attitude and started competing with their counterparts. Gradually now we find many Indian MNCs who are in a shopping spree to acquire foreign companies. Tata group acquired many foreign companies be it in steel segment, tea, or chemical or in automobiles. So is the case of Ambani and other business houses in India.

Research reveals that one per cent of India has been crossing the poverty line each year for the last 25 years. And that adds up – 200 million Indians have crossed the poverty line in 25 years. Slowly and steadily many Indians will cross the poverty line and thereby minimizing the percentage of poverty.


Rising crude oil prices, increasing inflation and depreciating rupee is a matter of grave concern. By 2011 the government expects half of India’s population to be living in the cities. The urban poverty is posing a major threat than the rural poverty. The rural poor have some space for life and some how they can survive but the urban poor are the worst hit thereby posing a danger for the society and the economy.

Although Indian economy is growing rapidly it is solely dependent on American economy. If America catches cold India sneezes and that is the plight of India economy today. Presently the Indian economy is doing extremely well but due to American recession the Indian economy is being affected badly. Therefore, it is essential to insulate Indian economy from American economy.

When we glance at internal environment like strengths and weaknesses it is very obvious that strengths outweigh weaknesses and similarly when we look at external environment like opportunities and threats it is crystal clear that opportunities outnumber threats.


“India is a long term bet with stability . . . China is a short term bet with volatility”, said Stefan Krause, Head of Sales and Marketing – BMW AG.

According to the available reports four countries will have bright prospects in the near future which are abbreviated as BRIC – Brazil, Russia, India and China. Both India and China are competing with each other with the latter having better economic edge currently.

Presently India’s working population is approximately 40 crores and that of China’s is 80 crores. But in 2025 the roles will be reversed with India having 80 crores working population while that of China having 40 crores. It is basically because China’s aging population problems and the democratic dividend that we talk about vis-à-vis India. Presently, half of the India’s population is under 20 years of age. Noted global management guru CK Prahlad also envisioned about a strong economic India by 2020.

It was David Crystal who said that the “language of the world at the end of the 19th century was British English; end of 20th century was American English. And he predicts that is will be Indian English at the end of the 21st century”. In the case of China, they have total disadvantage as they don’t know English and they are trying to learn now.

India has a very strong IT base and unfortunately it would grow at 18 per cent which is second to China where the latter would grow at 20 percent, according to the market research firm Forrester and that becomes a great challenge for Indian IT sector.

India has many constraints and it could grow economically with in the democratic framework where as in China there is communist set up. In this context, it can also be said that India has law and China has order.


We have lot of waste land that needs to be allocated to the landless poor so that they can cultivate and earn their livelihood. If every family is allotted with a piece of land and provided with water and power facilities the land gets developed as well as the people make their living and they get engaged in a right direction.

Even after six decades of independence we are not in a position to provide compulsory primary education to all. Efforts may be made to see that children aged between 6 to 14 years are encouraged to go to schools as it eliminates child labor also.

Focus on environmental issues also is equally important. We have to cut carbons and the corporates should be taught to be friendly with ecology and the development should be ecology driven. There is a strong need to resort to afforestation to check ecological imbalance.

Ours is basically an agrarian society and a gradual shift to services is essential. Focusing on infrastructure is the need of the hour. Unless we have strong infrastructure we can not afford to have strong superstructure.

Cultivate the mind set of ‘what we gave to the nation not what nation gave to us’ as it makes us more accountable and responsible. The Indian media is more banking on negative information rather than on positive one in order to ensure their struggle for survival and also to take on their rivals in their segment. It is an unhealthy trend. If they focus on positivism and resort to constructive criticism then they can enlighten the society with right knowledge and information and also they can survive in the long run.

There is need for political reforms to make our democratic process more meaningful and qualitative. Criminalization of politics should be checked. Politicians with criminal records should not be allowed to the legislatures and parliament. Harmonious balance amongst the four pillars of democracy - legislature, executive, judiciary and press is vital. It should be made mandatory that politicians should have basic education for contesting in elections. No person should occupy the higher offices of President and Prime Minister at the centre and Governor and Chief Minister at the states more than two times.

Militarily we need to strengthen our forces by allocating proper budget for defence so that we can be prepared to meet any eventualities as we have threat from both China and Pakistan. Resolving the border disputes with both the countries through diplomatic means is to be accorded priority.


“The best way to predict the future is to create it”, Peter F. Drucker.

As every individual likes to grow, similarly every country likes to grow. It all depends on the mindset of the people. Cultivating a right mindset is the need of the hour. We can learn a few lessons from the V formation of the birds that conveys certain qualities and characteristics.

When birds fly they get into V shape and start their journey. By forming into V shape the birds minimize the drag and maximize the speed thereby enhancing the speed of journey by 71 per cent. During the course of journey they shift their roles and responsibilities. If any one of the birds is hurt or hit by gun shot or falls sick, a few birds will escort the sick bird or the wounded bird to the ground and extend all kind of support to bring the bird to normalcy and then they restart their journey with other group of birds by V formation. If the bird is not able to revive the escorting birds wait till the death of the bird and then they resume their journey. From this V formation of birds we can cultivate the qualities like team spirit, unity of direction and command, sense of belongingness, common goal and objective, fraternity and leadership. All Indians need to cultivate these qualities and characteristics to grow as strong individuals as well as to build a strong India.


“It is the nature of man to rise to greatness if greatness is expected of him”, John Steinbeck.

India is set to become a politically mature, economically vibrant, socially stable, culturally rich and militarily strong country with in a short span if the present trend persists. Our former President, Dr.A.P.J. Abdul Kalam has a vision that by 2020 India will become a developed country.

When small countries can lead why not India with a population of billion plus? Let us not only make managers but also leaders who can motivate and inspire passion among the people. Presently Indians are leaving for overseas for better pastures and the day is not far away where foreigners will come and work in our country.

Let us have fire and passion to make India a great nation. The youth have to be trained, groomed and guided in a proper direction by channelising their energies and efforts in a right perspective. Providing right education and character and laying stress on ethical values can tip the scales in favor a vibrant nation. Let us benchmark with the best in the world. Let us dare to dream big, think big and achieve big. Everyone should note that to aim low is a crime.

I am confident and bullish that India will become a developed nation much before 2020. And also I strongly believe that we will lead the leaders of the developed countries as a Super Power by 2050.

“The dream is not what you see in sleep. Dream is the thing which does not let you sleep”. JAI HIND