Reforms 2020

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    P R E S E N T S

    2020

    Ref rms

    L A S T 2 0 Y E A R S , N E X T 2 0 Y E A R S

    5VISIONPART

    DECEMBER 2011

    TT RAM MOHAN PRASOON JOSHI PERCY S MISTRY MEGHNAD DESAI

    C RAJA MOHAN JANMEJAYA SINHA R GOPALAKRISHNAN

    SURINDER KAPUR G MADHAVAN NAIR K SUBRAMANYARAJESH SHUKLA

    AMITABH KANTAJAY DUA DR PRAHLADAVR FEROSE NILESH SHAH

    CHANDRA BHAN PRASAD SOM MITTAL PAWAN GOENKA RAGHAV BAHL

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    06 INDIAS OWN HARVARDBY TT RAM MOHAN

    10 INDIAN BRAND AMONG TOP 10BY PRASOON JOSHI

    14 MUMBAI AS A GLOBAL FINANCIAL CENTREBY PERCY S MISTRY

    16 CAN WE CATCH UP WITH CHINA?BY MEGHNAD DESAI

    18 WILL INDIA BECOME A PERMANENT UNSCMEMBER?BY C RAJA MOHAN

    20 CAN WE GROW AT 9 PER CENT?BY JANMEJAYA SINHA

    22 INDIAN FIRM AMONG FORTUNE 10BY R GOPALAKRISHNAN

    24 INDIA AS A SMALL-CAR HUBBY SURINDER KAPUR

    26 INDIA AS A SPACE LEADERBY G MADHAVAN NAIR

    28 RISING WITH THE SUNBY K SUBRAMANYA

    30 A MIDDLE-CLASS INDIA

    BY RAJESH SHUKLA

    32 OUR OWN SHANGHAIBY AMITABH KANT

    34 MEGA MANUFACTURERBY AJAY DUA

    36 THE R&D DEFICITBY DR PRAHLADA

    38 AN APPLE FROM INDIABY V R FEROSE

    40 WILL THE SENSEX TOUCH 30,000?BY NILESH SHAH

    42 WILL RESERVATIONS STOP?BY CHANDRA BHAN PRASAD

    44 WILL UID DRIVE ALL TRANSACTIONS?BY SOM MITTAL

    46 AN INDIAN AUTO GIANTBY PAWAN GOENKA

    48 AN INDIAN MEDIA MOGHULBY RAGHAV BAHL

    THE FUTURE OF INDIA

    BY RISHI RAJ

    PAGE 4

    CONTENTS

    Ref rmsL A S T 2 0 Y E A R S , N E X T 2 0 Y E A R S

    2020

    EDITORIAL: Rishi Raj DESIGN: Bivash Barua, Bipin Sharma ILLUSTRATIONS: C R Sasikumar, Shyam Kumar

    ASSOCIATE SPONSORS

    VISION

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    4 REFORMS 2020 | DECEMBER 2011

    20Reforms 20L A S T 2 0 Y E A R S , N E X T 2 0 Y E A R S

    The future

    of India

    According to English poet Lord Tennyson, change is the essence of lifethe

    old order changes yielding place to new. However, all changes are not his-

    toric in the impact they have on society, economy or polity. The economic

    reforms which India adopted in 1991 is one such change that transformed

    the way the country grew in the years ahead, which, in turn, changed the

    global perception of India. The nation that was perceived to be strong on spirituality also

    proved to the world its material prowess. From being a recipient of aid to tackle its pover-

    ty, today India provides aid in times of global catastrophes. Whether it is in terms of

    brands, talent or wealth, Indians can be seen on the global stage.

    It is this change that we have tracked in four parts of the series on 20 years of

    economic reforms. From key reforms to reformers, brands, personalities and trends, all

    have been captured in the four volumes. However, no nation can rest on its laurelsandwho knows it better than we Indians! If 1991 was historic, the growth momentum it

    began needs to be continued. Sure, in the past 20 years, the entire environment has

    changed. From a nation for which growth and prosperity once meant owning a Bajaj

    scooter by the time one retired or, if lucky enough, a second-hand Ambassador car,

    today be it automobile, telecom or FMCG products, India ranks among the fastest-grow-

    ing markets. Once Indias finest technical brains went abroad to work in multinational

    companies; today, those very companies are busy setting up shop in India.

    If 20 years have brought about such radical changes, it is natural to speculate where

    we would be as a nation 20 years on. All discussion today about the growth of our society,

    economy and polity centres on the fact that we started late in the growth story, that the

    decades of 60s, 70s and 80s were lost, and therefore we need time to demonstrate to the

    world what we can achieve given the right environment and policy framework. This is

    what the fifth and the last part of the series aims to bring to you. We have come a longway from the days of Ambassador cars, but will we be able to produce in the next 20 years

    an automobile company that ranks among the top five in the world? The growth of

    mobile telephony in India is the fastest, and all the global biggies are present in India, but

    do we have the ecosystem to produce an equivalent of Apple in the next 20 years? India's

    growth rate of around 8 per cent is only next to Chinas, so will we be able to overtake Chi-

    na? Will we see Sensex touch 30,000? Will Mumbai look like an international financial

    centre? Will the booming Indian media scene be able to produce a media baron like

    Rupert Murdoch?

    These questions have been answered in this volume by writers who are the finest in

    their fieldsfrom economist Lord Meghnad Desai analysing whether India would be able

    to overtake China to Percy Mistry examining whether Mumbai could finally become an

    international financial centre. What is strikingly common in all the analyses is that we

    have the ecosystem and the talentwhat we need is a little speed and the right approach.

    And yes, democracy is an opportunity not a limitation. So read on!

    Rishi Raj

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    6 REFORMS 2020 | DECEMBER 2011

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    ReformsL A S T 2 0 Y E A R S , N E X T 2 0 Y E A R S

    2020

    Those who wail about Indiaseducational institutions notbeing world-class lack an

    appreciation of what it takes toget there T T Ram Mohan

    Indiasown

    Harvard

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    ReformsL A S T 2 0 Y E A R S , N E X T 2 0 Y E A R S

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    REFORMS 2020 | DECEMBER 20118

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    NOand we shouldnt even try. This statementwill, no doubt, come as a big disappointment

    to many who believe that India is on its way to

    becoming a major world power, if it is not

    already one. Let me, therefore, soften the blow

    by saying that I cant see second-rung universities in the US

    attaining the level of Harvard in the next 20 years either; nor,

    for that matter, universities in Europe, China or Japan.

    In higher education, as in defence, the US is the worlds sole

    superpower. Nothing comparable to Americas top universi-

    ties, of which Harvard is one, obtains anywhere in the world.

    These marvels, which are to be found in both the government

    and private sectors, have been created over hundreds of

    years. Harvard itself is 375 years old. They are supported byphilanthropy and government funding on an enormous scale.

    Harvard sits on an endowment of $26 billion. Harvard Busi-

    ness School alone has a corpus of more than $2 billion; com-

    pare that with IIM-As total funds of around $45 million.

    Americas top universities have the resources to fund

    infrastructure and research on a

    scale that others cannot hope to

    match. They can also attract the

    best minds from all over the world,

    whether students who go on to

    become faculty at US universities

    or academics who have made a

    name for themselves elsewhere.Resources and Americas openness

    to immigration are among the fac-

    tors that underpin the success of

    the top American university. But

    they do not fully explain it.

    A third factor is crucial. The top

    American universities have man-

    aged to bring the discipline of the

    financial marketsand their ruth-

    less equation between performance and rewardinto the

    university system. The market for higher education is

    intensely competitive, unlike in India where there is no

    worthwhile competition for, say, the leading IITs and IIMs.Universities, schools and departments are all ranked on per-

    formanceand the ranking is taken seriously.

    Performance of individual faculty too is measured. Confir-

    mation in a tenured position happens on the basis of mea-

    surement of output (with research as the key output) over a

    period of five to seven years.

    Finally, there is a highly developed eco-system for facilitat-

    ing research. This comprises generous grants, quality doctor-

    al students, seminars at which ideas can be presented and cri-

    tiqued before papers are finalised, peer collaboration and

    peer review, etc. This combination of resources, culture, strin-

    gent performance measurement and incentives has resulted

    in something that others can envy but cannot easily emulate.

    Those who wail about Indias educational institutions not

    being world-class lack an appreciation of what it takes to

    get there. We must not aspire to produce the next Harvard:

    setting unrealistic targets is not only demoralising, it willcome in the way of achieving what is achievable. What we

    can and must do is to seek a substantial improvement in the

    performance of our institutions, including those that have

    achieved a certain reputation for excellence.

    In moving towards this modest objective, we face a num-

    ber of choices. Should we focus on universities (that encom-

    pass a range of disciplines) or on institutions that specialise

    in one discipline? Should we aim at a significant improve-

    ment in teaching or at superior teaching as well as research?

    Should we aspire for publications in international journals or

    should we strive for relevance in research?

    To begin with the first question, the Yashpal committee on

    higher education wanted the IITs and IIMs to expand theirscope and b