Redesign Economy For Success In Post-Covid World: N Chandrasekaran
“Jugaad, tweaks and tricks” will not solve India’s present day problems, says Tata Sons Chairman N Chandrasekaran.
"Jugaad, tweaks and tricks" will not fully solve present day problems and India needs to "rethink and redesign the whole economy" in the post-Covid world, Tata Sons Chairman N Chandrasekaran said on Tuesday.
Without naming China, he said a huge opportunity has presented itself because of the rebalancing of supply chains and India can find success if it works on the infrastructure front.
Chandrasekaran, who heads the over $110 billion Tata Group, founded in 1868, said every pandemic presents a big opportunity of change for the better, and reminded that the Spanish flu pandemic in 1920s saw communities coming together to help each other.
"The challenges ahead are daunting. I do not doubt that. But a century ago, a political revolution emerged from the ashes of a devastating pandemic. The lesson from a century ago is this -- the worst crisis contains within it an opportunity for profound change. And today, if we're brave, we too can imagine a new way of living," he said, delivering the 26th Lalit Doshi Memorial Lecture.
“When we look back to the Asian miracle economies of the past few decades, we are pre-occupied with their strategy of manufacturing-led export growth. What if the miracle was not this strategy, but rather the tremendous investments made in health and education by these economies? The outcome was the ability to capitalise on the world’s demand for manufactured goods.N Chandrasekaran, Chairman, Tata Sons
He said Covid-19 can be a catalyst towards the adoption of digital technologies in health and education and drive change in a way that even venture capital funds have not achieved despite pouring billions in investments.
Chandrasekaran said the "new India" he imagines can be a leader in research and development, science and technology, artificial intelligence and advanced manufacturing, courtesy its human capital, but requires the right investments, starting with the fundamentals.
These investments should be on digitisation efforts and focus on education and healthcare, he said. The benefits can be extended to other sectors like agriculture, financial services, retail and justice system as well.
"...this requires rethinking and redesigning our whole economy, suited to India's specific needs -- not just building digital imitations of what we have now, or what we see in other parts of the world," he emphasised.
Listing out the challenges, he said infrastructure, regulation, bureaucratic overload of the private sector and investments are key areas, adding that special attention needs to be paid to women and small businesses where he pitched for a national digital platform that aggregates and localises business services.
Across the developing world, SMEs account for over a third of private sector employment. In India it’s a different story. Only a little more than 10% of employees are in similar enterprises in India. We have millions of micro-enterprises, but these are neither job-creating, nor resilient. Those who work for them do so informally, with little protections or security. For operations like these, the pandemic was a grave challenge. Many will not survive as they operate outside formal procedures of protection.N Chandrasekaran, Chairman, Tata Sons
Interventions are required on the energy sourcing front as well, he said, pointing out that renewable energy needs attention.
Two of the biggest challenges which India needs to solve right now are jobs and access, he said, making it clear that there are no shortcuts.
"Jugaad, tweaks and tricks can only take us so far. We need to work harder to meet India's great needs," he said.
He also said the last few months have revealed the "biggest blight on our society" -- how some lives exist "precariously", and added Indians are forced to go to spectacular lengths for basic things.
Mentioning aspects like "epic journeys" undertaken by rural folk to see a doctor or how graduates queue up for entry-level jobs, he said, "When an endeavour is successful, the effort it takes is forgotten. The enormous odds, once they are overcome, gradually seem less daunting. But this success is also a sign of deficiency."
"The past months have been some of the most challenging our country has faced. But history shows that with the right spirit, progress can follow a setback," he added.
To a question on the need for smart cities, Chandrasekaran said we need to deliver clean water, uninterrupted power, quality education and accessible healthcare to all, which will help convert all cities into smart ones.
However, he declined to comment on the recently launched National Education Policy, saying he is yet to read the entire document.