India needs to stop comparing itself with itself — Smadja

New Delhi, Nov 27: The day after the politicians spoke effusively of how India was growing, and of how well it was doing compared to that ...

New Delhi, Nov 27: The day after the politicians spoke effusively of how India was growing, and of how well it was doing compared to that of the past, it was time for the CII-WEF office-bearers and members to get back at them. Speaker after speaker today, at various sessions, did just that.

WEF managing director Smadja, whose traditional annual speech is a long litany of what’s wrong with India, spoke of how India needs to stop comparing itself with itself. Sure India’s done a lot — Smadja, who Finance Minister Yashwant Sinha had once dismissed as just a `failed journalist’, listed the deep and impressive reforms — but India’s competing with moving targets. Each country, Smadja said, echoing the exact words of ABB chief Percy Barnevik on Sunday, is progressing so fast, that India no longer had the luxury of basking in its rate of progress.

Earlier, kicking off Monday’s debate, CII Chief Economist Omkar Goswami began with a very telling example. He said that if Thailand stood absolutely still — kind of made a policy decision not to grow at all — it would take India 28 years to catch up to reach Thailand’s per capita income levels.

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Goswami added that with the e-economy and globalisation trends converging, the time for calibrated growth was over. Other countries were progressing so fast that India had no option but to massively hike its growth. And the problem with this, Omkar said, was the Digital Divide. Most Indians, such as the 14-year-old Imarti in Jehanabad in Bihar, didn’t know how to read and write, much less to use a computer, or to be able to harness the power of the internet.

As a result of this, Reliance Industries’ managing director Anil Ambani pointed out, India would never be able to meet the kind of growth targets it both needs and is aiming at. By 2020, Ambani said, India will have a working class of 600 million. Now, if they could be educated and trained enough to earn even the lowest global wages — say $10 an hour — that would generate an annual income of 2 trillion dollars, or 50 times our current GDP.

How close are we to this? Well, we spend 3.2 per cent of our GDP on education and other social infrastructure as compared to 3.8 for even developing countries as a whole. Just 0.1 per cent is for higher education, and 0.05 per cent on scientific education. The US spends $208 bn on research every year, or 2.6 per cent of its GDP, we spend just $3 bn or less than 1 per cent of our GDP.