Home > Business-Economy, Current Affairs > What India lacks…

What India lacks…

December 27, 2010 Leave a comment Go to comments

…is the spirit of INNOVATION!

As I got back from a late night end-semester party on the NYC Subway Metro along with a classmate, our discussion drifted to best places to settle down in future. And with both of us being originally from India, we went about discussing India… and then drifted further away to the state of Indian economy.

When you talk about India or for that matter China overtaking US as the economic superpower, we just think in terms of just economic growth and future outlook. What we don’t consider is the details… of what made US what it is, and whether India and/or China has that.

In US, a non-descript lad, Mark Zuckerberg, emerges from nowhere with no money but an idea… And fast forward a few years later, Facebook is a revolutionary social network platform generating a multi-billion dollar business.

When we look to India, we don’t see any such entrepreneurism even when we tout ourselves to be the intellectual giant! And coming home, I delved further into this… and looked at the top 20 companies in India and came with the following information:
India's Top 20 Companies - Profiling

.

.

.

.

.

.

.

.

.

.

.

.

.

From the top 20 companies, 12 companies are from the private sector while the remaining 8 are public-sector undertakings. Then, looking into the industries these 12 companies cover, it is interesting to see that:
– 3 companies are from the IT industry (Infosys, TCS, Wipro)
– 3 companies are from the Financial Services industry (ICICI, HDFC Bank, HDFC)
– 4 companies are diversified (Reliance, Adani, ITC, L&T)
– 2 companies are single-industry focused (Bharti, Tata Motors)

Let us now look at the industry dynamics…
IT industry… while there has been a lot of innovation in this industry worldwide, these Indian IT companies have thrived on the cost advantage with no focus on innovation. Their business offerings are pretty standardized.
Financial Services industry… ICICI was definitely a revolution when it started but then, difficult to innovate so much since most advancements have already been tried and tested in the western world.
All the other 6 companies… operate in industries which are heavily reliant on government regulations and/or require a license to operate. No wonder, these big business conglomerates have shifted their energies to managing proxy governments to make sure they retain their stronghold in their respective industries. This has also been brought to public notice through the recent revelations of the political-business nexus in the telecom spectrum allocation scandal.

So, inspite of all the positive metrics forecasting prosperity for India… there is no real wealth creation since it is just these big business groups making money through proxy governments while whatever limited streaks of innovation are there in the Indian spirit are left for the common man to exploit. After all, these regulated industries have the highest returns which appeals to all these money-hungry business honchos.

If nothing is done on this front… it is a shame for companies such as Reliance, Tata, Birla, and Bharti to be riding the Indian growth story with blinders focused on their personal wealth creation and not national wealth creation.

Advertisements
  1. April 17, 2014 at 8:22 pm

    Nike NFL Jerseys: Green Bay Packers Navy home and away jerseys

  1. May 7, 2011 at 9:27 pm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: