"If we are integrating with the world, we will benefit when the world goes up and suffer when the world goes down"
Montek Singh Ahluwalia, Deputy Chairman, Planning Commission
This is the reason for this post. I read this in one of the business magazine the other day and it shook me up completely. Coming from a man of Mr.Montek’s caliber, I did not have enough reasons to refute the validity of the statement, but then neither could I come to terms with it.
Is it impossible to have globalization and yet be decoupled from crashing global economy?
If the answer is ‘No’, wouldn’t it be better to refer "India is going global" to "India is getting more dependent on the world"?
I surely feel that India of all the countries can expand its reach across the globe and yet be considerably insulated from the global economic downturns like the one we are seeing now."How India can do it" is something I may not be able to answer technically but, here are my 2 cents on it.
To start with, I am all for globalization and the kind of Economic fertility it has provided to India. But yes, I do feel that there is a very basic and critical aspect the Indian Corporate Sector has overlooked.
Exploiting The Domestic Demand
We are a population of over a Billion and unfortunately growing at an alarming rate. Have we exploited the domestic demand completely before we spread our wings to the west or elsewhere?
Why are the most globalized IT/ITES sector crying fowl over the ongoing recession in U.S.? Yes, the developed countries provide enough demand and profitability for us to target the market there, but in the process, isn’t India Inc completely forgetting the under reserved domestic market.
From the IT sector alone, it would be prudent to say that the Indian demand for IT services lags far behind the west. From a personal experience, it is difficult to explain and deal with Indian Clients when it comes to software implementation et all.
But does that mean, that the demand is not there. The demand is indeed there, all that’s missing is obviousness of it. It involves some extra efforts but then if it helps the IT/ITES sector lose even 1% dependency on the west to maintain its profitability, I think it is worth the effort.
This argument holds true not only for the IT/ITES sector alone. There are umpteen sectors which I feel have overlooked the potential in the domestic markets. A major part of this under exploitation is attributed to the Dynamic and Un-predictable Consumer behaviour In India.
This actually is ironic since the foreign markets are going crazy to enter the Indian markets to fulfill the demand-supply gap.The last few years have seen the major players of the west making Inroads into the Indian soil what with the Wal-Mart’s, Docomo, Virgin et all. Makes me think,
Are the foreign players better than us Indians in understanding the Indian Consumer?
I may not have the exact numbers to back my hypothesis, but then that’s why the article is being put up on one here :). We need to get a sense of what are readers thought on this – -the power of crowd sourcing shall win and throw more light on the same. So, take some time out to post your thoughts
[This post has been sent by an anonymous blogger, who is working in the field of Finance and Stock Markets]