“If you don’t rock the boat, folks, guess who’s going to do it? Your competitors.” —Todd Hockenberry
Today India as a nation-state is looking upwards, there is a positive mood, and the economy is moving Northwards. Stock markets are good and GDP growth is getting a thumbs up from economists and rating organizations across the world. We have a very healthy FOREX reserve. We have done a great job in IT, ITES, like BPO and made billions in the entire service sector vertical.
The service sector is a low-hanging fruit according to me. For instance, to launch a software development venture you do not require acres of land, heavy-duty machines, lots of free running supply of water, raw material, and electricity round the clock to run heavy-duty plants and not a huge labour force or even logistics required for manufacturing and distribution. This much is required to make even ancillary items like pistons or pumps. For an IT company, a few thousand square feet of built-up area, a few computers, bandwidth and some tech geeks and a contract to develop a system can get you going. A similar story is for ITES-skewed companies like BPO or digital marketing.
We missed out on the first and second industrial revolutions. The first one was in Europe between the mid-18th and mid-19th centuries when India was under the British East India Company. The Second Industrial Revolution occurred in the 20th century, but then India was ruled by the British whose only aim was to use India as a raw materials mine and as a market for finished British industrial goods. In fact, a major spin-off of this was to keep Indians in awe of their British rulers who produced goods like cars, weapons, cutlery crockery, and several fancy products including perfumes and binoculars and we got bugged with ‘imported hai na?’ syndrome. We were dying for Hawaii chappals till the late sixties, imported frying pans, toasters, mixers, cutlery, and bone china. An imported shampoo or aftershave lotion was a prized possession. All cars were imported and we were going gaga over Triumph and BSA motorbikes and brands like Jeeps, Plymouth, impalas, Hillman, Vauxhall, MG, some British some American. People went abroad only to shop for ‘imported ‘goods. Then there was a tsunami of Japanese brands like Kawasaki, Honda and Sony. We bought comforters and table mats from Dubai! We were going crazy and we were kept starved- I don’t know why?
After independence, we failed to industrialize, unlike our East Asian counterparts. We chose a Soviet-style planned economy that was protectionist in nature. After Independence, Nehru, our PM for more than 15 years, attempted an industrial revolution via the state. He didn’t trust private entrepreneurs, so he made the state the entrepreneur, and not surprisingly, he failed. Even then the government did not let go of its stranglehold on the industry with fixed Quota Raj fixation. British Raj left after 200 years and on came the self-imposed Quota Raj.
If you want to take just one country on the same timeline as ours, it would be South Korea which was an underdeveloped, agrarian economy that depended heavily on foreign aid. It was governed for almost three decades by a military government with an iron hand yet a pragmatic governance model to improve the economy. South Korean economy grew at an average annual rate of nearly 9 percent, and per capita income increased more than a hundredfold. South Korea was transformed into an industrial powerhouse with a highly skilled labour force. Hyundai and KIA are household names today in India.
We have missed the bus in a big way just because of our wrong policies. Since providing service and making a buck is a lot easier there is hardly any enthusiasm of even neo-entrepreneurs for manufacturing where you got to literally dirty your hands and sweat it out.
I was giving a motivational talk at a big Indian software company in Kolkata almost fifteen years back and asked how many were Computer science engineers in the audience. I was not surprised that hardly 5% were from computer science and the rest were rubber technologists, civil engineers, electrical, mechanical and even chemical and textile engineers. They all were direct beneficiaries of low-hanging apples.
You can’t create an industrial base in a jiffy. You need trained manpower, designers and right-fit managers. No wonder our PM has emphasized on skill India to train artisans who are the backbone of any industry. Industrial Training Institutes (ITI) are a huge infrastructure for training manpower but since there was very little push for manufacturing; these lost their sheen and shine. There are nearly 15,000 ITIs and if utilized properly can become a great input for our industry.
Today, India is growing at 9% and its GDP is about to touch the $3 trillion mark. With strong global tailwinds in the future, India can embrace industrialization and innovation, and finally, enter what American economist Walt Rostov has termed the takeoff stage of national economic growth.
The Second World War created a massive manufacturing Industry
The two world wars also gave a fillip to the Industrialisation of the western powers. Mobilizing the economy for Second World War finally cured the depression in the US which had had its ripple effect across major western countries too. Millions of men and women joined the armed forces, and even larger numbers went to work in well-paying defence jobs especially manufacturing. World War Two affected the world and the United States profoundly; it continues to influence us even today. War was not fought with software, but with solid hardware and manpower where 15 million perished over six year’s war.
Let me give some figures of hardware manufactured before and during the war for you to absorb and appreciate the scale and speed of manufacturing.
Can you believe that a total of 809,693 (more than 8 lakh) aircraft were produced across all the countries including US, Russia and UK? Forty percent were produced by America! Germans produced 119,371 aircraft and America was at number one with 324,750, almost three times that of Hitler’s Germany.
Russians had a total of Tanks and Self Propelled Guns (SPG) 131,700 in number.
US losses- 10,000 tanks/SPGs destroyed or lost.
A glimpse of other vehicles used by Americans in the war are:-
Dodge one tons 382,350 produced by US. Willey jeep WW II total: 647,925 by US. Harley Davidson Motorcycles, the largest recipient was the Soviet Union, which was sold over 30,000 Motorcycles. 572,500 Large Cargo trucks 2.5 tons by US.
Bhag India Bhag
We have no time to waste.
The above gives enough idea of what we missed. We participated in the war and lost our men but used someone else’s equipment and weapons. 87,000 military men from the Indian Army died and 3 million Indian civilians lost their lives.
We need to cover a lot of lost opportunities and time.
Atma Nirbhar Bharat.
Remember the journey of a thousand miles begins with the first step.
‘There is a tide in the affairs of men, which taken at the flood, leads on to fortune. Omitted, all the voyage of their life is bound in shallows and in miseries. On such a full sea are we now afloat. And we must take the current when it serves, or lose our ventures.
William Shakespeare
In an uncertain world, where geopolitics is changing rapidly, supply chains are deliberately being disrupted, these material deficits can become a geopolitical liability for any nation because manufacturers can shut off access to the most basic of goods. Even computer chips can stall another major industry. Manufacturing does not only increase productivity and enhance security, but it also creates jobs and lowers inequality. For these reasons, India has recently embarked on a reindustrialization program.
Silver lining in the dark cloud
We are close to a 3 trillion dollar economy and the fifth largest in the world. We have also started thinking big which is very important. There is a top-down push for industrialisation by the government. Incentives and policy changes are being done at a rapid pace.
The advantage one can take is that since these are already developed technologies we need not reinvent the wheel in most cases. Yes we need to do a lot of In-house R&D which takes time. You can telescope the efforts and do parallel processing to save time but still one needs time.
We need not go to war to go for industrialization like the West had to.
There is a hilarious anecdote that fits this situation.
A Chinese home caught fire and unfortunately, a few pigs were left inside. When the fire was extinguished they found roasted pigs and for the first time tasted roasted pig meat. Next time whenever they wanted a roasted pig, they locked it in the house and set the house on fire!
We need to produce indigenously, but we could take off at a much higher learning curve if we tie up smartly with those who are ahead of the curve. It has to be vertical-specific. As the Railway minister says that Vande Bharat trains are indigenously made and designed at home.
The Vande Bharat Express is an Indian semi-high-speed intercity train which is operated by the Indian Railways only on four prominent routes as of October 2022, one from New Delhi to Shri Mata Vaishno Devi Katra, the second one from New Delhi to Varanasi, third one is from Gandhinagar to Mumbai Central, and the fourth one is from New Delhi to Una. A fifth train on the Chennai- Bengaluru- Mysuru route will be launched next month. It was designed and manufactured by Integral Coach Factory (ICF) at Perambur, Chennai under the Indian government’s Make in India initiative. The unit cost of the first rake was estimated at ₹100 crore, although it is expected to go down with subsequent production. At the original price, it is estimated to be 40% cheaper than a similar train imported from Europe. The train was launched on 15 February 2019.
Defence expo 2022
Prime Minister Narendra Modi inaugurated the country’s biggest-ever Defense Expo showcasing the products of Indian firms in Gujarat’s Gandhinagar on 19 Oct 22. He said the event will strengthen the world’s faith in India’s business skills.
“In the world, there is a monopoly of few countries. But India has made its own place now. Several countries are showing interest in Indian industries,” he said. “Over 1,300 exhibitors, including 100 start-ups, are taking part. There are foreign companies that have investments in Indian companies. In a first, over 450 MoUs and agreements are being signed,” PM Modi added.
“The country will need the contribution of youths to grow in the field of space technology. This opportunity will be like a window to the future for the youth.” He said that in the last 5 years, the nation’s defense exports have increased by 8 times.
“We are supplying defence products to over 75 countries now. Several countries are showing interest in Indian fighter jets. We are supplying defence goods to America, Israel, and many other countries. Brahmos is the best example. Brahmos is favourite among several countries.”
Another feather in the cap
Pune-based defence major Kalyani Group has informed that it would set up the world’s largest artillery manufacturing facility in India, producing one gun per day.
“We are in the process of setting up the world’s largest artillery manufacturing capacity. In three years from now, we will produce one gun per day,” said Baba Kalyani, Chairman of Kalyani Group, the parent of Bharat Forge Limited.
The group currently produces about six guns in 30 days at present. “The capital investment has already been done. Now we need to increase the volumes,” said Kalyani at the DefExpo 2022 at Gandhinagar on Tuesday.
Stating that the group has the technology to produce lighter guns with the same firepower as heavy ones, Kalyani stated that the trend for ‘shoot-and-scoot’ guns is growing globally. “In future Indian armed forces may go for lighter guns such as mounted guns etc. And we have the technology that nobody else has today,” said Kalyani.
The tide has surely turned. Better- we have turned the tide.
Again I get offended by silly remarks of the naysayers. Whenever there is a technical glitch which can be with a toilette flush too at your home, they make noise and are happy as they can find faults with the make in India initiative.
I just ignore them.
“Think big and don’t listen to people who tell you it can’t be done. Life’s too short to think small.”
― Tim Ferriss
