Why this can be India’s tech century

Shailendra Katyal, Managing Director of Lenovo India, asks whether India can go from being the “Office of the world” to the “Factory of the world”? People are looking for more diversified supply chain options and that’s where Make in India comes in. Edited excerpts from a video interview…

Can India take on the West?

Increasingly what we see and hear is it’s not: Us versus them. It’s more about: Can we solve problems at a global scale? That’s where a lot more appetite is coming in. Earlier it was only India solving for India. But now: Can India also solve for the world? That mindset and confidence is coming through over the last 5-6 years.

We’ve shown that we’re able to leapfrog a lot of technologies. For example, many people never had a landline but suddenly we became the second largest smartphone market in the world in a very short span of time. The fact is that people had never used the device but became very comfortable with the Internet without knowing the language. Innovation, affordability and access are a few things, if you do really well, you can enable the country to do a lot more on the technology front.

We’ve done that in ITES successfully, also solving for scale. Maybe we have not done it in some sectors, but India forever has been the office of the world with all the offshoring drives and the fact that we have very qualified people and engineering talent. Language has not been a barrier too.

Going forward, India from being “Office of the world” can it also become “Factory of the world”? That’s the new topic with Make in India as people are looking for more diversified supply chain options. The government has done a good thing in terms of promoting PLI schemes in many sectors, not just electronics. Many corporates, including us, are encouraged by it.

What about startups?

Startups are a true innovation for new and disruptive ideas coming in. Given that India has some of the biggest problems to solve (we have become the most populous country), if it can be solved for India, it can be replicable in a lot of other markets.

Our India Stack is being looked upon as one of the best in the world in terms of security and deployment. We’ve seen Aadhaar come in, UPI come in and we’re now seeing ecommerce public platforms coming in.

Have we been able to create many breakthrough technologies in India? Not yet, but when we look at EdTech as a problem, or AgriTech as a problem, FinTech as a problem, we are seeing many models which can go global, especially in the emerging markets.

What about training human capital and tech?

We have young people who are eager to learn, and we strive hard to move up in life. People are also becoming more courageous to not just seek employment, but create employment for others, which is the startup culture.

There are some problems in the learning ecosystem. We saw that during Covid. A lot of students were struggling with the digital divide. People have access to a phone, but not a PC or a tablet. The penetration of these devices is very low. People want to learn and contribute positively to the workforce, but if they grow up without a positive device in their hand, it’s a problem.

The New Education Policy is talking about some of these in terms of digitizing the classroom and it has to start there. It can’t be through a consumer retail push. Digital learning has to become embedded into the education system for penetration to go up.

We may have some lag versus other countries. In some countries they are learning coding at the age of five. We are still on a system of learning by rote. How do we quickly move in that direction? The government has spoken about the right steps, in terms of changing the grading system, changing the learning methodologies, but technology adoption is very poor.

There’s been learning loss over Covid. People were either not with a device or a shared device and they could not go to school. We lost human capital for nearly two years. Everyone is trying to get that back, but can us as an industry in technology, the government and schools do a lot more to drive more learning through digital technologies?

I was at a round table with Finance Minister Nirmala Sitharaman and we asked her: What were the top two problems we need to solve? We were all expecting some finance related answer. Interestingly she spoke about two topics. Affordable energy and what we need to do to keep growing at 7-9%. We are not fully ready for that, which is why there’s a lot of push to go green and have more global sources of energy.

The second thing she said was “skilling”. We have a young and ready workforce, but what are we training them for? That may create a bigger problem of unemployment if they are not skilled to participate in the workforce. India will become a $10 trillion economy and a lot of that will be digital and technology forward, but who’s training them at an early age?

Where are we lacking and what more can we do?

The good part is that in a very short span of time, a foundation has got built. Now usage of that is required. India talks about teacher to student shortages. The ratio is very poor. Digital can solve that problem. One teacher instead of teaching a class of 50 can teach a class of 500 at one time.

Similarly there is a lack of healthcare access, but now telemedicine is an established practice. Given the fragmented landholding in India, AgriTech can solve the productivity problem. How do you use the technologies where acceptance is OK, but we need a little more innovation to solve the problems?

But it will happen. Every time you build a stack, you see people coming in. Because there was UPI, there are so many FinTech innovations. That will help with participation in the stock market and insurance. It will lead to more financial inclusion.

On the success of Asian companies like Lenovo…

Broadly if you see all emerging market giants, and we are one of them from China, the success stems from the desire to win big. Lenovo went global with a very large acquisition. That was just appetite. At that time people said that ThinkPad was much bigger as a brand.

Indian companies have also done that. Look at the Tatas. They’ve gone global and acquired many large enterprises. That’s the thing about desire and the confidence that we can compete at the global level is one pattern that we can see.

There is also an emerging market frugality which comes in. If you look at the smaller Asian companies which are trying to become big, they don’t traditionally have the heavy cost structures. Hence the nimbleness and empowerment in decision making. Not having a very padded kind of bureaucratic mechanism is all what makes them more agile.

Where we lack again is more core R&D and core investment when taking a long-term view. That’s where the catch up has to be done.

Looking at the future…

None of us are soothsayers who can predict the future very clearly, but if you look at the pieces of the puzzle coming together, where is most of the demographic dividend? It’s in Asian economies. As long as the younger people are trained well, they have the ecosystem to thrive. It will make their productivity better.

Then there’s the base effect. If you’re at a lower base, when you grow, the percentage will be obviously higher. If you look overall contribution to incremental GDP growth at a world level, you will see the Asian economies adding a lot more. Most of the mature markets in terms of consumption are flattening out.

There is human capital. There is the base effect. There is the consumption effect. It will take a lot to mess this up (which could happen if there’s a Black Swan event). But by and large the stars are aligned for India and the Asian economies to do a lot better.

Catch the complete video interview here...

sunilr@cybermedia.co.in