An opportunity for India Inc

Source: The post is based on the article “Connecting the dots to boost the patent ecosystem” published in The Hindu on 14^th September 2022.

Syllabus: GS 3 – changes in industrial policy and their effects on industrial growth.

Relevance: About Indian business activities.

News: At present, businessmen are seen not as wealth creators but as nation builders. Corporate India receives trust, goodwill and confidence from the nation, and it must provide returns to the nation in equal measure.

What is the present state of Indian business activities?

Challenges with corporate: Corporate India focuses on brand power, digital technology, talent pools, scales of operations, and global connectivity. So, Corporate India’s response to the country’s job crisis has been more symbolic than substantial.

Challenges with the Small and Medium Enterprises (SMEs): a) Much of India’s blue-collar employment is generated in SMEs and in its sprawling gig economy. The jobs thus created are sub-optimal with low wages and unstable working conditions, b) Some 45% of India’s manufacturing takes place in garments units, hazardous chemical factories and in unsafe engineering workshops.

What should be done to improve Indian business activities?

1) Learn from Taiwan: Technology and innovation in Taiwan has transformed its low-level economy into a part of a global value chain. Taiwanese SMEs which manufactured cotton shirts, plastic flowers and wooden toys are now producing memory chips and laptops and assembling smartphones.

The Government’s ONDC (Open Network for Digital Commerce) and collaboration from other corporate can also transform Indian SMEs.

2) India’s SME sector needs to modernise itself with the help of digital technology, professional management and better scale of operations.

3) India’s corporate sector can extend a helping hand across the aisle to help the SMEs achieve a transformation. This helping hand should be market-driven and backed by a strong value proposition.

4) Indian food is popular worldwide. However, India has not been able to create a McDonald’s or KFC to bring Indian food to the world stage as a global business in scale and sophistication. So, the corporates has to utilise this space.

5) Across the world, the informal sector is steadily evolving into the formal sector in partnership with the organised industry which is creating innovative business models. For instance, Uber, Ola, etc. This model could now be replicated in other situations. This can create a win-win situation for both corporates and informal sector.

Mahatma Gandhi’s insight that “what we need is not mass production, but production by the masses” must be an enlightened vision of Indian business.