By Anand G. Mahindra

I wish we could annihilate the word global-isation with one stroke of the 'delete' key. It has been one of the most used and abused words of the pre-Millennium decade, and will, probably, meet the same fate as most overused words: it will begin to mean everything and nothing at the same time.

Why, indeed, do we concern ourselves so much with the destruction of national boundaries, and the prospect of a global village? Is it, simply, a natural human urge to extend geographical freedom and resist the erection of barriers? Will globalisation be welcomed, therefore, with emotions identical to those that greeted the dismantling of the Berlin Wall?

Not quite. I believe that the process of globalisation engages everyone's attention because the majority of us actually have very ambivalent feelings about it. Anthropologists do not believe we have departed too greatly from the behavioural characteristics of our ancestors, and tend to depend on-and derive our identities from-our social groupings. In a volatile, rapidly transforming world, our dependence on our local communities has only increased. Despite global mobility, communalism, sectarianism, and nationalism have not diminished

It is not my contention that the phenomenon of globalisation will be reversed in this millennium. On the contrary, it is inevitable. Our planet is a small place, and every day witnesses the birth of more people who lay claim to finite resources. Most countries acknowledge that only collaborative solutions can answer the challenges posed by a world bursting at the seams.

Still, I believe globalisation will not happen as instantaneously as the demolition of the Berlin Wall. The fact that more people will compete for the same quantum of resources will make people more protective of their possessions, and, so, the voices of the futurists and would-be-collaborators will, initially, be matched by the noise created by those resisting globalisation.

I believe a globalised world will emerge only after long years of arduous labour. The tug-of-war between the advocates of globalisation and the dissidents will be only too evident, and will provide much drama in the early part of this millennium.

The powerful logic of economics suggests that the world of commerce should move rapidly towards globalisation. There are few arguments that can be put forth against the proposition that a seamless world without barriers will send international trade volumes into overdrive. But, given the parallel trend of increasing regionalism, the stage is set for an epic battle. The principal arena for this battle will be the World Trade Organisation (WTO) negotiations. At first, it may appear that there are clear winners and losers, but I believe that, eventually, anyone with even a small stake in international trade will emerge victorious as long as the negotiations result in barriers being lowered by both East and West, and for both goods and services.

This is not to say that developing countries, including India, will plunge into the negotiations without a vigorous defence of their local interests. But even those local interests can, at best, be served only through a temporary reprieve. If local companies complain-and justifiably in most cases-that they need the time to build competencies, governments may oblige but, at some point, governments will realise that openness will, by itself, ensure the survival of the hardiest corporate species and catalyse the growth of locally bred transnationals. An open market will also ensure that new, dynamic, local businesses align themselves to the nation's comparative and competitive advantage instead of basing their business-models on the distorted logic of protectionism.

At first glance, the Indian economy seems vulnerable to any move to integrate with the global economy. It is only reasonable to fear that widespread unemployment and unrest would be the natural corollary of unfettered liberalisation. Happily, however, the experience of the last nine-odd years since the first reforms has showcased the extraordinary resilience and the learning capacity of the Indian corporate sector, both public and private. There has also been an incredible flowering of entrepreneurship in the 1990s. Tomorrow's model tycoon will embrace new technology and leverage new service opportunities to build competitive advantage at Internet-speed. This entrepreneur will favour intangible assets over conventional brick and mortar assets.

The objective will no longer be the ownership of a large proportion of equity, but the creation of wealth through market capitalisation. And corporate governance will continue to occupy centre-stage as it becomes apparent that market capitalisation is umbilically linked to the level of transparency in a company's operations.

This emerging picture of the Indian entrepreneur is not very different from that of successful businessmen in Silicon Valley. Not coincidentally, a large percentage of New Age entrepreneurs in the Valley are of Indian origin. What I am trying to prove with this comparison is that no analysis of the future of the Indian economy will be complete without accounting for the extraordinary quality of our resources. At a conference in London, the chairman of one of the world's most powerful financial firms remarked to me that he was constantly puzzled by one fact: in his own ground, he was surrounded by highly intelligent and resourceful Indians, but the Indian economy itself continued to be in an appalling state.

The solution to this puzzle is staggeringly simple. Indians have never thrived in a constricted and controlled environment, and never will. India will never witness the bizarre experience of common people celebrating the establishment of a military dictatorship, as happened not too far from us recently. If the agenda of the Indian government in the new millennium is simply to let entrepreneurship thrive, India Inc. is well-placed to derive benefits from a globalising world.

Our comparative advantage and our native competencies will lend themselves fluently to New Age technologies, where capital and economies of scale are not key drivers. Our domestic market will slowly, but surely, grow and engage the attention of the world. That increased attention will lead to a greater diplomatic influence which, in turn, will lead to greater investment. Thus, we will, finally, be able to set in motion the virtuous cycle that China did so adeptly in the mid-1980s.

These notions are, perhaps, ambitious, but certainly not beyond the realm of possibility. Should the average Indian, then, be excited at the prospect of globalisation? Unhesitatingly, I say: yes.

Anand G. Mahindra is the CEO of Mahindra & Mahindra

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