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APRIL 9, 2006
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Insurance: The Challenge
India is poised to experience major changes in its insurance markets as insurers operate in an increasingly liberalised environment. It means new products, better packaging and improved customer service. Also, public sector companies are expected to maintain their dominant positions in the foreseeable future. A look at the changing scenario.


Trading With
Uncle Sam

The United States is India's largest trading partner. India accounts for just one per cent of us trade. It is believed that India and the United States will double bilateral trade in three years by reducing trade and investment barriers and expand cooperation in agriculture. An analysis of the trading pattern and what lies ahead.
More Net Specials
Business Today,  March 26, 2006
 
 
EVENT
The Shadow Land
India Tomorrow 2006: Bridging the Divide was the theme this year.
New order: Former German Chancellor Gerhard Schroeder delivers the inaugural address as India Today's Editor-in-Chief Aroon Purie pays close attention

The India Today Conclave, an annual assembly of some of the world's leading thinkers and decision makers, has, over the last five years, become a much-awaited fixture in Delhi's events calendar. The fifth edition of the conclave, held on March 10-11 at the Taj Palace, lived up to that billing. Inaugurating "the most anticipated event in India", India Today Editor-in-Chief Aroon Purie lauded the country's scorching pace of growth, but drew the attention of the forum to the "other India-the shadow land" that exists "beyond the multiplexes and the call centres". Two-fifths of the world's poor live in this shadow land. Nearly 300 million Indians subsist on less than $1 (Rs 45) a day. Understandably, the conclave's theme was: "India Tomorrow: Bridging The Divide."

The inaugural address on "Multilateralism in the New Millennium" by former Chancellor of the Federal Republic of Germany Gerhard Schroeder emphasised the role of a rising India in the new world order. "Globalisation and international political questions are the twin challenges confronting the global community," he said, adding that for the former to be successful, every country had to have a stake in the world's economic well-being and developing countries had to be granted access to international markets. "Multilateralism is the only way to deliver the tangible benefits of globalisation to common people all over the world," he said, adding that India has a big role to play here; this necessarily presupposes a greater Indian role in regional issues as well.

"The world needs India to be a moral power as well"
RANIA AL-ABDULLAH
QUEEN OF JORDAN

The next session on "The Centre-State Divide", saw a lively discussion on whether devolutions to the states should be entitlement-driven or performance-based. The Chief Ministers of Rajasthan and Bihar, Vasundhara Raje Scindia and Nitish Kumar, respectively, participated in the discussion, which was moderated by N.K. Singh, former Member of the Planning Commission. While Raje felt that the emphasis on performance should increase steadily, Kumar said the Centre had to necessarily play a larger role in the development of backward states such as his. Kumar also wanted the governor's role to be clearly defined. If the governor can be used as a link between the Centre and the state, then it would be a positive step, he said. "And in this era of coalition governments, there is an urgent need to improve communications between the Centre and the states," they both said.

In the luncheon keynote address, L.K. Advani, Leader of the Opposition in the Lok Sabha, was at his rhetorical best, systematically dwelling on the economic and political gaps prevailing in the Indian society. CNN-IBN Editor-in-Chief Rajdeep Sardesai looked bemused as Advani launched broadsides against both the Congress and its Left allies.

"The Centre must not impose its wishes on the states. The development process must vary from state to state"
NITISH KUMAR

CHIEF MINISTER, BIHAR
"It is in the US' interest to keep Asia divided as it is in the US' interest to see a united Europe"
NAOMI WOLF

AUTHOR
"India's pre-eminence in the world today is based on solid economic and strategic foundations"
PRAFUL PATEL

CIVIL AVIATION
MINISTER
"The wonder of the East is not always spelt as China any longer. India is the country to watch for"
AROON PURIE

EDITOR-IN-CHIEF,
INDIA TODAY
"Investments must be directed to areas that
will allow the
poor to be brought into
the market process"

SITARAM YECHURY

SENIOR CPI(M)
LEADER
"Since the 1990s, we have started realising the virtues of faster growth. And the situation has changed over the last 10 years"
ARUN JAITLEY

SENIOR BJP LEADER

Next up was the session on "Globalisation: Can Free Markets Serve the Masses?" Senior BJP leader Arun Jaitley pointed out that India had wasted decades on its ill-fated socialist experiment; the way out: reallocate resources that remain locked up in unproductive or non-priority assets to sectors that are crying out for funding. Senior CPI(M) leader Sitaram Yechury, expectedly, did not agree and repeated his party's clichéd arguments against greater economic freedom. The spirited discussion was truncated by the long-distance address of noted economist Hernando de Soto, head of Peru's Institute of Liberty and Democracy, who said sound property rights are a prerequisite for building trust in free markets. "Legal structures are essential if free markets are to serve the masses," he said.

"Markets are all about exchange and an element of trust is crucial to the functioning of the markets"
HERNANDO DE SOTO

ECONOMIST
"Businesses can create value for society; they can also change the way you nurture and maintain natural resources"
Y.C. DEVESHWAR

CHAIRMAN, ITC

The next session "Geopolitics: India vs China or India & China" was arguably the most interesting of the day (see "There Are No Communists In China").

The day's last session, on "Development: Government vs NGOs" was chaired by Dileep Ranjekar, CEO, Azim Premji Foundation. Opening the discussion, ITC Chairman Y.C. Deveshwar called for a greater corporate role in poverty alleviation and development programmes. Citing well known ITC initiatives like the e-choupal and the social e-forestry schemes, Deveshwar argued that it was possible for companies to simultaneously help reduce poverty and increase profits by following the "triple bottom line"-another well known ITC initiative-approach. But Sandeep Pandey of the National Alliance of People's Movement was unsparing in his attack on both the Indian corporate sector as well the government-bureaucrat-contractor nexus. "The best way to bridge the divide is to return the ownership of natural resources to the people," he said, adding: "Civil society has to play an assertive role in the implementation of policies."

"There Are No Communists In China"
He first went to south-east Asia as a young soldier, went on to become a business journalist in Hong Kong, followed by a stint in the local venture capital industry, and finally reinvented himself as a China expert. In Delhi recently to speak at the India Today Conclave, James McGregor, Partner at BlackInc China, a China advisory firm, and author of One Billion Customers, spoke to BT on India and China. Excerpts:

As an observer, what do you think is the difference between India and China?

China is stable on the surface, but chaotic underneath, while India is chaotic on the surface, but stable underneath.

One of the speakers at the Conclave today said China is a bubble. Do you agree?

No, I don't. Once the government starts incentivising provincial officials not for the number of factories built, but for improvements in the quality of life of its people, then things will change.

What can India do to catch up with China on FDI?

I think India should tighten its intellectual property rights and then sell it as a strong point to foreign investors.

You've been in China for two decades. How communist is the country really?

I don't think there are any communists in China anymore. I've met one; he was an actor and he used to get paid for acting as Chairman Mao.

Finally, India and China see themselves as rivals. Do you think it's possible for them to cooperate?

I don't see China and India becoming partners. I don't see a natural affinity. But I also don't see why India should be afraid of China. That country is going to be preoccupied with its own problems for quite a few years.

At the dinner keynote session, Queen Rania Al-Abdullah of Jordan stressed the pivotal role that India can play in world politics. "An emerging economic power, yes...but the world needs India to be a moral power as well," she said.

Day 2 began with a session on "Business: Is Innovation the Key to Growth?" (see Assembly Line Innovation). Nelson Mandela, former South African President, in a recorded message, called for a return to Gandhian principles to bring back the dispossessed and the deprived to the mainstream. "The dilemma of India as explored in the Conclave is, in fact, a dilemma of the entire planet," he said.

"Uniform Civil Code can only apply to non-religious civil laws; otherwise it will negate the country's secular nature"
G.M. BANATWALLA

PRESIDENT, IUML
"When many diverse groups learn to live together on the basis of shared values, it becomes a civilisation"
PRAVEEN TOGADIYA

GENERAL SECRETARY, VHP
"Faultlines in communities are due to politics of religious identities"
TEESTA SETALVAD

ACTIVIST AND LAWYER
"Oscars are a just another annual ceremony. I want to win everything; I often keep preparing acceptance speeches"
KARAN JOHAR

FILMMAKER AND CHAT SHOW HOST
"IT is changing the way we work and do business. The gap is between those who have access to IT and those who don't"
DAYANIDHI MARAN

FORMER UNION MINISTER

The post-lunch session on "Communities: Can We Overcome the Faultlines?" saw some provocative volleys between Praveen Togadiya, International General Secretary, Vishwa Hindu Parishad, G.M. Banatwalla, President, Indian Union Muslim League, Teesta Setalvad, lawyer and activist, and Subramaniam Swamy, President, Janata Party. As Togadiya and Banatwalla sparred on the various definitions of secularism, among other things, Setalvad provided the rational counter point. "The faultlines are due to politics of religious identity," she said, adding rather bluntly that the nation's youth hardly identified with the ideologies put forth by her fellow panellists. Swamy blamed international Islamic terrorists and foreign Christian missionaries for creating and deepening the faultlines. This session was chaired by Chandan Mitra, Editor-in-Chief, The Pioneer.

Then followed a discussion on "Society: Can Power Feminism Talk to Power Machismo?" chaired by filmmaker Rohan Sippy. Authors Naomi Wolf and Suketu Mehta disagreed on the forms of redressal of gender inequality, but did concur on the basic premise that a lot more needed to be done to ensure that women got their rightful dues.

Assembly Line Innovation

Is innovation the key to growth?" was the question thrown at Vijay Govindarajan, Professor, Tuck School of Business, and Nandan Nilekani, President, CEO and Managing Director, Infosys Technologies, at the India Today Conclave. Chairing the session was R.A. Mashelkar, Director General, Centre for Scientific and Industrial Research.

Govindarajan argued that innovation was a mandatory pre-condition for growth. "Revolutions don't happen unless somebody questions the status quo," he said. But can there be a scientific way of going about thinking differently? There can, he felt. How? His recommended path: challenge the accepted wisdom; don't strive to follow the best global practices; create the next best practice; manage the present; and forget the past selectively and then create the future. The upshot of all this: "Don't set realistic goals. Set unrealistic goals because performance is a function of expectations and ambition is the starting point for expectations," he said.

Nilekani, too, made a strong case for innovation. Expectedly, perhaps, he cited the success of the Indian information technology (IT) sector. "Top IT companies in the country now boast over Rs 2,00,000 crore in market capitalisation," he said, adding that this wealth creation for shareholders is a direct function of the ability of the companies to innovate and dare to think differently. Nilekani, like Govindarajan, also thinks it is possible to go about innovation in a scientific manner. "One has to think both linearly and laterally. This is essential for reconfiguring, repackaging and introducing fresh discontinuous products and technologies," he said.

"Culture: The Immigrant Experience" was the theme of the next session which was chaired by Vir Sanghvi, Editorial Director, The Hindustan Times. Uber model and actress Saira Mohan, daughter of a French-Irish-Canadian mother and a Punjabi father, spoke on balancing the different pressures that persons with multi-cultural ancestry experience. The other panellist, filmmaker Karan Johar, however, emphasised that it would be unfair and simplistic to segment Indians as residents and non-residents.

At the dinner keynote session, Minister for Communications and it, Dayanidhi Maran stressed on need to bridge the digital divide. "it is changing the way we work, we communicate and the way we do business," he said adding that majority of Indians, however, have sparing access to technology.

Former telecom minister Pramod Mahajan seconded the argument. And, Civil Aviation Minister, Praful Patel also reiterated the need to reduce the infrastructure deficit that is severely impeding India's growth story.

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