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India and the West: Changing Lanes in a Flat World

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In the not-so-distant past, India had the dubious distinction of being noted for just its beggars, the Taj Mahal, and Mother Teresa. A land of snake charmers and rickshaw pullers, they said, largely impoverished and illiterate to boot. The west's perception of India left much to be desired.

The fact that this land of a billion was – for centuries mind you – until a few decades ago under the mis-rule of the west is easily and conveniently forgotten. India, for her part, has not done much better herself. Post-liberation from its colonial wrongdoers, corruption, religious strife, and war marred the first few decades. A slow but steady progress ensued thereafter till the early nineties.

During this era India's perception of the west was equally warped and jaundiced as well. The fear of the colonizers still haunted it. It was both an excuse as well as a means for political mileage. Bash the west. The change of heart that the erstwhile colonizers claimed to have were treated with skepticism and mistrust. Claims of India's ethnic culture and traditions being more respectable than the hippie west were many. "Who needs the west?" went their rhetoric. It still sounds like sour grapes. For a while, it seemed like India was happy to be known for its beggars, the Taj, and Mother Teresa only. Nothing more.

Right around the time of the noble nun's death in the late nineties, the west's notions about India and India's notions about the west changed dramatically. A notable essay on the change is Thomas L.Friedman's upbeat take in The World is Flat. It is a compelling read. His description of the ten world-flatteners, ranging from Columbus's quest to the fall of the Berlin wall to the Internet to open-sourcing to out-sourcing, is a telling tale on how we got here. It is a veiled take on where the world is with regard to free-market and capitalism. Some hail it as an eye-opener while others accuse it of over-sensationalizing the obvious, with Friedman not being able to extricate his emotional self from the narrative. Now that the din of its debates has abated, it looks like a good time to revisit and assess what it means in the current global context, more so in how the warped notions have changed vis-à-vis India and the west.

With the stock markets pushing western businesses into an iterative growth spurt each quarter, companies were forced to seek lower cost alternatives. While staying away from the politics and merits of outsourcing, at a cultural perception level there was a paradigm shift — a shift that states that the once defamed land of snake charmers was indeed capable of much more. With a large majority of its younger generation adept at English and technically trained, it was a gold mine waiting to be discovered. India, on the other hand, had the infrastructure to produce technical talent with very little of it being used. English was abundant. So was the notion that it was just a vestige of the erstwhile British raj. Given the new order, it seemed like a match made in heaven. The perfect storm lined up in the form of the Y2K millennium bug. The west needed help and the land of the snake charmers was more than eager to help and dispel its tag.

India did much more than to merely dispel its tag. It has come a long way since the Y2K era that gave it the much needed exposure. It has steadily garnered a good and respectable share of the low- to medium-cost IT outsourcing pie. Not just stopping there, it has moved up the value chain to be a part of the Internet revolution with Indians contributing significantly to the World Wide Web revolution. Silicon Valley has Indian executives managing key units of very many Fortune 1000s. Though you cannot say the same about India's Olympic medals haul or human rights, India in technology is a force to reckon with.

Until recently, that brainpower mostly went in one direction, from India to the west, benefiting the west more than India. Today, we see a bevy of chip, software, and e-commerce startups in both nations, mobilizing billions in venture capital. The economics are so compelling that some venture capitalists demand Indian R&D be included in business plans at the onset. New age visionary companies like Yahoo, Google, and Microsoft have long heeded this and set up large research centers in India. These are not just relegated to low-end support call centers. It is to engage in top of the line research. It is paying rich dividends. The Indian arms are leading the way in patent filings. Considering Indian cyberspace uses Microsoft, Google, and Yahoo as extensively as the west, it is only appropriate that they be a part of the development. Not withstanding the outsourcing hue and cry, even before IT shone its spotlight on the country, India has been a strong supplier of textiles and precious stones to the west. Indian grey cells are as much behind Hotmail as behind Bose acoustics, or India’s indigenous nuclear, space, and ballistic technologies. A new India has emerged.

If one had a penny for every time Bangalore was mentioned in the west, he would be a millionaire many times over. But what is oft ignored is that China and India represent not just threats to the developed west, but also great opportunities. A low pay, low respect job in the west translates to a high pay, high respect job in the east and at a fraction of the cost. This comparative advantage that mandates an Indian techie in Bangalore will, on the backend, spend his newfound higher-than-the-norm income to buy the products from the west. That is west's comparative advantage, the proverbial ying and yang.

Per Newton, every action has an equal and opposite reaction. The gain in India's IT sector is not without its share of costs. A job loss in Ohio is as much a heartache as is the loss of a few due to mom and pop restaurants closing, courtesy of McDonald's and Burger King. If the Indian low-cost technology has killed a job position in Ohio, high volume, deep pocket corporations of the west are doing very much the same for Indian businesses. The newfound money in Indian IT has found its way into the bottom lines of Nikes, Microsofts, HPs, McDs, Burger Kings, INGs, Fords, and Hollywoods.

Newly sprung department stores that are brightly lit with shiny marble floors and endless aisles of well-stocked, neatly stacked inventory resemble any Macy's or Sears in New York or London. Fast food restaurants, smoothie bars, and coffee shops line the food courts while stylishly dressed young Indian men and women, garbed in a mix of designer western brand names and traditional Indian clothes, wander in and out of stores with shopping bags, while chatting on the newest style cell phone. From the Volvos that take the techies to the HP work desks that run Microsoft, to the Cokes and Pepsis consumed to the Nokias used, to the Jay Leno or Hasslehoff on a Samsung or Sony, it is the west and its businesses flourishing. Given the amount of dependency the east has on the west and vice versa, it looks like the world is flat. Like it or not, this is how business will be transacted in the future, experts opine.

So how does this equation reflect on the largest democracy and the most powerful democracy? The United States dominates the global policies like no country since ancient Rome. It has been at the forefront of global policies, pushing for open markets, open trade, and democracy. All of it much needed. India needs the United States to be its partner for its economic growth and to ensure peaceful co-existence with its non-trustworthy neighbors, an economic partner and a geopolitical deterrent.

India has much to offer the United States and this has not gone unnoticed. Apart from a new, untapped, one billion person strong market for its wares, the largest democracy all of a sudden seems a much better bet than any Islamic fundamentalist-ridden country the United States has courted in the past. Pakistan and Afghanistan are rife with sectarian violence and are more headaches than true allies. Communist China needs to be contained. On the economic front, if critics are to be believed, outsourcing is imminent for the United States to be competitive and India is the outsourcing mecca. As opposed to the baby boomer retirement wave that is hitting the United States, the Indian population's median age is twenty five. Even within the United States, Indians are among the highest earners when segmented ethnically. They are largely peace loving and stay out of trouble. The number of Indian students, 70,000+ in U.S. universities, is one of the largest of any ethnic group. A lot of this is true for India with other western powers as well.

So with the realities on the ground drastically changed, no wonder the warped wrongful perceptions have since straightened out on both sides of the table. Myopic vision which illusioned a blurry horizon just had a much-needed LASIK surgery to see the world as flat. The paradigm shift for India has been to see that the west is not bad. Many were colonialists; they have changed. We have the manpower sans the money; they have money and need manpower. We are spoken of as having potential; we need the west to realize our true potential. The paradigm shift for the west has been to see that India is not worthless and poor. India has illiteracy; but India also has a scientific pool that even the United States taps into, constantly at that. India has beggars; but India is not a nation of them. India has her problems; but India is not a problem.

India needs the west as much as the west needs India.

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