India is predicted to become the world’s third largest economy in less than three decades. The country has been witness to phenomenal growth in a relatively short span of time. The progress is clearly reflected in hundreds of millions of Indians rising out of abject poverty, and the country’s ever burgeoning middle class. The largest in the world, the Indian middle class is expected to swell by over ten times to nearly 583 million by 2025. The economic surge will also favor the rich; in less than two decades, 23 million Indians will number among the country’s wealthiest citizens – more than the population of Australia today.
The flip-side of this incredible story is that much of this new wealth will be created in urban areas. Over the past two decades, annual real rural income per-household in India has seen a growth rate of just 2.8 per cent. In the next two decades, this growth is predicted to change by a mere one per cent. Simply put, almost 70 per cent of the Indian population will see little if any benefit from India’s rapid GDP growth of seven to eight per cent per year.
Mahatma Gandhi once said “poverty is the worst form of violence”, and I tend to agree. The definition of poverty in India is highly debated, but even by the most conservative estimates, nearly 30 per cent of rural India lives below the poverty line. Many even estimate the figure to be much higher. I believe we have a duty, Government, businesses and citizens alike, to help bring the disenfranchised into the mainstream, and ensure that no one is denied their basic rights.
I, for one, view access to power as a basic human right, and indeed the Government has set laudable targets such as ‘Power for All’ by 2012, which aims at bring light to the homes of 400 million Indians still living in the dark. The challenge here is to maintain the focus on providing for the 47 per cent of the rural populace without electricity, and not just the middle-class settled in the cities. This is a classic example of India’s urban-rural divide, and ensuring an equitable access is critical to India’s growth story.
At the India Economic Summit we had an engaging discussion along these very lines on the (very aptly named) panel on “Empowering the Underpowered: Actions for Energy Infrastructure”. I was honored to share the platform with renowned names like Yvo De Boer, Peter Gartenberg, Rajiv Lall, Ravi Sharma and Tejpreet Singh Chopra.
The discussion revolved around the basic need of a strong regulatory framework required to achieve the country’s stringent targets to provide power to all. While I wholeheartedly support and agree with this, it is important that we don’t disregard the essentiality of the private sector to participate in achieving this goal. So while the Government develops the infrastructure and provides supportive policies, the private sector needs to innovate to make business models more inclusive. I think my company, Suzlon, is a small example on responsible capitalism; a business model that works towards this ideal.
Allow me to explain. In India, our major cities are crowded and the infrastructure is stretched to the limit. But thousands flock to the cities everyday in search of work and this, in turn, increases the pressure on our cities, threatens our rural way of life and breaks up family units. Wind farms, however, typically come up in the remotest parts of the country. So at Suzlon, we train people in rural communities in wind energy. In parallel, we engage in need-based and community-led CSR initiatives; partnering with the community to help meet their basic needs – and ultimately empowering them to create better lives for themselves. This means today they have secure, decent, sustainable livelihoods and don’t add to the migration. This also benefits our customers, as they get great, much localized service.
I am glad that WEF brings together some of the smartest minds in the world to debate and think about solutions to some of the greatest challenges we face today. I certainly believe that shared experiences pave the way to collaborative and definitive actions. The next WEF event will be the annual summit at Davos – I look forward to taking the unique insights of the India chapter to their global platform.
The way I see it - the more challenges, the more opportunities; we just need to look close enough