The Leader and the Sign of the Times
For almost 70 years the Commonwealth of Nations, formerly the British Commonwealth, has linked together one third of humanity in a loose confederation of states based on shared history and shared values. While there are many international institutions, such as the World Bank that have specific mandates and a few others, such as the United Nations, that are more universal, the Commonwealth remains unique as a project to foster free trade, democracy, good governance and liberal values across the world’s six inhabited continents. However, the Commonwealth project for decades has fallen short of its potential, due to both a lack of leadership and to the nature of the institution itself, being a free association of equal members with no permanent governance organs. Nevertheless, the economic, political and security potential of the Commonwealth remains considerable at a time when existing geopolitical alliances and institutions generally are in flux with a vacillating America and an increasingly assertive China. With its more informal titular ‘leader’, the UK, currently extricating itself from the European Union and with the UK’s economic and political linkages in a period of global transition, a revitalised Commonwealth will require fresh and proactive leadership if it is to develop into an effective alliance which can actually deliver on a more ambitious agenda for its members. India, the Commonwealth’s largest and arguably most dynamic member, has seen its prospects and standing revitalised under the current government and therefore has an opportunity to step up and be one of the leaders in the transformation of the bloc into a positive force for development, security and prosperity in the world.
The Narendra Modi-led BJP government is close to completing its first term in office, having implemented a series of far-reaching policy reforms during the past three years. During this time the political complexion of the country has radically changed, with control of many state legislatures changing hands (largely to the BJP), and the emergence of new regional leaders who are now driving key states like Maharashtra, Uttar Pradesh and Tamil Nadu, among others. While large metro and city-centric states including Maharashtra, Delhi, Tamil Nadu and Gujarat continue to remain the biggest drivers of growth within the country, several states further behind on the growth trajectory appear to be catching up. In July 2015, the Sign of the Times evaluated a series of growth, risk and scale related metrics across India’s states with a view towards analysing the vast economic and social differences within the country, as well as the implications of these inter- and intra-regional differences for policymakers and investors. This month’s Sign of the Times revisits and updates this original analysis to identify the key changes in the relative position of India’s states and how the country’s landscape has changed, as well as the implications of these changes for investment strategy and policy.
In India, the provision of modern healthcare to 1.3bn people is one of the biggest challenges facing the country today and a priority for its government. Poor access to credible information, physicians and pharmacies, inadequate hospital infrastructure, and the continued prevalence of fundamentally preventable life-threatening diseases represent systemic and significant fundamental challenges in a country where per-capita healthcare spending remains among the lowest even among emerging market economies. Solving these challenges in a timely and capital efficient manner will require developing a series of radical solutions, for which the variable that stands between failure and success is technology.
Over the past two decades, India has emerged as a market leader in providing information technology services to the world and will likely maintain this position in the coming years. More importantly, the coming decades will also see India apply digital technology to solve various issues it is facing, potentially leapfrogging older western models with new low-cost ones that are fit for a mass population, thereby providing its 1.3 billion people with access to an increased quality of life and opportunity without needing to over-build physical infrastructure. While at this stage the domestic market may not be as large or profitable for India’s IT companies as western markets, eventually the scale and scope of opportunities in India will attract not only these companies to return home, but new entrepreneurs and global technology and data players as well to help digitize India. While the developed world struggles to transition from an industrial economy supported by digital, India has the opportunity to jump development curves directly to a digital economy supported by a modernised industrial base. This month’s Sign, the second in our Digital Shock series, examines both the opportunity and imperative for India to leverage emerging digital technologies and data science to address its challenges and transform the country.