Being in India after such a long time, made me feel like Urashima Taro. My own hometown has changed beyond recognition so I have been learning new things about my own country every day. The following was written in response to a Japanese person’s question regarding the future of India Japan relationship and how it could develop further. I have highlighted some areas where India is lacking, some of which Japan could help India by investing in such key areas and in the process build a firm foundation for a new kind of Indo-Japan relationship in the 21st century. Things are happening, like the bilateral currency accord for $ 3 billion etc. along with some amount of outsourcing and investment, but still we can call them precious little.
1. Soft power: In Japan, the largest numbers of foreign students are from China and Korea. Indians are a minority. In the US of A the largest number of foreign students are from India, (second is China and third is South Korea), a lot of whom have settled down there in the past, making Indians one of the largest diaspora in the US. They have become top class scientists, politicians and administrators too in the course of time. Settling down in Japan is hard. There are very few Indians who have spent their entire lives in Japan and even fewer Japanese who have done the same in India. This factor is going to determine future relations between the two countries in the long run both economically and politically. Japanese soft power, mainly stemming from manga, anime and funky culture has not had much of an effect on India. Not that we need such soft power! As Professor Roger Pulvers has pointed out on a YouTube video, Japan needs to convert soft power into smart power as soft power does not necessarily show an interest in Japan.
2. The IT boom and mathematics: Here are a few straight facts. Only 0.1 percent of the Indian population is engaged in the IT industry. (This sector alone can not sustain the entire country in any way.) This industry is the biggest boom in India now. Bulk of the work comes from the US, a result of outsourcing, often called back office work! This boom is the result of the university education in India for the past sixty years. Everyone is encouraged to become an engineer. Anyone who is not an engineer is frowned upon. All these techies have joined the Information Technology sector and have made it “big”. How big is open to debate. There has not been any invention from this “shining” sector that has affected the world in any significant way. For example, the innovative way Google, Apple Computers, Facebook etc. have. And if you talk of money, well these companies are still far behind their Western counterparts, their R&D expenditure too low to be of any significance. Also, this has nothing to do with being good at math. Being able to do multiplication tables fast is not the big point. Not many students learn upto 20 X 20 as most Japanese would like to believe. (I don’t think it is a big deal to learn multiplication tables by heart. The Japanese who master about 2000 characters in their script could easily do so if they wanted. And no one talks about how many multiplication tables Einstein could recite do they?!). Also, Japanese people should not forget that Japanese students perform far better in the Mathematics Olympiad than their Indian counterparts. If you still have doubts, catch hold of an Indian at random and ask her/ him to perform mental math.
Those people who are engineers but did not find the opportunity to go to the US by a whisker, have a solid foundation of mathematics due to their engineering background. That is how the IT grew. And when money started flowing in, a lot of Indians in the US started to come back to India because they could get well paid jobs here too. But these days even high school pass outs with diplomas are calling themselves engineers!
Indian companies also bought a bulk of the fibre optic cables from US companies when they over invested themselves out of business. So communications with the US became virtually free. Phone calls to Japan are still very expensive and so are sending goods by post.
3. Many people often compare India-US and India-Japan relationships. They should realize that they have been respectively many more differences than similarities and that the numbers involved are vastly different. For example, in the 60’s about 25,000 Indians settled in the US. They were the cream of Indian brain power and some of them have achieved gigantic feats. In recent times, about 20,000 Indians are living in Japan. But it is unfair to compare them with those Indians who settled in the US in those times. None of them have even come near their feats of excellence. Also, they are not the best Indian brains for the best still go to the UK and US.
4. 68% of Indian software exports are dependent on the US. Japan is still a puny player in India. Wonder why!
5. The current scenario of business is only about cost cutting. Japan does not seem too confident or interested in India’s “brain power” yet.
6. As Suvro Sir pointed out, “I think the Japanese are cautious, but they keep informed. When they feel India is ready, they will come to invest willingly enough. Yelling at them is not likely to make them act quicker!” Unless more and more Japanese people come and work with their Indian counterparts and understand the office politics and regional biases that prevail, only investing money is not going to get the desired results.
7. Mobile phones: In 2004, 70 percent of the people in the world had never heard a dial tone i.e. they had never used a telephone. Just six years back mobile phones were a rare luxury in India that few people could afford. In 2008, there were 10.89 million new users for mobile phones in India. Now everyone has a mobile phone including students and domestic helpers. Mobile phones are much cheaper than landlines. A huge market for mobile phone companies. A few years back Japanese mobile phones did not connect in India. Now you can use any Japanese mobile phone, AU, Softbank, Docomo in most cities in India. Just switch it on and call! But due to radiation from mobile phones the sparrows can not be seen anymore. Docomo has a joint venture with TATA.
8. 200 million people (may be many more!) in India live below the poverty line. How to solve that problem is the biggest challenge. How can Japan help? How many Japanese volunteers and teachers do we find here when compared to those going to Africa or south-east Asia or Latin America?
9. Clean drinking water is scarce in India. Another big challenge of the future. Perhaps one of the biggest challenges! An area where Japanese technology can be of immense help. We Indians have forgotten that in ancient times India had a good water system. Some Japanese are doing research on that. Perhaps they have something to teach us in a new/ modern way?
10. National highways are clean and fast. With high speed Volvo buses running between cities, transportation has become faster and more comfortable. This will help commerce and business. Also, Japanese technology can help find culprits of rash driving and make life better. Traffic accidents are on the rise in India and should already be sufficient cause for worry.
11. India is one of the very few developing nations that have avoided famine. Despite troubled politics and ignorant voters, India has maintained her democratic system without much problem. This is something to think about. But of late, rise in onion prices and food scarcity is alarming. We lack proper storage facilities and modern farming methods. More and more farmers are moving to cities to find jobs as farming is no longer a viable livelihood as rising suicide rates partially indicate.
12. There are only 15 million tax payers in a country (India) that has a population of 1.13 billion people. The rich evade taxes and the poor just can not pay; two extremes of the problem; there must be many more reasons. Contrary to popular belief, tax rates are very high in India. Prices of commodities have risen in recent times but not in proportion to the rise in incomes, thus creating disparity.
13. Medicine: There is no national health insurance scheme in India. Medical expenses are so high that people avoid going to doctors or hospitals or rely on free medical help from friends and relatives who are doctors. Any major surgery is beyond the reach of most people. Public hospitals are insanely dirty. An MRI scan is much more expensive in India than in Japan when an individual goes without insurance coverage (insurance is compulsory in Japan) but there is no surety of getting good results because the machines are often old and over used.
14. Solar power: India has abundant sunshine throughout the country. Solar power could be the next best alternative to electricity not just in remote villages but cities as well. Japanese solar panels are good. Could they be installed in bulk?
Given the above points it leaves Japan ample opportunity to develop strategic technological and insurance/ investment ties with India. Simply being the largest recipient of the Japanese ODA is not enough. John Kenneth Galbraith wrote that being the largest recepient of US aid after independence did not bring any significant improvement in India. As a top class economist and former US ambassador to India, he should have known best.
Relationship between India and Japan has at best been at a cursory level so far. But there is a lot of scope to forge deeper ties of friendship as business partners in the 21st century. Suzuki is the largest selling car in India. But they could soon be overtaken by TATA, Hyundai etc. Japan could provide technological help and create their own market for cheap high quality products in India in medicine, water purifiers, solar power, high speed transport, and telecommunications. 3G mobile phones with Japanese technology could be a hit. Also, management science is a much sought after qualification in recent times. Japan could make business schools that taught and offered diplomas and degrees in Japanese Management. Doing this will also increase the demand for knowing the Japanese language.
These technological ties and investment in cheap high quality medical products will achieve much more than ODA. In modern times giving financial aid to other countries is a type of diplomacy and not out of necessity on either the part of the giver or that of the recipient. Although both India and China receive huge amounts of financial aid from Japan, both India and China give a lot of financial aid to other countries. This is true with many other countries.
Economists and some journalists predicted the economic crisis a decade ago. The party had gone on too long in some countries. In present times with a world that is increasingly becoming flat economically, the financial aid diplomacy is just not enough to forge lasting ties.
Similarly, just trying to balance China politically is not going to bring any long term fruitful results.
India Japan relationship does not have much common cultural background. Talking of Buddhism coming to Japan from India is not going to build stronger ties in the modern world. Technological partnership and more collaborative work will be the most beneficial for both sides. Repeating myself, Japan could help India build plants that would process clean water and could also use the sea water available to India on all sides by building distilleries. We would not have to depend so much on the polluted Ganges then.
P.S. LIC India and Nomura securities Japan have recently joined hands in India.
(mostly written in the latter half of 2009)