The Hindu Business Line : `India must realign strategies to be globally competitive'

INDIA has emerged as a fourth largest nation in terms of purchasing power parity (PPP) and it now needs to realign its strategies and policy framework, since it is on course to becoming third largest by 2025.

The PPP is yet another measure for world economies wherein US topped with $10 trillion, followed by China ($6 trillion), Japan ($3.5 trillion) and India ($2.6 trillion).

However, to sustain this momentum in a rapidly changing global economy a different management perspective is needed, according to Dr Jagdish N. Sheth, Charles H. Kellstadt Professor of Marketing, Gopizueta Business School, Emery University, Georgia.

Speaking on Management 2005— New Paradigms for India's competitiveness, at the 17th annual convention of Association of Indian Management Schools, here, Prof. Sheth said that the global economies are undergoing change calling for re-alignment of approach to taking a larger share of business and trade pie.

It is a reality that China has emerged as a global producer because of its focussed approach and Communist Government. This has been brought about by a notable change where Communist governments like West Bengal are also inviting private players to participate, Dr Sheth said.

"In order to be part of the global competitive world, and to be counted in its capabilities, India has many challenges on hand. This calls for a change in the way Indian companies approach the business. They need to have global outlook at the same time adopt best practices in manufacturing, R&D, improve productivity and while focussing on production qualities," he said.

The Government should plan strategies not based on ideology but on achieving planned results in overall economic growth, he said.

The new paradigm to make it one of the largest global economies would mean focus on encouraging industry consolidation, globalisation of domestic markets based on standardisation and branding, investing in quality and innovation, re-engineer business processes, discourage unorganised sector and encourage automation and integration.

Prof Sheth said India is destined to become a major economic power in the 21st century and its future is dependent on geopolitical realignment of nations and the emergence of Triad Markets or North America, European Union and Japan in the Asean Block.

Elaborating on Triad power, Prof. Sheth said about 75 per cent of the world trade is concentrated among Triad power of nations, which account for 70 per cent of world GDP. The Triad power desperately needs economic growth to sustain employment and political stability.

Summing up the focus towards global competitiveness, Dr Sheth said that the India of current times is mainly domestic-oriented and this mindset needs to change. This means creating a diversified portfolio with a global orientation not as a cheap services provider but as a competitor for premium markets.

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