Industrialist Kumar Mangalam Birla’s Vision For The Indian Economy

A lot of hard work has already been done. We are poised for transformative change to see a developed India. On the other side of the paradigm shift, let me share a few factoids with you to set the context. About 10 years ago, we ranked as the 11th largest economy in the world. Today, we are number five and already on course to overtake Japan and become the number four, with a five trillion dollar GDP by next year. A decade ago, this would have seemed completely unimaginable.

The size of India's nominal GDP is expected to nearly double to almost seven trillion by making India the third largest economy in the world, raising its share in global GDP from 3.6 to 4.5, and lifting the per capita income to the upper middle income group. Each of these are nothing short of staggering.

India's income rise has pulled millions out of poverty into a middle class. A new generation of youth who are digitally connected and socially aware will become the engine for household consumption. By 2035, 80% of households will be middle income, up from about 30% today. And in 10 years, the per capita income is expected to rise to about $10,000 US, boosting the quality of life for more than 1.2 billion Indians.

This rise in the number of people with disposable income would be the largest national development effort any democracy anywhere in the world has ever attempted. We witness how structural reforms by the government supported this economic lift. GST created an integrated national market. Introduction of Aadhaar, Jan Dhan, and UPI has vastly increased financial inclusion. We see visible change in the economic landscape of the country.

Urbanization is an indicator of upward mobility. Every minute, 30 people are moving from a village to a city or town in India. But beyond numbers, our core strength is our people. Even as other developed economies face the challenge of an aging population, we are the youngest global workforce. We will have over one billion working-age people by the year 2030, and this is the core to Vikasit Bharat. We stand there at a pivotal juncture where our ambition, our imagination, and performance paves the way for a bold transformative India.

It is time to reimagine India's role as a global force and as one of ideas and solutions. I believe there are four fundamental levers that will be integral to shape this. Let's start with the first. Among them, I believe the first is business. The government to a large extent has done its bit by creating and enabling ecosystem. And it is now for us in business — and this includes India's corporate India, the exciting startup sector, and India's talented MSME businesses — to grow the moment forward.

We have the service hub, we can revive the supply chain of the world. We know India has the intrinsic capacity to create world-class companies. For example, Maruti Suzuki's market cap in India is double that of its parent in Japan. I believe the large Indian companies of tomorrow will emerge from the humble sector of today, and groundswell of entrepreneurial energy is now palpable in our country.

We now know there is need to. Over the last decade, the government increased its capex by fourfold. And now it is time for India Inc. to join the party. Large corporates like our group have undertaken an unprecedented expansion. But this investment further needs to be far more widespread across industry. This brings me to the second pillar for Vikasit Bharat, and that is innovation.

Over the last decade, India has demonstrated to the world the power of innovative digital public goods. The digital edifice that has been painstakingly built in India by the government covers payments, identity, data management, and commerce, and has no parallel in the world. Let us look at two examples. Take the Anna Yojana scheme that transfers food grains for free to the poor. This scheme covers 800 million beneficiaries. This number is greater than the entire population of North America.

Or for that matter, the Awas Yojana project that provides housing for 180 million people. That is like providing housing for a population which is more than the size of the population of South Korea and Thailand combined. And this has been made possible thanks to the digital public infrastructure put in place in the country by the government.

The need of the hour for India to achieve the next level of growth is to leverage technology across sectors — manufacturing, agriculture, healthcare, and education, among others. And now, I believe India's private sector must innovate and harness the power of technology for transformation. Recent PwC analysis suggests up to 40% of India's GDP in 2034 should be derived from new solutions. Hence the need for innovation. This brings me to the third fundamental factor which I think is critical, and that is talent.

India's is, as you know, our natural advantage. In just 75 years of independence, we've broken into the top five global economy. And globally, Indians are either creating or leading some of the world's companies. We have the talent. Many enabling factors are in place. We have strong capital infrastructure in terms of PE and VC investors who are ready to fund new business ideas and have done so in large context here in our country.

We also have a robust higher education system to develop skilled talent. India's workforce is interestingly shifting from agriculture to more productive sectors — productivity and process improvement. The private sector and skilling capacity. When designing of education and vocational courses to develop industry-specific skills, diversity and inclusion also come into play. Labor force participation, particularly the participation of the female labor force, will directly impact India's growth rate.

Also improving the quality of human capital. At the other end of the spectrum, as we migrate to Industry 4.0, adopting AI, ML, IoT, and other such new technologies, we also need concerted effort to leverage our technology talent. For this, industry needs to invest in education, skilling, and training with the very best the world has to offer. For instance, as an example, AI alone has led to the creation of many new jobs — natural language processing specialists, machine learning engineers, smart home designers, AI research scientists, user experience designers, robotics engineers, and cyber security experts.

Such emerging areas and build the capacity to skill our young talent so that they can be ready to work in the industrial environment of tomorrow. And the fourth fundamental factor in my view is the journey towards Vikasit Bharat, which is sustainability. My great grandfather and the patriarch of our group, G.D. Birla, believed in the power of business as a force for good. And this philosophy has guided our action over the generations.

We believe that it is imperative in the world where economic growth and social equity need to advance in sync to make transformation possible. A sustainable, future-ready enterprise creates collective prosperity. In my view, that is a strict imperative for our hope to see many more enterprises emerging. The creation of long-term value not just for shareholders, but for all the stakeholders.

Companies will need to ensure that a shared future can be profitable as well as sustainable. Building for tomorrow means embracing the notion of responsible businesses. For example, it requires transitioning to renewables, minimizing waste, producing responsibly. This will be the gateway to responsible growth and development in the future. And this issue will continue to shape the future of capital, of innovation, of technology, and of our society.

The private sector's role is, I believe, critical in realizing the objectives. Companies have shown ability in adopting sustainability practices, driving environmental responsibility aligned with long-term profitability and value creation.

To summarize, the collective journey towards Vikasit Bharat will be driven, I believe, by three by four key pillars, as I've outlined: business, innovation, talent, and sustainability. Or let's call it BITS, as I can tell you from personal experience as the Chancellor of BITS Pilani, that with an acronym like BITS, you just can't go wrong.

As you'll know, last night an 18-year-old Indian Grandmaster became the youngest ever world chess champion, D. Gukesh. I hope I am getting his name right. His historic feat is emblematic of the rise of New India — a young India, a self-assured India, a path-breaking India. And as this New India unfolds, it promises to define possibility and inspire greatness.

I am confident the Bombay Chamber will continue to play an active role in the journey towards Vikasit Bharat. I would like to convey my very best wishes to all of you, members and office bearers, as we collectively contribute to the creation of a Viksit Bharat.

I request President Miss Pinky Mehta and Vice President to present Mr. Birla a moment token of our appreciation.