In the Innovation Age, India Must Declare Interdependence
I published this article in Harvard Business Review in 2008, but I believe it’s even more relevant today.
On August 15, 1947 India achieved independence from the British Empire and charted its autonomous socioeconomic trajectory.
Jawaharlal Nehru, India’s founding Prime Minister, was a strong believer in the transformational power of science and technology. Eager to cultivate India’s “indigenous” (i.e., 100% local) R&D talent and innovation capabilities, Nehru founded the Indian Institutes of Technology (IITs) in the 50s. Today, IITs produce some of the world’s most inventive engineers and scientists. Similarly, nearly 40 years after its creation, India’s space agency ISRO made Indians proud in April 2008 by launching 10 satellites in one go with an indigenously built rocket. ISRO is even planning a mission to Mars by 2015. Six decades after its inception, India’s autarky-seeking national innovation system has made India scientifically and technologically non-dependent on the West.
But on August 15, 2008, as the country celebrates the 61st anniversary of its birth as an independent nation, I propose that India declares its interdependence — by announcing a new outward-looking innovation agenda that promotes cooperation with the West. Let me explain why.
As India enters the 21st century, global economies are more integrated (external trade, of measly proportion in 1947, now accounts for nearly 35% of India’s GDP) and societies more interwoven. In this globally-interconnected economy, (local) knowledge by itself will no longer confer power to a nation; rather, finding, sharing, and transforming global knowledge into social value will yield power. To emerge as a knowledge superpower in this digital economy, India can’t exclusively depend on local knowledge.
To put it more bluntly, India just can’t keep inventing locally when it comes to massive socio-economic problems such as illiteracy, the energy crunch, wobbly infrastructure, and its dismal healthcare system. Rather, India must learn to broker access to Western technology inventions and transform them into social value. But being interdependent is a two-way street: the Western countries also desperately need India’s creative R&D capabilities to boost their own societies’ welfare.
India needs the West, and the West needs India.
The mutual knowledge dependency between India and the West is a boon for India. Indeed, it can once again self-confidently assume its rightful role as a global knowledge broker to drive innovation synergies between Eastern and Western minds — just as it did in past centuries.
Let me illustrate this symbiotic “give-and-take” knowledge partnership in one crucial innovation domain: energy technologies. The virtually sealed US-India nuclear deal will broker India’s access to cutting-edge nuclear tech inventions from American and even European companies, which could help transform them into civilian applications for energy-strapped India. By the same token, Suzlon, India’s homegrown wind turbine maker, shares its top-notch renewable energy tech and know-know with US and European customers, reeling under the oil crisis. What is good for India can be good for the rest of the world, and vice-versa.
But India and the West must revisit their current trading paradigm to effectively broker and transform each others’ tech inventions into mutual value, be it in the energy domain or others. It’s time for India and the West to practice what Warren Buffet calls “true trade,” i.e., not just exporting products and services but also importing ideas and talent.
For India, this creative new approach to global knowledge exchange and integration hinges on the adherence to a new collaborative market structure made up of what I call Innovation Networks.
Innovation Networks would form a fluid and dynamic ecosystem that interconnects Indian and Western talent, ideas, and capital to satisfy both local and international innovation demand. Instead of the rigid commercial agreements between importers and exporters, Innovation Networks presuppose richer collaboration among four interdependent actors: Inventors (think R&D labs and universities), Transformers (the go-to-market specialists), Brokers (i.e., market-makers and facilitators), and Financiers (e.g., banks, VC firms). In this fluid model, the Indian firms that collaborate with their Western peers will adopt, based on their strategy and depending on the innovation project, the role(s) of Inventor, Transformer, Broker, or Financier.
In my upcoming posts, I will articulate how India can weave itself into these global Innovation Networks by: a) cross-pollinating innovative best practices within the heterogeneous Indian states by instituting and facilitating a nation-wide Innovation Network; b) integrating local R&D and innovation capabilities with the West. In particular, I will discuss how India can effectively forge transnational Innovation Networks with two major Western powers: the US and Europe.
I am curious to read your reactions as to whether India should maintain its autarkical national innovation policy or open it up for win-win collaboration with the West. Meanwhile, let me close this post by quoting Mahatma Gandhi, who brought independence to India: “Interdependence is and ought to be as much the ideal of man as self-sufficiency.”
This article was originally published in Harvard Business Review.