The Indian economy has grown and opened up at a rapid rate in recent years. In Finland interest in the Indian economy – particularly its IT know-how – and research and culture, has clearly increased in the past few years, but knowledge about India is still quite scarce. Sitra began its India Programme at the beginning of the year, the aim being to map out the current situation and probable direction of development of India’s society and economy, as well as the opportunities and risks for Finnish actors.The purpose of the programme is to increase knowledge of India’s economy and culture, as well as create a foundation for a network and international co-operation for Finnish India actors.
At the end of the first phase of the India Programme in spring, Sitra will produce a basic assessment by Vesa-Matti Lahti, Research Manager, who is in charge of the programme, and Elina Grundström, editor. Both have researched and written extensively about globalisation and the world economy.In a way the programme is a continuation of Sitra’s earlier Globalisation and Concrete Effects project, which, as part of the book Globalisaation portinvartijat (Gatekeepers of Globalisation) published in September 2004, was the subject of much debate. In the basic assessment of India under way, the intent is, for example, to describe how various domestic and foreign actors are planning to operate in relation to India. Furthermore, the assessment will appraise what role would be suitable for Sitra in terms of India. The India picture needs to be widened ”The interview and research material for the basic assessment is currently being collated and analysed, and it should be ready in May. More focussed special assessments will be carried out in the second phase of the programme. The starting date for the third and most functional phase is open and should be decided at the latest in March 2006” says Lahti. What are the results so far?
”The India phenomenon, and India as an economic force, is already a fact. In Finland, however, the subject is still quite unknown or the picture of India is one-sided.
The central theme of the study is ’the many Indias’. Growth is divided unevenly between the various regions and social classes of India. There are so many different states, cultures and languages that it is difficult to define India as a country using a general description.”
India will probably be dealt with in the Sitra programme by focusing on the states and sectors of most interest to Finns.
Lahti has recently returned from a visit to India led by the Minister for Foreign Trade and Development, Paula Lehtomäki, on which Lahti gathered material for the basic assessment
“In the IT field, Bangalore is, of course, the town of great interest to Finns. Other important cities include Pune, Gurgaon, Hyderabad, Kochi, Calcutta, Chennai, as well as Delhi and Mumbai.”
Pune, near Mumbai, is an interesting industrial town, which has attracted Scandinavian companies with its IT know-how and modern technology centres. Tampere is already setting up research and business co-operation with Pune. Many are also waiting for Nokia’s decision on the location of its new production unit in India. The need for health and environmental technology
Lahti reckons that the area to bring most synergy benefits in terms of Sitra’s programme activities would be healthcare, because the Indians want to adopt new health care technology, as well as environmental technology, because there is a great need for it in India. Both fields can offer ample opportunities for Finnish companies
Lahti would also like to see a cultural dimension to the programme, in that an awareness of customs and culture creates a foundation for lasting business activities. “Communication problems can be an obstacle to the development of business activities.”
Lahti considers the textile industry to be a particularly interesting industrial sector, since clothing design, as well as design in general, are rising sectors in India, in which Finland and India could co-operate.
One important research focus in the India programme is the development of outsourcing by which work and services are transferred to countries with lower wage levels. India is particularly attractive to the IT sector, which is not without problems from the Finnish standpoint.
”Sitra cannot prevent the development of globalisation, but it can influence the ways in which economic challenges are met. The phenomenon is not as one-sided as is often claimed, at least with regard to India. Indian companies are also investing in Finland and are interested in operating here. For example, Wipro, an Indian IT company, already has many employees in Finland.” India interests the research communities
”India is also deemed attractive elsewhere in the world: research into India is an up-and-coming field in many foreign think tanks,” says Lahti The Sitra programme has already formed contacts, for example, with the Calcutta Department of the Indian Institute of Management, the Delhi Department of the National Council of Applied Economic Research, Demos in Britain, the Brookings Institute in the United States, as well as the British Council.
In future, possible co-operation channels could be, for example, the British Foreign Policy Centre and its international India and Globalisation project. In addition, preliminary plans are underway to found a Nordic Research Center in Calcutta, which Helsinki University of Technology and the University of Tampere have been actively promoting.A wide range of interview material has been gathered in Finland for the basic assessment, which is being used to ascertain which actors in the public sector, in particular, are doing with regard to India.
Domestic contacts have been formed with, for example, ministries, Finpro, the National Technology Agency of Finland (Tekes), the Academy of Finland, the Asia Business Academy at the School of Economics and Business Administration at the University of Tampere, as well as individual Finnish India experts. Other possible co-operation partners could be universities, companies, associations, the Technical Research Centre of Finland VTT and many museums. In April, Lahti will discuss co-operation projects with both the Indian Ambassador to Finland, Om Prakash Gupta, and the future Finnish Ambassador to India, Asko Numminen. Plenty of ideas for further projects
The common ground in the economic history of Finland and India is an interesting factor to Lahti. Both countries had strong ties with the former Soviet Union and since its break-up have rebuilt their Russian business activities with the help of their earlier Russian knowledge. ”The interface in this area could be with Sitra’s Russia programme.”
Lahti has collated many ideas for studies and research projects, as well as practical ideas for the possible continuation of the programme. One interesting project could be ’India through Finnish eyes’. Here the most interesting areas and sectors in India could be studied from the Finnish standpoint.
Delhi and Mumbai, the core areas of textile production, as well as new growth centres, in particular, could be areas to examine. These areas and their cultures could be studied as operational environments for Finnish companies, and a by-product could be, for example, suitable Internet material and exhibitions for use in teaching. The targets for further research could be, for example, the textile sector and the IT and telecommunications sector.
Furthermore, it would be useful to map out possible student and researcher exchanges in many different educational branches, such as bio-informatics and the design sector. On the cultural side, co-operation could take place in the development of open source software and media artist exchanges.
”The economic development of India is now at a particularly interesting stage and offers enormous opportunities for Finns as long as we act in time. However, unfounded ’hype’ is also associated with the India phenomenon and there are also risks involved in operating in the country. Not everyone should go to India to do everything, but it definitely would pay some Finns to go and carry out certain well-planned operations.”
Elina Ranta, Verkkotie Oy