Planet India

The Turbulent Rise of the World's Largest Democracy

Mira Kamdar

• Publisher: Simon & Schuster UK
• Year: 2008
• Print ISBN: 9781847390776
• eBook ISBN: 9781847396006
• Topic: Business
• Subtopic: Business General
• Index: Business

India is everywhere - Indian studios produce animated features and special effects for Hollywood movies; Indian software manages our health records; and Indian customer service centres answer our calls. A country of English speakers and a free-market democracy, with the youngest population on Earth, India is not only the fastest growing market for the next new thing, but a source for the technological innovation that will drive the global economy. Yet, India is also in a race against time to bring the benefits of the twenty-first century to the 800 million Indians who live on less than £1 per day, and it must do so in a way that is environmentally sustainable and politically viable on a scale never before achieved. If India succeeds, it will not only save itself, it may save us all. If it fails, we will all suffer. As goes India, so goes the world. Like CHINA, INC, published in 2006 by S&S, PLANET INDIA will capture and catalyze the growing interest in this rising power. With in-depth research, interviews and provocative analysis, Mira Kamdar offers a penetrating view of India and its cultural and economic impact on the world. From Bollywood to the Indian diaspora to India's effect on global politics she reports on the people, companies and places shaping the new India. Kamdar examines the challenges India faces while celebrating India's tremendous vitality and the opportunities this Asian democracy has to shape its own and all of our destinies.

Chapter One

Indians and Americans

THIS EXPERIENCE WILL CHANGE YOUR LIFE,” SAID VICTOR Menezes, a member of the board of directors of the American India Foundation (AIF). A group of recent college graduates and young professionals stood absorbing Menezes’s words. New AIF Service Corps Fellows, they had all made it through a rigorous selection process and were now gathered at a reception in their honor at AIF’s New York headquarters. With wine glasses and small plates of Indian appetizers in hand, some shifted nervously on their feet, others beamed confidently. A few had been to India before. Some were Indian Americans who spoke an Indian language. Many had no connection to India at all, aside from a desire to gain practical experience in areas as diverse as improving livelihoods, women’s health, and primary education.

Connecticut native Margorie Schulman, a petite blond woman in her early twenties, wanted to learn more about microenterprise so she could better serve poor communities in the United States. Vimala Palaniswamy, raised in Augusta, Georgia, was headed to South India. She confessed, “My Tamil’s not fantastic, but I can get along.” The daughter of immigrants from India, Vimala looks unmistakably South Asian but she sounds every bit like the American she is. She told me that a stay in India a couple of years earlier made her realize how American she really was. “They all referred to me as the American girl,” she told me still a little amazed, having been the Indian girl growing up in Georgia. All the fellows I spoke with invariably intended to take their experience in India and apply it in careers they hoped to pursue in banking, medicine, or public service.

I cornered Victor Menezes, dressed in an elegantly understated business suit and a red silk tie, and asked him what, beyond the skills and education these young Americans were taking to India, the value of the program was to AIF. “These young Americans become ambassadors for India and Indian causes when they get back,” he explained. “Look, there is far more in common between India and the United States than there are differences. India is a wonderful laboratory for a lot of issues. It is a microcosm of every important policy question the world faces.”

AIF was awarded a major grant from the Ford Foundation last year to encourage philanthropy in the Indian-American community. The Indian-American trend toward giving back will likely be spurred to new levels by this effort, enhancing a virtuous cycle that benefits both India and the United States.

The United States and India:
People to People

Until this century, the India-U.S. relationship was almost exclusively a people-to-people affair. Business and political relationships were negligible, not the least because for a considerable time the government of India was that of Great Britain. Under British rule, Indians identified with the United States as a fellow British colony and admired it for having achieved what India so desired: independence. Strong philosophical currents flowed back and forth between the two countries, currents that significantly affected the political futures of both nations. Indian philosophy and theology were sources of profound inspiration to the American transcendentalists. Ralph Waldo Emerson and Henry David Thoreau read Indian sacred texts, including the Vishnu Puranas and the Mahabharata. Both wrote poems and essays inspired by their Indian readings.

My parents’ wedding invitation cited the following lines from Walt Whitman’s poem “Passage to India” from his famous 1855 collection Leaves of Grass:

Passage to India!

Lo, soul, seest thou not God’s purpose from the first?

The earth to be spann’d, connected by network,

The races, neighbors, to marry and be given in marriage,

The oceans to be cross’d, the distant brought near,

The lands to be welded together.

Their Indian-American union was unusual in 1957. Quoting Whitman helped ground it in a recognizable American tradition. This did not prevent the dean of women students, however, from summoning my mother to her office to try to dissuade her from making a terrible mistake: while she might not be doing anything illegal in the state of Oregon, she would be breaking antimiscegenation laws in the American South.

Mahatma Gandhi, like thousands of other Indians of his generation, including my own grandfather, read Emerson and Thoreau. Gandhi was inspired by Thoreau’s notion of civil disobedience and integrated it into his political tactics of nonviolent resistance. Gandhi was also haunted early on by a chance encounter, the day after the famous incident when he was thrown out of a whites-only compartment on a train, with “an American negro” as dispossessed as himself in apartheid South Africa. Gandhi and his followers identified the plight of subjugated Indians, especially of untouchables, with that of African-Americans in Jim Crow America.

During the 1920s and 1930s, African-Americans closely followed the progress of Gandhi and India’s freedom movement in such widely read publications as The Crisis. In 1936, Howard Thurman led a Negro Delegation of Friendship to South Asia and met Gandhi. They discussed the similarity of the oppression of India’s untouchables with that of African-Americans. Martin Luther King came to know about Gandhi and his philosophy via Thurman’s Jesus and the Disinherited.¹ In the footage of Martin Luther King delivering his famous “I Have a Dream” speech on the steps of the Lincoln Memorial, the followers flanking him are wearing white Nehru caps. King said of Gandhi’s contribution to his movement, “Christ furnished the spirit and motivation, while Gandhi furnished the method.” ²

Sympathies between the Indian struggle for independence and the African-American struggle for equal rights ran deep. Historically black colleges encouraged Indian students to come to study at their institutions. Writer Marina Budhos told me that her father, an ethnic Indian from Guyana, attended Howard University in the 1950s along with a group of students from India.

On the West Coast, Punjabi Sikhs and other immigrants from India came to Seattle and California’s Central Valley around 1900 to work as laborers in logging and agriculture. Acutely aware of their unprotected status as colonial subjects of Great Britain, they started a revolutionary movement for India’s independence from British rule called the Ghadar movement. The Ghadars were headquartered in San Francisco, where they published a newspaper. These Indian Americans raised money for their homeland’s freedom, organizing a boat (which sank) loaded with guns and ammunition for freedom fighters in India. Other Punjabi immigrants to California saved enough money to buy land and start their own farms. A thriving Punjabi community still exists in and around Yuba City, California. Allowed into the United States as single men, many married Mexican-American women. When their farms were threatened with confiscation under the terms of the 1913 Alien Land Exclusion Act, many put their properties into the names of their wives to save them.³

While the peoples of India and America drew inspiration from each other’s struggles for freedom and social justice, the governments of the two countries pursued a very different tack. After a brief warming following India’s independence in 1947, the United States and India drifted into wary estrangement, each aligned with the other’s archenemy: India with the Soviet Union, and the United States during the Afghan war with Pakistan. Ironically, the Cold War imperative to beat the Soviets opened the doors of the United States to immigration from India. Racing for technological and military dominance, the United States sought to harness the skills of the best and brightest, even if they had to come from Africa and Asia. In 1965, the United States moved to open its borders to highly skilled workers from non-European countries whose immigration had previously been severely limited.

When my father came to the United States in 1949 on a student visa, there were only ten thousand persons of Indian origin in the entire country, the same number as in 1900. After 1965, Indian engineers, doctors, scientists, and other college-educated individuals or people seeking an education in these fields began arriving in increasingly large numbers. The Indian engineering student stereotype was born (my own father, though he came earlier, became an aeronautical engineer), to be replaced a couple of decades later by the Indian information-technology whiz.

The numbers of Indians studying, living, and working in the United States increased steadily during the 1970s, 1980s, and 1990s. For the last several years, India has consistently sent more students to study in the United States than any other country. In 2005, over eighty thousand students from India came to the United States for higher education. That’s nearly 30 percent more than the sixty-two thousand who came from China. Not every Indian who comes to study or work in the United States stays. Many return to India. This used to be true only of members of the upper class where the opportunity to take over a family business or to scale the heights of government service was attractive. An impressive number of India’s top business and political leaders have studied, lived, or worked in the United States. Many more have children or other close family members who have. The number of Indians in senior positions I have met who have MBAs from prestigious American institutions such as Stanford, Harvard, Wharton, or Kellogg—where many of the top professors are Indian as well—is amazing. These experiences create powerful links to the United States, and a natural affinity for an American approach to policy and business.

By 2000, 1.2 million persons of Indian origin were living in the United States. There are now approximately 2.2 million. Fueled by ongoing immigration and by the natural growth of the resident population, that number is expected to double every decade, making Indian Americans the fastest-growing Asian immigrant group.

Indian Americans

Indian Americans are one of the most prosperous and well-educated immigrant groups in America. Fifty-eight percent of Indian Americans have a college degree, whereas only 27 percent of the general population do. Their median household income is $64,000, as compared with the national average of $50,000. Indian Americans command a whopping $76 billion in disposable personal income.⁴ Many of these impressive numbers derive from U.S. immigration laws, which favored highly skilled and highly educated immigrants from India, who had the opportunity to get high-paying jobs.

Indian Americans command a disproportionate presence in certain fields, such as medicine, the hospitality industry, information technology, research science, and business management. Americans have become used to entrusting their medical care to Indian doctors. According to the American Association of Physicians of Indian Origin, there are forty-two thousand physicians and fifteen thousand medical students of Indian origin in the United States.⁵ CNN’s Dr. Sanjay Gupta is the media-icon version of the trusted American family physician from India.

The market value of the properties in the United States owned by members of the Asian American Hotel Owners Association, an organization founded by immigrants from India and dominated by Patels originally from the Indian state of Gujarat, is estimated to be $29.9 billion in franchised properties and $8.1 billion in independent properties. The association explains on its Web site the origin of the name Patel: “In ancient India, rulers appointed a record keeper to keep track of annual crops on each parcel of land, or ‘pat.’ That person became known as a ‘patel.’” ⁶ This group’s success in the American hotel and motel business has given rise to the expression Patel motel.

Prominent Indian-American senior managers include Indra Nooyi, CEO of PepsiCo; Rajat Gupta, worldwide managing partner and former CEO of McKinsey and Co.; Vikram Pandit, former president and COO of the Institutional Securities and Investment Banking Group at Morgan Stanley; Shailesh Mehta, former CEO of Providian Financial Corporation; and Victor Menezes, senior vice chairman, Citigroup. One factor in this phenomenon is the highly competitive Indian Institutes of Technology (IIT) and Indian Institutes of Management (IIM), which admit only one out of sixty applicants and give those who make the cut an outstanding education. Graduates of these schools are snapped up by leading companies around the world.

The contribution of Indians in Silicon Valley to the United States’ technological leadership and to India’s economic take-off has been tremendous. Veteran journalist Michael Lewis wrote in his comprehensive study of the Silicon Valley phenomenon in The New New Thing: A Silicon Valley Story back in 2000, the “definitive smell inside a Silicon Valley start-up was curry.” ⁷ Many IIT and other technical graduates gravitated to Silicon Valley, contributing to the tech boom there in the 1980s and 1990s. Others ended up in business or scientific research. Of Indians who went to Silicon Valley, a significant number started their own companies. By 2000, Indian Americans either owned or were in top management positions at 40 percent of all Silicon Valley start-ups and had a collective net worth of $62 billion.⁸ Some of the better known Indians who made huge fortunes during the tech boom include Vinod Dham, the creator of the Pentium processor; Vinod Khosla, one of the founders of Sun Microsystems; Sabir Bhatia, who created Hotmail.com; Suhas Patil, the founder of Cirrus Logic; and Kanwal Rekhi, the founder of Excelan.

One day in 1992, a group of Indian Silicon Valley entrepreneurs was waiting at the airport to meet a visiting Indian government official. They got to talking, and decided to start something that could help aspiring entrepreneurs benefit from their experience. TIE, The Indus Entrepreneur, was born. TIE began with one hundred members. It now counts ten thousand members in forty-five chapters and nine countries. India is the country with the most chapters after the United States. TIE has become one of the most powerful networks of entrepreneurs in the world and is expanding at a dizzying pace. Since 1992, individuals associated with TIE have created businesses with a combined market capitalization of $200 billion.⁹ Born in Silicon Valley, TIE was very much a product of the unique set of circumstances that gave rise to the information technology revolution: the proximity of Stanford University with Xerox’s Palo Alto Research Center, and the success of the original techie garage tinkerers, Bill Hewlett and Dave Packard, the founders of Hewlett-Packard.

TIE, however, introduced something uniquely Indian to this environment: the ancient learning relationship of guru-shishya, or teacher-disciple. TIE mentors (gurus) help budding entrepreneurs, professionals, and students (shishyas) learn the ropes by sharing their experience and knowledge. TIE also fosters the principle of doing well by doing good. When asked about the role of social entrepreneurship and TIE, Vish Mishra, senior venture partner with Clearstone Venture Partners and a charter member of TIE, explained, “Social entrepreneurship caters to the needs of the poor. Bottom-tier markets have thus far been neglected.” ¹⁰

The commitment on the part of successful Indian Americans both to give something back to their country of origin and to help others succeed has grown into an important engine driving the U.S.-India relationship. Private investment capital is pouring into India, much of it flowing from successful Indian Americans who are familiar with both countries. “At Clearstone,” Vish Mishra told me, “we’re very familiar with India as a talent source and as a market. We really believe that India has achieved ignition. An educated population is the fuel. The oxygen is a stable sociopolitical environment. The spark is the young, upwardly mobile population that wants to consume.” Clearstone now has an office in Bombay.

During ...

Table of contents

• Cover
• Copyright
• Contents
• Author’s Note
• IntroductionLife on Planet India
• Chapter One: Indians and Americans
• Chapter Two: India Imagines the Future
• Chapter Three: Retailing India
• Chapter Four: 600,000 Villages
• Chapter Five: The Cities
• Chapter Six: The Other India
• Chapter Seven: Power
• Conclusion: As Goes India, So Goes the World
• Acknowledgments
• Notes
• Selected Bibliography
• Index