No event in the history of India has been, arguably, as liberating as the dismantling of what was known as the License Raj in 1991. A decidedly opaque and archaic system of controls and permits – one that was established in 1947 and that effectively stifled enterprise and innovation – was replaced by a torrent of economic reforms that unleashed a furious surge of entrepreneurial activity and promoted a newfound respect for transparency and good governance.
The past 20 years have been momentous, for Indian society and its suddenly dynamic business class. Companies like Infosys and universities like the Indian Institute of Technology demonstrated India’s business prowess to the rest of the world. Age-old institutions like the family business have recognized the importance of ceding control to professional managers. The openness of the market has replaced the favours granted behind closed doors and under the table. Today, as Infosys co-founder Nandan Nilekani wrote in Imagining India: “India has unique advantages at the moment – the biggest pool of English speakers in the world and ambitious young entrepreneurs who are experimenting with low-cost models of doing business.”
As is the case with China, those who prefer to believe that India’s economy is being powered by its low-cost advantage can do so at their peril. As in China, ambition in India is bucking tradition, fuelling the development of innovative, truly leading edge technology. And as anyone who has set foot Palo Alto’s Sand Hill Road has seen, Indians’ intellectual capital is a major force behind the success of American venture capital firms. The articles on India in this issue of Ivey Business Journal describe how India got there – the forces that at one time held it back and that have powered it forward. They also describe India’s great advantages and the challenges its business class must meet and overcome. Anyone who doubts India’s ability to take its success in business to the next level will learn why he or she ought to have second thoughts about that ability. To them, and to you…I hope enjoy all of the articles in this issue of Ivey Business Journal.