Davos: Its creative imperative

Mukesh Ambani’s nomination as a co-chair for the conference was a recognition of India’s growing economic importance and his leadership qualities. India participated in 52 sessions spanning almost every subject which was discussed at Davos. The flavour of Indian cuisine every evening in some hotel or the other and a spectacular India Soiree left no one in doubt that India had arrived on the global scene.

Indians are not known to prepare in advance. This time it was different. The meticulous preparation, spread over nearly a year, under the guidance of Nandan Nilekani, Tarun Das and with able support of Ajay Khanna of CII made a decisive difference. The overall theme of this year’s conference was ‘Creative Imperative’. However, the theme session entitled ‘The Big Debate’ compressed the broader themes to five key issues—namely Emergence of China and India; Changing Economic Landscape; New Mindsets and Changing Attitudes; Growing Future Jobs; and Regional Identities and Struggles.

Within each of these themes, there were multiple sub-set questions. The audience at the plenary was grouped around these themes on separate tables and there was voting at the end on the key concerns of these segments. The voting outcome was quite revealing. On India-China emergence, maximum concern seemed to be on sustainability of development and the orderly integration of these economies in the global economy. On changing economic landscape, the issues of growing global and structural imbalances and business sensitivity to climate change were perceived as being most worrisome. On the mindset of the global educational framework which can foster inclusively was the key concern. On creating jobs, what was considered vital was to create an educational system designed to respond to changing skill requirements. On regional identities, it was the rising economic disparities which occupied centrestage.

The co-chairs made over-arching suggestions. Lawrence Summers, President of Harvard, talked about Hope and Fear and his fear was ‘‘the lack of fear itself’’. Market risks, financial collapse, the consequences of integration of India and China, the disconnect of local economies with the regional economies and market failures constituted risks and should instill fear. Hopes could be exaggerated and the need to balance hope with fear must be an abiding policy concern, he said.

Laura Tyson, Dean of the London Business School, mentioned demand and supply instead of hope and fear. The issue was how global demand for labour and skills will drive economies for adequate supply-side responses and how these could be managed in an orderly fashion through responsible action, she said. Mukesh Ambani wanted countries to look beyond growth and focus on distribution of wealth in an equitable manner. The world needed to adjust to the new paradigm of high growth coupled with equitable distribution.

In overall terms, the audience felt that the highest risk was vulnerabilities of a sustained global economy followed by all-round challenges of emergence of India and China and inadequacy of mindset changes to meet these challenges.

Given our high-profile presence it is legitimate to ask how impressed were the investors and will the India glamour last? Did the investors get the feeling that we were now on an irreversible fast accelerator or was it going to be a roller-coaster ride? The Indian delegation was armed with the recent decision on opening retail for single brand, easing sector caps on foreign investment and finalisation of procedures for airport bidding for Delhi and Mumbai. These decisions certainly attempt to overcome the handicaps of coalition politics and make an important statement on further deregulation of the economy.

To sustain the new India momentum and to convert favourable investment disposition to tangible investments will continue to require innovative skills from political decision makers in an era of coalition politics. While flow may not be easy, they look more than ever before in the realm of possibilities.

If the glittering India event in Davos is to make an abiding dent on investor imagination there is no option but to persevere in implementing our promises. A transient excitement no matter how glamourous is no substitute to abiding action. Davos will keenly await a year from now on how much and how many promises made have lived up to the new expectations. A year passes quickly. The Creative Imperatives of Davos leave little room for complacency or excessive optimism.

write to nksingh@expressindia.com