The president of the World Economic Forum has said that a part of the reason why India has seen the fastest growth among large economies for three years in a row is affordable digital connectivity and the digital ID, or Aadhaar, that has been issued to most of its 1.4 billion-strong population.
Borge Brende was speaking at NDTV’s Decoding G20 Conclave, where he was part of a panel on “The Voice of the Global South” with NK Singh, co-convener, G20 Independent Expert Group on Reforms in Multilateral Development Banks and Vera Songwe, chair and founder, Liquidity and Sustainability Facility, Africa Growth Initiative, Brookings Institution.
Mr Brende also said he had seen on television the other day that a grandmother in Assam was wiring money to her grandchildren using her cellphone. “Where else is that happening? If India is 1.4 billion people digitally connected and there are 4 billion people out of 7 billion people (in the world) not digitally connected. You have a huge, huge advantage… It is a prerequisite for economic growth and for poverty eradication,” he said.
The WEF chief’s views were echoed by Mr Singh and Ms Songwe. “Financial inclusion is a micro and macro issue. If you are not financially inclusive, for those who are out of it, not having access to financial tools is a terrible thing. And poverty is a terrible thing. What India is doing with the Aadhaar program is about including people in the financial sector,” Ms Songwe said.
“The minute you have enough information, people become part of the formal economy. We can bring the Small and Medium Enterprises (SMEs) in. We can grow them faster and they can become job-creating entities. And that is why you are the fastest growing economy in the world. Because your Aadhaar economy is now paying off,” she added.
Mr Singh said this has huge implications for empowering people who are outside the digital framework. “From a macro-economic perspective, digital access is also a growth disruptor. People are concerned with the enigma, that given a lot of other disabilities, how is it that India is the fastest growing economy? This is because economic models do not work if you introduce a disrupting factor. That disrupting factor is technology with a medium of digital access,” he said.
On India being the pharmaceutical headquarters of the world, Mr Borge said many people forget that the country is “world-leading” on the pharmaceutical side. “I think India has a huge opportunity to go from manufacturing pharmaceutical and generic products to also invest and be the developer and have the patents and then you have the full value chain,” he said.
The WEF chief also spoke about climate change and the need to tackle it. “Climate change is happening here and now, and we are paying a price. It’s affecting agri production. We are not seeing enough action. India’s G20 presidency underlines the need for faster decarbonisation,” he said.
Mr Singh said the financing of the orderly transition to green energy remains an enigma and is a challenge that is being worked on.
Ms Songwe also pointed to the electric vehicle industry in India witnessing a boom and the reskilling that this and the new climate economy would necessitate. “We need to take people from collecting data to data centres and artificial intelligence. We are going to move people from fixing cars to being technologists that actually make sure you can drive a Tesla. This is a whole reskilling process,” she said.
On startups, Mr Singh said, “I continue to see India to be not only the prime-mover, a catalytic, but an important destination for startups. Technology is an enabler but also a disruptor. I think that we are undergoing a period of readjustment of startups with newer technology on the horizon and newer challenges on the horizon… I see that the vibrancy which we talked about in startups will come back to this country with even greater force.”