Unless you’ve been living under a very large rock for the past decade, you got the memo: the global economy is shifting east. Notwithstanding a black swan or two, even the most conservative forecasts show that China and India are set to be the No. 1 and No. 3 economy in the world by 2050—larger together than the entire G7.
For India, this growth isn’t driven by the state or by exports, but by the collective energies of tens of millions of entrepreneurs and would-be entrepreneurs. With 66% of its population under the age of 35, India is set to reap an unprecedented 40-year demographic dividend similar to those enjoyed by industrializing Europe and the Far Eastern “tiger” states at the peak of their growth. And as its new North America–sized middle class flexes its purchasing power, India will grow rich before it grows old.
What’s more, given the great trend of our time—south-to-south trade—whether Canada matters in growing markets like Brazil, Turkey and South Africa will depend in no small part on our finding leverage in India. It’s already a big player in these markets; while China has just surpassed the U.S. as Brazil’s largest investor, India is knocking at the door. From retail to automotive, Indian investors are among those setting the standards, preferences and new terms of commerce in the world’s other fast-growth markets. So for Canadian companies dealing with these new grids of global commerce and their complex supply chains, success depends on being well-integrated in anchor markets like India. If we don’t get it right there, we’ll lack the influence needed to play globally in the coming decades—and the understanding of how to do so.
Diaspora aside, Canada’s governments and business community haven’t historically engaged with India, and Indian companies know little of our potential. We’re one of an increasingly large crowd jostling for their interest and attention, and too often we are not being heard. It’s time to change this.
The Canadian government is actively working on a free trade agreement with India, which business should get behind—it’s not just about market access, it’s an attention getter. But trade agreements aren’t enough. We need to streamline Canada’s India policy into a strategy that promotes Canada as a useful nation: useful not only in helping to solve India’s domestic challenges to growth—critical shortages of water, power and food; education, infrastructure, health care and environmental degradation—but also in helping India succeed abroad. For instance, Canadian expertise in mining finance and technology can help India grow its resource interests in Brazil. Countries seen as useful now will reap the rewards down the road. To be in the best position to innovate with India in the years ahead, we need to engage with their best talent now.
To be seen as useful to India, we need to increase our mind-share. We tell ourselves that the world needs more Canada, but we need to prove it, to be seen as practical partners in addressing needs from clean tech to building smarter cities and helping Indian resource companies to access African opportunities. Brand Canada begins with our “weapons of mass attraction”: our education system, our expertise in resource management and soft infrastructure, and our immigration system.
We can start by tapping India’s 10,000 key leaders and influencers, including entrepreneurs, academics, officials and journalists—telling them the story of the Canadian advantage and letting them pass it along. Nothing sells better than positive word of mouth, and in emerging countries, these networks are the real keys to market access.
Canadian universities are also an underleveraged resource. Unlike the U.S., Britain and Australia, we don’t sell our educational brand in a co-ordinated way. Despite their excellence, our universities remain largely unknown, attracting only 2% of Indian students studying abroad. But recruitment isn’t enough. Canadian companies need to work with universities to match research with India’s talent and market needs. Following successful models like the X-Prize, private- and public-sector leaders should work together to set up a high-profile Canada Prize that offers incentives for entrepreneurs and researchers to solve critical problems with commercial and public benefits, like cheap desalination units or better distribution of electricity to villages.
Our immigration system can strategically recruit top talent; we could market short pathways to citizenship for top Indian graduates, and for those working for listed companies or studying in leading U.S. graduate programs.
Finally, we need to encourage public and private targeted investment into specific high-profile and high-value Indian projects. We need to pool funds to get scale, get attention and get better return. Given the stakes and the opportunities, it’s time to revisit the idea of a national sovereign wealth fund with a global investment outlook.
These initiatives will be government-led, of course, but can’t be left to government alone. Industry needs to co-ordinate on strategy and build bridges for talent and investment. That means actually travelling more. It means building conferences, internships and work exchanges that encourage people to flow in both directions. Nothing beats the relationships and market knowledge that comes from being on the ground—and since these markets are often status-conscious, senior leaders need to be there.
But that highlights the biggest threat to our efforts in India: complacency. Our leaders are busy managing through austerity, impending fiscal fights and slow growth in existing markets.
The status quo is dangerous, though, and fortune favours the bold. As a middle power, Canada has a unique opportunity to prove its usefulness to the emerging major power on the subcontinent by acting quickly and creatively while others are distracted. We can’t waste it.