'Chindia': An Intriguing Proposition - InformationWeek

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6/4/2007
03:21 PM
Rajan Chandras
Rajan Chandras
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'Chindia': An Intriguing Proposition

We are all perfectly (and in some cases painfully) aware of the rising IT prowess of China and India. But a recent book written by a couple of Gartner analysts takes this theme to an intriguing new level: what if India and China were to combine their capabilities, not just in information technology, but in other areas of business as well? The book presents an arresting proposition and is near the top of my suggested-reading list.

We are all perfectly (and in some cases painfully) aware of the rising IT prowess of China and India. But a recent book written by a couple of Gartner analysts takes this theme to an intriguing new level: what if India and China were to combine their capabilities, not just in information technology, but in other areas of business as well? The book presents an arresting proposition, and is near the top of my suggested-reading list.If the rise of India and China is not the Theme of the Decade, it certainly belongs right up there in terms of disruptive economic impact to businesses and, in turn, to our lives, in ways both positive and negative. However, most of the news usually focuses on the two countries individually. In "IT and the East: How China and India are altering the future of technology and innovation" (from Harvard Business School Press), authors James Popkin and Partha Iyengar do dwell on these two countries individually, but they also devote the most compelling one-third of the book to scrutinizing the current reality and future potential for China and India to collaborate for greater business world-share - to what the authors call the "Chindia bloc."

Consider just a few of the nuggets mentioned in the book: • From 2006 to 2010, India is expected to add 71 million workers to the global labor pool and China 44 million, compared to the projected 10 million additional workers in the U.S., no additions in Europe and a decline of 3 million in Japan. In other words, Indian and Chinese workers will outnumber combined U.S., European and Japanese workers by a factor of more than 9:1. • China is expected to displace the United States as India's largest trading partner by 2007. In other words, the two countries are learning to work together. • TCS, India's largest IT shop, has now established the Chinese market along with a Chinese partner… not just to exploit local opportunities in China, but also to expand into Japan, Korea and other regional Asian markets. • Wipro, among India's IT giants, has now established a presence in China aimed at providing US and other western customers the comfort of increased service stability (e.g., in case of local disruptions in India). • Bharat Forge, a forgings manufacturer based in Pune, India, has tied up with a leading Chinese corporation to set up what will be China's largest forgings company. Points to note? (a) Bharat Forge isn't some small local outfit - it is already India's largest (and the world's second-largest) forgings company; and (b) the scope for China-India collaboration clearly extends far beyond IT. In fact, according to the authors, the "Chindia advantage" has the potential for "unassailable global positions in manufacturing, IT services, textiles, pharmaceuticals and other industries". • Many economists project that China will become the world's largest economy in absolute GDP terms (not just purchasing power parity) by 2050 - not too far away - and India will ultimately pass China in GDP before the end of the century.

To my mind, the book makes it clear that as individuals and as businesses, we probably have only two choices: bury our heads in the sand and ignore the evolving world at our own peril, or take the initiative and effort to understand where the world seems to be headed and try and prepare for the seemingly inevitable future. Which brings to mind the famous line from William Shakespeare's Julius Caesar - a little dramatic, perhaps (it is, after all, Shakespeare), but certainly no less pertinent.

There is a tide in the affairs of men Which taken at the flood, leads on to fortune; Omitted, all the voyage of their life Is bound in shallows and in miseries.

The question is: how do we ride this tide?

Rajan Chandras is a consultant with a global IT consulting, systems integration and outsourcing firm, and can be reached at [email protected].We are all perfectly (and in some cases painfully) aware of the rising IT prowess of China and India. But a recent book written by a couple of Gartner analysts takes this theme to an intriguing new level: what if India and China were to combine their capabilities, not just in information technology, but in other areas of business as well? The book presents an arresting proposition and is near the top of my suggested-reading list.

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