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EDITORIAL:
Re-thinking Knowledge:
India’s Economic Future

Sam Pitroda is not just one of the most independent and visionary thinkers of India, he is also someone who has a passion for India and its future. An inventor, a technocrat, and a social thinker, the telecommunications whiz made the case that telecommunications – along with substantial food, clean water, and adequate shelter – were a fundamental component in the process of modernization. People dismissed him then, but he has had the last laugh after time has proven him spectacularly right.

So we thought who better to ask what he thought about the huge celebratory hype over IT and specially business process outsourcing, which many in the media were touting as India’s next big thing.

Pitroda was characteristically blunt. Yes, it was nice jobs were being created, especially in the urban areas, but what was the big deal about BPO? Pitroda said India needed far, far more jobs to address the needs of the millions of new entrants to its rank of unemployed, and the few hundred thousand jobs created by BPO was like a drop in the ocean.

In fact, India needed to rethink the whole concept of knowledge, he said. Now that sounded fascinating. So we pressed Pitroda on this, and he elaborated further on India’s Knowledge Commission, which is a unique body of extraordinary Indians who have been successful in various, diverse fields.

The Knowledge Commission had taken a close, thorough look at the basic concept of knowledge and where India was headed, and had come up with some innovative concepts about what needs to be done to ensure that India becomes a genuine player in the coming century.

In this month, we carry excerpts of an absorbing interview given by Sam Pitroda to Siliconeer.

Another entrepreneur and educator is also wondering about India’s coming gap in a pool of knowledgeable workers, and he has his own, ambitious plan to deal with it. Palo Alto, Calif.-based Alo Ghosh knows what he is talking about, because not only has he taught at the Wharton School of Business at the University of Pennsylvania, he has also been involved in creating a hugely successful technology start up in Kolkata and actually headed an educational institute there that conferred bachelor’s degrees approved by the University of London.

Ghosh, who keeps a close canny eye on business development around the world, has discovered that increasingly, India’s tea gardens and some spice farms in the south are becoming unviable for a variety of reasons, including the realities of a murderously competitive global market.

One person’s problem is another’s opportunity, he figures. Here’s a great opportunity to get large tracts of particularly beautiful, sylvan land, and here is his conceptual masterstroke — why not get the land, turn them into high-end golf resort properties, and then plow in the revenues into building top-class educational institutions that offer solid, practical undergraduate degrees for thousands of young students who can jump in the job market right away.

Fully developed, the plan envisages a cluster of four campuses in India and two in China, and could produce tens of thousands of world-class graduates every year.
It’s not a pie-in-the-sky theory, either. Due diligence is going on as Ghosh eyes a plot to purchase in Kerala and rounds up potential investors, and he has done all the math. He writes all about it in this month’s issue.

India’s Bollywood is a multi-billion dollar filmmaking industry, but cinema is not just about entertainment, says avant garde filmmaker Ashish Avikunthak. The Stanford graduate student has been making films for 11 years, but don’t expect winsome nymphets to dance around bushes in his films.

Calling himself a “fringe of the fringe filmmaker,” he says is he not just outside the mainstream filmmaking world, he is not even part of the alternative documentary filmmaking community in India. “I look at films as means of artistic creation driven by deep aesthetic processes, and not a means of entertainment like Bollywood or Hollywood does, nor a means of producing political propaganda as television documentary does.”

How does he make films? “That’s easy,” he replies, “I make films using my own savings; people buy houses and cars, I make films.”

He is presently finishing a feature film in Bengali but hasn’t been able to complete it because he still needs $20,000.

Siliconeer presents a report this month on the work of this unconventional artist and the challenges he faces.

Do drop us a line with ideas and comments about how we can make Siliconeer better serve you.
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COVER STORY:
The Knowledge Advantage: What India Needs to Do - A Siliconeer report
All the hoopla over the hundreds and thousands of jobs created by back office work leaves Sam Pitroda unimpressed. This is just a drop in the bucket, he says. To really get ahead, India needs a total knowledge makeover, because knowledge is not just about education, it is about a whole lot of things. A Siliconeer exclusive interview with Sam Pitroda.

You have recently told the BBC Hindi service that India’s success with BPO has been overhyped. Why?

I think BPO has gotten a lot of publicity in India, outside India. Rightfully so, in one way, because it has created jobs in urban areas, in modernized sectors. But at the same time we have lost sight of the fact that it has created only a handful of jobs in a nation of a billion people. We need to create 10 million jobs every year and BPO has created 500,000 jobs, which is really a drop in the ocean. But it affects well-to-do families, urban families . . .

Sam Pitroda is the chairman of India’s National Knowledge Commission.

In fact that was something I was going to raise with you. Do you think that one of the reasons BPO has gotten this much attention is that the Indian audiovisual media, and perhaps to some degree the print media, has a habit of focusing obsessively on the metropolitan areas and tends to extrapolate from that and draw conclusions about entire India?
Absolutely. Because they see if they go to a club, they go to a friend’s house, they go to a wedding, and they all talk about “Oh, my son’s working in BPO,” “My brother-in-law’s cousin is working in a BPO.” (That’s) the ecosystem in which they live in, and pretty soon they lose sight of the fact that this is not really India.

Let’s talk about the Knowledge Commission that you happen to chair. Has the commission as a whole done any work on this?

The commission has not done work on BPO because it’s such a small piece of the puzzle. The commission is really first focused on e-governance.

Okay, let me rephrase that question. Give our readers a sense about the organization. It’s a bit odd. You are there, DSE sociologist Andre Beteille, a lot of distinguished, interesting people are there, but we do not know a whole lot about it.

So give a thumbnail sketch for our readers on why you people were brought together by Prime Minister Manmohan Singh, and what your general agenda is, what you are trying to do.
The idea was that what we tried to do 30 years ago to telecom, in mid-’80s, had far-reaching implications for India in the 20 years down the road. At that time when I talked about telecom revolution down the road in India, people used to laugh at us saying, “Look, India needs water, agriculture and why telecom, why IT, why software? Why computers?” My answer then was, “Look, I know how to deal with telecom, I don’t know how to deal with water, so let me do my telecom job. Because I believe telecom is an important part of transformation of India because it results in connectivity, networking, democratization, resource utilization.” IT telecom did transform India.

Twenty years down the road, Congress government came to power. A national advisory council headed by Sonia Gandhi — I was a member — was asked to look at science and technology and education. I spent some time, and based on that I felt that if you focus on knowledge today, 20 years down the road, you will see some significant change in India.

And knowledge is not about education, it is about a whole lot of things.

So I put together a presentation for the National Advisory Council, gave them a presentation, and then I talked to PM and PM liked the idea. And I am sure PM must have talked to other people as well. But immediately PM said, “Sam, we want to do this.” So I said, let’s wait for six months, do a little bit of thinking and I want to internalize the issue. So I spent six months reading, understanding, talking to people at Harvard, MIT, Japan, you know, looking at what everybody is doing.

The Knowledge Commission: Objectives The overall task before the National Knowledge Commission is to take steps that will give India the ‘knowledge edge’ in the coming decades, i.e. to ensure that the country becomes a leader in the creation, application and dissemination of knowledge. Creation of new knowledge principally depends on strengthening the education system, promoting domestic research and innovation in laboratories as well as at the grassroots level, and tapping foreign sources of knowledge through more open trading regimes, foreign investment and technology licensing. Application of knowledge will primarily target the sectors of health, agriculture, government and industry. This involves diverse priorities like using traditional knowledge in agriculture, encouraging innovation in industry and agriculture, and building a strong e-governance framework for public services. Dissemination of knowledge focuses on ensuring universal elementary education, especially for girls and other traditionally disadvantaged groups; creating a culture of lifelong learning, especially for skilled workers; taking steps to boost literacy levels; and using Information and Communication Technology to enhance standards in education and widely disseminate easily accessible knowledge that is useful to the public. (Source: Knowledge Commission Web site)

You say that knowledge is not the same as education. Would you elaborate on that?

You see, when you look at education, it is one piece of the puzzle. To me there are five aspects of knowledge. One is access to knowledge. Who has access to knowledge? How do you get access to knowledge? In access, we are looking at things like reservations, affirmative action programs, libraries, networks, portals to really improve access to knowledge for large number of people where they are all over in multiple languages.

Then second piece is: Knowledge concepts, which is basically education. Primary education, secondary education, university, distance learning, vocational training, all of that. Third piece is creation of knowledge. Where is knowledge created? In science and technology laboratories, in research activities. So that piece also includes intellectual property, copyright, trademark, innovation, entrepreneurship. Fourth piece is application of knowledge. How is knowledge applied? Where do you apply knowledge? Application in agriculture, application in industry and application in health. And fifth piece is knowledge-related services. How knowledge can transform governance. We have really not looked at transforming governance in the last 60 years. We have made incremental changes here and there. If you focus on e-governance, you can really begin to look at transformation of government in a very different way.

Take for example, how do you get a birth certificate? Or land records? An issue of perennial fights and arguments.

Absolutely. You know, all these processes are set up 70-80 years ago in British period, and today we are computerizing those processes. So Knowledge Commission has looked and said: “We need to really first redo the processes.” In other words, we really need to restructure the processes before we computerize. Today, we have to redo the process of getting land record, process of getting birth certificate, process of applying for admission to a school instead of doing it the same way we have been doing for the past 80 years.

So going back to the earlier question: There are really five areas of knowledge. Access, concept, creation, application and services.

So we are looking at knowledge horizontally, also vertically. We are also looking at traditional knowledge. We have set up this group of eight prominent people, they have different backgrounds, different sort of experiences. In first couple of meeting (we were) getting to know each other, we all have to click, and see the problem the same way. Then we decided to focus on something like 100 different activities, of which, we said: “Look, we can do only limited things.” So let’s focus on 20 for the first year. Now we are focused on 20 activities. We have set up some working groups, we had some meetings. First was really e-governance. We have submitted our recommendations to the prime minister on e-governance, very different from the way we are doing it today.

The Knowledge Commission: Members Sam Pitroda, chairman of the Knowledge Commission, has spent four decades in the world of telecommunications helping bridge the global communications divide. His professional career has been divided between the three continents of North America, Asia and Europe. Widely regarded as the architect of modern biology and biotechnology in India, Dr. P.M. Bhargava, vice chairman of the Knowledge Commission, is currently chairman of The Medically Aware and Responsible Citizens of Hyderabad, the Sambhavna Trust, Bhopal, and the Basic Research, Education and Development Society, New Delhi. Dr. André Béteille is professor emeritus of sociology in the University of Delhi. He is known world-wide for his contribution to the comparative study of social inequality. He has lectured in many universities and is a Corresponding Fellow of the British Academy and an Honorary Fellow of the Royal Anthropological Institute Dr Ashok Ganguly is currently the chairman of ICICI OneSource Limited and ABP Pvt Ltd., and has been a director on the central board of the Reserve Bank of India, since November 2000. In addition, he heads his own consulting company, Technology Network India Pvt Ltd. Dr. Jayati Ghosh is professor of economics and currently also chairperson at the Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University, New Delhi. Her research interests include globalization, international trade and finance, employment patterns in developing countries, macroeconomic policy, and issues related to gender and development. Deepak Nayyar is professor of economics at Jawaharlal Nehru University, New Delhi. Earlier he has taught economics at the University of Oxford, the University of Sussex and the Indian Institute of Management, Kolkata. Until recently, he was vice chancellor of the University of Delhi. One of the founders of Infosys Technologies Ltd., Nandan M. Nilekani is currently its Chief Executive Officer. In the past he has also been its Managing Director, President and Chief Operating Officer. Nilekani co-founded India’s National Association of Software and Service Companies. Dr. Pratap Bhanu Mehta is president and chief executive, Centre for Policy Research, New Delhi. He was previously professor of government at Harvard University and associate professor of government and of social studies at Harvard. (Source: Knowledge Commission Web site)

Obviously you can’t detail the entire set of recommendations. But can you tell us one or two salient things that you recommended?

One suggestion is that we really need to focus on reengineering of processes before we computerize.

What do you mean by that?

What we mean by that is the current practice is to take the existing process and computerize. How do you file income tax? They are taking how you file income tax and then computerizing it, rather than saying that the process of filing income tax is wrong. If you had to redo in 2006, how would you redo it? So process reengineering is a prerequisite to computerization.

Then standardization. Today every state is doing their own thing. Karnataka is doing something, Andhra Pradesh is doing something else. We are saying, “Look, that is not acceptable. We must have some standards.” Why should birth certificates be different in every state? It could be different in language, but it should look alike. It should be Indian birth certificate.

We are doing our police records (differently). One state cannot read another state’s police record. One district cannot read another district’s police record.

So we are really attacking a problem in a very different way. Like standardization.

Then, Web-based services. Every state today is doing their work in letter-driven approach. We are saying you can’t do that, we should have a federal Web-based service.

Today, everybody is doing their own thing, and lot of this stuff is not viable because there is no business model.

We have done I think a reasonably good job — (Infosys CEO) Nandan Nilekani has spent a lot of time, I spent a lot of time, and we have basically accepted recommendations.

Reservations are a political minefield. How do you propose to navigate in this dangerous territory?

Let’s do one thing at a time. We know that we can’t do everything.

So first we have taken e-governance. Now we are taking university reforms, because our universities are in a mess. A country of a billion people cannot have 300 universities, you want 2,000 universities. We can’t have affiliated colleges, we can’t have same level of standardization university. We need different levels of universities — good universities, very good universities and okay universities. We need different pay scales. We have done a lot of work on university reforms. We will be submitting that in next few weeks.

Then we have started working groups on translation. We believe translation is a multi-billion dollar business in India, which we have not really focused on. You know, I don’t know good literature in Tamil or Gujarati, good literature in Bengali or Malayalam. We haven’t done that. We only translate English stuff.

Then we have working groups on traditional knowledge, on distance learning, on vocational training, on innovations. So we have lots of groups set up, we have meetings going on, we have talked to industry, we have started consultation process, we’ve met with the members of Parliament, all that process has started.

You are based in Illinois. Mr. Nilekani, presumably, is based in Bangalore. How do you work?

We are working through networking and all, because all these people have full-time jobs, and we wanted to make sure that people who have full-time jobs get involved in it and do not take this as a full time job, because I don’t want this to be a bureaucratic office. Nobody takes salary, everybody pays their own staff. There are ten bright guys who are helping us to coordinate our work. They are in Delhi. They are paid. It’s a contract, not a full-time government service. It’s a three-year contract.

We want our freedom to be able to say things and I insisted that we don’t want bureaucratic network, we don’t want IAS officers. We want to do it differently. We do networking. We are all doing our thing. We come together every two-three months, spend three full days.

Let me just give you the key areas that we are attacking. E governance, university reform, vocational training, distance learning, primary education, literacy, innovations, translations, libraries, networks, portals — we will have a national portal on water. Energy, education, environment. These are some of the areas we are focused on. And we want really generational transformation in these areas.

How is your focus going to change the current skewed media focus on BPO and outsourcing and the metropolitan cities?

First of all, we need the support of people like you. We need many more young, enlightened, journalists to really bring what we are doing (do the public).

Here’s the thing that bothers me. I am all for changing the license raj, and bringing in the market to serve Indian society where it can. But my real worry is that what we are seeing increasingly in India is essentially a class divide where elites in the metropolitan cities are enjoying the fruits and the media exercise has become a sort of insular navel-gazing where the privileged pay themselves huge salaries and they say everything is hunky dory. Yet vast swathes of India outside the metropolises have remained virtually untouched.

I buy that. I am all with you, I subscribe to your views. I am very concerned about water, literacy, health, rural development. All I am saying is that I want to take that knowledge and make sure that people really transform our quality of life.

Something as simple and stark as the digital divide is a cause for enormous concern. For all the strides in IT, capability of using vernacular Indian languages on the computer remains appalling. Yet nobody is talking about that.

Digital divide is not just a divide of computers, it’s also a divide of literacy. The divide is the divide in education, health, malaria research, it’s not about just computers.

One final question before we wrap up. From what I hear from you, it seems that what your team is doing is not only crafting an independent way of determining India’s knowledge needs, but also along the way creating a separate and independent model of addressing large public policy issues. Is that a fair way of putting it?

Absolutely. To me this is the lifetime job.

More information and contact email, addresses and phone numbers are available at the Knowledge Commission Web site at www.knowledgecommission.org.

- Sam Pitroda is the chairman of India’s National Knowledge Commission.

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EDUCATION:
The University That Can: Alo Ghosh's UniverCity
Amid the celebrations over sky-high projections of the number of skilled jobs that are going to be outsourced to India, former McKinsey consultant Alo Ghosh asks the critical question: Will India be ready? He offers a very compelling answer as well.

Here’s the deal: India’s staggering growth in attracting outsourced jobs from all over the world may be spectacular, but it could well come to a disastrous halt if we don’t create the number of employable graduates with the right skills.

Alo Ghosh is a former finance teacher at the University of Pennsylvania’s Wharton School, a strategy consultant for McKinsey, and a Silicon Valley technology entrepreneur.

After looking at the issue closely and giving it serious thought, I am convinced that there is an opportunity here to put together a large campus that provides a solid, employable education, makes money for its investors, and provide India with a real fillip as it takes on the challenge presented by the spectacular growth that analysts anticipate.

Intrigued? Good. Now please read on as I present my case.

The Challenge
It’s a good time to be Indian. Gone are the days when the tendency in the West, particularly in the U.S., was to treat the world’s largest democracy with condescension if not contempt. India was known for its poverty, its left-leaning policies, its bureaucratic red tape, its corruption.

What a difference a few decades make! The rapid strides in information technology has brought about a dramatic makeover in India’s image. Indian-educated technocrats have come to this country in droves and have either set up or been part of some of the most successful IT firms in this nation. Meanwhile, the likes of Infosys and Wipro have made the world sit up and take notice, and India is now increasingly recognized as a global player not only in terms of its economic prowess but also in terms of the knowledge power of its skilled and educated people who have unleashed a global traffic of jobs to the country.

So far, so good. But if you step back and think about it for a moment, there’s a big catch in this rosy picture if India doesn’t plan ahead. And it’s this: When all those jobs come to India, will we be ready?

According to a recent study from McKinsey & Co., the number of Indians employed in the BPO sector could potentially swell from 700,000 today to 2.1 million by 2010, with a further 6.9 million being indirectly employed.

Salil Tripathi puts it well in a recent issue of The Wall Street Journal: “India produces engineers of both types. The engineers from the IITs, whom multinationals encounter in Silicon Valley, are part of the cream.

“Over the past 50 years, some 40,000 of them have left India, usually for the U.S. Some remain in India and some return home, rising quickly to senior positions in multinationals and leading local companies.

“That elite is vastly overqualified for most of the outsourced jobs. What the industry needs is a bigger pool of moderately-skilled transactional engineers and workers. But of the 2.5 million Indians who graduate each year, McKinsey estimates that only a quarter possess the skills multinationals want.”

Business Week wrote about the problem in graphic terms in November last year: “With India’s economy on a tear, these are heady times for Mumbai-based Larsen & Toubro Ltd. The company, India’s top construction and engineering outfit, has seen its sales jump by 35 percent in the past year as Delhi boosts spending on roads and ports and India Inc. invests in more factories and office parks. But L&T chairman Anil Manibhai Naik isn’t celebrating. That’s because he can’t hire enough mechanical engineers to keep up with all the work. Despite boosting wages for rookie engineers by 25 percent — to roughly $5,700 per year — Naik is still losing potential recruits to the software industry, multinational competitors in India, or rivals in the Persian Gulf that pay twice his current rate. Says Naik: ‘Everyone is growing fast, and India is facing a talent shortage.’”

That’s happening right now. Just imagine what the situation will be when the needs grow by the supply doesn’t keep pace.

Business Week hits the nail on the head when it points out the deficiencies of India’s education system: “While the country’s elite universities rival schools anywhere, they graduate fewer than 100,000 students annually. The rest of the 14 million people who finish high school each year must choose between lower-level universities and vocational training schools, which haven’t adapted to the requirements of India’s changing economy. Unless the education system can fulfill the aspirations of India’s youth, the current boom could turn into a disaster, warns Rama Bijapurkar, a Mumbai marketing consultant. “Without some changes, the aspirations of India’s employers — who need more and better-trained workers than ever — will remain unfulfilled as well.”

The Plan
There you have it. So what’s to be done? The old days of the government being the recourse of last resort are gone. Nor is it fair, or even practical, to expect the cash-strapped Indian government to subsidize tertiary-level education which middle-class Indians have been getting for a pittance.

Good, college-level education costs money, but this provides a pathway for graduates to raise their income astronomically, so it is perfectly legitimate to require them to pay their way, and a profit can be made.

This is not simply theory. I have studied the issue thoroughly, made detailed plans, and am ready to actually launch into it. The World Bank’s International Finance Corporation has verbally agreed to back me, and could well end up financing up to 20 percent of the project.

My lawyers are going through due diligence as we speak and we are all set to buy 1,000 acres of land near Kerala’s Periyar Tiger Reserve The completed project in Kerala alone will cost over $300 million.

While the opening up of Foreign Direct Investment in the real estate sector in India has generated a rash of investment funds today, their narrow focus on urban housing and office space, given the paucity of land with clear title in India’s largest cities, will likely generate very low return of investment for investors. We take advantage of a recent trend, the WTO induced decline of the tea industry in India, to originate large tracts of tea estate land in the hilly and cooler areas and target them for effecting a novel strategy to generate high return of investment while contributing significantly to the economic development of India. In the process, we hope to create the world’s largest educational institution by enrolment and a role model for employment-focused mass education.

Our strategy is to start with the first property being purchased (1,000 acres near Kerala’s Periyar Tiger Reserve) and build a world-class golf community (along with health-care, yoga practices and ayurvedic healing) as our core return-on-investment component. It will also serve as the basis for attracting the best people to teach, whether as time-share visitors or full-time retirees. We plan to build a 27-hole golf course surrounded by 200 single-unit villas and another 200 apartment condos, priced at $500,000 and $250,000 respectively. Around this 350-acre golf and health-care community is planned a sprawling residential education campus consisting of an American/International School (supported partly by the U.S. State Department), an undergraduate program of B.Sc. degrees by the London School of Economics in business and technology subjects, a diploma program by Cambridge University in business and technology areas, an indigenous medical & nursing school, and future graduate programs in collaboration with some of the top universities in the U.S. The campus is planned to utilize another 350 acres of land. Total student population is planned at 50,000. Finally, corporations will be invited to locate their remote IT, R&D & BP outsourcing outposts in the remaining build-able land area of 350 acres to effect talent based synergies with the student and teacher populations in the campus. This utilization of the remaining vacant land will be in the form of long-term leases awarded to the corporations.

We plan to replicate this model in the East (Darjeeling/Gangtok), West (Sahyadri/Mahabaleswar), & North (Gangotri/Mussoorie) of India in phases once the golf community is pre-sold & construction has begun in each location during the course of the next 3 years. Expansion into China is also in the works. All of these campuses are planned to be networked into an extensive provider of Distance Education & E-Learning to thousands more at homes in India and China. As of now, only the land in Kerala has been finalized for purchase immediately. We are now embarking on the process of enlisting key investors in the equity of the new corporation being formed that will own and initiate this entire development process during the next three years.

We expect to take this entity public at that time when the growth multiple will be in full play.

We know the scene very well. I know all of the private players there. There is a huge need to create graduates — the number of employable graduates we have is not very different from Poland or Russia which is kind of painful to hear, because we are so much larger.

The idea is that we don’t have to give them a Stanford brand, we don’t have to give them a really bad education — it has to be somewhere in the middle. The biggest problem is infrastructure and the second biggest problem is lack of teachers.

Here’s where our future plans of distance education will come into play. India just hasn’t created the number of teachers required. Because we are going from 100s of institutions to tens of thousands. It’s not a joke, right? We have to take the best of teachers and marry distance education to them so that each can reach more number of students.

Alo Ghosh can be reached at alo@aloghosh.com.

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