Indian mining industry to face skilled manpower shortage

India, ranked among the top five global players in production of several major minerals, is poised for rapid growth in its mining industry - about five percent of the GDP.

However, lack of skilled workers is set to hit the industry, creating a demand-supply gap of over 2,200 people by 2025, according to a study on mapping of human resources and skills for the mining industry in India by Confederation of Indian Industry (CII).

Mining, which has contributed 2.5 to 3 percent to the gross domestic product over the last few years, is expected to increase to about five percent in the coming years.

"Based on the estimated demand and the current supply from various educational institutes, a demand-supply gap of about 1,500 and 2,200 is expected during the period 2009-2017 and 2009-2025 respectively," said the study.

While the mining engineering category is expected to experience a demand-supply gap of about 8,500 during 2009-2025, the study recommends the course curriculum be updated with focus on mine safety, environment-related content and rock mechanics to better address the requirement of the industry.

One of the major areas of concern is the lack of mineral-specific professionals such as lawyers, financial analysts and economists. To support the growth of the mining sector, there is an immediate requirement to start courses for mining lawyers and mineral financial analysts, the study said.

It also pointed out the huge shortage of trained operators such as blasters, short firers, drillers, heavy machine operators and surveyors as well as the complete lack of infrastructure to train people at this level.

The shortage of formal training systems for candidates at the operator level also needs to be addressed by introducing relevant courses in technical institutes located close to mining centres, it added.

The study also said that to synchronize the efforts of the industry, government and educational institutions, an industry skills centre be set up on the lines of Australia's Mining Industry Skills Centre.

Globally, India ranks among the top five players in terms of production of several important minerals. Orissa, Chhattisgarh, Andhra Pradesh and Jharkhand together contribute to more than 39 percent of total mineral production in India.

At present, around 900,000 people are employed in the mining and exploration of coal, metallic and non-metallic minerals. Coal accounts for more than 75 percent of the total employment.

Orissa, Rajasthan, Jharkhand and Karnataka account for around 58 percent of total metallic, non-metallic, and minor minerals employment while Jharkhand, West Bengal, Andhra Pradesh and Madhya Pradesh account for more than 63 percent of total coal and lignite employment.

Of the total employment, women constitute only about seven percent. However, given the current level of employment, there is scope for further increase in women's share of employment, the study said.
--IANS

http://www.newkerala.com/news/world/fullnews-167141.html

Focus on Higher Education to leverage Demographic Advantage

The global marketplace and indeed the world economy is changing rapidly and these changes are impacting the way we do business, earn a living and grow within India as well. About 51% of India’s population is less than 25 years old. While this gives India a large demographic advantage, states in India need to focus on education to ensure that an educated and appropriately trained/skilled workforce is ready to tap the opportunities of the time.

However, increased government spending on education since 2007 notwithstanding, 142 million children in India are denied primary and secondary education and a third of the nation’s population cannot read. Clearly, with the Indian economy growing rapidly, fuelled by the rise of knowledge-intensive and hi-tech sectors like ICT, automotives , pharmaceuticals and others, states must ensure quality education to enable Indians reap the benefits of economic growth.

In order to understand which states in India are prioritising education, we considered four indicators — higher secondary school enrolment , government revenue expenditure on education , number of universities and women’s literacy rates. These indicators serve as good pointers to the condition of education in a state and impact on economic growth.

Small states target education as the recipe for growth; need more focus

The hill states of Uttarakhand and Himachal Pradesh will benefit from high per capita school enrolment figures, which are much higher than the national average of approximately 3,230 students per lakh people, even as their GDP growth rates are above the national average. Meghalaya, Tripura, Haryana, Goa and Delhi are other states with healthy GDP growth as well as school enrolment figures. These, except for Haryana, are also among the top 10 states in terms of per capita revenue on education, arts and culture. This indicates that education is a clear priority in these states.

Women’s literacy is another dimension and the one widely seen to have a big impact on economic growth. Many small states fare well in this regard. Kerala clearly stands out with exemplary female literacy rate (87.72%). The state also shows healthy school enrolment figures, good government expenditure and adequate infrastructure.

The fact that these states are small — both in geographical area and population — requires them to pay attention to the quality of their human resources if they have to attract investment and successfully harness their natural endowments . For instance, both Uttarakhand and Himachal Pradesh have focused on creating industrial zones. The success of these industrial zones depends on the availability of employable talent locally, besides power, cost of land, logistics and government incentives.

From a competitiveness perspective, these states would need to align skills imparted by the institutions in the state with the skills to be required by the industry in the future. States, therefore, need to make a realistic projection of labour that would be required by the industries the state is promoting as well as by those industries that already exist, and then focus on developing institutions that can train people who can be placed in these industries. This is the key to enable people to avail of the opportunities within their home state, instead of being forced to migrate to other states or metros for employment.

Large states daunted by task of educating masses despite adequate infrastructure

Tamil Nadu and Maharashtra are the only two large states with good higher enrolment figures for higher secondary school. Other large states such as West Bengal and Karnataka, that have healthy GDP growth, and even Bihar and Andhra Pradesh, that have substantially higher GDP growth than the national average, show poor per capita higher secondary school enrolment. Madhya Pradesh scores low on both counts. Large states, with the exception of Tamil Nadu, Maharashtra and West Bengal, are also at the bottom of the list when it comes to female literacy.

Educating a large population is a challenge for big states. If we look at the figures for government expenditure, this is evident. Large states do not figure among the top 10 spenders per lakh population. Yet, West Bengal spends more on education, arts and culture than Tamil Nadu and Maharashtra that show good enrolment figures . Madhya Pradesh and Uttar Pradesh spend the least per capita on education.

Ironically, these large states have the best infrastructure in the country. Uttar Pradesh has the largest number of universities (29), followed by Maharashtra (27), Tamil Nadu (22), Andhra Pradesh (20), Madhya Pradesh (19), Bihar (17), Karnataka (16) and West Bengal (14). However, the quality of education imparted by these institutions is a matter of concern. States such as Madhya Pradesh and Uttar Pradesh are neither able to adequately fund their educational institutions, nor retain quality faculty.

Inadequate employment opportunities for graduates further strengthen the cycle of out-migration , leaving such states bereft of their knowledge workers and lowering the motivation for profit-making corporations to invest in these locations. This has, however, been changing in specific cities where centres of learning, corporate will and attractive location factors are fuelling clusters of industry in specific verticals. Bangalore in Karnataka has emerged as a hub for the IT industry and so has Hyderabad in Andhra Pradesh. Uttar Pradesh has world-class institutions like the Indian Institute of Technology at Kanpur, Indian Institute of Management at Lucknow and the Banaras Hindu University at Varanasi, but has been unable to develop industries around these to harness the resident knowledge from these places and employ the graduates. The standards of statelevel universities that attract local students must also be simultaneously raised while local employment opportunities are created.

Low-performing states need urgent intervention to progress

Some of the small and mid-sized states that do not fare so well need specific intervention. Chhattisgarh, Orissa, Gujarat and Nagaland have poor higher secondary school enrolments despite moderate and high GDP growth. Jharkhand , Punjab and Assam have low GDP growth rates and low school enrolment. Other than Nagaland , Punjab and Gujarat, these are also the states with low female literacy.

Rajasthan is on the cusp of both GDP growth and school enrolment. However, Rajasthan has surprisingly high government expenditure on education, showing that the state has prioritised education and is determined to cross over into a better performer in the next decade. States such as Chhattisgarh and Jharkand, which do not have a single university yet, need to urgently create the right infrastructure to raise their human capacity and attract investment.

Long-term benefits on the horizon

States need to focus on the benefits that education provides in the long term. A literate population results in controlled population growth rates over time. High-quality workforce will allow states to boost economic growth by focusing on more sophisticated and value-added industries and services instead of merely continuing to invite investment in basic manufacturing and service activities.

The increased productivity that a trained workforce can deliver results in enhanced prosperity and better distribution of wealth, which are the ultimate goals of governments and private sector corporations alike.

http://economictimes.indiatimes.com/policy/focus-on-higher-education-to-leverage-dmographic-advantage/articleshow/7160372.cms

Is Gold a Hedge Against Inflation?

Gold’s price behavior is a reflection of a built-in perception of uncertainty and nervousness regarding all currencies and the current global socio-economic state. From a low of $250 in 1999 to the current price of about $1400 per troy ounce, gold is the only perceived store of value that investors have come to accept. The inverse correlation to the dollar that has somewhat held true for quite a while — gold and dollar values move opposite of each other — has been lost as of late, and the metal has risen on days when the greenback lost against all other currencies.

From a supply and demand perspective, consumption by the precious metal major market – retail jewelry — has declined, according to the World Gold Council, an organization funded by the world’s leading gold mining companies. Total gold demand in the second quarter of 2010 rose by 36%, largely reflecting strong gold investment demand compared to the second quarter of 2009. In Dollar terms, demand increased 77% to $40.4 billion. However, global jewelry demand declined 5% from one year ago despite China’s increase of 5%. In India, the largest retail market in the world, had a decline of 2%. The key driver behind the spike in price is due to investment demand with an astonishing 118% increase from last year, with the largest growth coming from the Exchange Traded Funds segment, which registered 414% growth. It is starting to look like oil between 2007 and 2008, but when many thought that oil was high at $100, it proceed to shoot up to $150, before it fell.

Why gold and not something else? Rarity, acceptability, usability, portability, and liquidity. But isn’t gold a hedge against inflation? Never was and will never be. It’s a hedge against instability, and a consensus exists that gold, for lack of a different asset, is the asset to hold due to the uncertainty that surrounds the markets, which are affected by the constant flux of less than clear economic policies at home and abroad. Positive consumer sentiment in conjunction with easy credit, cause inflation, and if inflation was the issue, the value of hard assets, such as land and housing, would be rising – and that is not the case.

I know about the guy that goes on TV and shows a shrinking dollar and then adds the dramatic clink-clink sound of security to the message. Oh, and he has been in gold for 10 years, except that ten years ago he forgot to mention it, when prices were a lot more accessible. But doesn’t your dollar buy you more house than it did in 2007? And by the way, the unscientific milk index has dropped from around 4$ a gallon in 2008 to the latest special of 99 cents for the same jug. Meanwhile, the price of gold is still rising, completely oblivious that inflation is not around – but global instability is.

Unfortunately, the rapid rise in the value of the commodity has attracted less than scrupulous operators, that rely on misinformation to trick the public into buying their inventory of extremely over priced gold coins, and many unsuspecting individuals are being taken to the cleaners. Whether the value of gold will rise to the stratosphere is an unknown, and I wouldn’t bet on a price level of any kind. Thus far, the price appears poised for further gains, but once the economic future of the major global players is well-defined – whether it is a positive or negative outcome – gold prices will subside because certainty will clear the air, even if sovereign default is the end result. Ultimately it’s only a commodity.

Lastly, gold cannot be money because the supply cannot grow at will to keep up with population and productivity. Only its value can change — up and down — relative to currencies, and the mining market supply coupled with demand from investment, industrial, and retail markets will determine the valuation. Shouldn’t platinum be money? The higher value of about $350 over gold, would translate into lower storage costs for Central Banks and everyone else. How about rhodium at $2,300 per ounce, a member of the platinum family?

The first gold coin used as money was the ‘florin’, minted by the Republic of Florence in the 13th Century, now modern Tuscany in Italy. Yet gold had been around for a little while longer. Gold was also used as money in Rome way before then, but since the mines were in North Africa, the metal lost its appeal as currency due to supply issues, and silver was used instead. In addition, gold is impractical to use as money because an extremely small one gram coin, if in existence, would be something less than 1/16 inch in diameter, and would be worth over $40 at today’s price. Do I have to buy 20 loaves of bread at a time? Let me pay you with this tiny golden speck.

Gold offers opportunities as an investment, much like other commodities, just not for the reasons that are commonly given. And silver has outperformed gold over the last 10 years.

Author: Carlos X. Alexandre
http://seekingalpha.com/article/236312-is-gold-a-hedge-against-inflation-not-really?source=feed

So said Nehru to Eisenhower

Indo-Pak issues, including Kashmir, can be sorted out only through direct contact between the two countries and not through outside mediation, wrote Jawaharlal Nehru in his 1958 missive to the US President

IN HIS letter dated May 14, 1958, US President Dwight Eisenhower had expressed concern over the economic problems of India and Pakistan “during the last few years” and “admired the resolute manner in which both the countries have tackled the complex difficulties facing them”. However, he found it a “source of real concern” that the “effective economic development of both countries is being hindered by the continued existence of unresolved political and economic issues” and that both the countries were “devoting increasing amounts to their defence budgets at the expense of development”. Emphasising his deep personal concern with this problem, he considered it necessary for both the countries to find “mutually acceptable solutions of the major outstanding issues” and for this purpose, he added, he would be “glad to designate a special representative to visit India” if India agreed to it. Excerpts from Prime Minister Jawaharlal Nehru’s reply to the US President dated June 7, 1958, are reproduced below:

Dear Mr President,
Ambassador (Ellsworth) Bunker handed over to me on the May 16 your personal letter of May 14. I am grateful to you for your personal interest and concern in matters affecting us.

I had a long talk with Ambassador Bunker on the subject of your letter and pointed out to him the various aspects of the problems and the difficulties we had to face. I have no doubt that the Ambassador has communicated to you what I said to him on both these occasions.

I need not, therefore, write at any length now. But I am taking the liberty of enclosing a copy of the report of a speech I made in our Parliament on April 9, 1958. This deals with Indo-Pak relations and I attempted to give in it our approach to all the problems that had arisen between them. It deals, in particular, with the basic difficulty we have faced throughout these years in our dealings with Pakistan. There is also reference in it to the report that Dr (Frank) Graham made to the Security Council after his recent visit to India.

This speech will, I hope, make it clear to you how anxious we have been ever since Independence to have normal and friendly relations with Pakistan. We had hoped that the old conflicts and the policy of hatred and violence, pursued by the old Muslim League, which indeed had led to the Partition, would cease. It was obviously to the advantage of both countries to live in peace and friendship with each other and to devote themselves to their social and economic development which was so urgently needed to give a social content to our freedom and independence. Unfortunately for us and for Pakistan, our hopes were not realised and the Pakistan government continued to pursue that old policy of hatred and violence. Every government that comes to power in Pakistan bases itself on this policy of hatred against India. It is this basic fact that has to be recognised. In our opinion, the settlement we so ardently desire cannot come if this policy of hatred continues.

Military pacts and military aid have made Pakistan think in terms of coercing India. No self-respecting country can submit to this, much more so when that country is an aggrieved party and the other country continues to profit by its aggression. Unfortunately, the encouragement that Pakistan has received in the Security Council and elsewhere has led it to continue its policy of aggressive intransigence.

I realise fully that whatever the rights and wrongs may be in regard to these disputes, it is highly desirable to settle them and turn the course of events in the direction of peace and cooperation. I entirely agree with you, Mr President, that we should make every effort to this end. The question that arises is how best this can be done, because a wrong step may well lead to further difficulties. We have experience of trying to explore various avenues and making proposals for discussion, which found no response from Pakistan and led to further confusion. Indeed, we were made to suffer for every step that we took in the hope of facilitating a settlement. Despite all this, it is our desire that our two countries should resolve their differences and develop friendly relations with each other. To this end, we shall continue to work, but in doing so, we cannot submit to what we consider basically wrong, for any such submission would not solve any problem and would only aggravate our conflicts.

We have always been of the view that a settlement of our various issues with Pakistan can only be arrived at satisfactorily by direct contacts between the two countries. If third parties intervene, even though that intervention proceeds from goodwill, the position becomes entirely different. The aggressor country and the country against whom aggression has taken place are put on the same level, both pleading before that third party. It is this difficulty that has faced me in considering the proposal that you have made. Ambassador Bunker has told me that it is not intended that any person should act as a judge or umpire. Nevertheless, by whatever name the third person might be called, his intervention would tend to be regarded as of that kind and might well add to the present difficulties. Any visit of such a person could not be kept secret and the result would be greater public excitement.

Kashmir, canal waters and other matters in issue between India and Pakistan are the result, and not the basic cause, of Pakistan’s hostility to India. The atmosphere between the two countries has been worsened further by the incitement by Pakistan of subversion and sabotage in Kashmir and by speeches by Pakistan’s leaders advocating holy war against India. The Pakistani authorities have been responsible for frequent border incidents; early this week, seven of our border police were shot down in cold blood while negotiating under the white flag with their Pakistan counterparts along the border.

I have ventured to point out frankly the difficulties that face us. At the same time, I appreciate greatly your concern and I am anxious to explore all possibilities which might lead to happier results. I do not think, for the reasons I have given above, that a visit by a special representative, as suggested by you, would be helpful. May I again express my gratitude to you, Mr President, for your personal approach to these matters which concern us intimately. I know that you and your country mean well by us and we are happy that there has been a growing understanding between our countries.

(From The Selected Works of Jawaharlal Nehru, Vol. 42)
http://economictimes.indiatimes.com/opinion/comments--analysis/So-said-Nehru-to-Eisenhower/articleshow/6862680.cms

Expats take rural road for new ventures - Archana Rai BANGALORE

HIGH on the Uttarakhand mountains, a group of networking engineers are hunched over Google Maps on their computer monitors. They are looking for an appropriate site to position a rural internet broadband system that will pipe banking services to customers in the state’s Tehri Garhwal region.
“This is very difficult terrain and we had to make site visits, rent land for solar powered relays on the top of some mountains and hire local labour to weld small masts and carry them to the relay sites,” says Jim Forster, an American entrepreneur, who is building low-cost broadband connectivity in the hills of northern India. Forster is a former Cisco professional who came to India in 2006 as a networking engineer. During one of his trips to Dharamshala, he met a non-profit initiative called Air Jaldi, and became a quick convert to the idea of rural broadband. Two years later, he quit Cisco and returned to India leading the move to turn Air Jaldi into a for-profit business that has just launched a commercial broadband service for consumers in areas such as the Kangra Valley in Himachal Pradesh, Mussoorie and Uttarakhand.
“Rural does not imply poor; rural people have motor bikes, cars, trucks. If we can supply good, affordable internet access then they will also have some number of PC’s,” says Forster who has invested several hundreds of thousand dollars into the venture that is now being launched as airjaldi.net. “We are looking for additional angel investment of up to $500,000 to $1 million by the end of the year,” he added.
Elsewhere in Tamil Nadu, DripTech, a start-up founded by Stanford graduate, Peter Frykman tested a drip irrigation system across 15 farms over five months. Following the pilot, the company has started marketing the product in China where there is a potential market of 300 million customers, according to Frykman. DripTech has raised over $ 1 million from angel investors to get the product off the ground. “We needed $50,000 to fund 6 months of operations and our initial pilot study in India, which I raised from a successful entrepreneur, Scott Petry,” says Frykman who travels to India every eight to ten weeks.

Opportunity across sectors
LISTED amongst the Most Intriguing Product Start-ups by Business Week, DripTech has notched up sales of 200 irrigation systems in China since its launch this year. “It can be challenging for certain people to accept that foreigners could gain expertise and insight into the needs of rural farmers in India,” says Frykman who believes his biggest challenge will be in building a distributed local manufacturing system that will make it possible to reduce costs.
Forster and Frykman are a new brand entrants into India’s burgeoning entrepreneurial landscape. Lured by the country’s economic boom, a number of expatriate entrepreneurs are flocking to India to set up new businesses ranging from rural broadband, solar lighting and drip irrigation systems to incubators that nurture very small enterprises and consulting firms. These professionals are tapping into segments that offer an inherent “India” advantage - untapped rural markets and a talented workforce. “Overseas entrepreneurs are looking for a warmer climate to try out new things as the economic climate in the US has not yet recovered and the buzz about India as an entrepreneurial destination is pretty good,” says Rishikesha T Krishnan, professor of corporate strategy and Jamuna Raghavan chair professor of entrepreneurship, IIM-Bangalore. “China and India are seen as the next big opportunity and while China and to some extent Brazil are not open economies, India is seen as a place that supports good entrepreneurship,” he added.
A unique combination of factors has helped support this perception of India. Skilled human capital with colleges such as the Indian Institutes of Technology and Management and technology companies with combined revenues in excess of $10 billion; A strong flow of capital and a well developed legal system; the opportunity to try out new challenges and take them to other emerging markets.
In contrast, physical infrastructure is poor specifically in sectors such as lighting and power, healthcare, roads, irrigation and rural data communication, all of which offer opportunities for skilled entrepreneurs to build on. Industry watchers estimate that nearly 90 % of Indians live within 40km of fiber optics, owned or operated by telecom companies, including BSNL, Airtel and Reliance Communications, but large numbers do not have access to broadband communication at speeds of 256kbps. “The fiber backbone supports pretty good internet access at very low prices in all the tier 1, 2, and even tier 3 cities but all of those technologies have issues in the rural areas,” says Forster, who finds progressive licensing policies for internet service providers, a huge boost in building a rural broadband business.
Sam Goldman, founder of D.Light , a start-up that has raised venture capital from a clutch of investors such as Draper Fisher Jurvetson and Nexus Venture, is cracking a similar challenge like Forster. “India and Indians are entrepreneurial and there is hunger for new business but there isn’t a mature distribution system to serve rural markets,” says Goldman who grew up in India and completed his high school here. But it wasn’t until he graduated from Stanford, did a stint with the Peace Corps in Africa that the idea of building a business for social good took concrete shape. He came to India in 2008 and started a company that would offer affordable lighting solutions to rural and low income consumers. It helped that the idea got picked up by the Draper Fisher Jurvetson-Cisco Business Plan competition.
“There is a definitely mature ecosystem for young start-ups here with almost all investor such as DFJ and Acumen having an office here,” says Goldman who has since leaned on investor networks to build his team of 80 people of whom 35 are in India. The rest are spread across East Africa, Hong Kong and China where D.Light also sells its products. “India is a highly competitive market and it took us nearly three years to get the right product and price mix here,” says Goldman who feels building products for India has made it easier to enter other emerging markets.
Fighting for a share of the solar pie is another expat entrepreneur, John Howard a former consultant at McKinsey & Co who quit his post at the firm’s Seattle Office for the rough and tumble of business in rural India. Earlier this year, his firm Duron Energy, started sales of solar powered plug and play devices for lighting and battery recharges in villages across Karnataka and Uttar Pradesh with sale of few thousand units until now. Howard, a graduate from the California Institute of Technology, or Caltech, discovered that he wanted to sell affordable power solutions to Indian villagers during a fun-trip to the country some four years ago, and launched his company Duron Energy in 2008. The start-up was incubated by Bill Gross, founder of Idealabs and a Caltech graduate himself and has received investments from Solgenix LLC and David Gelbaum’s Quercus Trust, a family trust .
“Our big breakthrough has been in tying up financing for customers with banks such as Kashi Gomti Grameen Bank,” says Howard who has in place a system where customers can pay as little as 100 a month for a solar light priced at 6,000. “We are actually displacing the 100 a family pays for kerosene every month,” says Howard.
It is innovation of this sort that will be needed to take-off in the Indian market according to IIM-B’s Krishnan who reckons long term staying power and constant innovation will be the twin tests for expat entrepreneurs in India. In fact, staying power is something that Freeman Murray lists as his calling card as he builds a technology incubator for very young start-ups in Bangalore. Upstart.in set up by him in partnership with Satish Dharmaraj, a VC from Silicon Valley-based Red Point Ventures, supports half-a-dozen tech start-ups in the city.
Murray, who worked with tech major Sun Microsystems in the early 90’s before he quit to set up his own company with a friend Pavni Diwanji, found a profitable exit from it in 2000. “After that I got into angel investing,” he says and found himself in India looking for interesting ideas in areas such as voice over internet and IPTV.
He began by investing in start-ups that topped the iAccelerator Business Plan Competition run by the Indian Institute of Ahmedabad putting in about 5 lakh in 10 companies. upstart.in now has a corpus of $ 100,000. “I am looking to raise more capital to support very early stage technology and in the meantime I am providing physical space that mimics hightech incubators in the US that young companies can use,” says Murray who has set up Jaaga, an open format structure that provides internet communications and defined work areas for entrepreneurs looking for an ecosystem in which to build new tech businesses. As the Indian economy expands there will clearly be more such expats who will dive into the world of Indian business. “I remember an early Cisco customer talking about how they would “get one million people on the broadband internet, and at the time, I was amazed at their vision and audacity. Now one million customers in the US is nothing, but I believe we could get 1-10 million people in rural India online, that would be a great accomplishment,” says Forster.

Rural India in the Vortex of change

Rural India in the Vortex of change

Why Indian Managers Succeed Overseas? - R Gopalkrishnan

A famous person said that the measure of a society is how it converts its pain and suffering into something meaningful and useful. India has done that through the remarkable success of its overseas managers.

Indians are rightly jubilant with the overseas success of their compatriots, for example, when Nitin Nohria was appointed Dean of Harvard Business School (HBS); or earlier, when Subra Suresh became Dean of MIT or when Arun Sarin and Vikram Pandit rose to the top of their companies. The positive emotion often has a trace of India Rising.

The achievers are humble about their success. Adobe CEO Shantanu Narayen nonchalantly says, “It is not a big deal, because America is an egalitarian and meritocratic environment.” HBS’ Nitin Nohria gives credit to IIT. Pepsico’s Indra Nooyi modestly says, “I am a mother first and then a CEO.”

Do India-born managers possess something distinctive? Do they achieve more success abroad than other immigrants? It is tempting to think so and, indeed, there are many views. One view is that Indian managers are no different from similarly-educated managers from elsewhere. Another is that Indians have always done well overseas, but media coverage has brought visibility and celebration.

A third view is reflected in a recent book, The India way: How India’s top business leaders are revolutionalizing management, in which Wharton professors Peter Cappelli, Harbir Singh, Jitendra Singh and Michael Useem identify four distinctive Indian practices: holistic engagement with employees, improvisation and adaptability, creative value propositions and broad mission and purpose.

Whichever may be correct, the upbringing of India-born managers quite unintentionally prepares them for a good chance of success overseas. As author Sanjaya Baru wrote in March this year in Careers 360, “Stories of extreme hardship, braving impossible odds and innumerable sacrifices, abound in the lives of nearly 90% of the students in the country.

But among them, some perform exceptionally well. Their academic laurels are so brilliant, that at times their CV looks intimidating. And each one acknowledges that it’s the right education that made them what they are today.” India-born managers are products of four unique circumstances.

Competitive education: IIT/IIM effect
Thanks to subsidies, higher education is accessible to middle-class people. When viewed with the cultural propensity to acquire degrees, this fact results in an avalanche of several thousand applying for every college seat. Higher education is crushingly competitive. Bright Indian children who do not get into IIT effortlessly secure admission into an Ivy League College! In the US, this has repositioned IIT as a genius factory, and IIT alumni promote this assiduously.

The graduates of India’s institutions have been psychologically autoclaved through high-pressure competition. They emerge with insatiate ambition that vastly exceeds their intellectual or financial resources. This stretch between resource and unreasonable ambition is significant: recall the late Prof C KPrahalad, “It is essential for top management to set out an aspiration that creates, by design, a chasm between ambition and resources.” The Indian system creates in many graduates a chasm between aspiration and resource, but quite unintentionally.

Accelerated learning
Life for the student is a struggle in India compared to elsewhere: commuting in chaotic cities, inadequate privacy and lebensraum to study at home, facilities for sports and libraries, and a crushing burden of exams. Almost every student has faced early setbacks: inadequate marks in exams, a lost college admission or a limited job choice. Chance plays too important a role in the Indian student’s life, making it quite stressful, hence youngsters just have to learn to face setbacks early on. They learn to be persistent and to fight with a never-say-die attitude.

Research indicates that extraordinary setbacks accelerate personal learning. Duke Corporate Education board member Judy Rosenblum wrote in 2009 in the Financial Times, “In order for people to develop as professionals, they need to be immersed in problems. A problem provides the opportunity to grapple with and test one’s ability to adapt.”

Although family and peer pressure are high, they also provide the required support to handle the stress. Fortunately, the influence of parents is prolonged and significant. Sir Winston Churchill told the English people, “Never give in, never, never, never, never” for the war years. The Indian student practices this all through life. Success is not just about being ambitious, it is about overcoming adversity.

Hard work plus creativity
It is not that other nationalities are lazy. It is just that overcoming shortcomings of infrastructure requires Indians to expend energy that could otherwise have been productively deployed. The educated youngster is forced to develop the traits of hard work like east Asians who naturally derive it from their Confucian ethos.

But there is a difference: the Indian has a low aptitude for repetitive tasks. The Indian will try to do the repetitive task differently and creatively: in short, he works hard and creatively, a brilliant combination. The serious student works and sweats as if on an academic treadmill and business executives do the same in their workplace.

Indians’ propensity for hard work was grudgingly acknowledged by Abraham Pinkusewitz while explaining how the Gujaratis managed to capture 70% of the diamond trade in the Antwerp market, “Indians succeed because business is all they have in their lives. If needed, they will work 24 hours per day.”

Young Indians have also to adapt to challenges arising from diversity, which is quite different from, for example, the Chinese: learning several Indian languages, adapting to school systems while transferring with parents, and coping with variable teaching quality.

Howard Gardner, Harvard academic on Cognition and Education, points out, “The only reliable way to determining whether understanding has truly been achieved is to pose a new question or puzzle on in which individuals have not been coached and to see how they fare.” Indian students are wired to work very hard, with passion and creatively.

Thinking in English
Where else in the world would a temple be constructed for Goddess English? On October 25, 2010, the birthday of Babington Macaulay, such a temple will be inaugurated in Uttar Pradesh. English is being installed as a deity there so that those who pray to her can be blessed with progress.

Uniquely, Indian managers think in English, the test being that they use English to express fine points. Many don’t comprehend the nuances of a vernacular paper. The manager’s professional education has almost certainly been in English, case studies have been Anglo-American, language proficiency has played an important role in success and socialisation, and the language of business is English. As a result, the Indian manager abroad is quite analytical, linear-thinking , and articulate in his intellectual skills. She hits the ground running in any overseas employment.

Unintended consequence
These four circumstances produce a sufficient number of highly-competitive , creative and competent students! Followed by a career in a relatively-orderly work environment with process-orientation in the west, the career manager goes Boom, Boom. She becomes productive early on because of lower frictional losses and obstacles.

Many, many Indians are successful abroad, not just the few that the media write about. I know from my Unilever experience that Indians are prized as much in India as in Peru, Poland and the Philippines.

These facts about the Indian manager ignore the harsh reality that many do not make it through the obstacle race. This has unfortunate social consequences. But for those that do, the probability of success abroad improves a lot. A concurrent trend is that foreign business leaders are joining Indian companies: Carl-Peter Forster in Tata Motors, Marten Pieters at Vodafone Essar, Wolfgang Prock-Schauer at Jet Airways and Raymond Bickson at Indian Hotels.

In short, Indian managers are rapidly globalising, and that must be a good thing for the future.

(The author is executive director at Tata Sons. Views are personal.)

http://economictimes.indiatimes.com/Why-Indian-managers-succeed-overseas/articleshow/6018548.cms