About India
Engage with India for Corporate Transformation and Growth
Geopolitical risks, climate change, energy, supply chains, ESG, organizational management, and other external environments and issues are changing at a rapid pace. In order to survive and complement each other in these uncertain times, co-creation with India, the world's largest democracy, holds great potential.
India, which continues to grow robustly, has three strengths: "Country," "System," and "People."
Country
Youth, Digital, Global: Supporting India's Leap Forward
India is the world's largest democracy, with over 950 million eligible voters. It ranks 5th globally in GDP, is projected to surpass Japan by 2030, and become the world's 2nd largest economy by 2075. After a V-shaped recovery from the pandemic-induced economic downturn, India achieved an 8.7% GDP growth rate in fiscal 2021, followed by 13.5% in the first quarter of the next fiscal year, maintaining positive growth thereafter.
Simultaneously, becoming the world's most populous country in 2023 brings social challenges, which also represent significant potential. The following three points characterize India's sustained growth:
1. Youth
India's population was 1.42 billion in 2022 and is projected to continue expanding to 1.67 billion by 2050*. The median age is 27.9 years (compared to 48 in Japan), with over half the population, more than 800 million people, under the age of 29**. While the youth form a large consumer market, they are also digital natives connected to global information and markets. This, combined with global agendas and an inherent entrepreneurial spirit, accelerates their significant impact on society.
*Source: UN Population Prospects (2022 Revision) (Median age)
**The Indian Express (May 2022)
2. Digital
Mobile internet access is widespread in Indian society, with 750 million smartphone users, projected to increase to 1 billion by 2025*. Additionally, some of the world's cheapest mobile data rates and the digital shift accelerated by the pandemic generate vast amounts of data daily. For example, registrations for Aadhaar, India's national identification number, exceed 1.3 billion**. Data, often called the "oil of the 21st century," forms the foundation for enhancing national power and corporate competitiveness. India also possesses international competitiveness in its abundant IT talent and development capabilities that support digital transformation.
*Deloitte, "Technology, Media, and Telecommunications - Predictions 2022"
**UIDAI CEO (December 2021)
3. Global
Foreign Direct Investment (FDI) into India increased by 85% in the eight years leading up to 2022*, further boosted by government tax and rule reforms and enhanced incentive programs. The government is also promoting India internationally as a venue for solving global common challenges, such as changes in the global semiconductor supply chain framework and decarbonization.
A recent characteristic of India's outward focus is the entry of IT services and startups into overseas markets over the past few decades, alongside the globalization of its talent pool. There is a marked emphasis on businesses and product development targeting global common issues and markets with an "India For the World" mindset.
*IBEF announcement (May 2022)
System
Digital Infrastructure, Innovation Ecosystem, Supply Chain, Education System
The systems supporting the social infrastructure of the vast nation of India are characterized by their scale and dynamism. Public-private partnerships, investment, and co-creation involve various overseas countries, generating new value. We focus particularly on the following four areas:
1. Digital Infrastructure
India Stack is a unique data utilization platform led by the Indian government. In addition to Aadhaar (India's national ID for individuals), it includes functions like e-signatures and money transfers that corporations can leverage to provide services. Published as APIs, it is used by government agencies and companies to improve services and create new products and innovations. Aadhaar has over 1.3 billion registrants, and mobile real-time payments occur 2.8 billion times monthly*. This massive data distribution platform will play a crucial role as India's unique infrastructure in the future data-driven society.
*IndiaStack.org
2. Innovation Ecosystem
India possesses an ecosystem for generating value, including new ideas, technologies, and services, comprising entrepreneurs, specialized talent, universities, research institutions, corporations, government support, and investment capital. A key feature of India's ecosystem is that while it faces many domestic challenges, its mechanisms are flexibly connected globally. For instance, Indian startups rapidly contributed to solving major domestic issues during the pandemic, such as healthcare, logistics, and education, securing investment and collaboration from foreign investors and multinational corporations. The birth of 44 unicorn companies (valued over $1 billion) in 2021* is a testament to this.
*Indian Government announcement (January 2022)
3. Supply Chain
Symbolically, India is engaging, with both public and private sectors, in strengthening the semiconductor supply chain, a common global challenge. In December 2021, the government announced large-scale subsidies and support measures (totaling 760 billion rupees, approx. $10 billion, for semiconductor and LCD production). In December 2022, the major conglomerate Tata announced its entry into semiconductor production and significant investment (90 billion USD over 5 years across various sectors including EV and renewable energy for the group)*. Vedanta Group, planning large semiconductor plants in India, signed MOUs with over 10 Japanese companies in the same month*. India's participation in the global supply chain mechanism is highly anticipated internationally.
*Based on interviews with the two companies by Nikkei (December 2022)
4. Education System
A national education system exists to nurture outstanding young individuals who will lead the next generation. For example, the IITs (Indian Institutes of Technology) were founded in the 1950s (starting with 4 campuses) as part of a national strategy to cultivate talent to support the nation after independence in 1947, expanding to 23 campuses across India by 2022. Talented individuals gathered from all over India, overcoming the fierce 1% admission rate competition, attract job offers from leading global companies.
To uplift the entire nation, the new "National Education Policy" was announced in 2020, outlining a vision for a "comprehensive framework covering education from primary and secondary to higher education, as well as vocational training, in both rural and urban areas*".
Furthermore, numerous startups recently strengthened online learning systems during the pandemic when in-person classes were impossible, contributing to supplementing educational opportunities. The emergence of six unicorn companies in the EdTech sector demonstrates the rapid, impactful system building led by the private sector.
*JST Science Portal (August 2021)
People
Indians with problem-solving skills, expertise, and passion flexibly lead in uncertain times
People of Indian origin or cultural background are active on the global stage. They lead not only IT giants like Microsoft, IBM, and Google, but also consumer businesses such as Chanel and Starbucks, and companies like Mastercard and FedEx. Their leadership is also notable in international conferences like COP26, renowned US business schools, and European politics.
This trend reflects how, against the backdrop of India's domestic cultural diversity and complex social environment, these leaders have embraced problem-solving as their mission, acquired the necessary knowledge and skills, and pushed forward.
Beyond corporate leaders both within and outside India, individuals significantly impacting business are emerging from India. This includes not only business leaders, project managers, entrepreneurs, and IT professionals but also experts in medicine and pharmacy, and researchers in biotechnology and space-related fields.
Especially in these uncertain times, and from companies seeking global markets, diversity, and breakthroughs, expectations are high for people of Indian origin.