Learning Lessons from: Naina Lal Kidwai

Last night at The Worshipful Company of World Traders’ Annual Tacitus Lecture, Naina Lal Kidwai spoke on “India’s emerging role in the global economy”. She is the CEO of HSBC India, the first Indian woman to graduate from Harvard Business School, and Fortune magazine listed her as the 34th Top Women In Business. I’m sure you’ve all been learning about the “glass ceiling effect” in your Work & Leisure modules, and she is a perfect example of an outright defiance of that.

First of all, she assures us that a US consumer slowdown, should it occur, would have minimal effects on India since exports only represent 20% of India’s GDP and importers would benefit from cheaper costs. India’s domestic markets are very much alive and well. However, always striving for betterment, she says that it should be aiming even higher for a growth rate of 10%.

She highlights India’s most famous exports in IT and BPOs (Business Process Outsourcing). India’s IT economy generates of 11 million jobs per year, more than any other emerging country. Even Thomas Friedman admits in his book “The World Is Flat” that it was India’s army of highly skilled technology workers and its abundance of fibre-optic cables which contributed to a more level global economic playing field.

She also mentions other areas of Indian growth such as the M&A markets and telecommunications and doesn’t neglect to point out that improving Japanese-Indian and Sino-Indian relationships will play a major factor in India’s future in the global economy.

On business innovation, she chooses to tell us about “dabbawallas” – food deliverymen who pick up home-cooked meals and deliver them right into the offices. It’s an intricate system, essentially FedEx for food, but manages to run astoundingly accurately without any use of computer technology. Forbes magazine awarded them a 6 Sigma rating – meaning accuracy to a percentage of at least 99.999999%, or only one missing meal per six million delivered!

However, she is not so hopelessly optimistic as to overlook some of India’s areas of concern. The rupee has been rapidly appreciating and this could be lethal to certain Indian export industries, especially the BPO sector which survives on wafer-thin profit margins. Inflation is another issue for India, especially food and fuel prices which will especially impact the poor. Her prescription to India’s lack of infrastructure is further investment, another $500 billion worth (!) according to the Government’s estimates.

On climate change, she is a proponent of cleaner, greener energy and co-operating with other nations. In fact, India had the highest positive response rate in HSBC’s Global Climate Confidence Index (the UK came last). Both India and China are facing a water crisis and this is only to be compounded by future population growth.

On social issues such as gender and class divides, she has reasons to be optimistic: more women are getting educated, getting jobs and becoming financially independent. Microfinance in India has been a remarkable success and contributes to not just an alleviation of poverty, but also positive social effects within the community.

She concludes that despite the challenges that lie ahead, opportunities in India are endless. Personally she would like to see an accelerated growth rate so that the change at the bottom of the pyramid is faster, with continued focus on more inclusive growth.

A copy of the full lecture transcript can be downloaded here.

[Editor’s note: this is the third instalment of the Learning Lessons series, detailing the author’s exploits on the London lecture circuit. For further information or to subscribe to the mailing list, contact arthurmauk@gmail.com]