Patriotism isn’t enough: Why going Swadeshi can’t build a Viksit Bharat

What if Satya Nadella and Sundar Pichai, the current CEOs of Microsoft and Alphabet, respectively, had stayed in India out of ‘national fervour’ and not gone to the US; would Microsoft or Alphabet have been Indian corporates rather than American then? Unlikely.

Both Nadella and Pichai are current CEOs who have taken their companies to greater heights, but the fact remains that taking over a successful company is easier than founding one. Even assuming that both of them had founder ‘material’, could they have founded and grown such firms in India? Unlikely again, as founders embedded in a supportive ecosystem alone can create global champions, which India lacks even today.

So, both Nadella and Pichai, leaving India... is that brain drain? Wouldn’t their staying in India be brain suppression? They helped their companies create outstanding products for the whole world and that is unlikely to have happened had they not gone abroad. 

The above hypothetical shows the complexities that a patriotic call for being Swadeshi cannot resolve. Swadeshi is a call to go local, which means handing over your earnings to whatever an Indian entrepreneur produces. If no Indian entrepreneur can produce the things you want, then give up your wishes – it’s unpatriotic to import.   

What then about atmanirbharta? It is self-reliance. Here, a nation produces only those goods and services that meet global demand, with varying quality at corresponding prices. This means meeting the needs of not just premium products from high-income economies, but also those of reasonable-quality products from low- and middle-income economies. Which, in turn, means those products are made by a typical Indian farmer or an MSME, not just by top-notch Indian corporates.

Self-reliance means using products and services that make your life easier or keep you entertained, without worrying about whether the products you consume are local. You use UPI because it makes payments easier. You watch RRR, not because it is a Swadeshi movie but because it has high entertainment value. That’s what self-reliance means.

Atmanirbharta also means using such income to import goods and services that others make best or cheapest. It also means we let overseas producers bring in capital and technology to make in India, using our labour and natural resources, in ecosystems that enable foreign investors to thrive.

But what about those sectors where we don’t have the supportive ecosystem? We can let the brightest among us migrate to where those ecosystems are, as our human resources are world-class; we can also let the skilled among us migrate to those economies where wages are better than those in India. This means those who emigrate could not just be from the IITs, but also from ITIs.

What then is the role of the state in such an economy? "Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things," said Adam Smith in 1755. This principle requires the state to act as a facilitator that lets business ecosystems emerge and thrive. Which means the state shall provide ease of doing business to capital and quality education to labour, whom the capital finds employable. We can also ask the state to provide affordable healthcare to all.

That leaves us with a segment where India does need to be much more self-sufficient, where it is better off being less dependent on the world. Our Achilles’ heel is the dependency on overseas entities for certain materials (rare earths), technologies (US-based social media apps, operating systems like Windows, overseas cloud services, etc.) and key financial assets/systems (US dollar, US treasury bonds, SWIFT international payment system, etc.).

All of the above are owned/controlled by a single or handful of corporations or nations, and they can simply cut us off through sanctions, just as in a ransomware attack. Achieving such strategic self-sufficiency is a marathon and not a sprint. In some cases, India alone may not be able to pull it off, which means forging strategic global relationships with those nations that respect sovereignty and inspire trust.

Gandhi’s call for Swadeshi made perfect sense when we were colonised. But having completed 75 years as a sovereign democratic republic, Atmanirbharta is the way forward. Going Swadeshi now will be going down the proverbial road to hell paved with good intentions. And that surely is not the road to a Viksit Bharat.