Indian Prime Minister Narendra Modi. What will be interesting to watch is how he continues to promote the country as an emerging superpower, projected to be the third-biggest economy in the next three years. Picture: EPA/STR
By Phapano Phasha and Redge Nkosi
AT no time in the history of mankind has the scramble for human talent and ingenuity been so brazen, with South Africa and other African countries unfortunately losing their best brains and skills to the world.
The interest by the West – in particular, by the United States and US multinationals in India and skilled Indian workers – remains an under-appreciated phenomenon in South Africa and the African continent, which we have been observing with interest.
While dynamics between African countries and India are different, there are similarities that require investigating, bearing in mind that India is also a developing and former colonised economy. There are a range of factors, but we will stick to those of interest to other developing economies.
The world economic superpowers are earnestly courting India, as Africa watches. How India has exploited and will continue to exploit its relationships with major economies for the greater good of that country is a case study of the moment.
India has become the epicentre of talent acquisition beyond ground-breaking innovations, be it in health, agriculture, ICT and FinTech. This is likely to continue as India powers ahead, turning itself into a contending superpower.
According to a review by Ashwin Lakhan (co-head of investment banking at Rand Merchant Bank): “India’s IT expertise is expected to be a valuable asset for South Africa’s development. It will cater to South Africa’s growing demand for digital transformation across various sectors, such as banking and financial services (financial inclusion), digital public infrastructure and healthcare, among others. Increased collaboration in areas like fintech and cybersecurity is also anticipated.”
However, the question remains: Do African leaders recognise that Africa’s biggest potential, no different to India, is its youthful workforce, as many parts of the world age?
Weak leadership and poor education appears to be the norm in a number of African countries. In South Africa, the phenomenon is no different, with the IT industry largely dominated by Indians in many multinational firms.
Drawing parallels with South Africa projects a picture of an under-utilised workforce (unemployed and unemployable) both locally and internationally.
Surely if South Africa and the continent is to get a competitive workforce on the international stage, a deliberate and a concerted effort is needed by both the government and private sector to strengthen the educational system, which is decades behind industry. Countries on the continent need to also ensure their governments intensify their skills development to make sure their workforce is more attractive to both the local and international markets.
India has primarily become to the US what China was to the US decades ago, after Deng Xiaoping opened up the country to foreign investors. However, many differences can be discerned between India and America, as contrasted with that of China/US.
China’s “Reform” and “Opening Up” policy by Deng Xiaoping in the late 70’s propelled the Chinese economy into a world leading manufacturer, thus helping the US and the world benefit from cheap finished products.
However, the industrialisation of China and its rise as an economic powerhouse, aided by the US, saw millions of Chinese used as cheap labour to build the Chinese economy and to supply the US and the world with cheaply-manufactured goods.
In part, the US helped create the superpower that became China, while it benefited from China’s rural and uneducated population, which manned factories that helped export low inflation to the US and the world. Today, the US is contending with a China that was actually “Made in the USA” and now trying to adapt as a world leader in a world that is fast scuttling towards multi-polarity.
In a recent article in the New York Times by Alex Travelli, titled, “Wall Street Lands on India, Looking for Profits, It Can’t Find in China”, the publication’s economic and business correspondent elucidates how stock markets in Mumbai, India are surging as big global investors look to India for economic growth. This includes “North American pension managers, sovereign wealth funds from the Persian Gulf and Singapore, Japanese banks and private equity firms, which are all clamouring for a piece of India”.
The optimism of economists such as Travelli is based on the assumption that India’s rise is inevitable, and Travelli in particular makes the following observation: “If India looks better to global investors, China and Russia look worse.”
China’s miraculous growth engine is sputtering, after three decades at full throttle, with threats of trade wars becoming routine. And Russia was effectively crossed off the list of viable emerging economies after its invasion of Ukraine in 2022, and the sanctions imposed on it by the US, Europe and their allies.
India having overtaken China as the most populous nation in the world, with more than 1.4 billion people, is now one of the well-sought-out countries for all manner of economic partnerships outside of talent acquisitions. Global Top 500 companies, Silicon Valley, FinTechs, as well as business leadership, are also dominated by Indians or Indian Americans.
The strategic relationships that are being formed go beyond India as the human capital centre of the world, for which there is a global scramble. Politically and economically, India is emerging powerfully.
What will be interesting to watch is how Prime Minister Narendra Modi continues to promote the country as an emerging superpower, projected to be the third-biggest economy in the next three years. Moreover, how, as a BRICS member, India will position itself in a growing multi-polar world.
High levels of poverty obviously still persist in India, including cheap labour; however, the country is mostly associated with a high quality, internationally-mobile, educated labour force. This is obviously an act of Indian leadership and a phenomenon for African leaders – who are attempting to navigate their countries out of squalor and degradation – to watch.
African leaders have an obligation to Make Africa Great Again, and we no longer have an excuse to blame others when we have active and young human capital at our disposal.
* Phapano Phasha and Redge Nkosi are with the Centre for Alternative Political and Economic Thought, with a focus on The Global South and BRICS Plus Countries. The views expressed here are their own.
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