International -- Editorials
HOW INDIA CAN REVERSE ITS BRAIN DRAIN (int'l edition)
Everyone has heard of the overseas Chinese and the contributions they are making in bringing China's backward economy into the modern era. Now, overseas Indians are beginning to play the same economic role in India. With the world's second most populous nation opening up its closed markets after years of autarchic stagnation, overseas Indians see unprecedented opportunities back home.
What overseas Indians could bring back to India is enormous. They represent one of the most prosperous business communities anywhere around the globe. They total 15 million people worldwide, save some $50 billion a year, and own $100 billion in real estate. In the U.S., their average income level is $48,000, higher than any other foreign-born group. Indians heavily populate Silicon Valley, are a significant force in chemistry and other sciences, and total 20,000 of an estimated 1 million doctors in America. They also own 40% of all U.S. motels.
Overseas Indians, in other words, have the skills, brain power, and the capital to make a difference wherever they live. For India, that could mean providing sorely needed investment for everything from telecommunications to manufacturing. India's overseas progeny can offer financial know-how, marketing expertise, and technological prowess. Their input could also help India expand crucial trading links to all the countries of their diaspora, from the U.S. market to those in Britain and Africa.
But first, India must recognize their value and open the door to them. The government of P.V. Narasimha Rao certainly recognizes their potential contributions. He is opening market sectors once-closed to overseas Indians and is making it easier for them to repatriate earnings. But overseas Indians, like all American, European, and Asian investors, still face stiff opposition from local industrialists, who want to block their entry and keep India's protected domestic markets to themselves. What's needed is a concerted drive by the government to increase competition in the economy by allowing overseas Indians and foreigners to invest into India. In the end, it will result in far larger number of competitive industries that are able to play on the world stage.
With elections coming in 1996 or sooner, Rao's Congress Party may be loath to offend local industrialists by proceeding to liberalize the economy. Not only must the central government stay on track, but India's state governments should join in, as well. There's trouble brewing on this front, however. An opposition Hindu nationalist state government in Maharashtra is now reviewing whether or not to cancel a $2.9 billion project by the U.S. company Enron Corp. If the project is stopped, the signal to all outside investors would not be positive.
Overseas Indians are a savvy people who have succeeded in the East and West alike often under adverse conditions. Now, they have a chance to give something back to India--and do well in the process. India should welcome them with open arms. If the country doesn't, overseas Indians will take their talents and capital elsewhere. They've proven they can do that already.