Prime Minister Narendra Modi’s emphasis on India creating world-class leaders across all sectors to turbocharge its economic growth appears to be his government’s model for leaving a mark on the global economy. This model resembles South Korea’s chaebol-led growth strategy, where the government supported a few conglomerates to emerge as global giants such as Samsung, Hyundai and LG, among others.Mr Modi’s speech at the School of Ultimate Leadership (SOUL) conclave on Friday hinted at his government’s thought process regarding the economic model. He called on Indian business schools to prepare individuals who move forward with an Indian mindset while understanding the international perspective.The plan to create Indian global giants is not only plausible but also a necessity. However, most homegrown Indian business conglomerates, except for the Tata Group and Mahindra Group, have historically pursued pure mercantilism. They focused primarily on benefiting from the Indian domestic market rather than expanding overseas to capture foreign markets or making major foreign acquisitions.India has also failed to create great product companies like Apple, Samsung, or even Huawei, that could appeal to global markets. Despite having deep pockets, the Indian wealthy class lacks a risk-taking appetite similar to that of Ratan Tata, who acquired global brands like Jaguar and Land Rover (JLR), Corus and Tetley.Indian multibillionaires do not need business schools to inspire them to become global leaders in their sectors. However, they need a nudge from Mr Modi to step out of their comfort zones and compete on the global stage. If they fail to heed the Prime Minister’s advice, the government should end all protectionist measures to compel Indian conglomerates to compete globally and emerge as new industry leaders.Just as a sapling needs protection initially, domestic companies require shielding from global headwinds until they gain critical mass. However, once a sapling grows into a tree, it no longer needs protection. Similarly, India has many business groups that must face global competition to establish themselves as global leaders.For the last two decades, geoeconomics has replaced geopolitics in the discourse of international diplomacy. Several factors have contributed to this transformational shift. However, a key factor has been China’s stupendous economic growth, which leveraged the very free trade regime created by the West to challenge the dominance of the United States.The growing rift between the US and China has disrupted global free trade. The re-election of Donald Trump as the US President replaced the rules-based trade regime with opportunistic trade practices, denying Indian businesses the conducive global economic environment that Chinese companies previously benefited from.Nevertheless, as the world’s fifth-largest economy, India can support the emergence of global giants — provided they are willing to tap into the global market. In 2024, India had just one company — Reliance Industries, ranked 86th — in the top 100 global business groups, which reflects poorly on the Indian business class. As articulated in his speech, if Mr Modi can persuade Indian business leaders to abandon mercantilism and embrace entrepreneurship, he can secure his place in history.
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