We must emphasise skills and knowledge above all else

Feb 08, 2004 Success, Sunday Nation

Last week I wrote about the remarkable progress India is making in transforming its economy. India is attracting the attention of economic commentators around the world; most agree that the country has come out of an economic ‘Ice Age’ and is going into a dramatic ‘takeoff’ stage. What can we in Kenya learn from this experience?

The first question must be: what role did the government play in facilitating India’s economic makeover? There can be no doubt that India’s leaders have done some very necessary things. Firstly, they have removed the choking grip of government from the throat of the financial sector: interest rates have been steadily lowered, forex restrictions have been removed, and banks are now free to lend where they please. This has given India’s teeming entrepreneurs access to funding, and fuelled an investment and consumption boom.

The Indian government is also making a sustained attack on modernising the country’s once-decrepit infrastructure. India is currently implementing the world’s largest infrastructure project – the National Highway Development Programme. The most ambitious part of this project is the Golden Quadrilateral – 6,000 km of modern six-lane highways connecting the four major cities of India. Businessweek pointed out recently that the trip from Bombay to Pune now takes 50 minutes; three years ago, it took three hours. The result: Pune, given a vital corridor into the outside world, is one of India’s many new boom towns.

In telecommunications, India’s network is large enough to be in the global top ten: 40 million fixed lines, 17 million cellular lines and, crucially, over 300,000 route kilometres of fibre-optic cable. When people call Kenya from India, they often pay as little as 5 rupees (Sh 8) per minute; a call in the opposite direction can cost twenty times as much!

The Indian government’s main contribution to all of this success has been quite simply to get out of the way. It has relaxed foreign-investment restrictions and offered tax incentives in strategic industries. It has embraced the participation of the private sector and brought in much-needed capital. Hardly any of India’s major infrastructural transformations are being conducted without the active and enthusiastic support of private local and foreign investors.

But wait a minute: good roads, functioning telephones, efficient capital markets – is that really all it takes? Every advanced economy has these, so how do these things offer India competitive advantage? The truth is that they are merely smoothing the path to transformation. The engine in the economy is fuelled by something else altogether. We must understand what that is, very clearly.

Retired General Wesley Clark is a contender for president of the United States. On the campaign trail recently, he said something very unusual. He suggested, to a somewhat astonished audience, that graduates from the Indian Institute of Technology (IIT) should be offered a fast-track Green Card to reside in the US. This tells us two very important things: one, that knowledge and skills can open any door in this world; and two, that these skills are mobile and cannot be regarded as the property of any one country.

There are seven IIT campuses across India, and they produce 3,500 science, technology and engineering graduates every year. They are the crème de la crème of the Indian educational system. The IIT concept was established nearly five decades ago, and today is seen as the hothouse for India’s brightest minds. As the Gen. Clark story illustrates, IIT graduates are amongst the most in-demand students on the planet.

Academic flagships like India’s IIT play a very important role. They put a country on the world map in terms of academic excellence. They send a very strong message in terms of that country’s emphasis on knowledge and skills. These institutions may be able to cater for only a limited number of graduates, but they play a huge role in raising general educational standards in the country, simply by setting a hallmark against which others are judged. The IIT is merely the pinnacle of a system that emphasises the acquisition of knowledge and marketable skills above most other things in life.

We have two great opportunities in this country: one is to try and capture the academic high ground in Africa; the other is to understand how to reap the most benefit from the graduates we produce. We saw a great explosion in the number of universities and graduates in the past twenty years; unfortunately, we emphasised quantity over quality. We plucked out a handful of academics and turned them into dubious politicians, and left the rest to stagnate in penury. In terms of priorities, we simply turned our attention elsewhere: away from the slow and painstaking building of excellence in knowledge, and towards the get-rich-quick economy of hucksters and wastrels.

A task force of the best minds is needed: to address the issue of building institutions that can raise the bar of academic standards over the coming years; to investigate the ways of involving the corporate sector in providing funding, endowments and sponsorships; and to revitalise our research efforts so that we produce ideas and patents that are born of Africa and work here, and carry an economic value. Without this investment in the skills of tomorrow, we will remain the also-rans of the world economy.

The second opportunity relates to the globalisation of skills. Today India’s skilled minds are scattered all over the world. The Indian Diaspora is an ‘economy’ with a ‘GNP’ of US$ 160 billion. So is the investment in skills lost to India? Not at all. India has slowly come round to the enlightened view: that its Diaspora is a ‘brain gain’, not a ‘brain drain’. It has granted dual nationality to persons of Indian origin living in 16 countries, and is facilitating the return of capital and skills to the country.

In Kenya, the evidence so far is that our minds remain closed. We regard our Diaspora as sell-outs who belong to others. We think dual nationality is a security issue, not an economic one. We cannot see the treasure trove we are sitting on: of business and technical skills, of experience of working in advanced economies, and of financial capital. Our Diaspora offers all this and more to us, but we are turning up our noses. We are happy to remain dependent on foreign donors and their conditions, but cannot see the helping hand that our own sons and daughters could extend to us.

It is time to think ahead and to think big. Whether it is done at Bomas III or in parliament, the issue of dual nationality must be addressed intelligently. It is an issue that requires open hearts and open minds. Let us pray that those who are designing our constitution for generations to come can rise to the challenge.

The formula is simple, as all good formulas are. Develop the institutions that produce the skills, and nurture the environment that attracts and retains them. Therein lie the seeds of economic transformation.