Wednesday, March 19, 2008

The China Opportunity

The Unknown India

What do the Chinese think about India? Well, they don’t. 398 urban Chinese were asked to associate 24 attributes with 14 nations, including the US, Japan, Korea and India. 58% of the people associated no attribute whatsoever with India. By no stretch of imagination is India a salient nation in the mind of today’s Chinese. Among the younger generation, at best, it brings up image of excellence in software. Some envy the facility of Indians with the English language and wonder whether English is the mother tongue of many Indians. The older generation, particularly the taxi drivers, spontaneously start humming “awala hoon” on the discovery that their fare hails form India, bringing memories of a time when Raj Kapoor’s Awara was perhaps one of the five films that the Chinese government allowed its citizens to watch in a year.
A missed opportunity
The obscure status of India in the Chinese minds is a missed opportunity for India. There is much that India could achieve by raising their profile among the contemporary Chinese, as they gaze at the external world with awe and bewilderment and whose view of the world is yet to fully crystallize. It is the appropriate time to invest in creating a clear image and a distinctive identity for India, and by doing so, benefit from the momentum of the fastest growing economy in the world. While there are many areas of opportunity, the following do stare prominently as the ones that India is particularly well suited to exploit.
34.5 million Chinese visited a place outside China in 2006 – not even a small fraction of these visited India. To the Chinese today, the most attractive tourist destinations are the European countries such as France, Italy and the UK as also Australia.
How can India start to attract the Chinese tourists? There is a seed of a perception which could be exploited - according to a survey of Chinese attitudes towards different countries, while as a country with rich culture and traditions, the Chinese are proud of their own place – India and UK are at the second place. This perception of culture and tradition could be built upon to attract the Chinese tourists. While the Chinese material needs are being satisfied, little sustenance is available for their spiritual needs. Yoga is already a bond (albeit still a weak one today) which attracts the Chinese to India, as thousands of Chinese have taken to yoga it all its forms and exotic variants. These elements of Indian tradition and culture could be effectively marketed to attract a fair share of the Chinese tourists.
In the field of computer hardware and software, US is the clear leader in the Chinese minds – but India is rated next – though a distant next. However, a foundation already exists for India to exploit this image with a mild recognition that the Chinese give to Indian software expertise. Perhaps this is one area that the Indian software companies are already acknowledging and have taken steps to exploit. Infosys, TCS and Satyam have set up development centres in China and are gearing up to carve a share in the huge domestic Chinese software market. Chinese service industry is still in a primitive state in China and to grow and enhance its quality, software is perhaps one of the more important tools that it needs. Indian companies are in a good position to carve out a niche for themselves in this market – provided they build further on the existing image, make their presence felt in China and invest in learning about the needs of the Chinese industry.
Managerial expertise
While the economic growth of China is clearly because of policies of the Chinese government, the Indian acceleration is perhaps in spite of the Indian government. The Indian growth is clearly attributable to the private sector and their ability to efficiently exploit both the domestic opportunities and the export potential of Indian services. On the other hand, the big corporations of China are still largely state owned behemoths. The growth in the size and profitability of Chinese companies and the huge Chinese banks, is not because of their skills and innovation, but because of their monolithic position coupled with increasing money in the hands of the Chinese consumers. Few Chinese have heard of the Tata’s and their purchase of global companies and brands or the Ambani’s who seem to be expanding their skills to touch every area of Indian life. A knowledge in China of the proficiency of Indian private enterprise and the skills and expertise of the Indian manager, will create a huge opportunity for Indian talent and businesses.
Karishma (translated into Chinese as Qi Ji or miracle) has been on the air on several Chinese television channels. A few other Indian serials have also hit the Chinese television. The most popular Asian cultural imports in China are, however, Korean. Korean films, television drama and music are a rage in China (as they are in many other Asian countries). Korean films and drama, offer plots of family intrigue and romance, that are quintessentially Indian, indicative of the fact that Indian storylines and plots are likely to appeal to the Chinese audience. In fact Indian entertainment industry, given their experience and expertise could even develop special programmes for the Chinese audience. India is in a better position to do this than any other country - both in terms of the technical prowess and creativity, as well as their ability to understand what will move their Asian neighbours.
While India has always prided itself on its education institutions, the irony is that Indian students are coming to China for higher education in medicine and there is practically no reverse flow. Indian Institute of Science at Hyderabad gets more MBA applications from Asia than any other management school other than Harvard. Indian Institutes of Management and Indian Institutes of Technology are often rated as among the best in their class globally – a fact that India could gain tremendously by advertising to the Chinese. Chinese are travelling all over the world in quest of higher education, often enrolling themselves at poor quality institutions in obscure locations. While it is true that India is hardly able to meet the demand of its own citizens for high quality higher education, attracting international students is sorely required to raise the profile of Indian education. India needs to actively market its education institutions in China. While success may be limited in the short run, the long term potential is extremely attractive.
Need to create the Indian image and identity
Chinese do not have a high opinion of Indian products. For quality products they look up to Germany, the US and Scandinavian countries. When it comes to perfumes and luxury products, they think of France and for consumer electronics Japan and Korea dominate their thinking. However, India has a foundation of an opinion which could serve as a basis for creating a unique image and identity for India and what it can offer to China. India stands to gain immensely from embarking upon this effort – or in omitting to do so faces an enormous opportunity cost of further growth and international prominence.

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