Of late there has been a lot of negativity around India's growth story and outlook. This has clouded a lot of the economic optimism in India. Slow growth, uncertain economic policies, rampant corruption and the depreciating rupee. After almost three years of my return back form the US, I must admit there were times that I was contemplating a move back. However, in retrospect a lot of these issues didn't really affect me in my business and career. Sure, this is my personal experience, but isn't what this blog is about :). Here's my take on some of these issues:
- Corruption - I haven't had to pay a single rupee in bribes for my business. Yes, we're still small and have been shielded from a lot of the bureaucracy that larger companies are exposed to , but we've had our share of government interactions, and that has so far been clean. We've sold to Government agencies, large private corporations and nowhere in this deal were we asked or have we come close to bribing officials. The closest we did come was in the customs office, where we probably had to grease a few palms to get a duty refund for re-exported items, but we decided to forego the refund than to indulge in bribes. I'm a staunch believer that with the burgeoning of youth in this country, tolerance for corruption is decreasing. They have the stamina to fight this and they can't be taken for granted as they are a significant portion of the votebank.
- Slow Growth rate - Yes the pundits peg India at a recession with it's sub 5% growth. Policy paralysis, corruption are some factors that get raised. We did see a slowdown in our business as some orders expected to come in from the automotive segments were deferred. But as entrepreneurs we need to be agile, and what was lost in the automotive segment was made up in the government and FMCG sectors. What fundamentally hasn't changed in India is the large middle class, and it being a demand driven economy. India still has more demand for goods and services than supply can meet. If you pick the right areas, you need a much bigger 'recession' to unsettle this demand and thus growth than what we are experiencing now. Malls and restaurants are buzzing, the stock market is at a three year high. Where is the recession again? My advice to folks contemplating entrepreneurship in India. Don't look for game-changers, and differentiators. It's an execution game for us small and medium business, not one of strategy.
- The rupee is worthless - My wife jitters every time I repatriate USDs to India. Yes, it's depreciated about 20%, but as part of our revenue is coming in from exports of services - this has helped. There was a recent article in the Hindustan Times on this topic. Moreover our domestic business has also seen an increase in interest with manufacturers who are exporting or contemplating export. A 20% increase in our goods more than makes up for it with the value they would see in being globally competitive. Their prices are thus cheaper and their quality of products are higher when compared to their international peers. So here again, we're trying to look for ways to take advantage of this decline. We may not be taking expensive foreign vacations any time soon, but I feel this may not have impacted us a whole lot, in fact it might even help because customers are now looking at us for solutions when they were earlier importing them.
So it's not all that gloom and doom from where I'm sitting :)