Google CEO and NRI poster boy Sundar Pichai is in India to launch Digital Unlocked – a training program for Indian Small and Medium Business Enterprises (SMEs) to empower them with essential digital skills. It is part-in-continuation of the grand idea of Digital India initiated by PM Modi since 2014
By the strength of numbers, the vitality of SMEs to Indian economic growth is undisputed. The 50 million+ SMEs contribute 37% to the national GDP, 45% of the export output while employing 40% of India’s workforce.
Thus, from the outside, it makes perfect sense to provide a much needed and deserved support to fully harness the potential of Indian SMEs. And when the entire country is on a digital-blitzkrieg, why should they (SMEs) lack behind.
However, a closer look – a process not much appreciated by our hyperbolic government – may reveal the fault in our stars. Check the numbers below:
- 94% SMEs are unregistered as part of the Indian Economy which itself is 90% informal and unregulated
- Only 3% workforce in India receives any training, leave alone digital
- Only 4% SMEs have access to institutional finance
- Digital literacy levels are < 10%
- 2/3rd rural India is yet to be connected by proper optical fibre internet. (Not counting the unreliable 3Gs and 4Gs which only the Airtel ad girl seems to get)
While the PR machinery handling Sundar Pichai’s speech carefully cherry picked the ‘good’ data, the numbers above make Digital Unlocked look more like a paint job when the house needs a foundational retrofit.
I do not blame Google. The company will do a fantastic job in whatever it does. Secondly, they do not legally owe us this initiative. At the risk of sounding cynical, it more or less a late Christmas present for our digitally enamored PM. Anything beyond would be unintended benefits.
Having said that, the problem lies with the lack of a long-term vision, planning, and imagination for robust, bottoms-up solution and not a cosmetic fix our policy makers are used to doing.
The Indian SMEs suffer from fundamental operational issues such as:
- low production scales,
- poor adoption of technology,
- fragmented supply chain,
- systemic aversion to expansion and innovation,
- broken labor laws and inadequate social security
- lack of access to financial products
- low levels of employee training
I do not outrightly deny the government’s effort in these areas. But, it would be more prudent for the government to take a step back from seeing everything from the digital lens and focusing more on real, offline, ground-level problems.
India, after all, is still not the US. There’s a lot of ground to be covered and hopscotching will not help.