They're capitalist-minded, and they're changing India forever
posted on Wednesday, August 20, 2008 12:31 AM
Business Week (International), Oct 11th issue
Every day at 8 a.m., her straight black hair tied neatly in a braid, 16-year-old Neelam Aggarwal rides almost 5 kilometers to school in a horse-drawn buggy. She would like to be a doctor someday. But for girls like Neelam, who lives in the dusty, impoverished village of Farah in India's northern state of Uttar Pradesh, such a vocation seems remote. For starters, her school-like most village schools in India-doesn't even offer science classes for girls.
Still, Neelam, one of eight daughters of a sweets maker, has no intention of becoming a housewife. ''I want to make something of myself,'' she says. So each day after school, Neelam operates what amounts to the village's only public telephone-a cellular phone owned by Indian cellular operator Koshika Telecom. By charging her fellow villagers to make calls, Neelam can make as much as $8.75 on a really good day. She's saving the money for computer classes, which she hopes will lead to a good job.
Ten years ago, few girls in India would have dared to be like Neelam. But today, she is the very embodiment of India's youth--ambitious, technology-oriented, and confident. Her generation is the product of the incredible sociological change wrought by eight years of economic liberalization in India, a period of painful transition from one-party, socialist rule to an economy where free markets play a much bigger role. Indian society also has been transformed by the Internet and cable television--forces young people are best equipped to exploit.
India's youth are already having an enormous impact: on the economy, on companies hoping to sell them products, on the media, and on the culture. Unlike previous generations, today's youth are not obsessed with the ins and outs of politics. Thus the current election, which pits the ruling Bharatiya Janata Party against the Congress Party, has failed to ignite the passions of the young. ''Today, even if Parliament blew up, no one from this generation would notice,'' says Rama Bijapurkar, a marketing consultant. ''It has little relevance for them.'' Liberalization's children also differ from their conservative, insular parents in that they proudly mix Indian values with Western packaging. They enjoy wearing saris and still admire Mahatma Gandhi. But they also like wearing blue jeans, drinking fizzy sodas, and watching MTV.
This generational shift in attitudes is all the more important because this group is growing so rapidly. Some 47% of India's current 1 billion population is under the age of 20, and teenagers among them number about 160 million. Already, they wield $2.8 billion worth of discretionary income, and their families spend an additional $3.7 billion on them every year. By 2015, Indians under 20 will make up 55% of the population--and wield proportionately higher spending power.
As this group, with its more materialist, more globally informed opinions, comes into its own, sociologists predict India will gradually abandon the austere ways and restricted markets that have kept it an economic backwater. These youth will demand a more cosmopolitan society that is a full-fledged member of the global economy. They will start their own businesses and contribute to a more vibrant economy. They also are likely to demand more accountability from their politicians. ''This is the generation that is reclaiming India's future,'' says Gurcharan Das, a former chief executive of Procter & Gamble Co. India and author of a forthcoming book on India in the next century. ''This is India's 'found' generation.''
FIRST TASTE. Obviously, many millions in this group remain locked in a struggle with poverty. But out of the teenage population, some 22 million belong to the urban middle class and are in a position to influence the economy dramatically as they grow older. Another 100 million or so live in rural India. Even here, many young people are having their first taste of rising prosperity and expectations.
One result is that computer literacy and education are eradicating caste barriers. While caste and social position still dominates Indian politics, sociologists predict the rigid lines of the system will continue to ease. Already, urban youth are more concerned with their professional ambition than their caste. ''We are only aware of caste while filling out government forms,'' says Trisha Singh, 23, a Pune law student. ''It's more 'What do you do?' that determines your status.''
In addition, massive computer literacy could do plenty for India's economy. National per capita income is currently $450 per year. But a 10% increase in computer literacy in a single year would push per capita income up to $650, according to Dewang Mehta of Nasscom, India's software industry association.
COCKY ATTITUDE. Another driving force of change is TV. Just one year after the 1991 election of former Premier Narasimha Rao ushered in a program of economic liberalization, cable and satellite television became available in 50 million Indian homes. Rupert Murdoch's Star TV, with its news footage from around the globe and soap operas like Santa Barbara gave many Indians their first real look at other worlds. Viacom's MTV and Murdoch's music channel, Channel V, changed the aspirations and values of Indians forever. With its cocky attitude, MTV embodied a take-it-or-leave-it style that appealed to the young. ''The old Brahmanical code of 'lofty thinking and simple living' went out of style, to be replaced by the MTV culture of youth anywhere in the world,'' says Vibha Rishi, marketing director of PepsiCo Inc. India.
The cultural impact has been revolutionary. The previous generation, born in the decade following India's independence from British rule on Aug. 15, 1947, grew up shy, obedient, and socialist in the 1960s and '70s. Bombay-born author Salman Rushdie dubbed them Midnight's Children in his famous book. They came of age during hard times: three wars, several famines, rigid protectionism. Consumer choice meant one state-run TV channel, three brands of bath soap, and car models that changed little through the decades. One political party, Congress, was voted into office again and again.
How times have changed. To appreciate the generation gap, consider Samarth Moray, 11. The only child of a lawyer father and schoolteacher mother in Bombay, he loves computers and building with Lego sets. His hero is Captain Planet on Ted Turner's Cartoon Network. Like many youngsters, he disdains politicians. ''They act like first-grade kids in Parliament,'' Samarth says. ''I feel ashamed.''
What the new generation does like is money. According to a survey conducted by Coca-Cola (KO), the primary ambition of young Indians from the smallest villages to the largest cities is to ''become rich.'' Young people hope to achieve this goal through enterprise and education.
That's a big change. For years, the most highly regarded careers were in civil service, engineering, and medicine. Now, high-paying jobs in high tech and the media are where it's at. Liberalization has created a ''new social contract in which making money is respectable,'' says author Das.
Young Indians endorse it heartily. ''India's salvation lies in free enterprise,'' says Vinay Aranha, 22, who illustrates the trend. He works two jobs--selling cars and doing marketing for his family's small business in Pune, near Bombay.
Already, high-tech startups are taking off in India. Industry experts put the number at almost two per week over the past two years. Pradeep Kar, 40, founder of two high-tech operations, e-commerce company Planetasia.com and portal Itspace.com in Bangalore, says he has been receiving e-mail from engineering students chafing to be entrepreneurs and seeking his advice. ''That spirit of enterprise will change the face of the Indian economy,'' says Kar. Kiran Nadkarni, managing director of the $55 million Draper India Fund, says the entrepreneurs he observes are getting younger--from an average age of about 40 previously to about 25 now.
Liberalisation has created new career models and heroes for India's young. Microsoft Chairman William H. Gates III is especially popular, and so are successful home-grown entrepreneurs like N.R. Narayana Murthy of Infosys Technologies Ltd. (INFY), India's premier software company. Other culture heroes: Indian national cricket team captain Sachin Tendulkar, 25, who is known for his clean image, and MTV video jockey Cyrus Broacha, 28, popular among urban Indian youth for his confidence and self-deprecating humor. ''Cyrus Broacha's our man,'' says Vinod Makhija, a high school student in Pune. ''He's humble, and he's wacko.''
Icons like Broacha embody this generation's ability to adapt Western influences. ''We are a hybrid,'' says Broacha, who sometimes wears a Gandhi topi, a traditional cap, as well as blue jeans. Embracing globalization has given Indians a new confidence. In fact, Indians feel being Indian is now a badge of honor in world music, fashion, literary, and intellectual circles. ''Even Madonna thinks India is cool,'' says Singh, the Pune law student. ''No one asks us any more if elephants walk the streets. Liberalization has changed all that and given India more exposure internationally.''
MARRY FOR LOVE. Indian youth haven't fully embraced Western ways. Tradition still dictates much of daily life. But progressive influences are everywhere. Take the tradition of arranged marriages, where parents chose children's spouses, often without their consent. Now young people want to marry for love--but also want parents' approval.
The younger generation is nationalistic. In a recent survey by ad agency McCann-Erickson Asia-Pacific, Asian youth around the region voted Paris, London, and New York as the ''coolest'' cities. But young Indians voted for Bombay, along with New York. ''India has the best mix of people and cultures you can find,'' says Gaurav Kumar, 16, of Bangalore, India's Silicon Valley. ''We should take the best of both worlds.''
Kumar wants to be an aviation engineer. Along with half his graduating class, he intends to take the tough exam for the Indian Institute of Technology, a system of prestigious, high-tech universities. The most sought-after field: computer science. ''It's almost a religion with young people,'' says Hema Ravichander, head of human resources for Infosys, which gets 280,000 job applicants every year.
Private computer training institutes are working to fill the demand. Just in the past three years, the New Delhi-based National Institute of Information Technology (NIIT) and Bombay-based Aptech have expanded their franchises to 2,500 training centers in 300 cities and towns in India. ''These kids have a deep desire to uplift themselves and their families,'' says Rajendra Pawar, who co-founded NIIT in 1981.
Companies are reaching out to the computer-literate young. Koshika, the cellular phone service provider in Bihar and Uttar Pradesh, India's poorest states, is using young people to develop an e-mail service. The company approached people who operate cellular phones as public services for their villages. It then sold them computers at a hefty discount and taught their children to use the Internet. For a fee, they offer e-mail services. Since most village families have members working in Persian Gulf states, they are starting to use e-mail to communicate, since it is cheaper than a telephone and faster than sending a letter.
For the boys of the village, such opportunities are a great incentive for staying home rather than moving to the cities. Bunty Garg, from the town of Punnhana in Uttar Pradesh, was regarded as a ne'er-do-well by his father, who owns the local fabric store. That was until Bunty set up a public cell phone. Bunty, 22, now has seven public phone booths, his own car, and the biggest home in town.
The danger for India is, of course, that the potent mixture of aspirations created by TV, computers, and marketers in the hearts of India's young could overheat, and the social cauldron could boil over. Some researchers also worry about rising aspirations colliding with the realities of Indian poverty. ''The young generation may want more,'' says Indrani Vidyarthi of ORG-MARG, India's premier market research agency. ''But how to get more when there ain't more?'' Indeed, almost 60% of rural Indian households have no electricity. ''How will they run computers?'' asks Rakesh Mohan, director of the National Council for Applied Economic Research in New Delhi.
But Mohan may be underestimating the pragmatism and ambition of India's liberalization generation. Young Indians are not pessimistic. ''Our lives are in the fast lane,'' says Bangalore schoolboy Gaurav. ''We can cope; we have to.'' With luck, they'll not only cope-they'll thrive.