An Indian Exchange Student Living In Australia Tells Us How Both Countries Can Build A Better Relationship

Shivaramakrishnan Ramamoorthy (Shiva) is studying a Masters in Management at the University of Sydney.

He’s an Indian international student who has previously provided some interesting insights into Australian culture after moving from Chennai in southern India just over a year ago. You can read what Shiva finds most surprising here.

So ahead of Indian Prime Minister Narendra Modi’s visit to Australia for the G20, Shiva has again opened up, this time giving the two leaders some advice on how to build a better partnership between Australia and India.

It’s something Tony Abbott has previously said he wishes to achieve. On a recent visit to India Abbott said: “Prime Minister Modi has said that India is open. He hasn’t used the phrase ‘Open for Business’, but he said, “Come, make in India”, and I think that that phrase, “Come, make in India”, is very close in spirit and in intent to the phrase I have used of our country, Australia, that we are ‘Open for Business’.

“So there is a lot to do – a very great deal to do. I think there have been times when we have focused on opportunities elsewhere in our region. I’m not saying that there aren’t lots of opportunities elsewhere in our region, but there is an abundance of opportunities here in India. I am determined to make the most of them, I know all of you are determined to make the most of them and I look forward to working very closely with you and with our Indian interlocutors over the next two days. Let’s enjoy our breakfast and enjoy our company.”

So with Abbott determined to build a better relationship, Shiva thought he might lend a hand.

Here’s what Shiva had to say.

Prime Minister Modi needs to…

Indian prime minister Narendra Modi. Image: Kevin Frayer/Getty Images.

The “Make in India” initiative, a pet product of Mr. Modi’s, should be tailored to the Australian market and business investors.

The reason for tailoring is important because in India manufacturing and other business departments have a long road approach for investing companies to begin their ventures. Even the local businesses are feeling the pain on the tax concepts that consist of General, VAT and GST, etc.

The very first lesson that India should learn is to simplify the taxation system, making them similar to the standards of Australia.

It is to be noted that contract enforcement takes as long as 1,420 days and going through the 12 procedures for starting business typically takes 27 days.

India’s infrastructure and logistics are still under the table of developments and inadequate transport networks make it tough for manufacturing companies to achieve just-in-time production. As a first strategic marketing pitch to investors, Modi should stress radical de-bureaucracy, deregulation, minimum paperwork and divorce the legal and infrastructure hurdles of starting and doing business in India ‘in action’ rather than just in words.

The education system in India is still a decade behind with cliché subjects and no space for innovation. The majority of students still lack proficiency in English and face many barricades to enter into the MNC jobs in India. Another major point to be noted is the lack of serious industrial engagement and international exposure.

Students from China, Korea, Germany and the US are landing in Australia every year to get international exposure and internship experience. They even get help from governments in the form of sponsorship.

This has provided them the opportunity to leave the queue system and land on a professional job more easily than other candidates. There is no simple, streamlined version that India has to identify potential talent.

The concept of entrepreneurship is still sporadic in India, whereas in Australia there is ample evidence and case studies of successful takeoff businesses.

This is a potential avenue of exploration, where India could receive assistance from Australia by creating a platform environment and a mutual understanding in bringing in top-tier organisations from aviation and technology companies, consulting firms and reputed academic and banking institutions, to participate and hire people on an internship or exchange basis for a semester.

In fact, the Indian education system should enforce a compulsory international exchange program in the near future through government bilateral agreements with other nations for the benefit of students. This would not only be helpful for students; there is potential to deepen untapped connections between countries.

For example, the maximum loan a student could avail from a bank is Rs 20,00,000 (AUD 40,000). None of the decent and highly reputable universities could avail a program on a budget this low for a duration of 2-4 years. Most students rely on scholarships, but there is already stiff competition for these. So, there is a clear avenue for the Australian banking institutions to offer loans to international students for the duration of the course.

This could be done with university, government and immigration understandings between both countries. This is a very abstract concept that needs in-depth refinement. The other major challenge for India is that students who leave India to study in other countries don’t have any intentions to return to India, as they are delighted to get stipends that are incomparable to the industry salaries in India. This is again a cliché trend that India possesses.

A concept method to change this trend would be something similar to Horizon 2020 – a big EU research and innovation program with nearly €80 billion of funding available over 7 years (2014 to 2020) – in addition to the private investment that this money will attract.

It promises more breakthroughs, discoveries and world-firsts by taking great ideas from the lab to the market (European Commission, 2014). It has all the ingredients for the Indian students to return to their home country and discover a future. Modi’s “Make in India” will eventually become “Come back to India” for Indian students.

Interestingly, this could be implemented as a joint venture initiative between India and Australia. If this happens, the US would become the second option for Indian students higher education studies, as Australia would potentially move up the ladder by two spots from number 3 to 1. The initiative would also contribute to manufacturing and trade developments.

Prime Minister Abbott needs to…

Photo: Getty / Cole Bennetts

Look beyond China.

The evolution of China as a favourable trade and manufacturing destination is curtailing, meaning there’s opportunity for Abbott to focus on India.

Both Boston Consulting Group and Deloitte have highlighted that China’s traditional cost advantage is under pressure.

According to the U.S. Bureau of Labor Statistics, average labor compensation (including pay, benefits, social insurance and taxes) in India’s organised manufacturing sector increased only marginally, from $0.68 an hour in 1999 to $1.50 an hour currently. The average compensation in China’s manufacturing sector in contrast rose 20% year-on-year in the same period to $3 an hour. Therein lies an opportunity “Make in India” must tap for Australia.

The first point of opportunity for Australia is to extend assistance and alleviate poverty in India. According to Mckinsey Global Institute report, India has a population of 680 million who cannot meet their essential needs. About 50% of public spending on basic services does not reach people in need, while about 46% of basic services are not out of reach for the average household.

Jobs and productivity growth will have a huge impact on India – 580 million people can be economically empowered by 2022.

An extra 115 million non-farm jobs are needed over the next decade and a 70% increase is required in agricultural yields over the same period. Half of public social spending is needed for health care, water and sanitation, up from 20% today.

This is more than enough for Australian firms to tap in to, not only to help alleviate poverty, but also to make a profit.

If this is taken seriously, both by universities and the Australian government, it could create a long-term business area with promising revenues on the investments. It is recommended the University of Sydney change its direction from China to India as it has a prolonged laid back approach towards the Indian sub-continent without knowing its potentiality in India.

Knowledge is power, and it reaches its highest peak if it is shared. Indian students are some of the world’s brightest mathematicians, something that was recently recognised by US President Barack Obama. But the students in India aren’t exposed to the best opportunities. There are only a few educational partnerships that have been signed.

This needs serious recalculation. With 700 universities and more than 35,000 affiliated colleges enrolling more than 20 million students, Indian higher education is a large and complex system. The structure of degree-granting institutions is cumbersome, primarily due to “affiliation” and funding sources.

More than 85% of students are enrolled in bachelor degree programs with majority enrolling in a three-year B.A., B.Com. or B.Sc. degrees. One-sixth of all Indian students are enrolled in Engineering/Technology degrees. But if one can see the output of employability and the exposure of the international markets it is relatively very low.

Australia could tap into this educational market and enter into an MoU with a range of universities – helping students come to Australia and do one semester abroad here. This would eventually have positive effects for both countries in terms of international mobility, business opportunities and retaining future talent – the second strategy for Abbott to consider.

Thirdly, open up an investor scheme for Indian citizens. Recently, Immigration Australia launched an initiative to attract more Chinese investors to Australia. According to Forbes India has more millionaires than China. This would not only help sustain Australia’s economy but would also be an additional source of investment.

Fourthly, there’s potential for urban and rural development. India has great highway connections but traffic is a nightmare in every metropolitan city. Australia could assist India with urban planning to alleviate congestion and extend its resources to build smarter cities that India is planning to commission.

The above strategies aim to drive both nations towards long-term growth and business opportunities. It is to be noted that most of the strategies focus on young people and alleviating poverty.

Hence, it is kindly recommended both countries ease the business winds, favouring better strategic partnership ties.

Shiva’s on LinkedIn and he’s happy to meet with the leaders to explain his arguments – if they’ve got the time.

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