Over the last two weeks, I had a crash course on business and society in India.  It started with the UK India Business Summit in London where a gathering of leaders met to share best practices and honour the state visit of the President of India to the UK.  And, my education continued the next day with a ten day trip to India to tour the country and attend the TED India event on the Infosys campus in Mysore.  Along the way, I learned about the opportunities in this important emerging country and the big challenges it faces ahead.

India is full of contrasts.  On the one hand, the government and society are in a crisis of poverty, pollution, and poor planning.  Infrastructure is need of a major overhaul.  The road network is crumbling.  Traffic is extreme.  Power outages are the norm.  Clean water resources are scarce.  In the cities, 50% of the people live in shanty towns with very poor conditions.  In the public schools there is a 30% absentee rate among teachers.  Corruption is widespread with half of the population saying they have had first hand experience in paying a bribe to get things done, according to Transparency International.  And, the government finances are a mess as the revenue is estimated to be only a third of what it should be if everyone paid their taxes.

Yet in spite of all these challenges, India is full of promising signs.  The country is growing rapidly even during this global downturn.  This year, the Economist Intelligence Unit predicts India will grow 5.5%.  And growth will accelerate to 6.3% next year, 7.8% in 2011 then continue at an 8% a year pace afterward.  Inflation is decreasing from just under 10% this year to only 5% in the future.  And there are examples of successful businesses all around especially in the IT industry with companies like Infosys, Wipro, Satyam, Tata Consulting and others all reporting positive earnings growth this year. 

So what is the key to success in India?  How does a country full of big constraints like poverty and creaking infrastructure still manage to grow so fast?  The answer is what some call “Jugaad” which is an Indian term meaning an arrangement or work around due to lack of resources.  And, the country is full of work arounds to get things done.  Today, doing business in India requires much ingenuity, patience and Jugaad to get things done.

Companies, organisations, and individuals find a way to wire around the obstacles, marshall new resources and be successful in India.  I saw this first hand.  The TED event was held on the Infosys campus in Mysore which is a giant university-like environment complete with five star luxuries that can train 14,000 students at a time.  New recruits come go into a 6 month intensive training program before starting work at the company.  And, this is all run on a high security campus that keeps the outside world at bay and a high quality, yet highly controlled, environment inside. 

I heard many stories of Jugaad particularly to benefit society.  Charities like Sukrupa are setting up their own schools to educate slum children across the country because the government has failed to do so.  Healthcare providers like the Aravind eye care hospitals deliver quality care to the poor who could not access it before.  Ambulance company Dial 1298 is setting up in cities like Mumbai to deliver emergency transportation where none existed.  Housing companies are making profits by building 300 square foot homes for the working poor to move out of their shanty towns and begin to move out of the bottom of the pyramid.  Faced with excessive government bureaucracy and corruption, all had to overcome major challenges to build their social businesses, work hard and use a little Jugaad to make their projects a reality. 

So, there is clearly tremendous opportunity in India.  However, the challenges faced are immense.  At the UK India Business Summit, all the speakers were in agreement that it takes much patience and a longer term view to doing business in India.  For those who use a little Jugaad can work around these constraints and enjoy financial benefits while helping improve the society.