India’s moment in the sun—despite the weather in Davos

A security personnel stands on duty on the snow-covered rooftop of a hotel near the Congress Centre in Davos. The city witnessed the heaviest snowfall in 20 years on Monday. Photo: AFP

For all of those who might feel self-important about being invited to the World Economic Forum in Davos, there is nothing more humbling or equalizing than being caught in a mind-numbing traffic jam. The events kicked off on Monday but the famed Swiss efficiency took a battering from the weather. The largest snowstorm in over two decades disrupted the entire transportation infrastructure with roads clogged, trains cancelled and apparently even helicopter landings restricted. For the first time that veterans can remember, events had to be pushed back on the opening day so that people could make it on time.

However, despite all this, the delegates are here. The theme last year was around the Fourth Industrial Revolution and its impact on businesses and economies. It was both optimistic in terms of the potential for transforming lives and downbeat in the short-term impact on jobs. This year, the theme is “Creating a shared future in a fractured world”. The subtext is that while there are many indicators that point to an optimistic future, there is a lot to be concerned about. For the first time in a long time, the global economic engine seems to be firing in all regions—from the US to India and China in Asia to even Greece and Spain in Europe. Stock markets around the world are reaching levels that one couldn’t have imagined a couple of years ago. However, in the midst of all this, the level of inequality is rising with a large number of people being left out of the economic gains that seem to be concentrated at the top. You don’t need to come to Davos to understand this but there is clear unease among participants that the knock on the door may portend trouble.

Politics around the world has been upended with developed economies essentially stepping back from the post World War II global economic order that they had established with their electorates expressing the view that globalization and free trade are fine in theory but not when it hurts jobs. With developing countries like India and China, an increase in economic parochialism in developed economies will pose a significant hindrance to the growth aspirations they have. There is still a large population of the world that needs to be brought above the subsistence line and into the economic mainstream. Over the next few years, there will be a reconfiguration of the economic world order—something that we see playing out in real time.

It is with this backdrop that one will listen to speakers talk in this Swiss Alpine town with optimism about the near future, but also with some concern about what’s beyond that and people will do their best to predict what may come but also spell out how to deal with some of the intractable issues facing us. The highlight in the first few days is going to be India. There is a large Indian delegation being led by Prime Minister Narendra Modi, who hosted a dinner for global and Indian chief executive officers on Monday evening. Rather than going into the details of who was there at that dinner, suffice to say that the participant list reflected an increased level of confidence in the Indian economy.

In his eagerly awaited address to a packed hall in the opening plenary, the Prime Minister made the case for investments in India, highlighting the opportunity that exists because of the inherent growth that is possible. While he touched on many topics during his address, the highlight was his very warm welcome to the world to come to India. He emphasized that for investors the red tape had been replaced by a red carpet. The Prime Minister also shared an expansive view of the key threats to the continuation of human civilization, which included climate change, terrorism and protectionism. He called on countries to work together to address these issues.

Overall, apart from the many sessions with representation from India, it’s important to note that one of the Chairs of the conference is Chetna Sinha, the founder of the Mann Deshi Foundation, besides of course Shah Rukh Khan, who got an award for his social contributions. With consensus building that India will be the fastest growing large economy, this might be India’s moment in the sun— despite the weather in Davos.

Sri Rajan is chairman, Bain & Co. India