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The Vivekananda International Foundation (VIF) organized a panel discussion on economy with Dr Roger Moser and Mr S. Gurumurthy on 15th November 2018. Dr Roger Moser is currently an Assistant Professor and the Director of Asia Connect Center at the University of St. Gallen (Switzerland). Mr S. Gurumurthy is an eminent Indian political and economic analyst and also the Chairman of the VIF. The discussion was attended by many prominent Indian strategic and economic experts. After a short welcome address by Dr Arvind Gupta, Director, VIF, the panel discussion commenced with Dr Roger Moser.

Dr Roger Moser spoke on the topic ‘From Insight to Impact: How Technology Integration might matter more than Innovation’. His talk focused on four major themes. First was on how declining profits and missing differentiation (among products and services) calls for new perspectives and value creation approaches for entire economies. Robotics and digitization have broken the barriers between the sales markets and production markets. Further, access-based business models such as the sharing economy amidst financial crisis and climate change, have led to an increasing level of commoditization/ convergence of products & services. Commoditization is the process by which goods that have economic value and are distinguishable in terms of attributes (uniqueness or brand) end up becoming simple commodities in the eyes of the market or consumers. So buyers then tend to buy the cheapest. Dr Moser further highlighted the volatility, uncertainty, complexity, and ambiguity (VUCA) that characterizes today’s business environment. He elaborated how business model innovation can help to differentiate value proposition in such VUCA environment, and find the right fit between the intelligence required as inputs to decision making and how companies can gather and process intelligence.

Dr Moser mentioned two projects in India that have utilized decision intelligence in improving the productivity in agriculture and Last-Mile Logistics. ‘SatSure’ utilizes spatial data enabled data intelligence to improve financial inclusion and the productivity of famers, banks and insurers in the agriculture sector, and dramatically reduce transaction costs. ‘Jivana Vitality’, by using decision intelligence, helps to improve the access to clean drinking water and the productivity of workers with a lack of formal education – but also to overcome the last mile-logistics challenge.

Lastly, Dr Moser listed some propositions and recommendations for India. Economic and political stability is (long-term) built on productivity increases, rather than job creation only. Technology innovation enables productivity increases, but technology integration realizes productivity increases. He enunciated how instead of ‘Smart Cities’, ‘Smart Villages’ could help realize more productivity increases for India. Technology integration will require more applied research activities between academia and companies. Switzerland’s consistent competitiveness is largely due to the technology innovation capabilities of its universities, and its outstanding ‘InnoSuisse’ program. India’s natural strengths such as a diverse culture and infrastructure are not leveraged to attract companies to build the potential for global technology innovation leadership out of India. In conclusion, Dr Moser stated that India should show more self-confidence as it is likely to be the most attractive consumer and infrastructure market in the world – with respect to growth & size in the coming future.

Mr S. Gurumurthy enunciated on the transformation of the US economy and the growing interlinkages between the global economy and world order. He noted the many doomsday predictions by prominent economists and the media regarding a US and global economic meltdown, if Donald Trump was elected US president. Yet, Trump’s presidency until now has been a remarkable success on various parameters be it the Dollar Index, GDP, or even unemployment statistics. His presidency has brought forth a marked change where the US no longer wants to incur the costs, yet continue enjoying its global supremacy unhindered. Thus, the current bout of ‘America-First’ can be expected to continue even after the end of Trump’s presidency. Excessive credit or phony money that is not generated by any economic activity today far surpasses the money created by central banks. Trump has sought to reverse the incessant current account and trade deficits that the US intakes every year, by renegotiating every major economic partnership of the US. He has also indicated his desire to end the superfluous quantitative easing pursued by the US, by removing billions of US dollars every month from global circulation.

Japan has sought to do the exact opposite, by printing more yen and having negative interest rates. This led India to sign the yen-dollar swap agreement during the October 2018 Indo-Japan summit, to better hedge its near financial future. Mr Gurumurthy mentioned that it is not just the world monetary order but even the international relations that have taken a hit in this growing uncertainty in the global milieu. With the US becoming a major oil producer itself, Trump has managed to disconnect the dollar from the oil politics, and thus been able to pursue a powerful Middle East Policy. Sanctions are now calculated to maintain oil prices.

Further, the 30 year old notion of breaking the communist alliance that underlined US-China relations, seems to have vanished overnight in the US after the growing belligerency of China. US Treasury securities that had been regarded as a leverage of China against the US holds no credence, weighed against the major interdependency of the Chinese economy on the US. EU is in its own dilemma of having to pay up for NATO and its own army after sharp remarks by Trump.

With globalization and its institutions such as the WTO, IMF and even the UN losing their relevance, Mr Gurumurthy anticipated a rise of ‘Asianism’ as regional relations would branch into a web of bilateral relations.