Bridgital Nation, N. Chandrasekaran and Roopa Puroshothaman

One of the most important trends of the 21st century will be the economic development of India. However, the rise of hundreds of millions from poverty to the middle class over the next few decades will come with its own unique challenges. In Bridgital Nation, N. Chandrasekaran and Roopa Puroshothaman attempt to identify these challenges and suggest solutions to ensure that the benefits of India’s economic growth are as widely distributed as possible.

The Twin Challenges: Jobs and Access

The book starts by laying out the two big challenges India faces: jobs and access. India has a very youthful population, with the working population set to expand by 90 million in this decade. This demographic dividend is a boon for economic growth, but only if there are enough jobs for everyone, otherwise this dividend could become a disaster. India’s growth so far has been fueled by services, which employ a small number of high-skilled people. On the other end, agriculture remains the largest single sector employing hundreds of millions of low-skilled workers. The challenge for India is to create a middle ground of good jobs for mid-skilled workers.

The other big challenge is that of access: how to provide vital services such as healthcare and access to the legal system for not just those Indians in the cities, but also those in remote rural areas.

To tackle these twin challenges, the authors propose their “Bridgital Nation” strategy, which aims to use technology to create the middle ground of the Indian economy and expand access to services. The role of technology in creating new markets is important. Unlike advanced economies, India still has a lack of mature markets which technology can help bridge. For example, traditional banks are unable to lend to rural low-income would-be entrepreneurs but fintech companies with more granular data-led approaches are able to assess credit risks and fill the gap. The second role of technology will be to more optimally allocate India’s limited supply of skilled human and physical resources to expand access.

One interesting comparison is the role of automation in India vs other countries like China, Japan, or the US. The authors note that in these economies, the populations are well into middle age and so they need to develop technology that can substitute for labour. In contrast, India’s youthful population necessitates a different approach. Instead of wholesale labour replacement, India must harness technology to augment the productivity of its emerging workforce. It cannot simply “cut and paste” China’s model. If India is successful in industrialising – as I hope/believe it will be – the role of technology in augmenting labour productivity will need to be a unique feature of the Indian development model that sets it apart from the China and the Asian tigers of the 20th century.

To clarify what exactly “bridgital” is supposed to mean, the authors provide a definition that focuses on using technology that “enhances and supports” workers. It rests on three elements:

1. Redefine what is needed to deliver a service or solution in a manner that prioritises access.
2. Identify and deploy technology + low-cost service delivery models that efficiently allocate scarce physical and human capital
3. Create a new type of “bridgital worker” who is digitally literate and technology augmented. These workers take on work ranging from higher value tasks that are currently done by more highly skilled workers to tasks mediating user challenges in accessing services or implementing solutions.

I found this definition useful as a signpost, but a lot of it seemed like little value-add consultant-speak word salad so I distilled it to what I think are the essentials. The examples in the following chapters were far more helpful in illustrating what exactly Bridgital entails.

The example of healthcare is used to powerfully illustrate the problems of access. Although India has many world class doctors, access to them is limited to the urban regions. The core reason is the scarcity of human and physical capital. India is sorely lacking in doctors and primary healthcare centers. While there is supposed to be one primary center for every 25,000 people, in India it’s closer to one for every 75,000 people. The result is that millions of Indians in rural regions undertake migrations of vast distances just to see a doctor.

One of the very nice touches of the book is that beyond just stating the macro problems, the authors vividly illustrate them through anecdotal experiences of everyday Indians. The book opens with a chapter about Nikhil Burman, a driver who would wait every night at 8:30 beside National Highway 37 in Assam for crowds from remote villages who had heard of a driver who would answer their medical questions. Nikhil would use his limited knowledge to assess someone’s symptoms and suggest a hospital for them to go to. For the poorest of the poor, Nikhil would often arrange a free ride to the hospitals, often hours away in the major cities, and arrange for any tests or medicines. Bridgital Nation is peppered with wonderful stories like this which bring India’s challenges to life and at the same time illustrate the heroic extent many will go to make ends meet.

The other three critical access challenges identified in the book are:

1. Education. 97% of children are enrolled in elementary school yet only 25% make it to university. More alarmingly, less than 30% of 3rd grade children in rural India can do basic arithmetic. Leveraging technology to expand access to quality education will be a vital complement to training more quality teachers.
2. Logistics. Moving goods and services in India is tougher than it needs to be. The lack of physical infrastructure is a big factor behind this, and this disproportionately affects small and medium-sized enterprises (SMEs) and farmers who lose access to markets to sell in.
3. Judiciary. The Indian judiciary is infamous for its case backlog numbering into the tens of millions. Part of the reason is that 30-50% of judges’ time is wasted in administrative hearings. Any well functioning society must be one where justice is readily accessible. More concretely, economic growth rests on the rule of law and the ability to enforce contracts. Removing the bottlenecks in the judiciary is critical for India’s progress.

The Challenges for Women

One of the biggest manifestations of the jobs and access challenge, and certainly for me the most perplexing (and slightly upsetting) is India’s abysmal record on female participation in the workforce. I was unaware of how serious it was until I read the opening quote for Chapter 13, which is a snippet from The Economist claiming that a 10% increase in India’s female labour participation “would surely be the easiest half-trillion-dollar boost available to the global economy”. In China and the US the female participation rate is 61% and 56% respectively. In India, it is an embarrassing 23%. If India is serious about becoming a global power, this needs to be dealt with.

The authors identify three core reasons behind women’s absence from the labour force. Firstly, they note that many women are involved in unpaid care work. In fact, 87% of unpaid care work in India is done by women, which is a staggering amount. This creates a shadow economy that the authors estimate could be worth ~$300billion if this work had compensation. I understand where this suggestion is coming from and certainly there needs to be some formalisation of care work, but I’m not sure importing Western models wholesale, which will erode the model of familial support networks in India, will be successful. I would be fine with more day-cares in India, but I wouldn’t want our families to degenerate into the broken households that are all too common in the Western world. I think we should be very careful disincentivising mothers and grandmothers (and sometimes fathers and grandfathers) from being the primary carers for their children.

Perhaps I’m guilty of a type of conservatism which the authors identify as another key reason why women are shut out of the labour force. There are different flavours to this of course. There is a strain of traditional belief that distrusts outsourcing care for your children, which I think I subscribe to. There is another strain that believes women need men’s permission to work and live their life, which is idiotic and completely self-destructive. India can never prosper if we keep the talents of 50% of our population bottled up.

The final factor shackling women is unfortunate concerns of safety. For example, women in India are less likely to journey further to go to the best university or get the best job they can because a longer commute, or a journey across the country, makes them feel more unsafe.

Undoing traditional attitudes is tough and something that can only be achieved organically over a long period of time (see attitudes to race in the US for example). However, there are short term actions that catalyse this process. One obvious solution is to use the force of the state to coax society, through bills like the 2017 Maternity Bill. A second suggestion, which I think will be more impactful over the long term, is to amplify the narrative of successful women and identify role models for girls and women to aspire to be like. This can obviously happen organically but I personally think the government shouldn’t hesitate to produce propaganda along these lines either.

The Jobs Challenge

Beyond access, the crucial challenge for India is to produce fulfilling jobs for its emerging working population. Unfortunately, the unemployment rate has been rising in recent years, and what employment is generated is in the low productivity informal sector.

Currently, most of India’s workers only have the skills and education for lower value add work like agriculture. High productivity sectors, like services, have a very small but highly skilled workforce. A key reason for the huge gap between the low and high skilled tracks of the Indian economy is the problems in education. Another obvious problem is that while India invests heavily in tertiary education – think of world class universities like the IITs – it does not invest nearly enough in primary and secondary education. The small sliver of the population that is talented enough to make it to the universities can join the higher productivity sectors, but the vast segment of the population that doesn’t reach tertiary education only has low value add work like agriculture as an option.

A huge answer to this will be manufacturing. Manufacturing jobs are vital for filling that middle ground with productive employment. In this respect, India’s trajectory needs to emulate China and the Asian tigers. It is reassuring that the Indian government has pulled its full thrust behind encouraging manufacturing but it remains to be seen how successful these efforts will be. At the time the book was written (2019), the transition to manufacturing was stalled but in recent years it seems to have picked up again. For example, while India made 9% of the world’s smartphones in 2016, today it is 19%. However, lots still remains to be done, such as increasing the ease of doing business by removing byzantine government regulation and making the judiciary more efficient.

Of course, multinational corporations aren’t the only source of employment. The most highly desired jobs, from a development perspective, must be those generated by Indian startups and entrepreneurs. While India does have a booming startup ecosystem, with the third highest number of unicorns after the US and China, even in this arena a tale of two Indias is apparent. On the one hand, there are colossal conglomerates like the Tata and Adani groups which could rival South Korean chaebols and Japanese zaibatsu. On the other there are micro 1-2 people firms that are largely informal, low productivity, and barely provide a livelihood. Much like with jobs, there is a sore lack of SMEs to populate the middle of the economy.

The reason for the lack of SMEs is not a lack of innovative thinking by Indians. On the contrary, as examples like Nikhil’s show, India is full of everyday entrepreneurs coming up with unique solutions to many problems. The primary reasons are more mundane but also more fixable. Firstly, as mentioned earlier traditional banks are unlikely to be able to supply credit to small entrepreneurs in India, preventing them from growing beyond the micro stage. New fintech platforms relying on more granular data will go far in bridging this gap. Secondly, excessive government regulations on matters such as labour and taxation reduce entrepreneurs’ confidence. Compounding this is an inefficient judiciary, which cannot reassure entrepreneurs that don’t have the heft of a conglomerate that they can get their contracts enforced. Delivering governance digitally, e.g. paying taxes online, will help certainly but at some point this regulatory bloat needs to be cut.

The authors suggest some other solutions to catalyse entrepreneurship, but this also felt like consultant word-salad to me, focusing on creating Bangalore-like clusters across the country where small businesses have access to assets like ports and universities. I think I’d need more specifics to be convinced. For example, do the authors propose something like China’s SEZ model?

One solution I agree with is to change school curricula to cultivate entrepreneurial skills. At the very least, we should normalise risk taking. Children should learn that it is ok to fail, provided you give your best shot at solving a difficult problem and learn some valuable lessons. Once again, changing societal mindsets is a long term process that can only happen organically, but interventions like this can catalyse that evolution.

The book finishes with some concrete proposals for what the impact of bridgital would be on healthcare, education, agriculture, logistics, financial services, and the judiciary. These range from the example of the intermediate administrative healthcare workers already discussed, to teachers using AI to gauge achievement better, to truck drivers using technology to optimise their routes, to judges and courtroom managers standardising legal procedures through technology and using AI to summarise case documents. I think these are good ideas and should be taken as inspiration rather than a specific prescription. Most crucially, none of these require some huge intellectual leap. The real challenge is in deploying these solutions at the vast scale that India needs. However, as India Stack illustrates, India is perfectly capable of delivering digital public goods at a vast scale.

Overall, I enjoyed Bridgital Nation. It is a nice and accessible read about the biggest challenges that India faces as it accelerates its economic development – jobs and access. Because India is starting from a low base, the solutions appear to be low hanging fruit. The crucial ingredient will be having the vision and willingness to implement these reforms and prepare India’s emerging workforce for the future. The task is simple in theory, but difficult in practice – not least because of the scale at which India needs to implement these solutions. As the authors tantalisingly remark “The future of work will be imagined, designed, tested, and made in India”. For the success of humanity, it is imperative that India solve these challenges for 1.4 billion Indians.