In search of Doi Moi!

During my recent visit to Vietnam for business, one thing that really left me fairly impressed was the focus of the country and its business community on exports and their open-door policy to global trade.?Whenever?I see the historical data of India’s past exports and read the target of USD 2 trillion contributions by the export sector in the Indian economy by 2030, it leaves me a bit skeptical and leaves many unanswered questions on the way forward. After all, making high export targets is good but then we also need a serious approach and well-crafted strategy to achieve those figures. As a country, we do have huge potential and nothing is impossible but certainly, we can draw some lessons from other economies that have achieved economic prosperity through the export-led growth model. To me,?Vietnam is a shining example as it’s a country that not only I love for its economic policies but also its rich traditional business culture. So, let me here highlight a few of its strategies and as a country what we can learn to achieve our goal of USD 2 trillion by 2030.

?a) Road from isolation to prosperity: Like India,?Vietnam also had a closed-door policy for a long as its development model was borrowed and inspired from the former Soviet Union and its East European nations. I still remember when I was in college, the liberalization was done by Dr. Manmohan Singh in 1991. Well, somewhat on the same lines, but 5 years earlier, Vietnam had the?1986 Doi Moi reforms (meaning “rejuvenation”) that initiated a broad-based economic transformation. This transformation dismantled the largely planned economy (beginning with agricultural reforms), opened a closed economy to international markets and trade, and initiated many pro-business reforms. A large number of self-imposed barriers to progress were removed and the utilization of various market-oriented measures was undertaken. Doi Moi was accompanied by a wide-ranging social agenda, led by the expansion of education, infrastructure, and electricity, with a clear goal of “leaving no one behind”. We did have reforms since 1991, but today India is at a tipping point and certainly needs a “doi moi “ type of initiative at the earliest. Just like Vietnam, we need to embrace trade liberalization with gusto, attract more FDI in all sectors and make more and more FTA and CCEP to have both-way market access. It's time to move with the world and work on more liberalization along with other domestic reforms through deregulation that can make our exports competitive.

?B) Focus on agriculture: In the ’80s, Vietnam had a huge food shortage but now it's the number 2 exporter of rice in the world. We also need to focus more on agriculture through modern technology, artificial intelligence, and all possible measure to make agriculture a substantial part of our export portfolio. The success stories that we had like the Banana cluster (in Ananthpur); Pomegranate cluster (in Nasik ); and Rose onion cluster (Banglore ) need to be further expanded. ODOP program is a step in the right direction but there should be a higher focus on new products.?For eg, iron-rich ‘red rice’?grown in Brahmaputra valley or Buddha rice from?UP are products that can fetch higher margins for all stakeholders. Some of the technological innovations like?solar power for irrigation pumps and setting up of large cold storage at various places will have a great impact on productivity as well as exports opportunity.

C) Double engine for export policies: Although we have a double engine concept in politics we also need a double engine in exports. What I mean here is that all the competitive sectors that have export potential need to work in tandem to get the best results. For this, the Central as well as State governments need to work together to boost the export roadmap. Innovation and a higher focus on manufacturing /production can definitely yield good dividends like in Bangladesh and China. PLI scheme has been a booster for industry but more initiatives are needed to push manufacturing. Even a small nation like Vietnam has become a manufacturing powerhouse and today it is the world’s third-largest exporter of textiles and garments. Although ELG (export-led growth ) strategies have been followed by many Asian countries, I feel Vietnam has been at the forefront which has contributed to its strong economic growth and fast international integration. In India, we have garments, home textiles, and value-added hand-crafted textile products that have huge potential but we definitely need to strategize to get the best results out of the Indian exporting community. We have all the resources, just need to channel our efforts in the right direction by opening up new markets and innovative value-added products.

D) More investment in Infrastructure:?We need to have a proper vision for developing export infrastructure. Although we improved the roads with a number of dedicated rail and road export corridors, the seaport infrastructure still needs a lot of improvement. For example,?Vietnam has more than 100?seaports with three strategic seaports in Hai Pong, Da Nang, and Saigon. It also has developed extensive inland waterways and railway networks even extending to China, Laos, and Cambodia. We also need to develop our road and railway network to extend to our neighboring export destination to improve the speed of logistics. The government has to prioritize infrastructure development to facilitate export-led growth.

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E) Education is the key: Although our government has launched a number of schemes to skill the youth and prospective exporters, India needs to follow the policy that Vietnam had implemented to educate its children. In Vietnam, with the Doi Moi policy, the government recognized that educating only the young would be insufficient to lift sufficient people out of poverty in the short term, given the long lag of school children entering the labor market. As a result, education for both the young as well as the out-of-school population was fully strengthened by the Vietnam government. Greater government attention was given to vocational education to meet the demand for trained workers, particularly for key economic areas and sectors. A network of continuing education centers and community learning centers was developed. In my opinion, we also need a holistic 360-degree approach to strengthen our education system so that we can become a leader in the global market for international business.

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I have been highly inspired by Vietnam's success and the above five strategies, drawn from Vietnam’s success can definitely be a blueprint for our export-led growth strategy. These strategies can definitely be a guiding force and a torch to lead to our USD 2 trillion roadmap. #vietnam #ideasworthspreading #importers #ancipreneur #globalbusiness #globalization #trademarketing #internationalbusiness #export #exporters #indianexporters #port #privatebrands #odop #rice #chinamanufacturer #packaging #laos #cambodia #china #mongolia #southeast