By Anand Kulkarni
Globally, we are, and will continue to be, in an era of the ‘fourth industrial revolution’ based on the internet of things, automation, artificial Intelligence (AI), robotics and the fusion of technologies. How prepared are countries, including India, for this revolution?
The Economist Intelligence Unit’s recently released Automation Readiness Index, measures 25 countries, including the BRIC nations, the US, the UK, South Korea, Japan, Australia, France, Canada, Germany, Italy and emerging Asian economies of Vietnam, Indonesia and Malaysia as well as economies from Latin America and the Middle East.
The Readiness Index is based on a comprehensive set of criteria:
• Innovation environment (research and innovation in robotics; automation and AI; regulatory environment for innovation; technology adoption support; international partnerships; infrastructure and connectivity policies; cluster development programmes, and ethics and safety in data protection; cybersecurity and data literacy)
• Education policies (early education programmes; technology education; 21st century skills strategies; access to education; lifelong learning programmes; career guidance; teacher training; use of AI in data and education; innovation in school models; dialogue with teachers and industry)
• Labour market policies (government-led research; implementation and dissemination on automation opportunities; programmes for the development of job-relevant skills; programmes for adoption of technology in the private sector and workplace innovation; and collaboration between private and public sector for education and the labour market)
How does India fare?
Overall, India is ranked 18th out of the 25 countries on automation readiness. This puts it marginally ahead of Brazil (19th), but behind China (12th) and Russia (16th) of the BRIC cohort. South Korea is the most automation ready of the 25 countries, followed by Germany, Singapore, Japan, and Canada to round out the top 5. Interestingly, and somewhat surprisingly, the UK and the US, usually at the absolute forefront of most innovation indices and higher education rankings, come in at 8th and 9th respectively.
Despite India being at the lower reaches of the ranks, the country does have some “aces up its sleeves” including innovative technology and service companies who are well placed to access and deploy AI and robotics for business enhancement, according to the index.
India performs slightly better than its overall position, in the labour market policies (=16th) and innovation environment (17th), but worse than its overall position in education policies (=22nd). Thus, education continues to be a major challenge for policy makers.
Digging deeper, access to post compulsory education (ranked =24th), technology skills and knowledge (=20th), 21st century skills and knowledge (= 22nd) and sector linkages (=21st) are among the weakest areas.
Modernising India’s education system to meet the challenges of emerging skills needs, breaking out of rote learning methods, linking with industry, and fostering creativity and innovation remain key elements for the country to grapple with. More broadly, are weaknesses around knowledge transfer in the economy a legacy of a “siloed”, fragmented approach to knowledge management, and technology adoption? A better diffusion and dissemination capability is required.
On the positive, India is ranked equal first out of the 25 countries on start up support, teacher training (a surprise given the weaknesses in the education and training system), broadband infrastructure, public employment services and targeted re-training. India’s growing emphasis on entrepreneurship through Start-Up India, for instance, is paying dividends at least in this context, as is infrastructure investments in information and communications technologies.
Overall, India faces a number of contentious issues when it comes to the automation revolution. On the one hand are the myriad of productivity enhancing benefits in a wide array of sectors, including agriculture, health, and energy among others, and linkage into global markets. And on the other, the prospects of job losses from automation are real, compounding an already stagnant job creation scene. One view is that automation is inevitable and that nations just have to adopt and adapt, capitalising on the benefits and minimising the losses.
India needs a comprehensive, integrated and cohesive ‘fourth industrial revolution plan’ that clearly articulates the trade-off associated with developing automation and related technologies, and which seeks to manage carefully transitions from declining sectors of the economy to emerging ones. At the same time, stakeholder “buy in” from across disparate groups is required.
On the Automation Readiness Index, India is somewhat on its way to being ready but not quite yet.
Anand Kulkarni is a Consultant and Principal Advisor at Victoria University, Melbourne. He is also the Associate Editor for the Journal “International Review of Business and Economics” and a Fellow at the Centre For Policy Development in Australia.