One of the founders of iconic IT company Infosys and the brain behind Aadhaar, Nandan Nilekani wears several hats these days — that of a philanthropist, angel for start-ups and an evangelist for re-imagining India. In an interview, Nilekani shared his views on a variety of issues concerning the country. Edited excerpts:

How do you read the current economic situation in the country? We have had a long drawn process of getting GST approved. Then there have been issues with the RBI Governor. At the ground level, corporates claim that getting approvals is time consuming.

Passing of the GST Bill is a positive sign that shows that our political system is willing to come together across party lines to address a very important strategic issue to make India a single market for goods. India is already a single market for services and not for goods and this Bill addresses that. But I think lots needs to be done in its actual implementation. How well the law is drafted and how compliance can be made easy. How we use technology to make automation the basis of tax collection.

Globalisation is in some sort of retreat which we are seeing across the world. Trade growth is coming down. But domestic growth is happening. If you can use technology and leverage the domestic growth and services economy, we can have economic growth. What we require are internal reforms to make business and transactions easier.

My view is we should not go so much by what large businesses say … but get millions of small businesses to become part of the economy. That’s where the growth is.

How do we improve their access to finance, their ability to grow, add people. India’s future is in getting millions of small businesses on to a common platform. If we can do that, then there are many, many years of growth. Expecting large companies to hire more people is unlikely because they will go in for automation. They will use contract labour where ever possible. Permanent jobs in large companies will not happen.

Philanthropists like you are trying to solve issues at a very fundamental level. Your EkStep initiative and the eGovernments Foundation are two examples that stand out. Then there are start-ups that you have invested in. How much of your time goes into each of these initiatives?

Well, I spend 80 per cent of my time on public activities of which about 30-40 per cent is spent on evangalising, and work with regulators. About 20 per cent is spent on working with EkStep and another 20 per cent on philanthropic activities. The other 20 per cent is spent on working with start-ups, advising them.

I have certain capital reserved for that but there is no formal structure for investing for these kind of high-risk activities. A lot of people come to me to talk about their projects. If they play to the thesis that they are going to change India using uniquely Indian problems, then I invest in them as well. My total investments are not more than 10 or 12 start-ups and may be a few million dollars in all of them put together.

Some of the start-ups you have invested in like Avanti Finance and 10i Commerce Services, are taking on big businesses in the same space. How will these start-up tackle such a huge challenge?

Indian retail is going to be a trillion dollar business. …and the bulk of it will come from small retailers. What Shopex or 10i does is create a platform where small retailers hook in, get access to a wide range of products, sell to consumers, get it delivered at the stores or at home and they get the same benefits, product range, technology, supply chain, logistics that the big guys get. It is a way for millions of smaller retailers to actually go ahead and compete with e-commerce and organised retail. The trick is not try to do complex things but do simple things at scale.

Ratan Tata’s vision for Avanti Finance is how does one reach affordable and convenient credit to the under-served and un-served. It is certainly a laudable goal because India’s poor and other farmers are not really getting credit whereas credit is going to big businessmen who don’t seem to be repaying.

Several start-ups in the country are unable to raise funds at the right time. Even those that have scale and volumes like some of the e-commerce companies are unable to raise funds. What do you attribute this trend to?

Actually, some of the companies have done an extraordinary job. It is not easy to start from nothing and build a multi-billion dollar enterprise. These are remarkable achievements by these young people. Where some of them fail is when their business model is just a vanilla model. Then you run the risk of being gobbled up by multinationals who are in the same space but have access to huge capital and technology. Therefore, the way to deal with it is to how well you address the Indian conditions, how well you use Indian infrastructure. The companies that use that well will grow. We are the only country with an Aadhaar-like platform. They (entrepreneurs) should design the product for scale, speed and sustainability. India is on the verge of an entrepreneurial explosion. These guys are re-imagining things.

For example, Mukesh Bansal, who sold Myntra to Flipkart, launched CureFit, which aims to tackle the health issues facing millions of Indians.

Source: Business Line