Category — Manufacturing Technology

Anything that’s said about  Tata Motors’ Nano makes for news, and why not, never before did we hear of a $2,100 car! At the recent roll out of the Nano from its Sanand (Gujarat) plant  it enjoyed some added attention. Cornell University Assistant Professor, Aleksandr Mergold with his team of four assessed the future of the car. Mergold suggested that Cornell University is considering an U.S. exhibition of the Nano. The plant in Gujarat has been set up in just about 24 months.

Interestingly, Tata Motors and Cornell University go back a long way.  Ratan Tata, chairman of Tata Sons, the holding company of the Tata Group is a Cornell alumni. Cornell University some time back had received $50 million endowment from the Tata Education and Development Trust, a philanthropic entity of  the Tata Group.

Tata’s Nano has garnered attention around the globe on its own merit, specifically based on its unique price point. The Gujarat plant was set up in record time and is all set to multiply production from 10,000 cars a month to 30,000 a month.

At presently, Nano is manufactured out of the Tata Pantnagar plant which is led by my friend P.K. Chobe.

Ratan Tata with the Nano

It’s the accepted wisdom that no country can touch China in desirability of a manufacturing location. There are few fields in which the “middle kingdom” does not excel. But did you know that the second largest maker of blank DVDs/CDs and related media is a company located just outside India’s capital city? It’s called Moser-Baer, in Noida.

Moser Baer DVDs

In automobiles, auto parts, pharmaceuticals, chemicals, medical components, and many other fields India today has a very strong showing. So I was not totally surprised that India ranked #2 on the Global Manufacturing Competitiveness Index with a score of 8.15, compared to China’s 10.  The USA is at 5.84, Brazil at 5.41 and Russia at 2.58 by comparison. The Index, compiled for compet.org, also projects what happen by 2015. where China will still lead. But India’s score will improve to 9.01 according to the study.

To western executives, this means that if you are concerned about the future of global expansion in Asia, you may consider an integrated design/manufacture operation in India, more readily than you might have a few years ago.

India’s Foreign Minister S.M. Krishna pointed to Frugal Engineering from India as a signpost of what the 21st Century will be all about. “The 20th Century was one of Capital Accumulation but the 21st century is one of innovation,” he said while delivering the keynote address for the 35th annual summit of the US-India Business Council in Washington, DC on Wednesday this week.

Foreign Minister S.M. Krishna in DC

Krishna echoed the thoughts about the recently deceased Prof C.K. Prahalad of the University of Michigan and his book “The Fortune at the Bottom of the Pyramid.” Prahlad had exhorted companies to look at the poor as a profitable market. (In India, foreign companies such as Unilever and Citi have joined Indian entities such as SKS Microfinance and CavinKare in showing how poor people can benefit from modern marketing and can be a source of profit).  Krishna referred to the Tata Swach water purifier and the Nano automobile as examples of India’s innovation.

He said that 200 Fortune 500 companies have R&D. Operations in India.  Krishna asserted that India has a 100 percent compliance record in respecting security and agreements, to safeguard American defense technology, for example.

(Via blackberry live from USIBC summit, edited slightly later).

For full speech, click here.

I write for Business Week from time to time and this week, Dr. Atul Goel and I wrote a piece entitled: Innovation from India, the next Big Wave.  It took them some time to publish the piece, but in many ways it is even more relevant now than when we first wrote it, given the state of the global economy.

Click here to read about how Innovative companies the world over are discovering the research and development advantages to be found in India.