As âThe Airport Economistâ I have had some interesting experiences in India. The first time I was there, I saw Sachin Tendulkar make a gallant 50 on a crazy wicket in Mumbai and then I visited a Bollywood set to meet the stars including the legendary Aishwarya Rai. On my most recent visit, I met a legend of the Australian variety, former Test batsman-wicketkeeper Adam Gilchrist, known affectionately throughout both India and Australia as âGillyâ. When I interviewed Gilly in Mumbai I was struck by how important India was to him- it clearly went beyond his high profile role with the Decca Chargers in the Indian Premier League (IPL) 20/20 series.
âA tour of India is not just a cricket tour. Itâs a life experience,â said former Australian wicketkeeper-batsman Adam Gilchrist when the airport economist interviewed him in Mumbai. Gilchrist described how the Australian cricket teamâs whole attitude to touring India changed under Steve Waughâs leadership. âSteve encouraged the whole team to embrace the place â not just the cricketing part â but the whole culture. The whole box and dice,â explained Gilchrist on one of his regular business trips to India that he undertakes in his post Test career. Gilchrist certainly took Steve Waughâs advice to heart and has become an unabashed fan of India ever since.
Of course, it wasnât always like this. India was regarded as a place to avoid for Australian cricketers in the 1970s and 1980s. In fact, even as captain, Greg Chappell would make himself unavailable for the Indian tour and would have Kim Hughes lead the tour in his place. The press reports were always about how difficult the place was compared to say a tour of England, and generally there was little media coverage of Australiaâs results in India â which for the most part were below par.
The same thing happened for Australian business too. India was largely on the no go list for Australian exporters. Red tape, corruption, and a general disdain for trade and foreign investment, meant that India was not a happy hunting ground for exporters, despite its large population and they instead went to China and the rest of Asia for business opportunities.
But by the 1990s, things started to change in the sub-continent. The turning point was probably 1987, when Alan Borderâs team won the World Cup at Eden Park in Calcutta. After that, Australiaâs Test team got a lot better (wining the Ashes in a clean sweep in 1989) and went on to becoming world beaters under Mark Taylor, Steve Waugh and more recently Ricky Ponting. India tours also became important to Australian cricketers, which has culminated in many of them spending a lot more time in India for business promotions (Brett Lee even has a hit single out in Bollywood and is learning Hindi) and of course many Australian players are starring in the IPL. In fact the Indian worship of cricket was there to see when the airport economist travelled into the city from Mumbai airport. In the midst of the Ganesh celebrations, there were many billboards celebrating the centenary of the birth of Sir Donald Bradmanâ a celebration of both an elephant god and a cricketing god at once!
But at the same time that Australian cricket got serious about India, India got serious about economic reform. In 1991, Dr Manmohan Singh became Finance Minister in the Indian Government and overturned some of the protectionist policies of the past to make India more attractive to exporters and foreign investors. Dr Singh, recently re-elected as the Indian Prime Minister, is an erudite intellectual in the best Indian tradition. He regularly give lectures at the worldâs best universities about how to balance economic reform and social justice as a policy maker. And in a country like India, with over a billion people, it is by no means solely an academic task. He has had some success with India withstanding the worst of the Global Financial Crisis (GFC), expecting to achieve 6 percent growth rates, and continuing its success in reducing absolute poverty â although great strains still exist particularly in rural areas and relative poverty remains a difficult policy problem.
And of course, the Australian-India trade relationship is blossoming. There are now over 2100 Australian businesses exporting to India which puts it in the top 20 exporter destinations. India is in 2nd place in the DHL Export Barometerâs measure of export confidence over the next 12 months (China is in first place) and India together with China is making strong inroads into Australiaâs trading patterns. In fact, according to new research just released by the Reserve Bank of Australia (RBA), in 1999, China and India accounted for just under 6 per cent of Australian exports, whilst in 2007, âChindiaâ accounted for 18 per cent (with Japan on 16 per cent and âother East Asiaâ on 16.7 per cent). China is now our 2nd most important export destination (up from 7th place in 1999) and India is now the new number 7 (up from 13th spot eight years ago). Over this period average annual growth rate of Australian exports was 24.8 per cent for China and 24.7 per cent for India.
So what comprises all this trade? Indian tourism to Australia is playing an important role, along with education. In fact, in 2008, the number of Indian visitors to Australia crossed the 100,000 mark with 116,000 visitors coming to our shores compared to 95,200 in 2007 which is an increase of 22 per cent. In fact, the airport economist interviewed Khursheed Lam, the head of Qantas for South Asia, in Mumbai and she pointed to the growing numbers of student and business travellers using the Qantas service between Australia and India. âInbound visitors to Australia have increased by 43 per cent over the past 12 months â with a 36 per cent increase in students and a 40 per cent increase in business travellers. And you can see more Australian influence in Mumbai too. I can buy Australian fruit and vegetables at the nearby Crawford Markets and Australian cricketers are everywhere endorsing products and appearing on TV shows!â Lam adds that Qantas former CEO Geoff Dixon was based in Mumbai in a previous career and therefore had a bit of a âthingâ for all things Indian! Lam believes the increase in traffic with help tourism both ways between India and Australia.
Tourism exports to India are related to education. In a recent RBA research report on education exports, the Bank found that Australia has been experiencing a major boom in the export of education services to both China and India. According to the RBA, China and Indiaâs combined share of Australiaâs education exports are now a third compared to just under 9 per cent a decade or so ago.
In fact, education â not cricket â was the reason Gilly was in India. Gillyâs new role as Brand Ambassador for University of Wollongong shows the importance of education to India, and Gillyâs strategy to âgo with the Gongâ and support a university is considered by some to be a classy move (rather than flogging air conditioners, nasal spray or hair restorers) After all, Gilchristâs father was director of education for Northern NSW and his brother is a graduate of University of Wollongong as is Ricky Pontingâs lawyer wife Rhianna. They used to make jokes in the 1970s about the University of Wollongong and that there was allegedly a Norman Gunston School of Economics on campus. But theyâre not laughing anymore as Adam Gilchrist leads the University of Wollongongâs charge into India, just as he led Australia to a famous victory in 2004, which was their first win in India in 35 years.
Letâs hope that Gillyâs efforts will bring more Indian awareness of Australia in terms of tourism and education. And we donât have to ask âwhere the bolly hell are youâ like Lara Bingle asked (or a version of it) international tourists in that famous campaign!
Tim Harcourt is Chief Economist with the Australian Trade Commission, and author of The Airport Economist.