[India is] a living contradiction. Jewels may well be concealed in the cloaks of beggars. . . .India presents a paradox. It is profound and primitive, deeply spiritual and darkly superstitious, both universalistic and maddeningly provincial.

-Dr. Mani Bhaumik

FEW OBSERVERS comment upon India's paradoxes-whether in the social or cultural sense-as profoundly as Dr. Bhaumik, but paradox is indeed clearly central to the debate regarding the country's future. Prime Minister Manmohan Singh clearly has a very similar view to Dr. Bhaumik of India's complex society. The vaunted economist, widely credited with framing India's sharp turn to a market economy some 15 years ago, has the daunting task of making the fast-growing climate he created work, economically and socially. As one close confidant told me, "Dr. Singh faces our paradoxes several times a day, every day. Thankfully, he remains optimistic."

The conundrum facing India today is this: Which side of the many economic and social paradoxes will prevail? Can enthusiasm and determination reverse the long decline in virtually every sector so that economic-and with it, social-growth will continue? Or will the neglect of decades cause the sensational growth of the last few years to stagnate? The optimists, from Prime Minister Singh to bankers and industrialists and even to small-plot farmers in remote villages-indeed, most Indians-believe the obstacles to continued growth can and will be overcome. If they are wrong, the boom of recent years could well become a blowout.

Coming to a judgment about where India is headed is not easy. Despite year-to-year growth averaging 8.6 percent for the past three years, for every positive indicator there is a conflicting, negative sign. Much of the heavily touted investment and development has occurred near major cities, but most of the 60-70 percent of Indians living in rural areas are barely surviving. The 300 million-strong middle class has access to jobs, services and amenities; the much larger rural-dwelling population gets by, in countless cases, on less than 50 rupees ($1.15) a day.

These society-straining factors have resulted in millions of rural residents invading India's already teeming metro centers. Greater Delhi, with a population estimated at 32 million, cannot expand basic facilities fast enough to satisfy its middle class, much less the impoverished. And Delhi is not alone. In order for India to maintain its balance as it pursues reform and development, it will need the broad support of the very diverse Indian people-not an easy task.

India and China are frequently depicted as the two Asian Goliaths in hot competition for economic and political leadership. But India's democratic system has always been more deliberate than Beijing's authoritarian regime. The Chinese government can, generally speaking, tell the population what to do. The Indian government-once the divisive governing coalition agrees-must convince its citizens to support any given program.

The Gift of Gandhi

THERE IS one cultural and historic icon who could propel a rallying of support-indeed, of societal self-respect-towards Indian progress and renewal: Mohandas K. Gandhi. Respect for the father of independence, universally known as "Mahatma", or "great soul", among the people and within government circles is universal.

In addition to being the driving force for Indian independence, his support for India's downtrodden dalit-untouchables, whom Gandhi called Harijan, God's people-has seen such progress that, currently, India's president and chief justice both come from the once-shunned community. The Mahatma is held in revered esteem by virtually everyone in India, including those with reservations-or outright opposed-to his acceptance of partition (thus blessing the establishment of Pakistan), or to his idealizing of the agrarian lifestyle or to his tendency to value prospective successors' friendship more than their merit.

Properly conceived and executed, Gandhi's image could well be the catalyst that drives the society to reconcile its many paradoxes. Gandhi pervades the Indian conscience, from an understated yet magnificent memorial in Delhi, to statues throughout the land, to his likeness on every currency bill. The Mahatma represents a critical unifying element to the multifaceted society and can be leveraged as the rallying symbol for the country to address its pressing problems, and indeed to preserve the progress it has already made.

His greatest single contribution, satyagraha-holding to the truth, broadly understood as non-violent protest-has kept the country together and largely at peace over six turbulent decades. Notwithstanding at least 17 distinct languages and some 600 dialects, an Indian consciousness not only exists but continues to grow. Contrast India's experience with Czechoslovakia and Yugoslavia, two failed multi-ethnic nation-states. India has less intra-national discontent than exists between Quebec and the rest of Canada. Despite periodic stirrings in outlying areas, much of it fueled by extreme-left efforts to gain local power, the center has held at least as solidly as in Spain (itself coping with small, radical and annoying Basque and Catalan separatist movements).

Pivotal aspects of Gandhi's vision for India remain elusive, importantly including honesty in government and all human dealings, citizen involvement in community governance and well-being, and general cleanliness. Indeed, much of what the country has yet to achieve is ultimately reflected in the Gandhi ethos and can be communicated as such.

If the far-fetched concept of a unified, democratic India has been successful, the more mundane requirements to solidify the nation as a major political and economic entity can doubtless be achieved, utilizing the still-vibrant memory of the nation's greatest hero.

BECAUSE OF India's economic growth in recent years, a tendency to believe that a "rising tide will lift all boats" has developed. After all, the information-technology sector alone forecasts $60 billion in sales in 2010, up from $25 billion in 2005. And the country's impressive economic growth is fueling the purchasing power of India's major conglomerates, as well as many smaller businesses. Besides European steel acquisitions by the Mittal and Tata groups and Hindalco's North American purchase of Novelis aluminum, medium-sized companies are investing overseas, accounting for most of the 266 cross-border investments during 2006.

Foreign companies are returning the favor, underscored by Vodafone's $12 billion February purchase of 67 percent of the Hutchison Essar mobile-phone business. The Indian market is adding six million new users per month, and control of Hutch brand's 25 million subscribers and 16 percent market share gives Vodafone, who will invest another $2 billion to expand the franchise, a strong position from which to capture millions of new customers. Investment by major world corporations-including Accenture, Accor, Dell, Hilton, ibm, Nokia, Microsoft and Wal-Mart-continues apace, with many significantly increasing earlier investments.

All of this has locals focused on when-not whether-India will surpass China in terms of economic growth, as projected figures for 2007 estimate Indian expansion at 9 percent and China's at 10 percent.

But India still has a long way to go. Consider exports, an area receiving much government and private-sector attention: India's $70 billion in 2005 amounted to just 10 percent of China's $700 billion in products shipped overseas.

Finance Minister P. Chidambaram argues that "reforms are driving growth. They have brought in investment, fostered competition, and enhanced productivity and efficiency." Moreover, Mr. Chidambaram notes, "High growth has brought in more government revenues, which can be used to support needed infrastructure development and other services." That said, negative indicators must be considered serious warning signs pointing to corrective action.

The infrastructure-in-crisis mantra is repeated endlessly: waste, roads, electricity and so on; all are in desperate need of improvement, and there is a sense that everything must be done now.

Clogged and poorly maintained streets cause massive traffic congestion in major cities daily. The problem is complicated by a mix of traffic, including buses, auto-rickshaws, tricycle rickshaws, bicycles, ox carts and the occasional elephant. A bemused Delhi resident noted: "I bought a new car three months ago. In that period it has been in eight accidents, most of them minor but all of them making it look like it's at least three years old." The government recognizes the economic-and environmental-consequences of millions of workers stranded for hours in traffic jams. Flyovers and bypasses are being constructed seemingly everywhere in greater Delhi, with a metro system under construction. To cut high pollution levels, auto-rickshaws, taxis and buses are required to burn low-toxicity compressed natural gas.

Thousands of open sewers and very limited removal and treatment facilities make waste a preponderant issue. With more than 1.1 billion inhabitants, India is particularly challenged, especially as millions move to already enormous major cities.

State and local governments are recognizing the need to take action before the challenge becomes overwhelming. Programs are underway to encourage on-site decomposition of natural waste, with earthworms getting quizzical media coverage as a possible decomposer of choice. Plastic packaging is dramatically on the rise, with very limited landfill area. Local governments have neither the know-how nor capital to improve conditions, and the population has so far proved apathetic to the litter crisis. Executives of an international environmental consulting group-which has studied the issue in countries as diverse as Colombia, Germany and Indonesia-believe a looming safe-water supply crisis can only be solved by major foreign participation.

Two of India's major cities-Mumbai and Ahmadabad-have commissioned modern treatment plants from Excel Industries, one of a handful of Indian companies in the field. The Ahmadabad plant was contracted on a build, operate and transfer (bot) basis, giving Excel an added efficiency and quality incentive.

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