India’s Development Strategy in the Digital Age.

July 2, 2020

17:30 – 19:00 IST


The digital revolution, including the rapid deployment of artificial intelligence (AI), is deeply disrupting economic life, and will fundamentally alter the development pathways for today’s developing countries, including India. The Covid-19 epidemic has dramatically accelerated the digitalization of the economy, including e-governance, e-health, e-education, e-commerce, and e-payments.  Countries with extensive digitalisation, notably those in East Asia, have successfully deployed the digital technologies to suppress the epidemic at low cost.  

The digital revolution will require a new development pathway for India that is not dependent on the exports of labor-intensive manufacturers. The jobs of the past that provided the path to industrialization, notably in apparel and assembly line operations, are rapidly being replaced by robots and AI systems. Already, low-wage developing countries are no longer able to take advantage of their lower wages through the export of labor-intensive manufactured goods. Developing countries such as India will need to create new export sectors to compensate for the reduction of labor-intensive manufacturing earnings.

There are two overriding and inter-connected challenges.  The first is to mobilize and economize on capital in an economy that is becoming increasingly capital intensive, including human capital, physical capital, and intellectual capital. The second is how to ensure universal access to education, decent jobs, healthcare, and other basic needs in an increasingly capital-intensive economy.  One key will be an expanded public sector that can provide essential services, redistribute income, and collect taxes on capital-intensive activities.   

While automation could in principle lead to deepening poverty in India and other developing countries if they lose out on the chance for labor-intensive manufacturing exports, the benefits of digital technologies are likely to far outweigh the costs. Most importantly, these technologies have the capacity to upgrade key business and personal services, as well as India’s governance and human skills, sufficiently to far outweigh the negative effects on low-skilled work.  Still, to benefit from the digital revolution, developing countries will need a coherent capital investment strategy and a coherent strategy for ensuring that no part of society is left behind.



Dr. Jeffrey Sachs

Director at Center for Sustainable Development, Columbia University, USA

Dr. Jeffrey D. Sachs is a world-renowned professor of economics, leader in sustainable development, senior UN advisor, bestselling author, and syndicated columnist whose monthly newspaper columns appear in more than 100 countries. He is the co-recipient of the 2015 Blue Planet Prize, the leading global prize for environmental leadership, and has twice been named among Time Magazine’s 100 most influential world leaders.

Professor Sachs served as the Director of the Earth Institute at Columbia University from 2002 to 2016. During that time, he led a university-wide organization of more than 850 research scientists and policy experts in support of sustainable development, championed the Masters of Development Practice (MDP) program, which is now offered at 30 universities around the world, and helped to introduce the PhD in Sustainable Development at Columbia University. He was Special Advisor to former United Nations Secretary-General Ban Ki-moon on the Sustainable Development Goals, and previously advised both Secretary-General Ban Ki-moon and Secretary-General Kofi Annan on the Millennium Development Goals.

Prior to his arrival at Columbia University in July 2002, Professor Sachs spent over twenty years as a professor at Harvard University, where he served as the Director of the Center for International Development and the Galen L. Stone Professor of International Trade. Sachs was born in Detroit, Michigan, in 1954. He received his B.A., summa cum laude, from Harvard College in 1976, and his M.A. and Ph.D. from Harvard University in 1978 and 1980 respectively.

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