The neologism -Fourth Industrial Revolution or Industry 4.0 is not uncommon for policymakers and technocrats. Klaus Schwab, founder and executive chairman of the World Economic Forum (WEF), published a book titled “The Fourth Industrial Revolution” and coined the term at the Davos meeting in 2016. Since then, “Industry 4.0” has been a buzzword in all major economic and business summits.
In a paper titled – The Fourth Industrial Revolution: what it means, how to respond, Klaus Schwab, said “this revolution is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres. There are three reasons why today’s transformations represent not merely a prolongation of the Third Industrial Revolution but rather the arrival of a fourth and distinct one: Velocity, scope, and systems impact.” The world is at the cusp of an unrivalled revolution. The first revolution captivated water and steam to mechanise production, the second exploited electric power and the third relied on electronics and IT. The fourth one is a conglomeration of various automation technologies such as artificial intelligence (AI), the internet of things (IoT), blockchain, fintech, autonomous vehicles, 5G telephony, nanotechnology, biotech, machine learning, robotics, quantum computing and the like.
Nicholas Davis, head of Society and Innovation at WEF in this WEF paper, describes this revolution as the emergence of cyber-physical systems which, while being “reliant on the technologies and infrastructure of the third industrial revolution…, represent entirely new ways in which technology becomes embedded within societies and even our human bodies”.
Industry 4.0 is shaped by advanced technologies from different spheres like the physical and digital worlds that combine to create innovations at a speed and scale unparalleled in human history. The fourth industrial revolution demands ubiquitous digitization, automatic machine-to-machine (M2M) communication and is constantly transforming how individuals, governments and companies relate to each other and the world at large. With such sudden disruption, it will radically change macroeconomics and the way the industry responds to the needs of civil society.
Great and sudden change by its very nature is painful to accommodate. Preparing for the Fourth Industrial Revolution is a subjective task. Developed economies like the United States, Russia, China, etc. will have to frame policies according to their economic and technological demands. For a growing economy like India with its under utilised population, young age and cultural diversity, a more people-intensive approach should be adopted. This will require policymakers to harness the industrial change instead of being a reactive agent. In democracies like India, it is effective law-making which plays a major role to deliver regulatory frameworks that change often and respond to the stimulus.
The speed of change is unexcelled. It is disrupting almost every industry in every country, and it presages the transformation of production and governance. The gap between the 1st and 2nd industrial revolution was around 100 years, 2nd and 3rd was approximately 70 years, 3rd and 4th is 25 years. Analysing this trend, it cannot be ruled out that the next industrial revolution may take place within 10-15 years. So, it is very important that economies pool their resources, take risks, make new investments and come together for better agility to adapt quickly to make the best use of this global change.
Going into the history of industrial revolutions, it is apparent from a layman analysis that whichever country early participated in the industrial process turned out to become world leaders right after that industrial revolution. India is a young nation aiming to be the third largest with a10 trillion-dollar economy by 2030, India has no option but to not only participate but also be the frontrunner in the Fourth Industrial Revolution.
In 1750 AD, India’s share of global industrial output was roughly above 25%. India missed the bus of first industrialisation due to the devious British Raj and by 1900, this had plummeted to 2%. While India’s contribution to the world GDP was 2.6 per cent in 2014, it has increased to 3.3 per cent in 2017. Addressing the joint sitting of the Parliament, the President of India said the country’s GDP has been growing at a rate of 7.3 per cent on an average, making India the sixth largest economy in the world. India is playing a vital role in international trade in the Asia Pacific region. The President also noted that this is an opportune moment for the country to play a decisive role in the fourth industrial revolution considering its economic position.
Proper channelling of resources towards Industry 4.0 can help India leapfrog traditional phases of development and accelerate its metamorphosis to a developed nation. Being the fastest growing economy, deploying these technologies optimally and strategically can create more sustainable growth. A culturally accommodative nation with more than 70% of its population under the age of 32, India’s role is also going to be crucial in shaping the global Fourth Industrial Revolution agenda in a millennial and inclusive manner. India has the potential to be the global hub for the Fourth Industrial Revolution.
Governments, entrepreneurs, business houses and start-ups are rapidly adopting technologies involving AI, the Internet of Things, 3D-printing, advanced robotics and blockchain. Artificial intelligence can be used effectively to reduce poverty, improve the lives of farmers and make the lives of the differently abled simpler. The application of AI in sectors from health to law, from manufacturing to finance, from elections to governance, is not an impossible reality. Blockchain can facilitate cross-border data and technology transfers to support government services and natural resource management. India recently came up with its unmanned aircraft systems policy, commonly referred to as drones, having the ability to strengthen defence and security, make dangerous jobs safe, and act as a lifeline for remote populations.
Considering the pace of growth of automation technologies, it is absolutely possible that we will reach a point called “singularity” where machines become as smart as humans and then keep getting smarter. Repetitive processes are increasingly becoming automated. Digital technologies have the potentiality to bring about the balance between green and growth, data and infrastructure, and profits and people. Technology will soon be able to edit genes to create favourable traits and new life forms. 3D Printers may become capable to produce fully functional, usable organs. Artificial blood might soon become a reality and the oceans would be harvested for food. Banks and financial sectors in India are already using chatbots and humanoid robots. A Kannada-speaking robot in Canara Bank in Karnataka and Ira robot of the HDFC Bank which helps customers choose the right service and financial products are examples of linguistic coding of automation technologies.
It is estimated that between 2018 and 2022, as many as 75 million jobs will be displaced worldwide due to automation; however, as many as 133 million new ones would be created. In the United States alone, it is estimated that 1.4 million workers will be displaced in the coming decade as a result of the introduction of new technologies. India’s information technology sector is already witnessing jobless growth and there are various reports showing India unemployment rate hit a 45 year high in 2017-18. The biggest concern of Industry 4.0 for every growing economy is the loss of jobs. A potential answer to this problem is – smart politics. In a country like India with 1.3 billion people, it is practically impossible for any government in the world to provide jobs to everyone, what is practical is to engage people. This engagement is not only about job creation but also about start-ups, alliances, businesses, offshoring, etc. which will sufficiently help an economy to capitalise the resource pool.
Like all revolutions that preceded it, the Fourth Industrial Revolution has the potential to raise income levels and improve the quality of life globally. Mitigating the relevancy of jobs is not India specific, it is a global issue. But the peculiarity of this problem is the method of tackling it. Smart policies and smart thinking can reconstruct these challenges into opportunities. When the first computer was invented, there was a worldwide outcry on its impact on jobs, but history is the evidence of the fact that computers created more jobs than it destroyed. India too faced national protests against the computerisation of railway tickets as economists predicted it would take its toll on the jobs. Today, Indian Railways is India’s largest employer and is about to conduct the world largest employment drive with around 2.37 crore applicants competing for 1.27 lakh posts.
Given the Fourth Industrial Revolution’s rapid pace of change, it is important for governments and international organisations to evaluate whether to create change or follow the change. Legislators and regulators are being challenged to an unprecedented degree and for the most part is proving unable to frame a flexible framework. Unconventional challenges need collaborative efforts. India will have to create a long-term ecosystem with the right mix of accelerators comprising of regulatory frameworks, educational ecosystems and government incentives that train and educates professionals.
India’s philosophy “Vasudhaiva Kutumbakam” or “the world is one family”, has guided the nation since Vedic times. It is based on the blending of science and spirituality for harmonious co-existence reaffirms faith in innovation and adaptability. India can act as a coordinator to collaborate with global economies to form a joint platform or intergovernmental taskforce involving all stakeholders of the global polity for leveraging most of the Fourth Industrial Revolution technologies.
