Vinod Khosla’s Marshall Plan for rural India

The daily drumbeat of biofuel headlines has made Vinod Khosla — co-founder of Sun Microsystems, former Kleiner-Perkins venture capitalist, and ethanol evangelist/entrepreneur extraordinaire — a hard man to ignore of late. But Khosla’s massive bet on renewable energy as the answer to climate change and peak oil (and big profits) may not even be his most ambitious scheme to remake the world. In 2002, Khosla co-wrote a paper with development economist Atanu Dey sketching out a plan to boost economic growth in rural India. It’s hard to think bigger than a bid to upgrade the living standards of some 700 million people — as the paper notes, one out of 10 people on this planet is a rural Indian.

The paper is titled “RISC: Rural Infrastructure Services Commons.” The title may or may not be a pun on the computer term RISC — an acronym for “reduced instruction set computing”; Khosla was reputed to be a big proponent of RISC processors in his Sun Microsystems days. But the paper is sui generis: a unique mixture of complexity science, new growth theory a la Paul Romer, and new economy Internet hype, all in the service of addressing the immense challenge (and, believe it or not, “Kantian imperative”) of incubating economic growth in rural India.

India has to urbanize, declare Khosla and Dey, but a wholesale migration to India’s major cities would create a mega-city disaster of megaslums, along with perpetrating a rural-to-urban brain drain that would leave the hinterlands even worse off than before. Conversely, attempting to extend the provision of electricity, telecommunications and other infrastructural services to every hamlet and village in India would be both exorbitantly expensive and criminally wasteful. The RISC model, in contrast, advocates coordinating and consolidating centralized infrastructure hubs in midsize towns. The authors believe that only 5,000 or so “RISC centers” would be necessary to cover all of India.

Salon