I am really surprised to hear from Tata that no one in India can produce an automatic transmission. With all the might of Tata's R&D and manufacturing - they still have to import auto transmissions ?
It seems to me that Indian conglomerates are always happy picking the low hanging fruit when it comes to design and manufacturing until someone comes along and challenges them on their home turf. As long as they can make money on the low hanging fruit - they will not venture into more advanced stuff.
Apparently you are the only poster who seems to have picked up on the main message. Tata's primary emphasis is on the future of India's economic prowess and industrial capacity; but as usual the sensationalist substandard "news paper" has taken the one fleeting reference to Pakistan and turned it into the headline. Subsequently all the keyboard warriors and nationalist blowhards on various forms of media have turned this into a Pakistan/ national security/ military issue.
If there is anything the audience can learn from Tata is that the new medium defining international relations whether it be an alliance or adversarial is economics, not conventional military force. And yes, India hasn't come anywhere close to China in terms of technological advancement (qualitative and quantitative) and is still a net importer of basic technology. This is also why India has to bow down and become friendly with China because there is no other profitable alternative.
To say that India is lagging behind china in technological development is an understatement; however the primary reasons for India's faltering growth are structural in nature. There can be no substantial R&D unless there is some semblance of intellectual property rights. R&D capacity takes years to build and it's a complex collaborative effort between academic institutions, private industry and intense government funding. There is no such thing in India. Indian universities aren't research oriented as in the case of industrial powers and there is no healthy collaboration; the state if anything which is supposed to play the crucial role happens to be the biggest impediment. There are also many other problems like land reform, terrible labor laws, lack of appropriate legal framework to facilitate business and rampant corruption. And let's not forget the absolute lack of infrastructure.
China too has corruption, however the difference is that it is
facilitative corruption as in, bribes will get you even more leeway to conduct business than what the states business friendly policies provide. India on the other hand suffers from
prohibitive forms of corruption; as in you have to pay rents to get even the most basic necessities which are suppose to be provided for free. I think one reason for this is the poor level of education among India's politicians, they simply do not understand the value of industrial development and business enterprise; to them progress and growth are all worthless because only a decrepit third world environment will keep them in business like the good ol days.
Tata has talked about all these issues on many occasions because he has a great understanding of it all. I also sense a lot of disappointment because if you listen to his talks from about 7 years ago he saw a lot of promise, but now that has waned.