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'Seeds of India's rise as IT giant were sown in 1947'
S Ramadorai
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July 11, 2007

The seeds of India's rise as a global powerhouse in information technology were sown way back in 1947, as Independence nudged education into the spotlight and led to the establishment of new universities, engineering colleges and research and higher education institutions.

These initiatives resulted in the availability of skilled technology and engineering professionals, many of whom went overseas in search of green pastures and some of whom came back to clear the forest to create new and greener pastures within the country.

In the global arena, the IT sector has been a catalyst to re-engineer India's image from one built on past clich�s like palaces and poverty. It has been the ambassador of emerging India and helped create a new brand image for the country associated with skilled and hard-working professionals.

With hindsight, looking back at the early days of the IT industry in the late 1960s and early 1970s, it seems a near miracle that the industry even took root, given the complete absence of demand for technology in India and strong foreign currency regulations that forbade import of computers and software.

Indeed, our economic past, characterised by scarcity, has been the driver for today's success. It forced us to be more efficient and do more with less. Not only did we get free lessons in optimising our resources, but it also challenged us to find creative solutions, and then test these in a tough operating environment. It was virtually like getting a free MBA!

What started with small programming jobs in the US, moved to larger projects being done out of India, until an entire ecosystem of talent, academia, training developed into a $30 billion industry. One of many engineers who left California for India and then came back to sell an idea was yours truly. I set up TCS's [Get Quote] US operations in 1979, having returned after my masters at UCLA in 1972.

Now, 'Made in India' has become the benchmark for software and services in the 21st century, just like 'Made in Japan' was the success story in manufacturing, automobiles and consumer electronics in the late 20th century. It is now a brand that epitomises efficiency and innovation that not only our manufacturing sector hopes to emulate but also has attributes that our dominant agriculture sector can ride on as it begins to supply flowers, fruit and grains to global kitchens.

If Indian IT learnt to walk in the West, it is now learning to run in India. Technology is helping bridge the rich-poor divide; distance education, telemedicine and micro-finance are helping achieve this.

Less surprising, perhaps, is that India is creating innovative products aimed at the bottom of the economic pyramid. So products like a Rs 10,000 PC, a refrigerator built to survive voltage fluctuations and, of course, the Rs 100,000 car are all unique, indigenous, cost-effective solutions that could be exported.

We are also deploying technology to ensure that citizens can avail of government services remotely without having to deal with India's mammoth bureaucracy; the current government's new employment initiative for families living below the poverty line uses TCS technology to ensure that the poor get the benefits of public spending rather than corrupt middlemen, and for one of India's leading children's NGOs we have devised and set up a nationwide database and communication system that allows help to get to children in need, in the quickest time possible.

Innovation in technology is helping India. It boasts of the cheapest mobile phones and call rates of just Re 1 a minute and public transportation that runs on non-polluting gas. To top it all, it has a young population bursting with energy and aspirations - probably the only big market where first-time telephone users are cellular phone users that have bypassed landlines.

All this has given Indian IT a seat on the global head table, with intellectual competencies to serve an array of offerings in several domains, technologies, with processes to deliver complex solutions, and to sell and support these in all parts of the world. We are transitioning from simple outsourcing to global sourcing - driving the next phase of evolution in process quality frameworks and practices.

We have a headstart on competing countries in terms of process, track record, relationship management, and technology management. We are building our domain abilities and expressing our value to customers visibly. We have played a globally significant role in the information technology and knowledge based services area.

The fact that our multinational competitors are setting up shop in India is proof of India's competitiveness and the success of our business model. Another proof-point of this success is that Indian IT companies like TCS are being requested to establish operations in countries like Uruguay, Mexico, Brazil, China and Morocco.

At 60, India is at a new inflection point. In the years after Independence, it was the government that invested in capacity building for education and research. Today, industry has to come forward to rebuild the capacity to suit the needs of the future.

Our industry has the responsibility to find ways to collaborate with academic and research institutions in India and abroad so that we can stay at the leading edge of the technology domain and process innovation. Technology as an enabler to address all fields continues to be a critical challenge.

While the increasing numbers of universities and educational institutions in India is heartening, the emphasis on examinations (rather than on understanding, learning or knowledge) falls short of inculcating the intellectual leaning required to prosper.

We need to emphasise the need to innovate, to build intellectual property and maintain the pace of transition, whether it is domain consulting, domain products, shrink-wrapped products, high-quality software services or business process outsourcing.

Our ability to anticipate and, indeed, create successive "waves of innovation" will be crucial as we straddle technologies, domains and processes - and create a self-sustaining process to do so continually.

For many critics, India remains a late bloomer. But it must be remembered that nations are not individuals, and while individuals may look to take the foot off the gas pedal at 60, India remains a young nation, which, at 60, is ready to take its place on the global stage on an equal footing with developed economies.

For the IT-ITeS industry, this means a transition from the technical software services of today to knowledge domain based services enabled by IT tomorrow.

But I am confident that IT will not remain the only global leader in the coming years and decades. If we can continue to build our knowledge skills, the manufacturing and agro sectors will soon be up on the global podium alongside the software giants.

S Ramadorai is managing director and CEO of Tata Consultancy Services.

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