Looking behind India's tech boom
Published: 28 Jun 2005 16:50 BST
The outsourcing boom that has transformed India's economy can be traced in part to a technology discovery made in 1995.
That year, engineers at Tata Consultancy Services found that a set of software tools called CasePac, developed to convert code for IBM, could be used to change the date field in other programs.
"We realised this could be used for the Y2K problem," said Nagaraj Ijari, a senior executive at Tata's offices, located in this city at the epicentre of India's thriving technology industry. Companies from around the world sought Tata's outsourced services to fix the "millennium bug", and the company's annual revenue has climbed from less than $170m (£93.1m) to $2.24bn in the years since.
The success story illustrates how quickly India's fortunes have changed in just a few short years, as the country's burgeoning technology industry has provided such services at a fraction of the cost of Western counterparts. Building on this foundation, India is now entering an important new phase in its economic evolution.
Once fairly anonymous organisations hired to run support desks and develop server applications for large multinational corporations, Indian companies are raising their profile as brand name suppliers in hardware design, software development, consulting services and virtually anything else in technology. Infused with new blood from a young tech-savvy work force, the new movement is a major advance toward economic independence that carries broad ramifications for a country whose past includes colonial rule, experiments in socialism and devastating poverty.
"There is a huge Indian domestic opportunity and an export opportunity beyond outsourcing," said Rishi Navani, managing director of WestBridge Capital Partners, a venture capital firm specializing in Indo-American deals. "Over the next 12 months, you will see three to four new Indian Nasdaq listings."
India's growing entrepreneurial spirit is reflected in its forays into consumer electronics — a highly competitive market that has long been considered the province of Japan, China, South Korea and other Asian nations, as well as the United States.
Tata recently won a deal to create an environmentally friendly mobile phone for a US carrier, for example, while rival Wipro Technologies is designing MP3 players for Europe and a flat-panel TV for an American company. Such entrepreneurial ventures in the consumer market are not confined to the largest players: Mumbai-based Celetronix produces set-top boxes for a US-based satellite TV carrier.
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