by Tom Field

India Unbound

Feature
Dec 01, 20006 mins
Outsourcing

Bypassed by the industrial age, India has the opportunity and the ambition to be a major player in the information age. But first, the country has to tackle some vexing infrastructure and political challenges.

CIO Senior Editors Tom Field and Cheryl Bentsen traveled to five Indian IT hot spots in August and September. Amid poverty, sickness and the occasional riot, they met with leaders in IT, government and business who have high hopes for India’s future as an information age powerhouse.

It’s only been nine years. This is what I remind myself as I stand atop Cyber Towers in HITEC City, one of India’s ultramodern IT office parks. Eleven stories high and fighting to stand in a monsoon wind, I survey greater Hyderabad and see just how much the IT industry has changed India. To my right is the brand-new Indian Institute of Information Technology (IIIT), a public/private venture tailor-made to train a new generation of knowledge workers. To my left is the still-under-construction Cyber Gateway, an 886,000 square foot office complex that will soon open its doors to a host of high-tech tenants eager to take advantage of India’s low-cost labor and HITEC City’s high-value telecommunications infrastructure and modern amenities. Below me, in the Cyber Towers itself, is a vibrant glass-and-steel complex already aglow from the energy of such big-name tenants as General Electric, Microsoft and Oracle.

Ten years ago, none of these things existed. There was no HITEC City, no IIIT and no Cyber Towers. It was only nine years ago that ex-Prime Minister P.V. Narasimha Rao’s government initiated a series of reforms designed to open India’s insular, insecure economy. By making it easier for the world to do business, India finally got its chance to stand and deliver in the global marketplace. The result is what one sees from the rooftop of Cyber Towers: a country absolutely transformed by the business of IT. Ten years ago, IT was a $150 million industry in India’s largely agrarian economy—a piddling amount considering the country’s population of 1 billion. Today, IT is a $5.7 billion industry in India, and it is projected to be an $8 billion industry by 2002—maybe $80 billion by 2010.

And yet, as I leave HITEC City, I ride over craggy roadways crammed with cars, motorbikes and cows. The belching auto emissions are so noxious, the honking horns so incessant, the roadside trash so imposing that my driver turns to me and says in broken English, “We have every kinds of pollutions here.” We pass the sprawling shanty villages that house the hungry, stop in traffic and become fair game to the ragged beggars seeking rupees for food, and I think, “You have every kinds of poverty too.” But again I remind myself: It’s only been nine years. Even at Internet speed, age-old problems can’t go away overnight.

India enchants visitors because it is—pardon the cliché—a country of contrasts. The splendor of the Taj Mahal in Agra is countered by the squalor of the shanty city in old Delhi. The beautiful rain forests outside Bangalore are startling in comparison to the thick-aired, traffic-clogged city itself. The brilliance of India’s technologists, the huge global success of the IT industry, seem incongruous with the country’s everyday realities of electrical outages and telephone failures. Pick a contrast (any contrast) and India probably has it. But the one that lured CIO to make India the focus of this year’s special field report is this country’s precarious balance between opportunity and challenge.

India can be an IT superpower. As the Indians themselves love to point out, they form the world’s largest democracy, host the second-largest English-speaking population, and their math and engineering skills are world-class. In less than a decade this country hasn’t just developed its own IT industry (fueled mainly by profits from software and services exports), but it’s also exported significant brainpower to help lead ours. By focusing on creating a larger skilled workforce, attracting new foreign-owned employers to India and broadening the range of services its own companies provide to the world, India has the opportunity in the information age to be what it never quite was in the industrial age—a player.

And, yet, how far and fast can the IT industry grow in a country where the lights and phone lines fail daily? How many knowledge workers can be created from a population with a more than 35 percent illiteracy rate? What social ramifications might there be if India’s new IT wealth proves only to widen the gap between the country’s haves and have-nots? These are among the vexing challenges that come hand in hand with India’s bountiful opportunities.

For Cheryl Bentsen and myself, the two CIO writers who toured the country in August and September to prepare this special report, India presented a whole new set of opportunities and challenges. We were granted easy access to such IT leaders as Wipro Chairman Azim Premji—who as the country’s wealthiest man and head of its biggest IT company is India’s version of Bill Gates—and Andhra Pradesh Chief Minister N. Chandrababu Naidu, the country’s renowned “laptop minister.” But to get to these people and the many others we interviewed, we had to overcome not just clogged roads and cranky infrastructure, but earthquakes, floods, riots and sickness.

For CIO readers, we believe India presents a compelling story. Perhaps you already know that India has become an easier place with which to do business, that the country has exported legions of IT workers to the United States and that it almost single-handedly built what we know today as the offshore outsourcing industry. But do you understand what challenges remain in trying to do business in India? Are you aware of how the nation’s government, schools and private industry have banded together (unlike our own) to improve IT education? Have you seen the early results of India’s Internet startups or the strategic plans of the outsourcing vendors whose futures depend on their ability to sell you higher-level services? These are among the topics we cover in this special report.

After you read this package and react to it, please send us your thoughts. But be sure to take time to reflect on what India has accomplished, what it has contributed to the world IT industry and how IT in turn has changed India.

And then remind yourself: It’s only been nine years.