Why the US trumps India in IT innovation

With its rich pool of talent, technology ‘powerhouse’ India should be the IT incubator for the world. So why is the US still leading in enterprise and innovation?

The Budget has been disappointing for the information technology (IT) industry. The much-needed Software Technology Parks of India (STPI) scheme has not been extended. There are also no schemes to encourage innovation in IT. The only silver lining has been the generous funding allocated to the unique identity (UID) project. This will surely help software and hardware companies to generate more revenue.

For all the hype about India becoming a superpower in IT, the government consistently shows a lack of vision. Contrast this with the US. Even in such dire economic times, the US shows its mettle by investing for a bright future. The US govt is coming up with a new category of visas for founders of start-ups. The Bill has recently been introduced and is yet to pass.

The proposed new visa norms go something like this: If one can get funding of $250,000 for one's start-up—with $100,000 from a qualified US angel investor or a venture capitalist (VC)—one is eligible for a two-year visa to grow one's start-up. At the end of two years, if the start-up is able to generate a $1 million in revenue or get additional $1 million in funding or create five full-time jobs (not including jobs for children or spouse), the founder becomes eligible to get a legal residence. Hats off to the US, the eternal place for enterprise and innovation.

It is this spirit of the US that has cemented its place as the leader throughout the 20th century and now going into the 21st century, it is already laying the foundation for its continued leadership.

Indians on the other hand are happy to be contractors for US firms. In fact, a growing country such as India should be the hub of entrepreneurship due to its growing market and the government should have had all kinds of schemes to foster high-tech entrepreneurship.

But there is none. Let us remember one thing—of all the software which Indians use to make their outsourcing money, most have been invented in the US or European countries. Right from C, C++, Java, .Net, or the Internet or name any other innovative technology, nothing has come out of India. And I can assure you that if the government's current stand continues, none will come out in the future. We will have all kinds of excuses for being second grade. There is no dearth of excuses for inefficiency and incompetence in India.

Is it any wonder then, that for the top brains of India, the US is still a magnet? For all the hoopla about Indian brains coming back, most of the people who come back are managers. Very few of the people who do high-tech innovation come back to India. And when they come back, they either go back after a while, or worse still, they end up working in more mundane but lucrative fields.

A few weeks back, we had another unsavoury incident. Tata Consultancy Services, India's top outsourcing company, had its website hacked. A company that probably does security work for many clients could not keep its own website secure. The Tata Group is a great entity; I have high respect for them. I myself have worked for the Tata Group on several occasions. Nevertheless, I am disappointed here to see the state of security in one of India's premier companies.

We don’t know what caused the security breach. Perhaps, a very rare vulnerability was exploited. I expected at least a press statement from the Tata Group. However, the lack of response from them somehow gives me the hunch that it could be plain negligence in keeping one's own website secure. Maybe I am wrong; it is still not late for the Tata Group to mend matters.

Bottom-line, if we are not able to take measures to work on areas that could give us a leadership position, at least we should stop harping on how a great IT superpower we are. Remember that superpowers don’t get made overnight. The US has a big history of research in technology.

The transistor which is the precursor of the electronics revolution was invented in the US in the 1950s. What has India to show for, in comparison?

(Dr Samir Kelekar is founder-director of Teknotrends Software, Bengaluru.)

udit c
1 decade ago
It is next to impossible to innovate anything for a market on the other side of the planet, especially when there is no premium on innovation for the local markets.
1 decade ago
Sameer, you have made many valid points -
didnt IT mature and become a great industry in india independent of govt support?
So as a matter of interest, why are we still dependent on and give excuse that govt is not supporting ... can we use private means.... the reason why an indian in technology does not come back is money, standard of life and kind of work - i am sure in india, we can provide alll the three! so why depend on govt? we love blaming govt for everything
Kingshuk Mukherjee
1 decade ago
I must say Dr. Samir Kelekar has hit the bull's eye on this subject. Despite our so-called IT super-power status all we Indians can do is what can be said in Marathi " Dusraynchi Bhandi Ghasne" or " Washing the dirty vessels of others - read Americans and Europeans. There is not ONE Indian company that is even close to achieving any software or hardware product that is a market leader globally or is of significant use in commercial applications. Some like "iFlex " solutions was in fact incubated by CItibank and later taken over another US software giant -Oracle. However I am optimistic that the scenario is changing very fast and it only a matter of time before one Indian company does some creative "Disruptive Innovation" that will take the world by storm. Some trivia for readers - Mr. Shiv Nadar (Chairman - HCL group) claims that his company HCL was the " First in the world to introduce the "PC" and not Apple as claimed by by Mr. Steve Jobs and Mr. Steve Wozniak, the duo who began Apple Computer in 1976.
1 decade ago
perfectly said
1 decade ago
Yes, it is disappointing to see not many IPs coming out of India. In US, the tie-up between university and industry is very synchronised and tight. Also US government spends milliosn over basic science research like NSF etc. I guess it is industry who have to take lead for innovations. I would say substantial part of Indian IT industry today prefer to work on the bottom of value pyramid. Which is more transactional, better managed by processes and is less riskier. I agree government should come up with the incentives to promote innovation. I would like to mention there are efforts like Prof. Anil gupta of IIM Ahmadabad who have take n huge steps to promote innovation at grass root level.
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