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Information Technology Paving Way for India's Development - 2002-12-06

India is emerging as a high tech software center, and some analysts, speaking in Los Angeles at a globalization conference, say information technology is paving the way for the country's development.

India has some catching up to compete with the Asian tigers, developing manufacturing centers like Taiwan and South Korea, or the burgeoning Asian giant, China. But Gurcharan Das, the former top executive at Procter and Gamble, India, says information technology is bringing his country into the 21st century.

Mr. Das is now a writer, the author of a book called "India Unbound." He sees a new confidence in his country. "And [Information Technology] has played a very important role in creating that confidence, that success that India has had," he says. "But this is reflected in all manner of ways, for example, how our attitude to money has changed. You know, Indians were very ambivalent about money."

Mr. Das, who spoke at a conference on globalization, says India's engineers and software developers are increasingly finding their place in the global economy. He says 200 of the top 500 U.S. companies outsource some of their high tech work to India.

UCLA professor Deepak Lal says India's surplus of trained engineers is the lucky result of a grand miscalculation. Fifty years ago, he explains, India's government determined the country's future lay in manufacturing, and it created institutes of technology to educate technical experts. The expected manufacturing boom never arrived, and many unemployed engineers came to America.

Vinita Gupta was one of them. In 1985, she founded a company, now called Quick Eagle Networks, in the high tech region near San Francisco called Silicon Valley. She says more than 30 percent of the Silicon Valley companies started during the recent Internet boom had at least one Indian founder. "When this boom happened, primarily because of the Internet, the talent was there, the founders were there, and there was a deficiency of workforce in the Valley," she says. "There were not enough software engineers. And because Indians knew the talents of the graduates of India, the educational system of India, and language was not a barrier, they drew upon that talent."

That meant bringing Indian engineers to the United States or, increasingly, outsourcing IT tasks to Indian high tech centers, like Bangalore. There, one panelist noted, engineers were happy to work for $10,000 a year, the lowest wage that an unskilled worker would earn in America.

Indian author Gurcharan Das notes that many U.S. firms hire Indian companies to handle their customer service, as well as develop their software. He says services and information technology will spur India's growth, not manufacturing. "Because there are too many hurdles that the government and the old rules, the old legislation, puts in way the of manufacturing," he says.

Entrepreneur Vinita Gupta says most Indian high tech businesses offer specialized services to U.S. companies, and need a better infrastructure and more reliable management systems to handle large-scale orders. She says when those things are in place, India could also emerge as a manufacturing center. "If Indian businesses want to become strategically important to companies here, they have to have some critical mass," she says. "And critical mass means larger portion of the development should be done in India. That's when they'll pay attention to India."

Ms. Gupta says the Indian government must be more responsive to public opinion, and go further than it has in reducing trade tariffs and bureaucratic barriers to business.