IT in India : Where We Were , Where We Are

ABSTRACT
I am somewhat positive on India’s endeavor for all round development, be it political, social, education, economic, industrial etc keeping in mind the historic as well as the current context of the country. Prolonged colonialism, population explosion, highly diverse social demography are some of the few radical factors one should not forget to touch upon where reaching a decision on India’s progress. Great leaders have born and died serving the timely purpose. The country’s comeback from abject pandemonium to a what software and services superpower it is today is highly commendable and cannot be said for any other country, the world over. This paper primarily focuses on the cradle of information technology in India, it withstanding the then strict government policies and becoming the major software services vendor in the world.

1. Post Independence Issues
India had been under the British Raj for about a century and eventually gained its independent status in 1947. During this colonial span the British had impoverished to country to a high extent. It crippled the economy, destroyed the social integrity and made the life of farmers worse. As soon as it got its independence the country witnessed violent communal riots resulting in further loss of the Indian heritage. Somehow we were able to bring peace and order imputed to the then effective government policies and initiatives. Contrasting with currently developed countries, precisely USA and UK, India had a miserable time dealing with colonialism. While USA attained independence from British colonies in 1776 (171 years before us), UK was never under a colonial pressure.

2. Economic Progress
In 1960-70 period India’s primary sector constituted more than half of the economy. Since then it has been able to bring it down to 20-25%. The industrial sector comprises of 25% of the GDP. Thus more than 55% of the GDP comes from the services sector tending more towards a developed economy. Within the services sector the IT, ITeS, ICT, Software and BPO have been the major contributors. India has received worldwide acclaim for the smart strategy it followed to reach the current GDP distribution statistics. This attracted a great deal of economists to study the forces behind such transformation.

3. Forces responsible for birth of IT in India
The term Information Technology, in its modern sense, was first coined in a 1958 article in HBR. The so called
“electronics lead” by the Americans was clearly visible in this context. IBM and HP primarily started as electronics and hardware companies. IBM’s electric tabulating machine helped the U.S. government in its large scale operation. HP was mainly focused on developing voltmeters, oscilloscopes, audio systems etc. The development of the FORTRAN programming language in 1957 by IBM, in a manner, gave rise to programmable artificial intelligence.
Companies such as Microsoft and Apple started as true IT firms which incorporated both hardware and software in their developmental work inspired the intellectuals the world over. Indian intellectuals like Narendra Patni (PCS), N.R. Narayana Murthi, Azim Premji etc. were some of the very few intellectuals who had a vision for software and IT industry in India and were inspired by the western developments. The ‘C’ programming language was developed during early 1970s and further influenced the software industry.

Table 1. Early Programming Languages
Language Developed Language Developed
FORTRAN 1957 C 1973

Upon observation one should find that indigenous companies like TCS, PCS and Wipro started their IT services in mid 1970s, during the same period when Microsoft and Apple were founded. Even Infosys was started was started in 1981.
Wipro was originally an oil and soap producing company. It switched to IT services in 1970s and is the third largest company in India today but not a big player in IT globally. Wipro had an added advantage during its foundation years, when IBM was knocked out to protect domestic companies.
SEEPZ (Santacruz Electronics Export Processing Zone), formed in 1973 in Bombay was the first IT hub indulging in exports. Several IT companies like TCS and PCS have their offices under it.
In 1981, TCS set up India's first software research and development centre, the Tata Research Development and Design Center in Pune.

Then comes the prime question – Why companies like Microsoft and Apple Inc. are the most enchanted names in the international IT industry and why TCS, Wipro etc are not equally prosperous? Why the operating system we use today is Microsoft Windows and not something developed by Infosys or TCS?

Table 2. Major IT Companies Globally
Company Founded Company Founded
IBM 1911 Microsoft 1975
HP 1939 Apple Inc. 1976

Table 3. Major IT Companies In India
Company Founded Company Founded
WIPRO 1945 PATNI 1978
TCS 1968 INFOSYS 1981

One reason behind this was the so called research lead taken up by Microsoft and Apple more actively, putting huge funds for research and experiments from the nascent stages of IT. Second reason could be the liberal western economies whereas before the 1991 economic reforms, Indian economy was identified by License Raj. Or the ‘Red Tape’. Red Tape existed for almost 40 years. It was a big bottleneck for the Indian entrepreneurs and hindered their concentration on company’s services, research and market strategy. To start a private firm there were a many procedures to be followed and forms to be filled, these often required them to travel a lot. The government was also very reluctant in assigning tasks to private firms. Capitalism was looked down upon.

The third reason could be imputed to the dearth of local markets for IT services during that period. More than half of the population was unemployed, thus the IT automation was not much motivating. These issues were not faced by western economies as their population and employment was well in control.

4. Post 1991 Economic Reforms

Today the IT industry in India is known globally for its software and services exports and BPOs. Their major markets are in the west. There had been two prime reasons for this.


1. Radical transition in economic policy.
2. Increasing availability of cheap, skilled and English speaking workforce.
3. Nature of work.


The 1991 economic reforms opened up the Indian economy to the world. Foreign investment and free markets were promoted. Above all it was a liberalization of the economic policies. This brought huge opportunities for the Indian capitalists and companies like Infosys, TCS etc. started enjoying their glorious years to some extent.

Most of us are aware of the second factor. India has the second largest English speaking population in the world, thought they are not native English speakers. This enables them to communicate with their foreign peers or clients specially in Business Process Outsourcing. Today most of the IT companies are into BPO operations. One advantage to the west is quite overt. They never had to tackle with the language problems as Indians and Chinese. Though we have a large number of English speakers, they constitute only 12% of the total.

The nature of work of an IT or Computer Science is also a responsible, at individual level, for the rise of this industry. Where industries like mechanical, electrical, chemical require the professionals and technicians to risk their health and often have cases of health hazards, the IT industry is quite safe from that viewpoint.