‘Indian IT doesn’t benefit its own people’

Yes, thousands of young people are getting jobs even before they step out of their colleges. Yes, the travel is good. Yes, the “world-class facilities” have given our cities a nice sheen. Yes, it has fetched India a place in the word. Yes, real estate is booming and as N.R. Narayana Murthy‘s proud boast goes, hundreds of taxi-wallahs are also earning a living. (And maybe the dowry menace came down!)

But is putting all the eggs in the Information Technology omelette such a good thing?

Wise heads like Prof. C.N.R. Rao have bravely spoken out against the long-term damage that we could be causing to our society if all our best and brightest end up doing the same thing—writing code or answering phone calls because the money is good. What happens to linguistics, sociology, geology, history, philosophy, etc?

Privately, many captains of corporate India crib about what IT is doing to them and to the country by sucking away all the engineering talent. But not too many have the cojones to express their views in public for fear of being branded as “jealous” or “anti-IT”.

A.M. Naik, the chairman of managing director of Larsen & Toubro, has bucked the trend in an interview with the Bombay newspaper, DNA.


# Infosys is so focused on making 26% profits after tax, their India revenue is less that 1.5%. So India doesn’t benefit with its own people. This makes me angry. Now they say they are looking at India and China, forced by their profitability issue. Not because they have any love for our country!

# Talent drain is India’s biggest problem. Previously the drain was because the talent was hired to go abroad. Now it is due to the outsourcing industry within India. Four out of ten Indians go abroad after using India’s highly subsidised education system and 90% don’t come back. Of these, four out of five go into outsourcing. Consequently they are only working to give advantage to the US, Europe and Japan. They are designing the product here and taking it to China to manufacture.

# China’s 52% GDP accrues from manufacturing. India shows only 17%. China’s manufacturing has spread into the second and third tier districts. India is shining only in 12 cities. One Chinese engineer creates 20 jobs only because of the country’s manufacturing prowess. An Indian engineer sells his man hours and fails to create any job for his fellow Indians.

# When I grumble about the outsourcing industry sucking away India’s talent it is because I want the powers-that-be to realise that outsourcing beyond a point is not in our interest. My complaint is that these companies sign up civil engineers, mechanical engineers, electrical engineers.

# Why can they (IT) pay better salaries? Because L&T works at 7-8% PAT, they work at 26% PAT. I cannot overcharge the nation. They charge it because of the cost advantage gives them enough leverage and gives their employees double and they still end up making 26% PAT. I doubt if they will last for long.

# The least that the politicians can do is stop cutting ribbons in the outsourcing industry. There are more than 75,000 engineers working on design in India for foreign companies. They are the brains, and there are 150,000 other engineers working in the IT industry who are non-computer science engineers. Then the Bangalore Club complains that infrastructure there is cracking. Arrey tumko kisne bola tha 100,000 engineers leke aao Bangalore mein. Secondly, who asked you to recruit civil engineers? There are no civil engineers available to build infrastructure!

Read the full interview: ‘This life is reserved for L&T’