How Nano is different from the software boom

Ajit Balakrishnan, founder of rediff.com, on the Tata Nano:

“It is early January here in New York and the weather had no right to be as warm and sunny as it is today… The streets are bustling with people. This is not a sight for early January. People ought to be indoor and the streets ought to wear the deserted January look.

“I find myself strolling back from lunch with a prominent technology guru of a prominent Wall Street bank.

“‘I have finally figured out what “one lac” means,” he said to me. “When the Indian software industry, made its mark, the rest of the world had understood how they did it; Indian programmers were a tenth as expensive as programmers in the West. Then the Indian rupee steeply devalued from Rs 8 per dollar in the mid-1980s to Rs 45+ per dollar in the mid-1990s making the cost competitiveness case even more compelling.

“But the Rs 1 lac car is different. They will get to this target not by using cheaper labour or cheaper materials available only in India. They are going to get to this by bringing into play product design skills, consumer insights, management systems, perhaps even a new business design. In other words, they are going to compete on capabilities not resources. That’s why it is sending a shudder down the spine of many Western executives, not just car industry executives.”

Read the Ajit Balakrishnan blog: Decoding the Rs 1 lac message

Also read: If we can get a car for one lakh, why can’t we…

And Ratan Tata sang, ‘PR kiya tho darna kya’