One of the more controversial points made the chieftains of the Information Technology industry is that the IT boom happened in spite of the government, not because of it. In other words, the “State” has little or no role to play or claim. The claim is obviously debatable because of the State’s role in securing and awarding land for IT companies, in setting up engineering colleges which produce their workers, in setting up the scientific and R&D labs which created the base, etc.
But evidence that the IT chiefs may be partially right comes from the growth in software exports from Karnataka in the year gone by. For the better part of the last two years, and more so last year, the JDS-BJP coalition government of H.D. Kumaraswamy was conspicuous by its perceived lack of interest in massaging IT egos, unlike in the S.M. Krishna years, when the State seemed very happy and eager to play The Great Provider.
Yet…
Yet, according to a story in Mint today, software and service exports from Karnataka only continued to grow. It will be 44 per cent of the country’s total IT and back-office services exports of around $40 billion. Software exports from the State, which were growing at a compounded annual growth rate of 38% over the past three years, are expected to grow by 46% in 2007-08.
“According to M.N. Vidyashankar, principal secretary to Karnataka government, department of IT, biotechnology, science and technology, the software exports from the state will touch Rs70,000 crore ($17.6 billion) during 2007-08 compared with Rs47,900 crore in 2006-07. Karnataka, which had a gross state domestic product of about Rs1.94 trillion in 2006-2007 dominates software and back-office exports from India. “We could’ve done more than Rs70,000 crore but forthe rupee’s appreciation,” said Vidyashankar.”
So, what’s the message? That the IT boom will go on, government or no government? Infrastructure or no infrastructure?
Read the full story: Karnataka to account for 44% of IT exports
My point to the Kannadiga IT Czars : “…..the IT majors have a responsibility here. Till now, they seem to be in a hurry to make the next quick buck. It is time for some introspection, some realization that, they too have a stake in the city’s well being. We are not asking the NRNs and Premjis to be Bill Gates or Warren Buffets. But do more than tangle with inept, imbecile officials. You are better than that. Bangalore nurtured you and your dreams, long before NASDAQ seduced it..”
More at : http://currentcaveats.blogspot.com/2007/11/its-not-government-stupid.html
IT boom is because of our naadu,nudi and neeru and ofcourse due to favourable tax structure of govt.. if it were in some other states say UP or bihar it would have become dysfunctional long ago..
I think the answer lies somewhere in between…
The IT industry, in its nascent stage, needed State Government assistance and active support. Now that it has grown to this size, it can do with a bit of neglect.
That of course, does not mean that HD and co. should start driving out companies by making it more and more difficult to carry out their businesses, but there is also no need to start allocating huge tracts of land (let them buy it at market rates) or offering more tax incentives and the like (the state’s coffers can use a bit of help).
I kind of agree with Alok, Initially they needed govt help and got it too. Karnataka is ideal to set up any industry that too industries which depend more on human capitol. Because, kannadigas are very accomidative, gentle and co-operative. They are much more intellectual than most other people from other states.
Let the bloody Govt just shut its mouth and provide the necessary infra-structure. Roads and everything else is woefully inadequate not just for the IT industry but for all industries across the spectrum. Unfortunately till now the IT industry felt some sort of a clout to hammer the Govt for its in-efficiency. With the $ in decline, lets see how many more days can the IT czars run this circus.
Thats one advantage of the politicians focussing on keeping their seats.. no time to interfere..
On a more serious note.. agree with SumneNeeve…
“Inspite of the Gods, Inspite of the Govt” – is it really that simple? – I beg to differ. If Rajiv Gandhi hadn’t envisioned the IT parks of India and the related Tax-cuts, If Dr. Manhmohan Singh and PVN hadnt come together to reform the economy, we would be set back by a few years and a few millionaires and that would have hurt because the Chinas of the world would have probably overtaken us.
But this argument stops here, it is incidental that Bangalore became the IT capital, it could easily have been any other city. To say that the Govt. of Karnataka’s IT sops started it would be foolish; Union Govt. to a little extent, yes. Again, very little to attibute to the Central Congress party itself, unlike their claims recently.
First: I wonder how these figures are calculated? For example, is full Infosys revenues taken for calculation because this is a Bangalore based company despite the fact that only 25-30% of Infosys employees are Bangalore based?? Can somebody explain?
Second: These figures seem to be fudged. When the IT companies are struggling for the past year to grow at even 25%, the states IT exports are growing at 46%?
The politicians had very little to do with the IT Boom. Companies like Wipro moved from Mumbai to Bangalore because they got cheap land in the early eighties and Karnataka those days was a power surplus state. Infosys moved from Pune for similar reasons. The rest of the boom began after Texas Instruments obtained permission from the government to hire a satellite, Indian design engineers who came at next to nothing and showed the world what could be done out of Bangalore. Then you had almost every other IT company setting up its own body shop in Bangalore. Affordable office space, good weather and quality of life which made it easy for companies to relocate talent from other parts of the country were the reasons why most came. While all this action happened those in power sat on their butts and did nothing. SMK was an exception. HDK had no need to massage anybody’s ego. Even if he had continued with the infrastructure it would have been enough. It’s time they made Bangalore a city state. Look at Delhi. It’s the only city where infrastructure is keeping pace with growth.
And we need to also question the numbers. When they speak about Infosys for example, are they including the company’s entire revenue and crediting it to Karnataka, if so is that the right way it should be done? Or should it only be for exports for Infosys originating from its Karnataka offices?
Actually it would be interesting to see how much has Bangalore as a city grown with respect to its software exports and how much have other cities grown.
In India nothing good happens without the state. The state just realizes it after the fact.
Sanjay,
About TI moving to Bangalore and the outsourcing boom taking off – doesnt the credit go to RK Hegde?
IT is enough. Its time to focus on research and development like alternate energy sources
The ICE (InfoCommEntertain) sector has grown precisely because the government had no role to play directly, only indirectly dispensing some public goods – not very efficiently though. A smarter government could have accelerated growth, but that species is rare in India.
krishna,
But who will pay for the R & D? The government? That is one of the things this post highlights.
If someone wants to research and develop on alternate energy sources, great. In fact the government does provide incentives in this sector too.
Alok, very well put. Agree 100 %
>>”…For the better part of the last two years, and more so last year, the JDS-BJP coalition government of H.D. Kumaraswamy was conspicuous by its perceived lack of interest in massaging IT egos, unlike in the S.M. Krishna years, when the State seemed very happy and eager to play The Great Provider.” ergo.. “IT growth is in spite of the state, not because of it”. (!!)
Your logic is pure gold. nim paada xerox kaLstira swalpa.
First of all, “… perceived lack of interest in massaging IT egos..” does not reduce to “anti-IT”, “inimical to IT interests” etc.,. All that it means is that HDK/Gowda looked the IT crooks in their eyes and called their bluff. They told them point blank that the state had enough for their needs but not for their greed. They were told in no uncertain terms that the merry days of pillage, plunder, loot and rape of the city and countryside alike was gone with Soole Maga Krishna, Deekayshit and their cronies.
Squealing and smarting like kantri naayis stoned on their genitals, the murthys and premjis tried the “we’re moving out of b’lore!!” card in one last pathetic attempt. And again, our Gowda and his son looked them in the eye and told them to go f#&* themselves. And dont you try to appropriate some credit for this gandastana for the the BJP.
And 3 years later, not only are the murthys and premjis sitting ‘gooTa hoDkoMDu’ and pretty in bengaluru, they’re also buying more land and expanding in bengaluru! After eating humble pie for a couple of years and biding their time, the bastards now have the gall to say
“Since 2004, all successive state governments had been sitting on Infosys’ application for additional land to expand campus in the city.”!! –>http://www.rediff.com/money/2008/jan/14infy.htm
Governments werent ‘sitting’ on your applications dammit! They’d just refused to give you land away for free! Now with the Congress back in power in the state, the crooks buy their lands at market prices(supposedly) and also take a dig at Gowda… jatti makkane biddru.. meese maN aaglilvante.. huh. ee boLi makkLella maryadastru.. deve gowda obba bhrashTa!
Who says Gowdas neglected IT firms? dont you remember, they bought over a nicely built tech-park!
Sisya,
Rightly said about the behaviour of the IT slave drivers towards the very place that is feeding them.
Uppu thindha maneyge yeradu bageyavaru.
Why dont these wipros and infosys just move out of Karnataka instead of squealing and complaining like pigs. Along with many of the riff-raff they hire from outside. A lot of the problems which they complain about will be automatically solved.
Sisya,
If you are the same Sisya that I know of, then as always a super pleasure to read your super post. Cheers
Yes AG. It was R.K.Hegde in power at that point in time. he must have made sure TI’s papers were processed fast. But then, it was Bangalore’s various attributes that made TI choose the location.
The State can either proactively promote growth or stunt growth by misguided regulations and bad resource management. If the state is passive yet cooperative than that itself is a great help to the IT industry as the state though an important part of the landscape, is not a catalyst in itself. What drives the IT industry is individual entrepreneurship. The state stands to benefit from the entire boom which it can use to lift its poor masses.