Will Infosys still be around in Bangalore in 2025?

PALINI R. SWAMY writes from Bangalore: Will Infosys and IBM and Cisco have shifted out of Bangalore to Madras and Hyderabad by the year 2025?

That’s the worst-case scenario painted at a World Economic Forum (WEF) event held at Stanford University last week to debate how high-tech clusters will evolve in the coming decades.

Two teams were formed to envision the future of Bangalore by unfolding two contrasting scenarios. By projecting themselves into 2025, both teams were asked to look back and identify the driving forces—i.e., crucial business/policy decisions (or lack thereof!) made over the past 17 years (2008-2025)—behind their respective scenarios.

The optimists, led by Indian-born French national Navi Radjou, a vice-president at Forrester Research, saw Bangalore as a global innovation hub not only in IT, but also in clean energy, bioengineering and medical devices, and even space technology.

They saw Bangalore’s policy makers betting big on non-IT technologies, the rise of a new generation of pragmatic politicians who invested massively in education and infrastructure, and to the return of thousands of US-educated PhDs and MBAs to launch startups and research institutions, thus accelerating the inflow of scientific knowledge, business acumen and venture capital.

The pessimists, on the other hand, said Bangalore would become a backwater of the global innovation markets. How come?

“Having placed all its development eggs in the IT basket, the city had become an IT services sweatshop that peddles its white-collar services to the highest Western bidder. There is no real innovation happening in Bangalore as high cost of housing combined with nightmarish traffic congestions had kept both prospective investors and PhD-armed scientists at bay.

“Starting in 2008, political leaders who formed the successive coalition governments spent more time jockeying for power than investing in vocational education and reforming universities to promote industry-academy cooperation. The result? By 2020, Indian IT vendors like Infosys and multinationals like IBM and Cisco had relocated their headquarters and R&D operations to business-friendly Indian cities like Chennai and Hyderabad.”

Irrespective of what scenario unfolds, Radjou writes on Harvard Business Publishing, there are three hard truths that policy-makers in Bangalore must face (and react to):

1) Human infrastructure will become more critical than physical infrastructure.

2) Competition from Chennai and Hyderabad will heat up.

3) The software industry alone won’t create enough employment.

Whose vision do you think will come good in 2025, the optimists or the pessimists?

Photograph: courtesy Infosys Technologies

Read the full story: Bangalore in 2025