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Reinvent, Stay Relevant

Improving capabilities and enhancing its presence globally is key to India’s IT sector

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India’s IT industry has played a seminal role in shaping modern industrial India. It has placed India on the world’s centre stage. In 2017, the Indian IT industry is the largest private sector employer with about 3.9 million employees. The total revenue of the industry is about $154 billion including $116 billion of exports.

In the past few years, the proliferation of IT and IT-enabled startups have made India the third largest and fastest growing startup hub in the world. I had the once in a lifetime opportunity of being an integral part of Indian IT from the late 1970s. How did it all begin, how did it evolve, and where is it headed?

The British HEC 2M was probably the first modern computer in India. It was installed in 1955 at ISI, Kolkata. TIFR designed and built a digital computer TIFRAC which was dedicated to the nation in 1962. In 1963, IIT Kanpur acquired its first computer, and soon started offering courses in programming for the first time in India. The other IITs followed soon. Many young professionals with background in computer science in the late 1960s and 1970s went to work for DCM Data Systems, IBM, Patni Computer Systems, TCS, etc. The first wave of IT entrepreneurship in the 1970s and early 1980s created companies such as HCL, Wipro, and Infosys. The evolution of the IT industry is also closely mirrored by India’s larger economic agenda. The focus in the 1970s and early 1980s was self-sufficiency including export substitution, conservation of forex, and indigenous manufacture of hardware and software.

The forex crisis from the late 1980s prompted the government to provide incentives for software exports. These macro factors, combined with a strong Indian IT capability made software services exports the mainstay of Indian IT from the 1990s. The spirit of entrepreneurship in the IT industry continued and the early 1990s saw many hardware firms pivot into software services exporters. The late 90s saw the emergence of the second wave of entrepreneurship creating companies like Mindtree. The 1990s and 2000s also witnessed many MNCs set up IT GICs in India.

The foundation of the past decades has given Indian IT a good springboard. The third wave of entrepreneurship is unfolding now in IT and IT-enabled industries. Incumbent Indian IT firms are reinventing themselves for the new era of digital and beyond. Many MNCs which have set up their IT GICs in India are upgrading them into centres of excellence. Current policies are also focused on India retaining its position as a preferred global destination for IT. There are challenges posed by emerging digital technologies, automation and trade policies. I expect Indian IT to be resilient, and learn to adapt just like it has in the past.

I believe, the next 30 years will continue to enhance Indian IT’s presence on the global centrestage. Nimble incumbents and a myriad of startups will continue to innovatively leverage IT. Both India and the world will benefit from our IT prowess. The nature of capabilities and technologies that define Indian IT may be very different from what exists now. AI and IoT are important today’s technologies that will power the immediate future. I believe computational neuroscience is an important capability that will develop over the next couple of decades to redefine IT. India is building its capability in this emerging domain with initiatives like the Centre for Computational Brain Research in IIT Madras and the Centre for Brain Research in IISc.

We live in interesting times. A history of resilience and triumph has placed Indian IT at a pole position, which provides a missive of optimism for the future of Indian IT.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Kris Gopalakrishnan

The author is co-founder of Infosys, Chairman of itihaasa Research and Digital, and Axilor Ventures

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