It's time Indian IT took the lead

India's booming tech industry seems acutely aware of the problems it faces - conservatism, social exclusion, lack of diversity. So can it change? Richard Sykes reports.

Nasscom's Leadership Forum closed with a session called 'Taking India to the next level of global leadership', designed to spark debate ahead of the Indian IT trade body's 20th birthday next year.

Leo Puri, managing director of merchant bank Warburg Pincus, took a firm line. He argued that the big Indian companies have been conservative for too long, milking the significant immediate term benefits of labour arbitrage.

This approach may have provided a nice gravy train but firms need to take risks to innovate for the future. Only now - after a long wait - was Puri excited by the new investment opportunities that are materialising.

Special Report: Inside India

In February 2007 silicon.com's Steve Ranger visited the Indian tech hotspots of Bangalore, Hyderabad, Mumbai and Pune. Click on the links below to see photo galleries of the cities and companies visited.

♦ Satyam's IT campus
♦ Hyderabad's tech parks
♦ Bringing tech to rural India
♦ High-tech on the streets of Pune
♦ Pune - the new Bangalore?
♦ Boom town Bangalore
♦ Bangalore's Electronics City
♦ SAP and Wipro in Bangalore

So is India moving from being the outsourcing capital of the world to becoming the innovation capital of the world? And is the country restrained by its education and social norms? The panel asked.

Some panellists suggested an open global and innovative mindset is not really deeply embedded yet. India was a significant player, suggested Subroto Bagchi, co-founder and COO of Mindtree Consulting, but not the new leader.

The campuses built by big companies to attract the best talent also emphasise the divide there is between Indians - smart lawns abutting shanty towns - a real form of social exclusion and a lack of real dialogue across the many Indian social divides.

Retiring Nasscom president Kiran Karnik has increasingly pressed this issue and sought a greater focus on practical work. And a new study by the Nasscom Foundation has explored and measured the social and wider economic impact of the industry.

Conclusion? This issue needs urgent attention. Quality data on diversity - or the lack of - in the IT/BPO industry is a very necessary first step.

Expert comment on India's IT industry:

Offshoring - not just about the costs

To feed the debate, written questions had been canvassed in advance from Nasscom delegates.

Will there be more women leaders in the future, for example? This provoked a debate about the barriers to change in a country where in a marriage of two professionals, the man does not relocate but the woman always has to. Women also lack effective role models.

A non-Indian as CEO of a major Indian IT/BPO company? Yes, in one to two years said Puri.

The future role of the Indian diaspora? Jerry Rao, founder of MphasiS, argued against any sentimentality. Professionals with clear agendas to bring investment, new entrepreneurship and new businesses are welcome - full stop.

In conclusion? By its 20th birthday celebrations next year, Nasscom will need to set some very new and challenging agendas for the next 20 years. India's achievements are beyond doubt impressive but the change agendas to free new drivers for future success are highly challenging.