India’s Opportunity to Accelerate IT Growth

posted by in Industry November 18, 2011
Nov 18

After a week of meetings with policymakers and business leaders in New Delhi, I leave convinced India is on the right path to achieve its goal of becoming a power center in the global IT economy. As I noted a few days ago, the country is moving rapidly up the leader board in IT industry competitiveness because of its enormous capacity for innovation. (One indicator: it now ranks second in the world in the share of its patents that go to computer and machinery inventions.) But India also has room to improve, something that was widely recognized by Indian leaders in our meetings. And it bodes especially well that there is shared determination on the part of government and industry to seize the opportunity to accelerate growth by strengthening India’s IT ecosystem.

On the final day of BSA’s Global Strategy Summit, we joined with technology business leaders from the Federation of Indian Chambers of Commerce and Industry (FICCI) for a discussion of the steps that would be most beneficial to improve the IT environment in India. There was widespread agreement from both Indian and multinational IT companies on key needs in the market, and a commitment to work together to help advance those shared goals.

As I look back on our meetings and discussions this week, I see opportunities in three areas, in particular.

First, given India’s size and stage of development, it is not surprising the market is still wide open to accelerate deployment and uptake of computer hardware, smartphones, and broadband Internet. When people and businesses have more access to those tools, demand for IT products and services will surge. Cloud computing services will likely prove to be especially important, because they will give Indian firms a new way of scaling up to do business globally. In that way, the cloud can act as a great equalizer.

Second, Indian policymakers can give a huge boost to technology innovation by strengthening intellectual property protections. In India, as in the rest of the global economy, it is important to recognize there are two sides to intellectual property: You have to foster it in the development phase (something India is becoming very good at), and then you have to protect it in the marketplace. There are a number of ways Indian policymakers could strengthen IP protection for software — starting with maintaining strong copyright and patent laws.

To enforce those laws, India also could form a national antipiracy task force, train enforcement officials, and create specialized IP courts — all approaches that have worked in other countries. Enforcement authorities also could use new and better policy tools. For example, when an enterprise pirates software, it is not just avoiding the cost of the software; it also is avoiding taxes. So policymakers could treat enterprise software piracy as a form of tax evasion.

Industry also has an important role to play, too, in protecting intellectual property. That is why BSA is partnering with the Government of India to spread best practices for complying with software copyright laws, which will help lower India’s 64 percent piracy rate.

Finally, India can open up access to its IT market and make it more competitive by forswearing the sorts of technology mandates that would, for example, favor one model for developing software over another. In public procurement, India also can avoid stringent preferences for local products and services and instead focus on acquiring the most effective and cost-efficient solutions for government’s needs.

India is already establishing itself as a leading IT hub in the global market. By continuing to build on its strong fundamentals, it has an opportunity to further accelerate the sector’s growth. By any measure, it is clear to me that India is open for business.

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