More Bangalore for your buck

More Bangalore for your buck
The Age, Australia

Bangalore was home to 13 companies that generated foreign software services income of $US8 million in 1990-91. There are now more than 1400 IT companies in the graceful city that sits on India's southern high plains, and they generate export income of more than $US5 billion ($A6.4 billion) a year.

The Bangalore IT cluster is the biggest in India, and the fourth largest in the world. And it will continue to grow, says B.V. Naidu, director of Bangalore's software technology park, "because it is now simply too big to ignore. If companies want to find the right people, this is the place to be."

Naidu's contention is backed by Bob Hoekstra, chief executive of Philips Software Centre Private, a Bangalore-based research and development laboratory for the Dutch electronics giant, Philips. Hoekstra's unit employs one out of four of Philips' software engineers worldwide, and Hoekstra says the group has a beachhead in India "because India has an unlimited supply of software engineers".

The impact of the IT revolution on India is profound, says Ghanshyam Dass, managing director, Asia, for the Nasdaq stockmarket. "The traditional path for economic development has been for agricultural economies to develop manufacturing, and then to develop a strong services sector," he says. "India might be the first country to leap from an agricultural base straight to services, and from there back to manufacturing."

Dass is continually looking for companies with the potential to be brought to market, and says he "discovers hidden diamonds every day".

One of them might be the next Infosys, which was launched in 1981 by seven software programmers who had less than $US300 between them and now is capitalised at about $US10 billion.

Infosys is part of an industry that now exports software services and products worth $US12 billion a year. An industry report tips exports to hit $US50 billion by 2008. Even then there will be room for growth. It is estimated India has only captured about 1.8 per cent of the potential market.