Kolkata:Hi -Tech with Hi- Touch
(Roopen Roy is the Managing Director of Deloitte Consulting, India. Views expressed are personal.You can read it @Times of India @ http://epaper.timesofindia.com/Repository/getimage.dll?path=TOIKM/2010/04/05/34/Img/Pg034.png) The original Macaulay Minute can be accessed @ http://www.scribd.com/doc/27765406/Lord-Macaulay-s-Minute-2nd-Feb-1835
In all seriousness, I make the claim, often testing the credulity of those who lend me a patient ear, that the seeds of the Information Technology (IT) revolution in India were actually planted in the vicinity of The Bengal Club in Calcutta. A marble plaque in The Bengal Club suggests that Lord Thomas Babington Macaulay lived where the club stands now. And it was this gentleman, more than anyone else, who can claim credit for the English proficiency of the “natives”.
Macaulay made an insightful observation when he wrote in the famous (or is it infamous?) Minute on Education dated February 2nd 1835, “There are in this very town (i.e. Calcutta) natives who are quite competent to discuss political or scientific questions with fluency and precision in the English language. I have heard the very question on which I am now writing discussed by native gentlemen with a liberality and an intelligence which would do credit to any member of the Committee of Public instruction. Indeed it is unusual to find, even in the literary circles of the continent, any foreigner who can express himself in English with so much facility and correctness as we find in many Hindoos.” Hear, hear! He was almost prescient when he wrote, “Less than half the time which enables an English youth to read Herodotus and Sophocles, ought to enable a Hindoo to read Hume and Milton.” He did not clarify, however, whether Latin or Greek was twice as difficult or Indians were twice as smart!
If the Indians were not taught the English language, I do not believe that spark of the IT revolution in India would have become a global prairie fire. Sorry, I borrowed that expression from Mao. Macaulay was instrumental in creating the foundations of English as a medium of instruction for the “native” Indians .He mandated that English should be the medium of instruction in higher education, from the sixth year of schooling onwards, rather than either Arabic or Sanskrit. On March 7, 1835, the Governor General William Bentinck agreed with Macaulay's Minute and wrote, “ the great object of the British Government ought to be the promotion of European literature and science among the natives of India."
Fluency in English is unquestionably a competitive weapon in the hands of Indian IT companies. I realized this even more when a Chinese colleague of mine who runs a crash language lab in Shanghai told me with a touch of arrogance, “We don’t need to be colonized by the British for hundreds of years to learn English. We are learning English faster than you and in 10 years there will be no difference. Really? And even if that is the case, you agree that we are 10 years ahead, comrade or should I call you buddy?
Apart from the head-start in English, Calcutta had another first mover advantage which it initially squandered. The first computer in India arrived in Calcutta in1956 at the Indian Statistical Institute. It came from what was then a communist country: the USSR and was called the Ural. It was 10 feet by 10 feet in size with a 'drum' placed beside it, which contained its most important part — the memory. The “keyboard” was 10 feet wide and mostly contained knobs.
But the trade unions in West Bengal looked upon computers with deep suspicion much like the Luddites in Britain in the early 19th Century. In the late 1960’s and early 1970’s Life Insurance Corporation of India and the foreign banks were not allowed to install computers. Any kind of “automation” was looked upon as job-destroying, anti-labour conspiracies.
It took more than two decades for the communist leaders to realise that the information technology revolution –with globally connected computers-was actually a huge generator of direct white collar employment . In addition, every direct job in IT created almost 8 indirect jobs. By the beginning of the 21st century, the “imperialists” were raising hell against “outsourcing” and crying hoarse about jobs in the West being transported across wires to India.
Calcutta –and by now Kolkata-although a late starter joined the game with boundless energy and passion .SALTLEC (Salt Lake Electronic Complex) which was created in Sector V of Salt Lake to house hardware and electronic equipment manufacture in the state unwittingly turned out to be a boon in disguise. Most hardware and electronic equipment manufacturing units promoted or assisted by the state-owned Webel turned sick and moribund. But the new game in town was not hardware, it was software and IT services and the ready infrastructure came in handy.
To give the devil his due, the creative Kolkata vulture capitalist was also working 24/7. They skirted and bent rules and built on the graveyard of these “hardware” units ---shining glass and concrete edifices which began to house software and IT facilities.To be fair, Webel also directly allocated land at a concessional price to several companies who built their campuses and global delivery centres in Sector V.
In 1995 when my colleagues and I decided to set up the first “software factory” of Price Waterhouse Associates (P) Ltd in Sector V in Salt Lake, there was only one pale blue building that shone amidst the vast wilderness where cattle roamed free. This building belonged to R S Software promoted by Raj Jain who was the pioneer of IT in West Bengal.
But ours was the first investment of an international company which put Calcutta on the global map of IT. When this business was acquired by IBM, the 1200 people became the nucleus of an IT business that has scaled up tenfold in 8 years. In quick succession, Sector V attracted investments and expanded rapidly. Amidst the gloom in manufacturing, the IT sector shone like a beacon and became the pride of Kolkata. Today, there are 100,000 people working in Sector V alone. Thousands of professionals from Kolkata have spread all over the world and there is scarcely a large city in North America, Europe and Asia Pacific where we do not have former colleagues!
Apart from IBM, TCS, Tech Mahindra, Cognizant, Cap Gemini and Wipro have set up huge facilities each one of them employing several thousands of professionals. Other well known names which operate their global delivery centers in one avatar or other are Deloitte Consulting, ITC Infotech , PricewaterhouseCoopers, Skytech, TCG Group, Genpact, Acclaris, Data Bazaar and numerous others. According to Webel and STPI, IT exports from West Bengal reached Rs 5129 crores last year. West Bengal has 63 Engineering colleges producing 20,000 graduate engineers every year. Some of the premier educational institutions are in the neighbourhood e.g. IIT Khargapur, IIM Calcutta, Jadavpur University, Bengal Engineering and Science University (BESU). Kolkata has a number of IT Special Economic Zones at Wipro campus, Bantala, Unitech and DLF. Almost 20 million sq. ft. of space is under construction.
The recent Nasscom study prepared with the assistance of Mckinsey predicts that by 2020, the addressable market for global sourcing of IT will increase from the current $500 billion to $ 1.6 trillion. The export component of the Indian IT industry is expected to grow to a minimum of $175 billion from the current $60 billion –an almost three-fold increase. The upside is even higher. According to the study, focused initiatives and innovation-led growth could lead to additional revenue of $135 billion. On the other hand, the domestic revenues could be as much as $65 billion in 2020. In an optimistic scenario, our IT industry has the potential of attaining a size of $375 billion by 2020 - more than 5 times its current the size. The most interesting data point is the co-relation between the availability of talent pool and the size of the industry measured in $ billions. If our talent pool count is 10 million in 2020 we are likely to reach a size of $175 billion. If we are successful in our focused initiatives, if we become one of the top 3 innovation hubs in the world and have a talent pool of 13.5 million then potentially the size of our IT industry would be between $225 billion and $310 billion.
Kolkata is uniquely positioned to harness this opportunity. All that it will have to do is to adopt intelligent enabling policies that will unshackle the education sector from the clutches of red tape and corruption. I am all for fair rules and sensible regulations but not government interference and meddling. The government must continue to invest in primary and higher education. But it must also create an enabling framework that will attract honest and quality investors to bring in private capital, expertise and delivery capacity in education. And these investors could well be eminent foreign universities. Why not? India spends more than $4 billion in educating young Indians abroad and the entry of foreign universities will enhance opportunities for our children and might even keep a billion or two at home. I am dismayed at the hysteria of the equivalent of Bombay Club among academics who do not want to allow the entry of foreign universities. Predictably, those who clamour most have either had the privilege of being educated abroad themselves and/or have sent their children to foreign universities.
For the foreseeable future, the demand for quality IT professionals will remain strong and cities which have quality educational institutions and talent are the ones which will win. There is no shortage of raw material and talent in Kolkata –the challenge is to give them a high quality education and make them ready for the industry.
Germans have a word “schadenfreude” which roughly means “delight at another person’s misfortune”. Although there is no specific word for it in Bengali-and I wonder why-we have a variant of “schadenfreude” – a perverted delight in one’s own misfortunes. One look at our Bengali media headlines will bring home to you what I am trying to say. Yet as person who is filled with hope and cautious optimism, I see a bright future for the IT industry. If we do it right, I am confident that it will continue to transform the lives of many thousands of families and create wealth for its stakeholders.
How will Kolkata compete in the future? One of the greatest intangible assets of Kolkata is its demonstrated commitment to plurality, diversity and tolerance. It resembles a salad bowl not a melting pot. It is one of our most underplayed cards. Kolkata does not have a caste baggage, religious bigotry or parochial divide. In this city which is scorched by the sun and drenched by the rain, a Macedonian nun can be world famous for her tireless work, a tailor affected by communal riots is welcomed to set up home and people of all castes, creeds, faith and persuasion live in harmony, peace and friendship. Silicon Valley succeeded not because the natives were the smartest people. It succeeded because it attracted like a magnet the best talent from all over the world. The assets were San Francisco and the Bay area’s quality of life, cosmopolitan culture, its inclusive philosophy and its ecology of diversity. In a world of global mobility of talent, Kolkata would do well to preserve its advantage of inclusiveness, diversity and harmony.