Indian outsourcing: an alternative view
Every day one sees a fresh headline - X moving to India, X hiring 100 staff in India, X being just about any reasonably sized software or telecommunications company in the West.
Bangalore, in India's south, has come to be known as the Silicon Valley of India. Little is said about Hyderabad but there is plenty of software activity going on there as well.
The movement of people and machines from the West to the East means one thing for companies - lower costs. Though nobody says it openly the fact that one US dollar is equivalent to around 45 Indian rupees drives this migration. The excuse of plenty of educated staff being available is just incidental.
There is much angst in the West over perceived loss of jobs, with sentiments bordering on racism sometimes driving the concern.
But how does this exercise impact on India? We all know the common perception - what is the reality? When a poverty-stricken nation suddenly finds itself being wooed by every tech company from Microsoft downwards, what happens within the country?
If truth be told, the reality could not be further from the common perception. Bangalore has grown in awkward fashion with the local government handing out huge parcels of land to each and every software outfit and telco that comes looking to employ Indians.
Local outfits, the so-called offshorers, sit among these prominently - Infosys, for example, has 70 acres to itself at the Electronic City some 14km from the centre of Bangalore. Wipro, another one of these outfits that contracts work from abroad and depends on the lowly rupee to keep work flowing in, has even more land.
The land apart, the offices of these companies bear no comparison to any Indian office. They are built like an American office would be, huge halls, empty space, winding paths and little motorised carts for getting about. Meetings are held at the drop of a hat and while some of them have gyms and other recreational equipment around, my suspicion is that neither gets used much.
In Bangalore, the construction of all these offices on the periphery of the city - apart from the Electronic City, there is a Technology Park close to Whitefield, which is about 20km from Bangalore City - has created a traffic rush both ways. Earlier, people would travel from the periphery to the centre to work; now the rush is both ways. The evening traffic jam in the city takes the better part of five hours to dissipate. And it is nothing short of chaotic.
All the roads that have been built in Bangalore have not had even a marginal impact on the traffic problem; the huge salaries being paid out by the IT outfits ensure that more and more vehicle manufacturers bring models to India. And more and more traffic appears on roads which are already stretched far beyond their capacity.
The building of so many offices on the periphery of the city has led to a boom in property prices in places like Whitefield which was once a pensioner's paradise. Now land values are so high that villagers are increasingly tempted to sell out to developers and migrate to the nearest slum close to the city. In a typical scenario, the farmer loses his land, gains a lump sum of cash which he uses to marry off some of his daughters. He then migrates to the nearest slum, becomes a drunkard and finally a beggar.
And now the software companies have begun to put the squeeze on the government in Bangalore - they want better infrastructure (read roads, power) else they will ship out or develop offices in other parts of the country.
But given that the governments of both Karnataka (of which Bangalore is capital) and Andhra Pradesh (capital, the twin cities of Hyderabad and Secunderabad) were both voted out in elections earlier this year, by rural poor who cared little for the techno-focus of these administrations, it is unlikely that the politicians will be over-eager to indulge people like Azim Premji of Wipro, now the richest man in India.
The technology companies have improved India's foreign exchange problem to the point where the government no longer has to bother much about its traditional source of dollars - the myriad workers who toil in regions such as the Arabian Gulf and send their hard-earned money back to loved ones in India.
Software exports now form the biggest source of foreign revenue. And with an increasingly yuppie-oriented media obsessed with the stock market - which incidentally is of little importance to the nearly 400 million who still live below the poverty line - the software companies have come to be accorded a greater degree of importance than they normally would be.
There is little innovation among the software crowd, just mindless drudge work. But while the Indian rupee is 43 to the US dollar, 57 to the euro, 85 to the British pound and 33 to the Australian dollar, foreigners will continue to send work to this impoverished nation.
Bangalore, in India's south, has come to be known as the Silicon Valley of India. Little is said about Hyderabad but there is plenty of software activity going on there as well.
The movement of people and machines from the West to the East means one thing for companies - lower costs. Though nobody says it openly the fact that one US dollar is equivalent to around 45 Indian rupees drives this migration. The excuse of plenty of educated staff being available is just incidental.
There is much angst in the West over perceived loss of jobs, with sentiments bordering on racism sometimes driving the concern.
But how does this exercise impact on India? We all know the common perception - what is the reality? When a poverty-stricken nation suddenly finds itself being wooed by every tech company from Microsoft downwards, what happens within the country?
If truth be told, the reality could not be further from the common perception. Bangalore has grown in awkward fashion with the local government handing out huge parcels of land to each and every software outfit and telco that comes looking to employ Indians.
Local outfits, the so-called offshorers, sit among these prominently - Infosys, for example, has 70 acres to itself at the Electronic City some 14km from the centre of Bangalore. Wipro, another one of these outfits that contracts work from abroad and depends on the lowly rupee to keep work flowing in, has even more land.
The land apart, the offices of these companies bear no comparison to any Indian office. They are built like an American office would be, huge halls, empty space, winding paths and little motorised carts for getting about. Meetings are held at the drop of a hat and while some of them have gyms and other recreational equipment around, my suspicion is that neither gets used much.
In Bangalore, the construction of all these offices on the periphery of the city - apart from the Electronic City, there is a Technology Park close to Whitefield, which is about 20km from Bangalore City - has created a traffic rush both ways. Earlier, people would travel from the periphery to the centre to work; now the rush is both ways. The evening traffic jam in the city takes the better part of five hours to dissipate. And it is nothing short of chaotic.
All the roads that have been built in Bangalore have not had even a marginal impact on the traffic problem; the huge salaries being paid out by the IT outfits ensure that more and more vehicle manufacturers bring models to India. And more and more traffic appears on roads which are already stretched far beyond their capacity.
The building of so many offices on the periphery of the city has led to a boom in property prices in places like Whitefield which was once a pensioner's paradise. Now land values are so high that villagers are increasingly tempted to sell out to developers and migrate to the nearest slum close to the city. In a typical scenario, the farmer loses his land, gains a lump sum of cash which he uses to marry off some of his daughters. He then migrates to the nearest slum, becomes a drunkard and finally a beggar.
And now the software companies have begun to put the squeeze on the government in Bangalore - they want better infrastructure (read roads, power) else they will ship out or develop offices in other parts of the country.
But given that the governments of both Karnataka (of which Bangalore is capital) and Andhra Pradesh (capital, the twin cities of Hyderabad and Secunderabad) were both voted out in elections earlier this year, by rural poor who cared little for the techno-focus of these administrations, it is unlikely that the politicians will be over-eager to indulge people like Azim Premji of Wipro, now the richest man in India.
The technology companies have improved India's foreign exchange problem to the point where the government no longer has to bother much about its traditional source of dollars - the myriad workers who toil in regions such as the Arabian Gulf and send their hard-earned money back to loved ones in India.
Software exports now form the biggest source of foreign revenue. And with an increasingly yuppie-oriented media obsessed with the stock market - which incidentally is of little importance to the nearly 400 million who still live below the poverty line - the software companies have come to be accorded a greater degree of importance than they normally would be.
There is little innovation among the software crowd, just mindless drudge work. But while the Indian rupee is 43 to the US dollar, 57 to the euro, 85 to the British pound and 33 to the Australian dollar, foreigners will continue to send work to this impoverished nation.
posted by Manoj Jain @ 1:21 AM
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