This is a piece I wrote for Wired magazine about changes in India created by the tech boom.
India’s tech superpower is acting more like Silicon Valley every day.
By Brad Wetzler
It’s a steamy, dung-scented evening, I’m riding around Bangalore, India, in a beat-up blue van, but right now we’re not going anywhere: There’s a citywide power outage, and we’re stopped dead in the middle of a clogged intersection, wishing the traffic lights would blink back on. Behind the wheel is a hot-tempered Sikh named Balbir Singh. Fiftyish and bearded, with Coke-bottle glasses, he’s furiously tapping his horn to shoo away a skinny cow. The cow isn’t budging, but it doesn’t matter. The entire city has become one huge and hopelessly tangled traffic jam.
“What a drag,” says Singh, jerking the shifter into neutral and leaning back in his seat.
Like all major Indian cities, Bangalore — a metropolis of about 5 million people on southern India’s Deccan Plateau — is a sprawl of decaying single-story houses and shops, Soviet-style apartment buildings, crumbling colonial offices, and abominable shantytowns that extend miles into the countryside. The potholed roads look like they’ve been hit by an air strike. People are everywhere, lounging on their front stoops, buying goat carcasses, gliding through the crowded streets in colorful saris. Poverty is everywhere, too: Through the van’s window I see an orange-clad devotee of Shiva the Destroyer begging for change, two cripples on all fours, and a leper with half a leg and rotting hands.
But keep looking and you start to see a very different Bangalore — a nouveau-riche parallel universe. There’s a Mercedes or two stuck in traffic with us; on the sidewalks, men in Armani suits have cell phones pressed against their jaws. When the traffic lets up, Singh turns onto Mahatma Gandhi Road, and suddenly you’d swear you were on Rodeo Drive, with row after row of designer boutiques catering to a new class of Bangalorean yuppies — some of whom made more money in the ’90s than their families earned in 500 generations.
The source of these contrasts is Bangalore’s digital economy, which in recent years has gone from being a sort of novelty act — Hey, India has a Silicon Valley! — to a humming, world-class engine of wealth. Bangalore is now home to 300 high tech companies that employ 40,000 people. Combined, these enterprises — plus the firms in lesser hubs like Mumbai (formerly Bombay), Chennai, Delhi, Hyderabad, and Pune — pumped out software and computer-related services to the tune of 176 billion rupees ($4 billion) last year. High tech accounted for 15 percent of the market capitalization on India’s premier stock market, the Mumbai stock exchange.
India is also making a splash in American markets. A year ago, one Bangalore-based firm, Infosys Technologies, debuted on the Nasdaq exchange, becoming the first Indian company to appear on a US stock market. Opening at 373/8, Infosys stock was pushing $300 in late 1999. John Wall, president and COO of Nasdaq International, says more of the same is on the way, because American investors have finally figured out that India is loaded with highly trained IT professionals. So thrilled is Nasdaq that it recently led a press trip to tour some of the hottest companies and expose American reporters to the Bangalore vibe. “We’ve only seen the tip of the iceberg in terms of what’s out there in Bangalore,” Wall says. “In the next 24 months you’ll see a dozen more Indian IT firms list with us. They’re already in the pipeline.”
The effects of the Bangalore explosion — boomtown riches dropped into the middle of a third-world city — are dramatic, varied, and often unsettling, but one thing’s for sure: A lot more people want in. Balbir Singh, a salesman who has no background in technology, hopes to make it as a dot-com player himself. He’s the founder of a fledgling Web site (www.koramangala.com) devoted to the people, businesses, and news of Koramangala, the southside neighborhood that’s home to most of Bangalore’s software companies. I happened across his site and emailed him before I left for India. Hospitably, he has invited me into his home and offered to show me around town. In return, all he wants is a little exposure.
Well, a lot of exposure. Tonight we’re off to a toy store to take pictures of Barbie dolls for his Web site, and he’s insisting that his inevitable success trajectory will make a perfect cover story.
“I’d like to be a billionaire, because it goes well with Balbir” he says giddily. “But I’ll settle for being a millionaire.”
Last year, Singh took his 60-MHz desk-top and 33.6 modem, signed up for India’s government-run Internet service provider, and convinced a few Web-designer buddies in Chennai to produce Web graphics for his site at a discount. He supports Koramangala.com by working long hours selling wrappers to toilet-paper and toothpaste companies. Koramangala has only about 200 households with computers (most people go online at work), but Singh hopes to capture enough ad revenue to underwrite an ecommerce operation that sells flowers, candies, cards, and toys — personally delivered by him or a family member. Singh’s credo: Koramangala is “Bangalore’s most happening place!” He carries an American slang dictionary in his van so he can bone up on with-it phrases whenever he’s stuck in traffic. “We gotta be hip,” he says. “I think a hip site will be a more happening site. People don’t want stodgy English. They want snappy.” He snaps his fingers three times.
The traffic gets nasty again. Singh, his pulsating carotid artery causing his beard to rise and fall, lays on the horn. “You’ve got to get in the game now,” he says, peering at me through his thick lenses, “or you’re gonna be left behind.”
The annual income per person in India is still about Rs10,070, or less than $320. But since 1980, as Bangalore has become a high tech superpower at the heart of the Silicon Plateau (see “Bangalore,” Wired 4.02, page 110), hundreds of millionaires — even a few billionaires — have been minted here. What’s more, high tech has given thousands their first chance to buy into the middle-class life that’s taken for granted in the United States.
The origins of Bangalore’s boom go back more than 50 years, when the newly independent Indian government chose it as a site for one of its weapons and aeronautics laboratories — India’s Los Alamos. The location was ideal, far from the country’s borders with archenemies Pakistan and China, and the city was home to the Indian Institute of Science, a world-renowned tech school that has produced stellar scientists and engineers since 1911.
As the base for the research labs that developed atomic weapons, missiles, and aircraft for India’s air force, Bangalore actually might have kept pace with Silicon Valley in the 1970s, if only India’s socialist government hadn’t established high tariffs, placed restrictions on foreign investment, and choked its own companies with a tangle of bureaucratic regulations. The laws isolated India and squelched innovation, and while the West upgraded to newer, faster computers, Indians were stuck with older machines.
These policies had one significant upside: To make the most of every byte on their clunkers, Indian programmers became experts at writing concise, elegant code. Thus, when American companies arrived in Bangalore in the 1980s looking for talent, they found a vast pool of English-speaking pros. Indians shipped out to Silicon Valley in droves. Those who didn’t leave often ended up working Silicon Valley-style at startups that sold software and services to a tiny number of digitized Indian companies.
But it was nearly a decade before investors were willing to drop much money into Bangalore’s Indian-owned startups. In 1991, facing economic crisis, India’s government lowered tariffs on foreign goods and loosened investment restrictions. Multinationals like Hewlett-Packard poured into Bangalore’s run-down office parks to set up shops that did nothing but pump out code. Meanwhile, foreign investors discovered a host of Indian companies that had been operating under the radar.
__ Once a sort of novelty act, Bangalore now is home to 300 tech firms that employ 40,000 people. __
An early breakout was Infosys, founded in 1981 by seven transplanted Mumbai engineers who scrounged together a few thousand rupees to get off the ground. Today, Infosys, which writes and maintains software for hundreds of corporations worldwide, employs 6,000 people, has a modern, 42-acre campus with a decidedly California feel, and pulls down annual revenues of Rs5 billion ($122 million). Another was Wipro Limited, which through its information-technology division employs 6,500 software workers worldwide and grossed $310 million last year.
Perhaps the most famous Bangalore techie of them all is Sabeer Bhatia, a young software engineer who became a legend in 1997 when he invented the world’s first Web-based email service, Hotmail. Bhatia soon sold Hotmail to Microsoft for $400 million and at the same time reminded the world of Bangalore’s stable of talent. The Indian gold rush began in earnest that year.
Bangalore’s new wealth is burning holes in the pockets of many individuals, who, taken together, have drastically altered the ancient social hierarchies defined by India’s caste system. In India, people who make Rs435,000 ($10,000) a year qualify as rich, but suddenly a new class of the super-rich is emerging. At the upper reaches, no Bangalore-based software mogul is more famous than Azim Premji, an executive originally from Mumbai and known in India as “our Bill Gates.” Premji owns the majority stake in Wipro and has a personal net worth of Rs392 billion — more than $9 billion.
One afternoon, in a conference room on the 10th floor of Wipro’s mold-stained downtown office building, I meet Premji and get a valuable perspective on how an Indian at the top views Bangalore’s good fortune. A tall, slim man with a brusque military carriage, Premji personifies attributes I’ll encounter many times as I travel around the city: pride, a sense of limitless potential, and confidence that Bangalore’s high tech entrepreneurs have the skills and energy to take on anybody in the world.
For his part, Premji thinks India can eventually out-tech anybody — including the United States, which he thinks is hurting itself with too much liberal-arts education — and he’s proud that India, that old colonial stomping ground, is making Western nations take notice. The UK, for example, is trying to piggyback on India’s success with a new plan to link British universities with Indian high tech firms and academic centers in a long distance network. While other countries come to India with their business, the subcontinent continues to populate the world with talent — witness the prevalence of Indians in systems departments all over the planet. They make up 30 percent of software workers worldwide, and this high tech army performed one-third of pre-Y2K fixes for the world’s corporations and governments.
Wipro has been gobbling up Fortune 500 clients since it opened its first software unit 17 years ago. The company’s first line of business was manufacturing cooking fat, but Premji kept it up-to-date, adding soap and other toiletry products, hydraulic machinery, lighting, and, eventually, a digital line that grew out of the company’s internal software department. Today Wipro sells software, software services, hardware, and peripherals and specializes in providing cheap, long distance programming for faraway corporations. “We keep the computers of a hundred Fortune 500 companies running,” Premji says. “That number is increasing every month.”
Most of Wipro’s action takes place in 30 football-field-sized offices in Bangalore, Chennai, and Hyderabad — what the company has dubbed “offshore development centers.” They operate on a simple idea: Thanks to the Net, it’s possible to turn an office in India into an extension of a client’s own development and maintenance center for software. Premji invented the idea of servicing the world’s computers from India, where the cost of labor is one-tenth of that in the States. And because Bangalore is 10½ hours ahead of New York, Wipro programmers can work on US computers at night so they’re ready the next morning.
Wipro, obviously, is just part of the story. Oracle and Texas Instruments depend on Bangalore’s engineers for circuit design; Citibank uses Indians to write applications. DaimlerChrysler has a small center in Bangalore that produces communications technology for automobiles. Apple has teams working on Hindi-based PDAs. Microsoft has set up a development center in Hyderabad to make Windows NT and BackOffice compatible with non-Microsoft platforms.
All these companies have come to the same realization: Only a fool would ignore Bangalore’s combination of skilled workers and affordability. With labor costs in India so low, many more programmers can be hired for a project, cutting development time way down.
“We’re gifted scientists and mathematicians by nature,” Premji says. Then he laughs. “And we invented the zero and integers and other crucial elements of modern mathematics — and we’ve never been compensated for that. But now, with the global shortage of software talent, we’re perfectly positioned to become the world’s next infotech superpower.”
Dawn in downtown Bangalore, and already the street-level noise is deafening. But inside the tall, wrought-iron gate of the Bangalore Club, it’s as peaceful as a temple. Genteel men in starched tennis whites are drinking tea, chattering, and watching one of their newest members — software entrepreneur Pradeep Kar, founder and chair of Microland — and his tennis partner thrash two of the club’s older members in a fierce game of doubles.
__ Oracle, Microsoft, Apple, and more have come to a realization: Only a fool would ignore Bangalore’s combination of skilled workers and affordability. __
“Hey!” Kar yells across the court to a waiter in a white waistcoat. “Bring us some water!”
“OK, sir,” the waiter replies, quickly disappearing inside the colonial-style mansion that serves as the clubhouse.
Short and intense, with a spotty beard and manic energy, Kar is an explorer of sorts, pushing forth into uncharted economic territory. Hailing from the mountainous and very poor state of Kashmir in northern India, Kar’s family moved to Mumbai in 1961 in search of a better life. His father rose through the management ranks at a power company, Tata Electric, in a job considered well suited to a Kashmiri: Conventional wisdom held that they weren’t entrepreneurs, that their place was to run things for others.
Kar wanted to do something else. After earning his MBA from the University of Bombay in 1983, he set out to knock down the caste system’s barriers, using technology as his battering ram. “I concur strongly with Thomas Jefferson,” he says. “I am more interested in the dreams of the future than the history of the past. I am the first in my family to do his own thing.”
Kar spent the ’80s and part of the next decade working for Wipro, creating a computer-hardware business, doing a stint in Silicon Valley, and helping the likes of Compaq, Netscape, and Cisco launch products in India. In 1989, he went searching for venture capital to pursue his dream of starting India’s first networking company. He eventually landed $500,000 in 1990 from SBI Capital Markets, a VC outfit based in Mumbai.
Microland, which offered networking and Internet products, servers, desktop computers, and notebooks, quickly took off. The following year, SBI sold its equity to another firm for nearly twice what it invested, and Kar emerged from the transactions as the principal shareholder of a multimillion-dollar operation. Since then Microland has grown at annual rates of between 50 percent and 118 percent, and Kar has diversified, launching companies like Planetasia.com (Web design), Micromedia (tech conferencing), and ITspace (a Web portal and news site). The word that flows from his lips now is “synergy.”
The Bangalore Club isn’t the most accommodating place for upstarts. Founded 125 years ago by British colonial bureaucrats and army officers who wanted a quiet spot to whack the shuttlecock and sip gin, it’s a starchy retreat that now echoes with a fugue of Hindi and Kannada, the local dialect. The club was Brits-only until independence in 1947, when membership was opened to upper-class Indian industrialists and government officials. Since then, the Indians have imposed their own economic and social mores in keeping with the caste system, in which lighter skin usually means better.
Despite his Kashmiri roots, Kar’s skin is fair enough to let him pass as a Bangalorean blue blood — and he definitely has the cash. He lives with his wife and daughter in a gated Mediterranean-style mansion in Koramangala and tools around town in a snazzy Opel Astra. He’s a founding member of a notorious, exclusive drinking club made up of Bangalore’s top IT executives, and he has become a manic sports nut who takes expensive private lessons to learn one new athletic pursuit a year. When Bill Gates came to Bangalore three years ago, Kar — whose company hosted Gates’ only private speaking forum — got his picture splashed all over the newspapers, mugging with the world’s richest man.
Like many high tech overachievers, Kar is having to get used to his unique socioeconomic perch: He’s a fabulously wealthy man living in one of the world’s poorest countries. There’s a lot of talk in India about inventing “compassionate” capitalism, but it’s mostly just that — talk. India’s population has topped 1 billion, and every year it grows by about 15.5 million. Economists have estimated that just to keep pace with the birth rate, each year India would have to add 127,000 schools, 373,000 schoolteachers, 2.5 million houses, 4 million jobs, 114,000 miles of cloth, and 6 million tons of food. But India doesn’t keep pace, and high tech does not — and may never — do much for the impoverished majority.
Driving home from a post-tennis riding lesson at a Raj-era paddock on the outskirts of town, Kar passes through a tiny farming community called Rajen Kunte. People dressed in traditional garb dig at the reddish soil with hoes. Ancient-looking men in loincloths squat like birds in the doorways of minivan-sized dwellings. Their gazes are fixed on Kar’s Opel. Ignoring the passing scene, Kar digs for an audiotape in the glove box and jams it in. It’s Jimi Hendrix, playing “Crosstown Traffic.”
Earlier, we’d spoken briefly and awkwardly about economic disparity, so I’m not about to bring it up again. But suddenly Kar launches into an unprovoked monologue. “There is no easy answer,” he says. “There have been poor people forever. But if we continue down this high tech road, then maybe Indians wouldn’t have to live like this.”
As Kar continues, a four-story castle with neon signs and flashing lights comes into view. It’s Kempworld, one of Bangalore’s most popular shopping spots, frequented by men in Italian-cut suits and women in Versace. Teenage girls made up like vampires stand in a circle, chatting. A woman in a tight rubber outfit sits on the stairs, posing for photographs. Kar is still thinking, offering up his theories on why the new rich cannot get bogged down in trying to help the poor — at least not yet.
“We’re not going to solve all of India’s problems by handing out money today,” he says, wheeling past the castle. “We must first acquire more wealth.”
“This place is very much happening for coming to blow off steam,” says Govi, a fortyish man wearing khaki pants, a Tommy Hilfiger shirt, and a maroon turban kept snug on his head with an elastic strap. He’s leaning against the wall, a little bleary-eyed, swaying to the dirgey sounds of Led Zeppelin’s “Kashmir.”
Welcome to Purple Haze, one of the 150 or so pubs that make up the central nervous system of Bangalore’s very-much-happening party scene. Places like this are a nightly pit stop for the high tech elite: Hundreds of programmers, programmer wannabes, low-level managers, and occasionally even a CEO or board chair stop by to down a couple of Kingfisher beers and let their freak flag fly as they listen to blaring rock from the ’70s and ’80s. In Bangalore there’s a huge selection of places like this to match your tastes and lifestyle — from Purple Haze to the ‘50s-style Black Cadillac to NASA, a futuristic spot with a space-shuttle interior and waitresses dressed like airline flight attendants.
__ The tech overachievers are fabulously wealthy in one of the world’s poorest countries. There’s talk of “compassionate” capital — but mostly just talk. __
Life is good for India’s new caste of computer programmers, people who, not long ago, probably would have moved to the US in search of work and fun. These days there’s plenty of everything, right at home. Top programmers in Bangalore now average about Rs1.5 million ($35,000) annually, and managers make at least three times that. Those are huge numbers in India: Basic expenses like housing, transportation, and food cost about one-fifth of what they do in the US, so earning a million rupees in Bangalore is like pulling down a six-figure salary in Silicon Valley, leaving plenty for luxury, travel, designer clothing, alcohol, and even servants.
I’m at Purple Haze with three coders from Infosys, all in their early 20s: two women — Meenakshi Nagarajan and Roopa Gosain — and their male pal, Mushtaq Ahmed. They each make more than Rs200,000 ($5,000), and as Infosys employees they’re looking at a bright future. Everyone knows that Infosys people have some of the sweetest stock-option programs on the Plateau, so they’ll have no problem finding desirable mates when the time comes. Right now, though, partying is job one. Ahmed, dressed in khakis and oxford cloth, is making frantic pub-crawl plans on his cell phone. The women are staring at the DJ, a woman dressed in ripped jeans, a T-shirt, and a leather jacket.
“I love that look,” says Gosain. A few minutes later, she and Nagarajan are up and jumping to the tune of Ricky Martin’s “Livin’ La Vida Loca” video.
For Nagarajan, Gosain, and Ahmed, the perks available at the workplace are just as important as their salaries. There’s a perpetual shortage of first-rate programmers in Bangalore, so software companies are doling out all kinds of goodies to attract and keep the best: Gourmet kitchens serving complimentary meals. TGI Fridays-style cafés in-house. Workout centers with weights, yoga, saunas, and day care. Golf courses, 24-hour karaoke, weekend “team building” safaris in national parks, rafting trips, parties — you name it.
One afternoon, I visit the sprawling, lush Infosys campus, which looks like it was airlifted in from Seattle. While I walk the high, airy hallways with company cofounder Nandan Nilekani, he tells me about the little things Infosys does to keep its employees joyfully cranking.
“We try to create a culture that inspires and redefines change,” he says, speaking in perfect sound bites. “We try to show our staff that it’s possible for regular, middle-class young people to create great wealth in a single generation.”
More of the same is in the works: Texas Instruments India now has a swank basement recreation center with 2,000 square feet of tennis and basketball courts, a weight room, a billiards room, a library, and a small theater with a huge television. A Rs7 billion ($160 million) office spread called the International Tech Park, now going up outside of town, looks like a modern American office complex, with boxy buildings covered by mirrored windows; when the facility is complete it will include upscale housing, a golf course, tennis courts, a dry cleaner, and a grocery store. A private sewage system will handle waste, a private power plant will supply electricity, and a massive satellite dish will provide the telephone connections.
On a warm Friday afternoon, I stop by the half-finished gated complex to hang out at an event called the Binge, a monthly party thrown by the office-park management. There’s food, music, and dancing. I wander down the hall to play some pool. Passing the door to the karaoke room, I watch a gaggle of programmers crooning to American pop songs. I tell my escort, an Indian woman named Twinkle Matthews, that with all these goodies, you’d never have to leave the premises.
That, she says, is exactly the point: “I can’t think of a single thing that you’d want that you couldn’t get here.”
A few days after my night out at Purple Haze, I catch up again with Nagarajan — Meena, to her friends — at the bus stop outside the Infosys world headquarters. To pass the time while she waits for the bus, she’s thumbing through a tattered copy of The Fountainhead, Ayn Rand’s capitalist philoso-drama. “This Ayn Rand, she has good ideas that are in this book,” she says. Nagarajan once told me that she’s “180 degrees different” from her parents. “The biggest change,” she said, “ is that we don’t think twice about buying something if we want it. With them, providing for your family took every rupee you had. Personally, I’m working on building a large CD collection and a library full of good books.”
It’s Friday, and Nagarajan says it’s been an exhausting 60-hour week, but she’s not slowing down. Flipping her black ponytail, she recites a long list of activities: friends over after work for MTV and some snacks, then out to dinner with her “batchmates” at an Italian restaurant downtown. Then, tomorrow, back to work to tie up a few loose ends. Then a shopping trip to pick out a motor scooter. Then off to see The Matrix with her roommate, Gosain, and her Purple Haze pal Ahmed, who always seems to be raiding her cabinets at home for potato chips. And then, Sunday. “Sunday, I’m not even going to get out of bed!” she says with enthusiasm.
While society at large may not be enjoying the fruits of high tech, women like Nagarajan have suddenly found themselves thrust into a Mary Tyler Mooreepisode. Forty percent of all new job applicants are women, and many of the larger, more progressive companies have a 50–50 male-female ratio. And women get equal pay for equal work, which isn’t true in any other employment sector in India, except perhaps medicine and banking.
What high tech means for Nagarajan is a level of independence that was unimaginable for her mother. She and Gosain live together in Koramangala in a one-bedroom apartment full of college-kid furniture. Most nights they’re at a pub or a movie, or home watching MTV India till 1 am. Nagarajan has even found her own boyfriend, a bold maneuver in a country where 90 percent of marriages are still arranged by parents.
“When I’m down, I’ll just buy myself some flowers with my boyfriend’s credit card,” she says.
Does he care?
__ 40 percent of Bangalore’s new coders are women — high tech has brought financial independence that was unimaginable for their mothers. __
“He’s in a different city. He doesn’t even know.”
Having a boyfriend doesn’t really mean the same thing in India as it does in the US — even in infotech’s progressive ranks, customs aren’t entirely overthrown. So Nagarajan’s boyfriend is really just a platonic plaything who gives her an excuse to rack up big phone bills and buy herself a few presents with his money. Would she ever consider moving in with him?
“Oh, no!” she says, genuinely shocked.
But who wants to be just one of the 20,000 or so programmers — “slave coders,” as they’re known — working in an offshore development center the size of a football field? Not Rajesh T. S. Reddy, founder and chair of Gray Cell, a 4-year-old company with offices in a couple of two-story bungalows in Koramangala.
The 29-year-old boy wonder is in the forefront of Bangalore’s newest generation of entrepreneurs. He came along at a time when venture capital was flowing more readily than it was 10 years ago, when the first wave of Indian entrepreneurs were launching startups in garages with a couple of 286s, a hole in the corner for a toilet, and less than Rs10,000 in capital. Glib, cocky, and still carrying around a little baby fat, Reddy is wearing a Tommy Hilfiger shirt and Timberland boots when he greets me in his tropical-themed café, which is part of the company lair.
“Let’s go up to my office,” he says, pointing at some stairs behind the garage. We enter a ‘70s-ish bachelor pad with white walls, groovy black leather furniture, a killer stereo, and lots of potted ferns. But it won’t stay his office for long. Reddy has just landed about Rs75 million ($1.7 mil-lion) in venture capital to launch a software product that transforms an ordinary cell phone into a quadruple threat: voice, paging, email, and Internet access. The deal probably explains why neither he nor anybody else on this funky little campus will stop smiling at me.
“School was a waste of time, and I had no desire to become just another slave coder after I graduated from university,” he says. “So I just sat around that summer trying to come up with the next true killer app.” Within a month, the kernel of the idea for his do-anything software popped into his mind. He talked a landscaper friend out of some money and convinced an old woman to rent him her house for a few rupees. Gray Cell was up and running.
Reddy represents a real break from the past in the Indian IT world. He didn’t have 20 years of software experience, which once seemed to be the unwritten requirement if you wanted venture capital. But in the past six months, people have been handing out money at street corners, and startups like his are popping up — mostly in Koramangala.
Reddy walks me out front, past a couple of buffed security guards and his personal driver, and down the street. After we pass an enormous mansion that is a replica of the White House, he stops in front of a two-story bungalow — the Gray Cell annex. The cell phone on his hip rings. It’s his live-in girlfriend, wanting to know what time he’ll be home. Late, he says. Very late. Then he hangs up. I tell him he’d better get back to work. Before returning to his office, though, he gets philosophical.
“We didn’t do what society wanted us to do,” he says, trying to sound defiant. “We pulled up to this house with eight of us crammed into one car. And four years later, with not a single holiday off along the way, we landed $1.7 million in VC. That’s unheard of. I think we’re quite a story.”
It is my firm belief,” says Dewang Mehta, president of the National Association of Software and Service Companies, “that Mahatma Gandhi’s dream of removing every tear from Indian faces will actually be fulfilled by the innumerable education, employment, and economic opportunities provided by the software-driven IT industry in India.”
Such rhetoric is heartwarming, but it only goes so far. For the most part, the only people for whom trickle-down really works are the families of high tech professionals: Parents, grandparents, and aunties who cruise Mahatma Gandhi Road in new Sumo SUVs and move into sprawling, American-style houses in Bangalore’s suburbs. And little brothers and sisters who wind up at the best, most expensive universities and tech schools, where they too can set out on the only reliable road to a better future — even if it’s just operating a digital cash register or doing word processing for some multinational corporation. The other beneficiaries of trickle-down are schools and universities. The one charity that wealthy high tech professionals consistently seem to support is alma maters.
The rest of the population either doesn’t get through IT’s narrow doorway at all, or it gets burned trying. To write code, you have to go to college (as Indians refer to high school), and to do that you have to know how to read. Yet 48 percent of Indians are illiterate. Roughly 30 percent of students make it to college, and 40 percent of college students (who make up 0.2 percent of the population) qualify for university admission. A tiny percentage of them will graduate in engineering or computer science. And while India does have a progressive affirmative-action program that provides scholarships for several thousand low-income students, these stats are hard to overcome: You won’t see many Horatio Algers leaping from the shantytowns to workstations at Bangalore’s infotech firms.
Children as young as 10 suffer insomnia from worrying about getting into engineering school someday. Desperate job seekers drop big bucks on psychiatrists, fortune-tellers, past-life therapists, and online astrologers in hopes of cracking the secret to success in the software business. Of the hundreds of new private computer institutes advertised on practically every Bangalore street corner, only a handful turn out qualified graduates who’ll be hired by firms. And thousands of people languish in expensive, essentially worthless computer schools that don’t deliver on the H-1B visas and jobs they promise. In a widely publicized episode in 1998, one young man set himself on fire after forking over Rs350,000 ($8,300) to a fraudulent placement company.
Walking to a Kentucky Fried Chicken outlet one night, I see a sign for the Bangalore Institute of Computer Studies. It points down a trash-strewn alley toward a dingy three-story walk-up across from an incense kiosk. At first glance, the BICS looks a little suspect — tuition is Rs30,000 ($680) for a six-month beginner’s course in Windows, Word, and Excel — but after spending a couple hours inside the musty one-room school, I decide the schoolmaster, a thin guy named Mohan, is a straight shooter. His institute isn’t going to turn anybody into a highly paid programmer, but taking one of his courses might land you a word-processing job at a company like Health Scribe India, which transcribes US doctors’ tape-recorded notes overnight. Mohan is proud of his small but necessary role in the Bangalore boom.
“If you want Java,” he says, “I’ll teach you Java. If you just want to learn Microsoft Word and Excel, that’s what I’ll do.”
Many of Mohan’s graduates seek employment through Inter-connection Consulting, whose office is a wooden desk at the front of his classroom. That night, several classmates surround the receptionist, a former student of Mohan’s who is dying to know whether he’s been assigned a US visa. No, he hasn’t, and from what I gather he didn’t have much of a chance. This year, as in 1999, only 115,000 spots are available for Indian immigrants, and those with the most education and the best jobs get first dibs.
__ Twentysomethings are breaking the chains of social stasis. “Our kids don’t see why they should play second fiddle to the US,” says one executive. __
Bangalore also has more than its share of ill-fated companies. One evening I visit a place called Orion Solutions, a 1999 startup. Orion’s windowless offices smell of mold from decades of monsoon rains, and the three-person staff wears what-have-we-gotten-ourselves-into expressions. All three men — Nirmal Kumar, Mujitaba Khan, and Sateesh J — had left well-paying jobs and sunk their last Rs130,000 into launching the operation. The company sells packaged software to small Bangalore businesses. Problem is, not that many Bangalore businesses have computers. Worse, Orion’s founders don’t really have an idea, let alone a business plan. Worse still, they aren’t making enough to draw a monthly paycheck.
“We only have one computer at the moment,” Kumar tells me, “which is holding us back quite a bit.”
The real losers are the rural poor, who make up 75 percent of India’s population. Most of them don’t even know the boom is happening. And as pockets of urban India get more wired, some critics fear the rural poor will slip further behind, missing out on news, business opportunities, and political organizing — and the critics don’t expect the nouveau riche to try to save the day through charity. A general tone of grumpiness prevails when you ask Silicon Plateau CEOs why, despite the fact that they can’t drive to work without being accosted by beggars, they’re not giving more back to their communities.
“It’s too early for charity,” one CEO tells me, sounding annoyed that I’d even asked the question. “We’ve got to build capital. And then someday we’ll be able to hire more people and help that way.”
Another CEO is more blunt: “I don’t see your Silicon Valley companies giving all their money away to help the inner-city blacks.”
Good point, but as Hotmail’s Sabeer Bhatia points out, “America doesn’t have 48 percent illiteracy.” Bhatia, who lives in the Bay Area and is the local head of an India-based child-welfare charity called CRY, adds, “It doesn’t have 900 million people living in such poor conditions that they don’t have water, electricity, and enough to eat. If there’s any country in the world where people ought to be giving back to their countrymen, isn’t it India?”
Still, I find it easy to sympathize with the CEOs; India’s infinite problems, which you’re constantly reminded of every time you walk down the street for a newspaper, can desensitize you to pain and suffering after a while. It happens to me after just a few weeks. Late one night, as I leave a pub, a pack of children sneak up behind me and latch onto my waist, neck, arms, and legs, begging for money. As I drag them along, hoping they’ll just go away, an Indian friend shouts some advice: “You have to yell ‘No!’ at them like you’re talking to a dog.”
I do, and it works. But later, wishing I’d just passed out a few rupees to them, I think about charity. No, India isn’t the US. And the problems of the US are arguably much easier to solve. But no one has found the solution, and if the networked economy is de facto global, then in some real sense we’re all in this together. Not to mention the fact that US high tech companies have been happily siphoning off India’s intellectual capital for decades.
But maybe things will change in India with future generations of IT entrepreneurs. Infosys managing director Nandan Nilekani points out that this generation of young, successful Indians is the first to do away with thousands of years of self-induced poverty and social stasis. The twentysomethings of today have never lived under imperialism. They are the first “class” to really break the chains of karma, which encourages people to be content with their miserable existence and hope the afterlife will be better. “Our kids don’t see why they should play second fiddle to America,” he says.
Meanwhile, the strivers keep on striving. I recently checked up on Balbir Singh, who was still in Koramangala, trying to get Koramangala.com into the black and on the international infotech map. He has some formidable new competition in ITspace, Pradeep Kar’s portal/IT news site. Kar, who has spent Rs15 million ($345,000) on the site, has hired a staff of about 25 designers, engineers, and writers. Singh, by contrast, keeps sinking paycheck after paycheck from the packaging company into Koramangala .com and occasionally dips into his meager savings. “We’re broke by the 10th of every month,” he says. On the plus side, traffic to Singh’s site has been increasing steadily, and his ecommerce bid is showing signs of life. His line of greeting cards has been moving particularly well, he says. You order cards online, then Singh shows up at your door and you write him a personal check. So far, however, his pleas for venture capital have fallen on deaf ears.
Singh hasn’t lost his enthusiasm for creating PR, though. When I got back to the States and emailed him some follow-up questions, he began wondering out loud whether he should try to go to the Bay Area and run his operation from there. And, of course, he kept angling for more coverage in Wired, or any other magazine — or, wait, what about a book?
“You know, you could write a book about me,” he said. “There’s a lot to tell. And I know it would sell.”