India, China are fast becoming THE places to work

BANGALORE, India — Every time I visit India, Indians always ask me to compare India with China. Lately, I have responded like this: If India and China were both highways, the Chinese highway would be a six-lane, perfectly paved road, but with a huge speed bump off in the distance labeled "Political reform: How in the world do we get from communism to a more open society?" When 1.3 billion people going 80 miles an hour hit a speed bump, one of two things happens: Either the car flies into the air, slams down and all the parts hold together and it keeps on moving — or the car flies into the air, slams down and all the wheels fall off. Which it will be with China, I don't know. India, by contrast, is like a highway full of potholes, with no sidewalks and half the street lamps broken. But off in the distance, the road seems to smooth out, and if it does, this country will be a dynamo. The question is: Is that smoother road in the distance a mirage or the real thing?

At first blush, coming back to Bangalore, India's Silicon Valley, that smoother road seems like a mirage. The infrastructure here is still a total mess. But looks can be deceiving. Beneath the mess, Bangalore is entering a mature new phase as a technology center, starting to produce its own high-tech products, research, venture capital firms and start-ups.

"The ecosystem for innovation is now starting to be created here," said Nandan Nilekani, the CEO of Infosys. For several years now, when venture capitalists funded companies in the United States, they insisted that the R&D for the products be done in India. But now, increasingly, Western companies will come up with a new idea and then tell Infosys, Wipro or Tata, India's premier technology companies, to research, develop and produce the whole thing.

As one Wipro executive put it, "You go from solving my problem to serving my business to knowing my business to being my business." What will be left for the Western companies is the "ideation," the original concept and design of a flagship product (which is a big deal), and then the sales and marketing.

"We're going from a model of doing piecework to where the entire product and entire innovation stream is done by companies here," Nilekani added. All of this means that innovation will happen faster and cheaper, with much more global collaboration.

The best indication that Bangalore is becoming hot is how many foreign techies — non-Indians — are now coming here to work. P. Anandan, an Indian-American who worked for Microsoft for 28 years in Redmond, Wash., just opened Microsoft's fourth research center in Bangalore, following the ones in Redmond, Cambridge and Beijing.