What Makes an Area an ICT City By Dr. T.H. CHOWDARY Director: Center for Telecom Management and Studies Chairman: Pragna Bharati (intellect India ) Former: Chairman & Managing Director Videsh Sanchar Nigam Limited & Information Technology Advisor, Government of Andhra Pradesh T: +91(40) / (O) ® F: +91 (40) , Andhra Chamber of Commerce, Vijayawada: 14 Oct 2006

THC_CTMSS319_Oct World’s Attention to India The Economist (UK), June, 2006 “Can India Fly” – 14 page supplement “…India is producing far more world class companies than China…” Time (USA) June 26, 2006 Cover page…”…trying to find out why the world’s biggest democracy is the next great economic power and what it means for America”

THC_CTMSS319_Oct World’s Attention to India Foreign Affairs (USA) (July-Aug 2006) “India is now the fourth largest economy and soon it will surpass Japan to become the third largest…rather than rising with the help of the state, India is in many ways rising despite the state…” Of the Fortune companies 125 now have Research & Development bases in India, a testament to its human capital.”

THC_CTMSS319_Oct Content of GDP (Figs. in %)

THC_CTMSS319_Oct Software Export Industry India as ICT Power: (1)

THC_CTMSS319_Oct Employment in Indian IT sector*,’000 (* Years ending March; + break-up: NA) 2 ‘06

THC_CTMSS319_Oct A.P’s Software and ITES Companies In Exports surged by 64.5% Year Volume (in Rs. Cr. ) 65 5,025 8,270 12,521 17,000 of Exports Hyderabad : about 1200 companies Visakhapatnam : Units 37; Exports Rs. 70cr Vijayawada : Units 13; Exports Rs. 24 Cr Number of direct employees 1,60,000 adding 30,000 to 40,000 per year

THC_CTMSS319_Oct PROSPECT- I T ENABLED / CREATED SERVICES & EMPLOYMENT (INDIA) GROSS WORLD PRODUCT IN THE YEAR 2010 US $ 40 T CONTRIBUTION FROM SERVICES (60%) OF GWP US $ 24 T INDIA'S 10% US $ 2.4 T EMOLUMENTS COMPONENT (15% TO 50%) US $ 360 TO US $ 1200 b EMOLUMENTS/EMPLOYEE/YEAR US $ 5000 NO OF JOBS (360/1200) b = 72 to 240 million 5 K

THC_CTMSS319_Oct Characteristics of (Trade in) Services Created in one place/country Consumed anywhere else Delivered over telecom high-ways Information/knowledge-intensive Storage, Processing & Exchange Knowledge workers Exemplary Service economies –Singapore –Ireland –Hong Kong

THC_CTMSS319_Oct India’s Tragedy Contribution of Agriculture to GDP 67%<20% Rural Population85%72% Labour dependent upon agriculture 70%65%

THC_CTMSS319_Oct In Rural India Literacy (62%) & Education ( About 15%) Per capita income All IndiaUrban Rural Rs. 30,000Rs. 56,000 Rs. 8000

THC_CTMSS319_Oct Unemployment Unemployed Graduates : 52 lakhs Unemployed persons : 420 lakhs Population growing/yr lakhs Max. jobs created/yr : 100 lakhs Rural & Illiterates: unskilled, unemployable in industries, increasingly becoming automated/mechanized Diploma/Tradesmen to Engineers ratio Developed India

THC_CTMSS319_Oct India is Graduating Every Year All varieties : 30 lakhs (3.5l in AP) Engineers : 4,50,000 (80 to 100,000) MBAs : 80,000 (15,000) MCAs : 80,000 (12,000) Employability in Tier #1 companies : 2% to 10% Fig. In ( ) relate to AP

THC_CTMSS319_Oct Characteristics of Indian IT Companies Born mostly in mid 1990s and so escaped socialism i.e nationalisation Born and thriving without government help and inspite of obstruction by government ( DOT) NRI inspiration – Silicon Valley Success Indigenous entrepreneurship by foreign-educated, nationalist young men – Infosys, Satyam, Wipro, Infotech … Foreign Markets – Indian talent who built confidence and trust-levels Pioneers- Texas Investments: Bangalore “Security” bogey Satyam: BPO for John Deere. “Little India” Moline (Illinois) USA First Satellite Link for Indian BPO for Satyam

THC_CTMSS319_Oct How Does a City Qualify  Hard Infrastructure Broad-band telecom links to world’s I.T markets (USA, EU,Japan, Australia, Brazil) Quality electrical power Modern intelligent buildings; centrally a/conditioned, UPS; preferably in a cluster (IT Park like Cyberabad in Hyderabad) Served by International Airlines Copious water supply Broad, unclogged roadways to City Center

THC_CTMSS319_Oct Soft Infrastructure (1/2) Culture is more important than infrastructure -Nicholas Negroponte Digital & Internet Guru; MIIT Media Lab Engineering colleges, Polytechnics in profusion University & Research Institutes Good and Modern Housing Estates; Hostels for working men/women Star-Hotels for global Business Executives International Standard Schools ( LKG to High Secondary) Hospitals with all specialties Entertainment & tourism facilities Banks ( ATMs, Internet Banking….) Taxi Services/ Group Transport

THC_CTMSS319_Oct Soft Infrastructure (2/2) Financial Services (Investment, Stocks & Shares) Chartered Accountants ( GAP qualified) Legal Services Marriage Bureaux / Counselling Shopping Malls with all sorts of goods from all over the world Real estate Services ( Investment, Sale/resale…)

THC_CTMSS319_Oct Vijayawada STP Operational since Y2001 in the ITI premises with a VSAT & 64 KBPS Has now 4MBPS on fiber optic cable can go to 8 MBPS at 2 Hr notice Government ear-marked 50 acres near airport RFP for equity to develop land and building (Kakinada; moved forward; Collectorate bldg. 12,000 ft 2 ; 2 companies from Chennai wish to move)

THC_CTMSS319_Oct Most Importantly (1/2) A government which is “evangelist” about education, talent, entrepreneurship; out-reaching; facilitative; friendly seductive A local body ( Municipal Corporation) which is caring, responsive and not greedy; providing civic services promptly Friendly, service-oriented utilities : telephone, electricity,water-supply,cooking gas, local transport

THC_CTMSS319_Oct Most Importantly (2/2) Absence of Inspector-raj –Health inspector, factory inspector, Excise & Sales-tax and income tax inspectors, property tax inspector –Labour ( women working at night) Inspector; Welfare Inspector – Revenue Inspector (Agri-land for “industrial” use)

THC_CTMSS319_Oct Dhanyawad: Thank You