Ghadar Jari Hai, Vol. 1, No.2, August 15, 2007
Book Review
The legendary history of 1857
Shivanand Kanavi
Vinayak Damodar Savarkar’s book, “The Indian war of independence 1857” is a truly legendary book. In both senses of the word.
The book itself has achieved a legendary status in the last hundred years since its first publication. The book showed up the censors in England for what they were, when they took the unprecedented step of banning it before it was even published. Thus it was a remarkable enterprise, in which many patriots participated, to enable the book to see the light of the day. Lala Hardayal, professor at University of California at Berkeley and founder of the famous Hindusthani Ghadar Party reprinted it in 1912 to make it available to a larger audience and Bhagat Singh and his associates also found it worthwhile to publish it again in India later. It is a pity that no publisher has thought it fit to reprint it in this 150th anniversary year of the Great Ghadar, when old books are being reprinted and new ones being churned out. It is heartening that most booksellers are reporting a lot of interest in books on 1857 among the reading public.
It is intriguing that a nation that groaned under colonial yoke for 200 years and whose pre-colonial past is glorified by some and decried by others but researched and documented in only a fragmentary fashion. We continue to be indifferent to re-discovering ourself even after gaining political independence. Our schoolteachers rarely take students to museums or monuments and do not teach history in a living fashion; our history departments in 200+ Universities remain under-funded and totter on the verge of being declared “non merit” by administrators influenced by market economics. On the other hand we continue to boast of a 5000 year old civilization, but when confronted by foreigners or our own conscience, we find few books that tell our past in a way that can ignite popular imagination and at the same time give leads to future research by showing where the gaps are.
Now that I have vented my frustration as an outsider to the discipline of history, let me address myself to Savarkar’s book. It is one of the best written so far on the subject of the great uprising of 1857. It is truly panoramic and sweeps thousands of kilometers of territory, from Kunwar Singh’s Jagdishpur in Behar to Peer Ali’s Patna, to Nana Saheb, Azimullah Khan and Tatia Tope’s Bithoor and Kanpur, to Laxmibai’s Jhansi, to Begum Hazrat Mahal and Moulvie Ahmed Shah’s Awadh and Lucknow, to Bakht Khan’s Bareilly, to Bahadur Shah Zafar and Feroze Shah’s Dilli. The innumerable heroes mentioned by Savarkar who rose up and led the local uprisings in town after town and kingdoms after kingdom all across the Gangetic plain, central India and even south of the Vindhyas are too long to be listed here. The other--those who fought with great “heroism” and “loyalty” on the side of the British and were mainly responsible for the victory of the British in almost all the battles are also mentioned with great feeling of revulsion by the author. Those who waited to see which side might win and remained neutral and ultimately threw their weight behind the British are also listed at length.
A panoramic view of history is difficult to narrate. In Mahabharata, Vyas used the artifice of “embedded journalist”--Sanjaya and his tele-vision to tell the story of the great battle of Kurukshetra. Here Savarkar uses no such artifice and with remarkable dexterity handles distances, places, times and events that take place over a battlefield of continental proportions, compared to Europe, and spanning several years. If his exclamations over bravery and heroism of patriots and fury over treachery by Indians, sound repetitive and sentimental, one just glides past them because of the wealth of information that he provides about a period about which we have been taught or told so little.
The story itself is very inspiring because it has not been told in this intensely nationalistic fashion in the last 150 years. On the other hand there is increasing evidence that British consciously suppressed all objective historiography much less nationalistic historiography and engaged in calculated character assassination of all the main leaders of uprising, be it Bahadur Shah Zafar, or Nana Saheb, or Tatia Tope or Begum Hazrat Mahal and so on.
The book extensively quotes fragments of truth that slipped through British eyewitness accounts of the uprising. Kaye, Ball, Malleson and others are frequently quoted to buttress author’s argument. However Savarakar hardly gives any kind of references to what he asserts about the extensive nature of preparation of the uprising, the methods of their organization, their statecraft and their vision. He mentions Swaraj and Swadharma as the guiding vision of the uprising but is deliciously vague about what they meant to the rebels.
Thus a historian might call this legendary in another sense of the word—full of legends rather than facts. From circumstantial evidence and logic we could infer that he may be right about many things that he asserts but an academic historian would probably baulk at it. Obviously he worked under very difficult circumstances while researching for the book in London. However there is no excuse for professional historians not following his leads up.
Another aspect of the book is that it was agit-prop at its best. In fact the book was extensively distributed by Ghadar Party amidst different units of the Indian army in their attempt to organize another widespread mutiny in the army in 1915 to coincide with a civilian uprising, a repeat of 1857 so to say. In fact Ghadar Party expressly chose the word Ghadar in its title not only to adduce revolutionary attributes to the organization but also to convey that “the Great Ghadar of 1857 could not achieve its aims and hence the task of the revolutionaries now, would be to complete it”. When British agents penetrated this attempt, and the leaders were arrested in hundreds in different cantonments, many copies of Savarkar’s book were found with the soldiers involved.
All in all even 100 years after being written, this incandescent piece of writing brings the events of 1857 to life and makes it worth reading to all interested in history of colonialism and India’s fight against it.
(Ghadar Jari Hai is a quarterly magazine produced from New Delhi, India. For more information write to S Raghavan, Editor, jaarihai@yahoo.co.in)
Saturday, February 16, 2008
Tuesday, February 12, 2008
Indian Science: Challenges
Business India, January 2001
Mofussil science
Science in India has echoed the developments in the West with hardly any conceptual or experimental breakthroughs. The current state of science education is alarming
Shivanand Kanavi
“In India, we let existing institutions die and meanwhile plan to build new ones," is the bitter comment made by M.M. Sharma, a Fellow of Royal Society (FRS). Sharma was referring to the plight of our universities, of which he has first-hand experience, having worked in UDCT (of the Bombay University) all his professional life. Today, we have 280 universities but cannot compare any of them to what BHU or Allahabad or Calcutta or Aligarh were in the 1940s and 1950s as centres of science. It will look preposterous to even consider comparing them to Harvard, MIT, Caltech, Stanford, Cornell, Berkeley or Cambridge, which are some of the main centres of frontline science in the world today.
While the number of universities have proliferated, they have become hotbeds of politics for state governments. "Universities have basically become examining bodies. Ninety nine per cent of the time is spent in organising examinations and results and convocation," adds Sharma. Today, even top universities have no research budget and wait for grants to come from CSIR or various government ministries like Department of Science & Technology, Department of Bio-Technology, etc. Libraries are languishing as they have no money to buy research journals and Internet infrastructure is primitive. The interest of students in basic sciences too is waning as more and more look for some kind of professional education and those that finally take to science are mostly reluctant ones.
Some of the best equipped institutions and laboratories in India are outside the university system and they take no part in science education except for some of them registering students for PhD. Industrial funding for science is not forthcoming. The days of Tatas establishing the Indian Institute of Science in Bangalore and the Tata Institute of Fundamental Research in Mumbai, two of our finest science institutions - seem to have vanished. Neither is industry taking up rejuvenation of a few of our universities. In this regard, the interest shown by IIT alumni in contributing to their rejuvenation is commendable though ironical; after all in India, the IITs are supposed to be the rich cousins of universities.
Today, we have very few FRS - just about 17 who are alive and working in India,, leave alone Nobel laureates. Only one of them is in his forties and the rest obviously did their work in 1960s and early 1970s. Clearly they were products of university education in the 1950s and 1960s. Are we going to see some more added to this list in the first decade of the 21st century? If there is no serious thinking and action on this front by academics, scientists, industry and government right now, all talk of India becoming a global knowledge player, etc, will prove to be undiluted bombast.
A few bright spots in this dark scenario are the government's Swarna Jayanthi Fellowships. Sixteen of them have been awarded to young bright scientists in their thirties. They will get packages equal to directors and secretaries of the government and handsome grants for books and equipment. Besides the Science Talent Search fellowships of NCERT given to school and college students, CSIR has just started a scheme for selecting the top 50 school children from each state and giving them various incentives like scholarships, visits to top laboratories and interaction with scientists, etc.
The fact that the scientific community realises the urgency of stemming the rot from whatever meagre resources it has - mainly constituting ideas - was apparent in the first Indian Science Congress of the new millennium held in Pune in the first week of January. Normally, a gerontocracy of Indian science, gives all the keynote lectures, Millennium lectures, evening lectures etc. and the delegates go sightseeing with their families. However, this science congress presided over by R.A. Mashelkar tried to be different. All lectures were given by 22 bright scientists in their forties. There were special sessions for children and students as well.
The result overwhelmed not only the scientists gathered in the Pune University campus but all civic and police authorities of Pune. Lakhs of school and college students poured in not only from Pune but from Jalgaon, Dhuliya, Akola, Malegaon, Sangli, etc - the mofussil towns of Maharashtra. It led to long traffic jams and even mild stampedes as the infrastructure at Pune University creaked to accommodate the nearly half a million visitors over four days of the congress. Children and their parents packed water bottles and picnic hampers and rushed to the venue in the early morning chill to stand in the queue.
So if Indian science has been characterised as imitating the western metropolises then today it appears that kids from mofussil India will save the day for science while the Indian city slickers dream of Silicon Valley and derivatives trading on Wall Street or Dalal Street.
Mofussil science
Science in India has echoed the developments in the West with hardly any conceptual or experimental breakthroughs. The current state of science education is alarming
Shivanand Kanavi
“In India, we let existing institutions die and meanwhile plan to build new ones," is the bitter comment made by M.M. Sharma, a Fellow of Royal Society (FRS). Sharma was referring to the plight of our universities, of which he has first-hand experience, having worked in UDCT (of the Bombay University) all his professional life. Today, we have 280 universities but cannot compare any of them to what BHU or Allahabad or Calcutta or Aligarh were in the 1940s and 1950s as centres of science. It will look preposterous to even consider comparing them to Harvard, MIT, Caltech, Stanford, Cornell, Berkeley or Cambridge, which are some of the main centres of frontline science in the world today.
While the number of universities have proliferated, they have become hotbeds of politics for state governments. "Universities have basically become examining bodies. Ninety nine per cent of the time is spent in organising examinations and results and convocation," adds Sharma. Today, even top universities have no research budget and wait for grants to come from CSIR or various government ministries like Department of Science & Technology, Department of Bio-Technology, etc. Libraries are languishing as they have no money to buy research journals and Internet infrastructure is primitive. The interest of students in basic sciences too is waning as more and more look for some kind of professional education and those that finally take to science are mostly reluctant ones.
Some of the best equipped institutions and laboratories in India are outside the university system and they take no part in science education except for some of them registering students for PhD. Industrial funding for science is not forthcoming. The days of Tatas establishing the Indian Institute of Science in Bangalore and the Tata Institute of Fundamental Research in Mumbai, two of our finest science institutions - seem to have vanished. Neither is industry taking up rejuvenation of a few of our universities. In this regard, the interest shown by IIT alumni in contributing to their rejuvenation is commendable though ironical; after all in India, the IITs are supposed to be the rich cousins of universities.
Today, we have very few FRS - just about 17 who are alive and working in India,, leave alone Nobel laureates. Only one of them is in his forties and the rest obviously did their work in 1960s and early 1970s. Clearly they were products of university education in the 1950s and 1960s. Are we going to see some more added to this list in the first decade of the 21st century? If there is no serious thinking and action on this front by academics, scientists, industry and government right now, all talk of India becoming a global knowledge player, etc, will prove to be undiluted bombast.
A few bright spots in this dark scenario are the government's Swarna Jayanthi Fellowships. Sixteen of them have been awarded to young bright scientists in their thirties. They will get packages equal to directors and secretaries of the government and handsome grants for books and equipment. Besides the Science Talent Search fellowships of NCERT given to school and college students, CSIR has just started a scheme for selecting the top 50 school children from each state and giving them various incentives like scholarships, visits to top laboratories and interaction with scientists, etc.
The fact that the scientific community realises the urgency of stemming the rot from whatever meagre resources it has - mainly constituting ideas - was apparent in the first Indian Science Congress of the new millennium held in Pune in the first week of January. Normally, a gerontocracy of Indian science, gives all the keynote lectures, Millennium lectures, evening lectures etc. and the delegates go sightseeing with their families. However, this science congress presided over by R.A. Mashelkar tried to be different. All lectures were given by 22 bright scientists in their forties. There were special sessions for children and students as well.
The result overwhelmed not only the scientists gathered in the Pune University campus but all civic and police authorities of Pune. Lakhs of school and college students poured in not only from Pune but from Jalgaon, Dhuliya, Akola, Malegaon, Sangli, etc - the mofussil towns of Maharashtra. It led to long traffic jams and even mild stampedes as the infrastructure at Pune University creaked to accommodate the nearly half a million visitors over four days of the congress. Children and their parents packed water bottles and picnic hampers and rushed to the venue in the early morning chill to stand in the queue.
So if Indian science has been characterised as imitating the western metropolises then today it appears that kids from mofussil India will save the day for science while the Indian city slickers dream of Silicon Valley and derivatives trading on Wall Street or Dalal Street.
Monday, January 7, 2008
Story of Nasscom
Business India, February 19-March 4, 2001
Power Lobbying
Shivanand Kanavi
Lobby: 1. Solicit the support of (an influential person) 2. Members of the public seek to influence members of the legislature 3. Frequent a parliamentary lobby 4. Get a Bill through the legislature by interviews, etc in the lobby.
(Concise Oxford Dictionary)
Though it sounds like a harmless part of any democracy in this sanitised version, lobbying is yet to attain a respectable position in India. In the United States, ex-presidential candidates, ex-senators and ex-ambassadors sport the description "lobbyist" with no hesitation. In India it brings on the image of a khadi-clad fixer, with paan in the mouth and toting a mobile phone, hanging around Delhi or various state capitals. Alternately, it could be a shadowy bagman representing corporate interests and servicing various MPs and ministers, seeking confidential Cabinet information or planting starred questions in Parliament on ill-starred corporate rivals.
Of course, come February and the Central Budget, 200-odd industry associations in the country seek an appointment with the finance minister - or at least a joint secretary in finance and other ministries - and present their wish list. Having done their job they vanish till the next February or the next consignment of Chinese goods.
In the first couple of years of liberalisation, the old trade associations, CII (Confederation of Indian Industry) and Ficci (Federation of Indian Chambers of Commerce and Industry) played a major role in pooling public opinion about deregulation and liberalisation and in showcasing India as a destination for foreign investors. Soon, the first flush was over and the economy started opening up for global competition. The protected laggards began feeling the pinch as never before, and the Bombay Club and its clones emerged. Large federations of industry associations beset by contradictory pulls from user industries and producer industries started singing a protectionist tune. The sheen gained as liberalisers and wannabe global players was lost in no time by many entrepreneurs and industry associations.
In this scenario, if there is one organisation that has lobbied for policy changes openly, transparently, and in a well-planned manner in India and abroad on a wide variety of subjects and achieved considerable success; it has been Nasscom.
Today, Nasscom members and its president Dewang Mehta have become a face of corporate India that is welcomed in any part of the globe and listened to with respect. How a bunch of computer nerds and a suave spokesman achieved this is the story Business India looked into.
Nasscom started its activities in December 1988 (see box Success has many fathers ... ) in a low key. The first major challenge it faced was effectively articulating the problems of software companies to the government. Though exporting most of their services, they were not getting the income tax benefits that other industries were getting. Adding to their woes, they were not getting bank credit. In 1991, Nasscom took the matter up for lobbying. "Banks saw no land, plants, and machinery in software companies; the entrepreneurs, moreover, were technocrats and had no great personal wealth of their own to use as collateral. Thus, income tax exemption was crucial. We were not asking for special treatment but to be treated on par with other industries," says Harish Mehta, then chairman of Nasscom. Industry leaders and Dewang Mehta, who had just joined as executive director, pleaded their case with Dr Manmohan Singh, who was very sceptical of the demand. "Vittal, then in the Department of Electronics, was very supportive and promised the finance ministry that the software industry would achieve exports of about 400 million by the year-end. The target was impossible to achieve, but we said we would do our best. Since the export did not involve tangibles, finance ministry officials were hesitant to give the benefit," adds Harish.
"I had to give up my software company Fractal Graphics in London and come back to India due to family obligations. I was told that running the secretariat of Nasscom was a light job and I could work two days a week there and do my own business during the rest of the time," recalls Dewang.
BOX
Success has many fathers ...
The cliche is proving to be particularly true, as Nasscom has gained great visibility recently. There are several people who claim to be founders, co-founders of Nasscom as if it were a new startup from the Valley.
In the beginning there was only the Computer Society of India, which was an organisation of academics and professionals, but did not address IT industry concerns. So, a new association - Manufacturers Association of Information Technology (MAIT) was formed in 1982. True to its name, it was an association of primarily hardware manufacturers. "In a council of 15-20, there were two representing dot matrix printers,” recalls F.C. Kohli. It reflected the infancy of software industry and the then existing mindset that said “buy a PC or a Mini and the software is almost free”.
Software exporters had specific problems, which were not being addressed. A software delegation, which had gone to the US for a road show, sat together after a tiring day in a Boston bar and brainstormed about a separate software association naturally, all those who were in that ‘Boston Scotch Party’ claim to be founders of Nasscom.
Then there are stories of a dinner at Vijay Mukhi’s house; scotch again at the Sea Lounge (Taj Palace, Mumbai), brainstorming in Bombay hosted by Harish Mehta, in Bangalore by Nandan Nilekani and in Delhi by Saurabh Srivastava and so on. Essentially, it all came from dissatisfaction with MAIT. Two founders of MAIT- Prem Shivdasani and Ashok Narasimhan- were also roped in. And a body called Nasscom was registered, with the following signatories to the MoU: Prem Shivdasani, Harish Mehta, Saurabh Srivastava, Yash Pal Sahni, Lalit Kanodia, K Pandyan and Ashank Desai.
The late Prem Shivdasani, the first chairman of Nasscom, is credited with coining the name Nasscom (National Association of Software and Service Companies). It was prophetic, since it included the non-existent IT Services, which became important later.
"Frankly, I was not happy about the formation of a new body,” says software pioneer F.C. Kohli. “The IT industry itself was nascent and I did not like fragmentation. I also firmly believed that hardware and software are two sides of the same coin. When the people who wanted to start Nasscom saw me, I blessed it, though I felt bad about it,” he says. “Initially, it was a small organization, but the real renaissance of Nasscom took place with Dewang Mehta. He was a charted accountant and also a software man. In those very early days he played with graphics software, which is a very complex software. He has worked very hard. In fact, he had no other life than Nasscom. But more than anything else, he connects with people,” sums up Kohli. And the rest is history.
--------------------------------
Dewang Mehta took to lobbying like a fish in water. He had seen his father lobby for pharmaceutical companies among the MPs in Delhi during his childhood. He managed to get endorsement from 40 MPs for the income tax waiver on software exports and waited for the budget proposals with bated breath.
"We were not allowed inside the Parliament during the Budget session. I still remember waiting outside Parliament house the whole day with Harish and buttonholing everybody who came out, trying to find out what was happening inside; a historic budget was being presented by Dr Manmohan Singh," recalls Dewang.
Singh gave a one-year waiver in the 1991 budget and the software industry was ecstatic. Suddenly, Nasscom gained popularity within the industry. "That was our first tangible victory and we had proven our point that a focused association like Nasscom was needed to lobby for the software industry, as against general ones that existed then," says Harish Mehta. "We worked so hard to achieve it that the promised two days a week evaporated in no time and I never looked back from my Nasscom commitment after that," says Dewang. This taste of victory was a turning point for Nasscom and for the Indian software industry.
Every industry association lobbies for protection or concessions with the government. But dealing with intangibles like software was new to bureaucrats and ministers. Come every February and each budget, and Nasscom had to lobby to get an extension on tax exemption. Finally, in 1997, P. Chidambaram, then finance minister, who was software savvy, gave the income tax benefit to software on par with the rest of the exporting industries till 2002, as allowed under WTO.
An anecdote from 1997 illustrates the problems involved in educating government officials. The government had proposed a 5 per cent duty on software imports, whereas Nasscom had asked for zero duty. This in itself amazed some people, who asked: "Are you not afraid of competition when all other sectors are asking for protection?" The reason was simply that imported software was being used to provide software services and, in any case, IT was a global industry and one had to use best of the breed products. "Chidambaram, then finance minister, asked irritably: 'You have billion dollars in exports, can't you pay 5 per cent duty?'. We explained that the import duty, even if imposed, could become impossible to implement since software can be downloaded through Internet gateways. An officer immediately piped in: 'But sir, we can make a customs officer sit at their gateway and charge the duty!' He had not understood the difference between a gate and a gateway. But Chidambaram immediately understood our point and relented," says Dewang.
The billion-dollar barrier was a significant one. Once the industry crossed it in exports in 1997, everybody took notice, both in India and abroad. While it is true that the growth in exports is primarily the achievement of software companies, Nasscom from the very beginning has been a great facilitator. For example, it has regularly organised conferences and seminars abroad to tell the India story. "The delegations to these seminars comprise any member company which applies by the deadline without any discrimination. The seminars end with actual deals being signed. We have conducted over a hundred of them in a short period of time. Even now, when the US ambassador says that over 266 of Fortune 1000 US companies are outsourcing mission critical software to India, we have to keep targeting the other 70 per cent who are not," says Dewang.
A major concern for the Indian software industry, of course, is its very heavy dependence on the US market. Over the last few years Nasscorn has taken initiatives in that respect and organised marketing seminars in Europe, Japan and Oceania. "Nasscom has done a wonderful job marketing and brand building for Indian software abroad. We have assisted them in Japan with the Indo-Japan business council for the last three years," says Amit Mitra, Director-General of Ficci.
The result is that today only 58 per cent of Indian software exports are to the US and the rest is primarily divided between Europe and Japan. "Nasscom, in fact, is running a programme called Ninjas (Nasscom India Japan Alliance in Software) which will help train hundreds of Indian software engineers in Japanese language and culture. The Japanese market has been the toughest to crack. The real breakthrough came with Y2K, when about 30 Japanese companies came with an SOS to Nasscom. We put them in touch with the entire Indian software industry and their problem was solved. That is how today there is tremendous interest in Indian software in Japan," says Dewang.
This also underlines how Nasscom operates and why it is so popular with its members. The association sends tonnes of research papers and information regarding market conditions; government policies; visa and regulatory issues in other countries; Indian government notifications and so on, to all its members. "I don't think any other association sends as much mail to its members. I get about 200 mails from them, giving me really useful information. The secretariat is doing a great job," says a member of Nasscom. "All these services cost money and we, of course, remove anyone who does not pay his membership immediately," says Arun Kumar, MD of Hughes Software and treasurer of Nasscom. Nasscom today has a budget of Rs10 crore collected largely from membership and conferences. The secretariat, however, is extremely slim, consisting of only 19 people. The frugal atmosphere, high pressure of deadlines, along with long working hours in the Nasscom office in Vishwa Yuvak Kendra in Delhi reminds one of a software start-up rather than an industry association.
BOX
Mr. Nasscom
The following narration by Dewang about his activities in the last week of January and first week of February on the eve of the Nasscom 2001 conference in Mumbai speaks for itself:
"Last Monday was the advisory committee meeting for the IT ministry. Later there was an industry leadership lecture organised by Nasscom, where John Chambers, CEO of Cisco Systems, spoke. It was followed by a dinner hosted by Pramod Mahajan in honour of John Chambers".
"Late in the night I flew to Paris. After a long time France is looking very positively towards India. It has taken eight years. We not only had a successful road show, but also signed a MoU with Syntec, which is Nasscom's counterpart in France. Wednesday evening I went to Aachen, Germany, and had a road show there. The next day I was in Berlin where we had not only a promotional seminar but in the afternoon actual contracts were signed. After coming back on Monday we had a meeting with the finance minister, Yashwant Sinha. Tuesday I had three major TV interviews."
"On Sunday I worked on the review, but in the afternoon I had flying classes. Flew till Mathura from Delhi and came back. Yesterday I had meetings with Canadian, French, and US ambassadors. For the first time we are having a session in the Nasscom conference with the ambassadors. Then I came to Mumbai in the evening, since I had to supervise the arrangements at Turf Club for a gala dinner during the conference, which will also have a fashion show. Then I went to the exhibition venue at the World Trade Centre. Then I had to meet a journalist. Checked into the hotel at 4 am and after an hour’s rest I just checked out at 5.30 am to leave for Bangalore by the early morning flight. I will be inaugurating Mindtree Consulting’s office there” .
To double check whether he was pulling a fast one on us, with all this namedropping, we spent a day with him. It turned out that his to-do-list actually increased as time went by. He had worked 48 hours straight but could not even catch forty winks on the first flight out of Mumbai to Bangalore, since he had fixed up an in-flight interview with us. On top of this, Sanjay Khan, bollywood actor and producer who was on the same flight, invited Dewang to join the board of a new media company he'd floated.
The man is a total workaholic. “Dewang works for Nasscom at great personal sacrifice. He is on the road for more than 15 days a month. That he is not married might have helped, but he is dedicated person. When Nasscom was not very big and did not have many resources for his travel, he was using his own frequent traveller coupons and I think Nasscom has been very fortunate in having him. It perhaps happens to a one in 100 organisations,” says none other than F.C. Kohli. Tall praise coming from a man of very few words and even fewer adjectives.
The visibility Dewang gets in the media is mainly due to his hardwork, but there are detractors in the industry who think that he gets more exposure than the elected chairmen even though “he is just an employee”.
Dewang seems quite sensitive to this criticism of hogging the limelight. In fact, he was hardly in the centrestage in the 20-odd sessions of the recently-conducted Nasscom 2001 and kept himself in the background. Of couse, cynics might say, “so what, he will have his 361 days.”
However, this manic is not all work and no play, he loves flying and is on his way to get a pilot licence. His passion is film-making and fashion design too. In fact, when he was hardly 20 and a young chartered accountant, he went to UK to receive a prize in the Commonwealth Film Festival for a documentary he had made called Garvi Gujarat. That is where he met Robert Kitching, a pioneer in computer graphics, who inspired him enough to get a BS in computer graphics from the Imperial College in London. Since his father got worried about his son’s inexplicable career path, he also finished his ICPA on the side, a UK accounting degree, Making a full length Bollywood masala film remains his ambition.
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"Besides lobbying in India, Nasscom has been very successful in lobbying abroad as well," says Amit Mitra. "We collaborated with them and did our bit about the H1B visa issue, as it unravelled in Washington, through the Joint Indo-US Business Council. But they worked really hard and in a focused way and achieved excellent results," adds he.
But the story of lobbying abroad does not start with visas. It goes way back. In 1993 Nasscom was the first industry association to appoint a fulltime lobbying firm in Washington.
The association has been most proactive in IPR. For example, in 1994, Nasscom started its anti-piracy initiative in India when IPR was becoming a major issue in Indo-US relations. Nasscom took up the campaign against software piracy and started conducting well-publicised raids. Today piracy has come down from 89 per cent to 59 per cent -largely due to awareness within the software industry and the corporate sector - though it continues with home computer users, small businesses, and some government departments. "We are way ahead of China in this respect and this is one of the reasons why US IT companies were attracted to investing in India," says Dewang. It was a master stroke, and gave immediate visibility to Nasscom in Washington. The Department of Commerce and the US trade representative, who was threatening actions under Super 301 against all and sundry for violating IPR, were pleasantly surprised to find an ally in India.
Again in 1995, the US trade representative (USTR) told a delegation of Nasscom that the copyright laws were not strict enough in India and they were contemplating using Super 301 over India. The Nasscom delegation immediately advised her to hold on and said they would lobby with the Indian government to change the copyright laws. "The USTR could not believe us. But we explained that if they imposed Super 301, it becomes politically impossible for the Indian government to change the laws, since it would appear to have buckled under pressure. Whereas, if the Indian IT industry lobbies for change, then the government will easily see reason," says Dewang. The strategy succeeded and gave a lot of leverage to Nasscom with USTR. It also helped bring more and more dedicated India development centres for US companies into India, as they felt more secure. Today, even data is being processed in India in back-office operations. If the relevant changes had not been made in copyright, most corporations, credit card companies, and banks would never have let go of data, which they, carefully guard.
Nasscom's most recent and remarkable achievement has been its role in the liberalisation of the telecom sector - the graveyard of many a telecom investor. Nasscom first targeted the Internet infrastructure and lobbied for allowing the emergence of private ISPs. When the government allowed private ISPs in 1998 - these were essentially bandwidth resellers for VSNL - Nasscom lobbied for allowing them to set up their own international gateways. This faced a lot of resistance since, as everybody knows in this age of convergence of data and voice, these gateways can willy-nilly be used as bridgeheads for breaking VSNL's monopoly over International voice services as well. Today the government has agreed in principle to bring forward the 2004 deadline for ending VSNL's monopoly status to 2002. It is also taking serious steps towards privatising VSNL. Such moves would have been unthinkable hardly a year ago. The campaign for bandwidth started way back in January during Nasscom 2000. The release of the Nasscom-McKinsey report on India's software future in December 1999 which postulated an achievable horizon of $50 billion of exports by 2008 set the ball rolling.
Once the figure of $50 billion sunk into the Indian psyche, Nasscom began popularising the necessity for removing bottlenecks in the quantity and quality of "bandwidth", a word known thus far to only hard core techies. Nasscom clearly pointed out that if the bottlenecks were not removed, the nation would lose $22.5 billion in IT-enabled services, e-commerce and software to other more lucrative international destinations. And along with it, about 6.5 lakh new jobs. Even politicians in UP can understand such numbers.
Clearly Nasscom's strategy of projecting the carrot and the stick has worked. In less than a year India is seeing the results of Operation Bandwidth. The domestic backbone of DoT, which had 34 Mbps capacity, is being upgraded to 2.5 Gbps by March 2001 and the international bandwidth, which was a meagre 300 Mbps and had a long waiting period, has jumped to 800 Mbps. VSNL and DoT have dropped charges on lease line and international circuits at times by 90 per cent. IT-enabled services are employing about 60,000 people and generating about $500 million in revenue. However, this is not the first time that Nasscom has used a report from an outsider effectively. It happened in 1992 as well, with the World Bank report on Indian software. In 1991 when IT had very low visibility, Nasscom found out through the Department of Electronics that the World Bank is working on a report on Indian software capabilities. "We managed to work with the WB team in producing the report and then used the same report to gain much required visibility," says Harish Mehta, CEO of Onward Novell and the then chairman of Nasscom.
Dewang's slogan 'Roti, Kapda, Makaan, Bijlee, and Bandwidth' is finally looking credible. It might not even be too surprising to soon find the IT industry and Nasscom lobbying for the much-needed power sector reforms. Already, IT minister Pramod Mahajan is saying in public that without assured power supply IT parks will be useless. Recently, power minister Suresh Prabhu was heard telling a friend: "I wish I get a Dewang for the power sector."
BOX
Peering
CII Ficci Nasscom
Members 3900 540 Chambers and 800
2,000 corporates
Budget 100 crore 18 crore 10 crore
Employees 450 350 19
"The access Nasscom enjoys in the government in all ministries from the PMO to telecom, industry, commerce and finance is amazing," says Amit Mitra. One achievement of Nasscom, and of Mehta in particular, is in converting the IT ministry into a valuable ally within the government, rather than an adversary. In fact, when the ministry was created, most people within the IT industry had said: "We have grown because we did not have any government interference. Now why create a ministry to spoil the sport?" Today Dewang and Pramod Mahajan have developed close ties, leading to easy access within the government for Nasscom. The friendship has drawn jealousy among some in the industry, more so when Mahajan has half jokingly begun introducing Dewang as the minister of state for IT. Perhaps it has fuelled Dewang's political ambitions as well. It certainly led Dewang to talk more of 'nation-building' and less of software. His Website says that he intends to contest the next Parliamentary elections. However, it is interesting to note that Pramod Mahajan had not even met Dewang Mehta till a year back. It is another proof of Dewang's people skills that software pioneer F.C. Kohli talks about. "Dewang is very hardworking, dedicated, has integrity, but most importantly he connects with people," says Kohli. "He has political ambitions but within Nasscom, he does not play politics."
Nasscom has taken up two serious projects as part of its mission. One is revitalising the Indian technical and engineering education to provide a high quantity of high-quality engineers to achieve export goals of $50 billion. This is a major initiative and creating a separate industry fund for this purpose is also being considered. The initiative will obviously be welcomed, as it will have far deeper significance than just munificence of some successful NRIs in regard to their alma maters. "There is serious discussion going on among us on how to raise the standards of the 43 regional engineering colleges to those of IITS," says Dewang. Narayana Murthy's speech in the Nasscom Industry Leadership series during the recently concluded Nasscom 2001 conference was in fact devoted to education.
The other initiative is directed towards making IT a part of common man's life, and introducing IT in governance and in education in a big way. This will mean for example; increasing use of IT in the RTOs for vehicle registration, land records, income tax, customs, municipal taxes, courts, and several other departments that interface with the public. This will obviously remove to a great extent the scourge of touts and agents and make the process more transparent and remotely operable from Internet kiosks without the necessity of visiting faraway government offices and queuing outside them. The use of Internet and video conferencing can bring a lecture by an IIT professor or a scientist to every school and college thereby bridging the divide and using scarce educational resources more intelligently.
However all these require time spent in championing them and demonstrating prototypes and so on, which Nasscom can effectively do. Besides modernising a large part of common man's life, it will also create a major market for software services within the country.
This is not to say that Nasscom does not have dissent among its leading lights. Without open and self-critical views, any such organisation is likely to go to seed. For example, past chairmen of Nasscom, Saurabh Srivastava (chairman of IIS infotech) and Harish Mehta (CEO of Onward Novell) are sounding cautionary notes. "Nasscom must save itself from becoming a victim of its own success. The accomplishments of the past have led to some sectors having unrealistic expectations from Nasscom, many of which are not in its purview at all. Nasscom cannot resolve systemic problems that plague the Indian economy as a whole. Nasscom would be doing a disservice to itself by diluting focus from its core agenda. We must learn and practice the art of saying 'No' when faced with such demands," says Harish Mehta.
However, Dewang is unfazed by dissent. "I have learnt much from Tarun Das (Director-General, CII) and Amit Mitra, who are handling complex issues and large organisations like CII and Ficci with contradictory pulls. Within Nasscom we have openness and I operate within the mandate given by my executive council. If I trespass it anytime I am, of course, open to criticism," says Dewang.
One major challenge facing the IT industry is the new phenomenon of startups, many of which are involved in products rather than services. Will Nasscom, dominated entirely by the service companies, be able to nurture them as well? "Our membership grew by 200, a hefty 33 per cent in one year. Obviously, most of them are startups. We have started incubation networking within Nasscom and will give them all assistance. In fact, in the projected $50-billion target we expect nearly 20-30 per cent to come from product exports. While large established companies will contribute to it, a lot is expected from the startups," replies Dewang.
When the going is good it is easy to do well but as competition from other countries builds up and as the US economy goes through a trough the task gets more challenging. Clearly Nasscom's work is cut out:
• Continued marketing of the "India story". Focusing on CIOs of the other 70 per cent of Fortune 1000 who are not outsourcing from India.
• Organising more focused marketing on specific skills in Indian companies in Internet enabling brick and mortar companies (e-biz), software skills in communications, optical networking, embedded software, and wireless technologies.
• Participating in new educational initiatives for upgrading quantity and quality of IT manpower in India.
• Dealing with the slowdown in the US economy and turn the adversity into an opportunity.
Dewang and Nasscom's immediate agenda is:
• Open 10 offices in India in 2001, Mumbai, Bangalore, Hyderabad, Chennai, Pune, Ahmedabad, Chandigarh, Lucknow, Kolkata and Jaipur.
• International offices in Geneva, London, Tokyo, Washington DC, San Jose, and Sophie Antapolis (France) during 2001 and 2002.
• NICE: A National Internet Center of Excellence, nucleated by Nasscom, to promote the Internet in local languages, for creating standards for content building and delivery, and researching new technologies.
• NISG: National Institute of Smart Governance to promote e-Governance (in association with the Government of India).
• Disaster Management Task Force:
Nasscom will help create the IT infrastructure for disaster-prone areas of India. This is a reaction to the earthquake disaster in Gujarat.
• Work with Civil Aviation ministry to convert airports in Hyderabad, Bangalore, Ahmedabad, and Pune into international airports so that global movement of IT professionals becomes less of a pain.
Personalities aside, growth and particularly fast growth, brings its own problems. A course correction is required from time to time, be it an organisation or an individual. Interpersonal problems can exist in any organisation, whether it's of the old economy or the New Economy or even a housing cooperative society. What's central is that a dynamic industry is created, which can bring great wealth and skills to India. This has charged up a sleeping nation, continuously wallowing in sectarianism and wasted opportunities. It has made the ideas to-riches story a reality rather than a Grimm's fairy tale. Its 50 per cent plus growth brings new problems of management within the components as well as within industry bodies like Nasscom. As long as it operates transparently, it can make mistakes and recover from them. It is, after all, a living organism and only dead organisms remain static, with no problems. The $50-billion pot of gold is the reward for Nasscom's continuing efforts.
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Power Lobbying
Shivanand Kanavi
Lobby: 1. Solicit the support of (an influential person) 2. Members of the public seek to influence members of the legislature 3. Frequent a parliamentary lobby 4. Get a Bill through the legislature by interviews, etc in the lobby.
(Concise Oxford Dictionary)
Though it sounds like a harmless part of any democracy in this sanitised version, lobbying is yet to attain a respectable position in India. In the United States, ex-presidential candidates, ex-senators and ex-ambassadors sport the description "lobbyist" with no hesitation. In India it brings on the image of a khadi-clad fixer, with paan in the mouth and toting a mobile phone, hanging around Delhi or various state capitals. Alternately, it could be a shadowy bagman representing corporate interests and servicing various MPs and ministers, seeking confidential Cabinet information or planting starred questions in Parliament on ill-starred corporate rivals.
Of course, come February and the Central Budget, 200-odd industry associations in the country seek an appointment with the finance minister - or at least a joint secretary in finance and other ministries - and present their wish list. Having done their job they vanish till the next February or the next consignment of Chinese goods.
In the first couple of years of liberalisation, the old trade associations, CII (Confederation of Indian Industry) and Ficci (Federation of Indian Chambers of Commerce and Industry) played a major role in pooling public opinion about deregulation and liberalisation and in showcasing India as a destination for foreign investors. Soon, the first flush was over and the economy started opening up for global competition. The protected laggards began feeling the pinch as never before, and the Bombay Club and its clones emerged. Large federations of industry associations beset by contradictory pulls from user industries and producer industries started singing a protectionist tune. The sheen gained as liberalisers and wannabe global players was lost in no time by many entrepreneurs and industry associations.
In this scenario, if there is one organisation that has lobbied for policy changes openly, transparently, and in a well-planned manner in India and abroad on a wide variety of subjects and achieved considerable success; it has been Nasscom.
Today, Nasscom members and its president Dewang Mehta have become a face of corporate India that is welcomed in any part of the globe and listened to with respect. How a bunch of computer nerds and a suave spokesman achieved this is the story Business India looked into.
Nasscom started its activities in December 1988 (see box Success has many fathers ... ) in a low key. The first major challenge it faced was effectively articulating the problems of software companies to the government. Though exporting most of their services, they were not getting the income tax benefits that other industries were getting. Adding to their woes, they were not getting bank credit. In 1991, Nasscom took the matter up for lobbying. "Banks saw no land, plants, and machinery in software companies; the entrepreneurs, moreover, were technocrats and had no great personal wealth of their own to use as collateral. Thus, income tax exemption was crucial. We were not asking for special treatment but to be treated on par with other industries," says Harish Mehta, then chairman of Nasscom. Industry leaders and Dewang Mehta, who had just joined as executive director, pleaded their case with Dr Manmohan Singh, who was very sceptical of the demand. "Vittal, then in the Department of Electronics, was very supportive and promised the finance ministry that the software industry would achieve exports of about 400 million by the year-end. The target was impossible to achieve, but we said we would do our best. Since the export did not involve tangibles, finance ministry officials were hesitant to give the benefit," adds Harish.
"I had to give up my software company Fractal Graphics in London and come back to India due to family obligations. I was told that running the secretariat of Nasscom was a light job and I could work two days a week there and do my own business during the rest of the time," recalls Dewang.
BOX
Success has many fathers ...
The cliche is proving to be particularly true, as Nasscom has gained great visibility recently. There are several people who claim to be founders, co-founders of Nasscom as if it were a new startup from the Valley.
In the beginning there was only the Computer Society of India, which was an organisation of academics and professionals, but did not address IT industry concerns. So, a new association - Manufacturers Association of Information Technology (MAIT) was formed in 1982. True to its name, it was an association of primarily hardware manufacturers. "In a council of 15-20, there were two representing dot matrix printers,” recalls F.C. Kohli. It reflected the infancy of software industry and the then existing mindset that said “buy a PC or a Mini and the software is almost free”.
Software exporters had specific problems, which were not being addressed. A software delegation, which had gone to the US for a road show, sat together after a tiring day in a Boston bar and brainstormed about a separate software association naturally, all those who were in that ‘Boston Scotch Party’ claim to be founders of Nasscom.
Then there are stories of a dinner at Vijay Mukhi’s house; scotch again at the Sea Lounge (Taj Palace, Mumbai), brainstorming in Bombay hosted by Harish Mehta, in Bangalore by Nandan Nilekani and in Delhi by Saurabh Srivastava and so on. Essentially, it all came from dissatisfaction with MAIT. Two founders of MAIT- Prem Shivdasani and Ashok Narasimhan- were also roped in. And a body called Nasscom was registered, with the following signatories to the MoU: Prem Shivdasani, Harish Mehta, Saurabh Srivastava, Yash Pal Sahni, Lalit Kanodia, K Pandyan and Ashank Desai.
The late Prem Shivdasani, the first chairman of Nasscom, is credited with coining the name Nasscom (National Association of Software and Service Companies). It was prophetic, since it included the non-existent IT Services, which became important later.
"Frankly, I was not happy about the formation of a new body,” says software pioneer F.C. Kohli. “The IT industry itself was nascent and I did not like fragmentation. I also firmly believed that hardware and software are two sides of the same coin. When the people who wanted to start Nasscom saw me, I blessed it, though I felt bad about it,” he says. “Initially, it was a small organization, but the real renaissance of Nasscom took place with Dewang Mehta. He was a charted accountant and also a software man. In those very early days he played with graphics software, which is a very complex software. He has worked very hard. In fact, he had no other life than Nasscom. But more than anything else, he connects with people,” sums up Kohli. And the rest is history.
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Dewang Mehta took to lobbying like a fish in water. He had seen his father lobby for pharmaceutical companies among the MPs in Delhi during his childhood. He managed to get endorsement from 40 MPs for the income tax waiver on software exports and waited for the budget proposals with bated breath.
"We were not allowed inside the Parliament during the Budget session. I still remember waiting outside Parliament house the whole day with Harish and buttonholing everybody who came out, trying to find out what was happening inside; a historic budget was being presented by Dr Manmohan Singh," recalls Dewang.
Singh gave a one-year waiver in the 1991 budget and the software industry was ecstatic. Suddenly, Nasscom gained popularity within the industry. "That was our first tangible victory and we had proven our point that a focused association like Nasscom was needed to lobby for the software industry, as against general ones that existed then," says Harish Mehta. "We worked so hard to achieve it that the promised two days a week evaporated in no time and I never looked back from my Nasscom commitment after that," says Dewang. This taste of victory was a turning point for Nasscom and for the Indian software industry.
Every industry association lobbies for protection or concessions with the government. But dealing with intangibles like software was new to bureaucrats and ministers. Come every February and each budget, and Nasscom had to lobby to get an extension on tax exemption. Finally, in 1997, P. Chidambaram, then finance minister, who was software savvy, gave the income tax benefit to software on par with the rest of the exporting industries till 2002, as allowed under WTO.
An anecdote from 1997 illustrates the problems involved in educating government officials. The government had proposed a 5 per cent duty on software imports, whereas Nasscom had asked for zero duty. This in itself amazed some people, who asked: "Are you not afraid of competition when all other sectors are asking for protection?" The reason was simply that imported software was being used to provide software services and, in any case, IT was a global industry and one had to use best of the breed products. "Chidambaram, then finance minister, asked irritably: 'You have billion dollars in exports, can't you pay 5 per cent duty?'. We explained that the import duty, even if imposed, could become impossible to implement since software can be downloaded through Internet gateways. An officer immediately piped in: 'But sir, we can make a customs officer sit at their gateway and charge the duty!' He had not understood the difference between a gate and a gateway. But Chidambaram immediately understood our point and relented," says Dewang.
The billion-dollar barrier was a significant one. Once the industry crossed it in exports in 1997, everybody took notice, both in India and abroad. While it is true that the growth in exports is primarily the achievement of software companies, Nasscom from the very beginning has been a great facilitator. For example, it has regularly organised conferences and seminars abroad to tell the India story. "The delegations to these seminars comprise any member company which applies by the deadline without any discrimination. The seminars end with actual deals being signed. We have conducted over a hundred of them in a short period of time. Even now, when the US ambassador says that over 266 of Fortune 1000 US companies are outsourcing mission critical software to India, we have to keep targeting the other 70 per cent who are not," says Dewang.
A major concern for the Indian software industry, of course, is its very heavy dependence on the US market. Over the last few years Nasscorn has taken initiatives in that respect and organised marketing seminars in Europe, Japan and Oceania. "Nasscom has done a wonderful job marketing and brand building for Indian software abroad. We have assisted them in Japan with the Indo-Japan business council for the last three years," says Amit Mitra, Director-General of Ficci.
The result is that today only 58 per cent of Indian software exports are to the US and the rest is primarily divided between Europe and Japan. "Nasscom, in fact, is running a programme called Ninjas (Nasscom India Japan Alliance in Software) which will help train hundreds of Indian software engineers in Japanese language and culture. The Japanese market has been the toughest to crack. The real breakthrough came with Y2K, when about 30 Japanese companies came with an SOS to Nasscom. We put them in touch with the entire Indian software industry and their problem was solved. That is how today there is tremendous interest in Indian software in Japan," says Dewang.
This also underlines how Nasscom operates and why it is so popular with its members. The association sends tonnes of research papers and information regarding market conditions; government policies; visa and regulatory issues in other countries; Indian government notifications and so on, to all its members. "I don't think any other association sends as much mail to its members. I get about 200 mails from them, giving me really useful information. The secretariat is doing a great job," says a member of Nasscom. "All these services cost money and we, of course, remove anyone who does not pay his membership immediately," says Arun Kumar, MD of Hughes Software and treasurer of Nasscom. Nasscom today has a budget of Rs10 crore collected largely from membership and conferences. The secretariat, however, is extremely slim, consisting of only 19 people. The frugal atmosphere, high pressure of deadlines, along with long working hours in the Nasscom office in Vishwa Yuvak Kendra in Delhi reminds one of a software start-up rather than an industry association.
BOX
Mr. Nasscom
The following narration by Dewang about his activities in the last week of January and first week of February on the eve of the Nasscom 2001 conference in Mumbai speaks for itself:
"Last Monday was the advisory committee meeting for the IT ministry. Later there was an industry leadership lecture organised by Nasscom, where John Chambers, CEO of Cisco Systems, spoke. It was followed by a dinner hosted by Pramod Mahajan in honour of John Chambers".
"Late in the night I flew to Paris. After a long time France is looking very positively towards India. It has taken eight years. We not only had a successful road show, but also signed a MoU with Syntec, which is Nasscom's counterpart in France. Wednesday evening I went to Aachen, Germany, and had a road show there. The next day I was in Berlin where we had not only a promotional seminar but in the afternoon actual contracts were signed. After coming back on Monday we had a meeting with the finance minister, Yashwant Sinha. Tuesday I had three major TV interviews."
"On Sunday I worked on the review, but in the afternoon I had flying classes. Flew till Mathura from Delhi and came back. Yesterday I had meetings with Canadian, French, and US ambassadors. For the first time we are having a session in the Nasscom conference with the ambassadors. Then I came to Mumbai in the evening, since I had to supervise the arrangements at Turf Club for a gala dinner during the conference, which will also have a fashion show. Then I went to the exhibition venue at the World Trade Centre. Then I had to meet a journalist. Checked into the hotel at 4 am and after an hour’s rest I just checked out at 5.30 am to leave for Bangalore by the early morning flight. I will be inaugurating Mindtree Consulting’s office there” .
To double check whether he was pulling a fast one on us, with all this namedropping, we spent a day with him. It turned out that his to-do-list actually increased as time went by. He had worked 48 hours straight but could not even catch forty winks on the first flight out of Mumbai to Bangalore, since he had fixed up an in-flight interview with us. On top of this, Sanjay Khan, bollywood actor and producer who was on the same flight, invited Dewang to join the board of a new media company he'd floated.
The man is a total workaholic. “Dewang works for Nasscom at great personal sacrifice. He is on the road for more than 15 days a month. That he is not married might have helped, but he is dedicated person. When Nasscom was not very big and did not have many resources for his travel, he was using his own frequent traveller coupons and I think Nasscom has been very fortunate in having him. It perhaps happens to a one in 100 organisations,” says none other than F.C. Kohli. Tall praise coming from a man of very few words and even fewer adjectives.
The visibility Dewang gets in the media is mainly due to his hardwork, but there are detractors in the industry who think that he gets more exposure than the elected chairmen even though “he is just an employee”.
Dewang seems quite sensitive to this criticism of hogging the limelight. In fact, he was hardly in the centrestage in the 20-odd sessions of the recently-conducted Nasscom 2001 and kept himself in the background. Of couse, cynics might say, “so what, he will have his 361 days.”
However, this manic is not all work and no play, he loves flying and is on his way to get a pilot licence. His passion is film-making and fashion design too. In fact, when he was hardly 20 and a young chartered accountant, he went to UK to receive a prize in the Commonwealth Film Festival for a documentary he had made called Garvi Gujarat. That is where he met Robert Kitching, a pioneer in computer graphics, who inspired him enough to get a BS in computer graphics from the Imperial College in London. Since his father got worried about his son’s inexplicable career path, he also finished his ICPA on the side, a UK accounting degree, Making a full length Bollywood masala film remains his ambition.
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"Besides lobbying in India, Nasscom has been very successful in lobbying abroad as well," says Amit Mitra. "We collaborated with them and did our bit about the H1B visa issue, as it unravelled in Washington, through the Joint Indo-US Business Council. But they worked really hard and in a focused way and achieved excellent results," adds he.
But the story of lobbying abroad does not start with visas. It goes way back. In 1993 Nasscom was the first industry association to appoint a fulltime lobbying firm in Washington.
The association has been most proactive in IPR. For example, in 1994, Nasscom started its anti-piracy initiative in India when IPR was becoming a major issue in Indo-US relations. Nasscom took up the campaign against software piracy and started conducting well-publicised raids. Today piracy has come down from 89 per cent to 59 per cent -largely due to awareness within the software industry and the corporate sector - though it continues with home computer users, small businesses, and some government departments. "We are way ahead of China in this respect and this is one of the reasons why US IT companies were attracted to investing in India," says Dewang. It was a master stroke, and gave immediate visibility to Nasscom in Washington. The Department of Commerce and the US trade representative, who was threatening actions under Super 301 against all and sundry for violating IPR, were pleasantly surprised to find an ally in India.
Again in 1995, the US trade representative (USTR) told a delegation of Nasscom that the copyright laws were not strict enough in India and they were contemplating using Super 301 over India. The Nasscom delegation immediately advised her to hold on and said they would lobby with the Indian government to change the copyright laws. "The USTR could not believe us. But we explained that if they imposed Super 301, it becomes politically impossible for the Indian government to change the laws, since it would appear to have buckled under pressure. Whereas, if the Indian IT industry lobbies for change, then the government will easily see reason," says Dewang. The strategy succeeded and gave a lot of leverage to Nasscom with USTR. It also helped bring more and more dedicated India development centres for US companies into India, as they felt more secure. Today, even data is being processed in India in back-office operations. If the relevant changes had not been made in copyright, most corporations, credit card companies, and banks would never have let go of data, which they, carefully guard.
Nasscom's most recent and remarkable achievement has been its role in the liberalisation of the telecom sector - the graveyard of many a telecom investor. Nasscom first targeted the Internet infrastructure and lobbied for allowing the emergence of private ISPs. When the government allowed private ISPs in 1998 - these were essentially bandwidth resellers for VSNL - Nasscom lobbied for allowing them to set up their own international gateways. This faced a lot of resistance since, as everybody knows in this age of convergence of data and voice, these gateways can willy-nilly be used as bridgeheads for breaking VSNL's monopoly over International voice services as well. Today the government has agreed in principle to bring forward the 2004 deadline for ending VSNL's monopoly status to 2002. It is also taking serious steps towards privatising VSNL. Such moves would have been unthinkable hardly a year ago. The campaign for bandwidth started way back in January during Nasscom 2000. The release of the Nasscom-McKinsey report on India's software future in December 1999 which postulated an achievable horizon of $50 billion of exports by 2008 set the ball rolling.
Once the figure of $50 billion sunk into the Indian psyche, Nasscom began popularising the necessity for removing bottlenecks in the quantity and quality of "bandwidth", a word known thus far to only hard core techies. Nasscom clearly pointed out that if the bottlenecks were not removed, the nation would lose $22.5 billion in IT-enabled services, e-commerce and software to other more lucrative international destinations. And along with it, about 6.5 lakh new jobs. Even politicians in UP can understand such numbers.
Clearly Nasscom's strategy of projecting the carrot and the stick has worked. In less than a year India is seeing the results of Operation Bandwidth. The domestic backbone of DoT, which had 34 Mbps capacity, is being upgraded to 2.5 Gbps by March 2001 and the international bandwidth, which was a meagre 300 Mbps and had a long waiting period, has jumped to 800 Mbps. VSNL and DoT have dropped charges on lease line and international circuits at times by 90 per cent. IT-enabled services are employing about 60,000 people and generating about $500 million in revenue. However, this is not the first time that Nasscom has used a report from an outsider effectively. It happened in 1992 as well, with the World Bank report on Indian software. In 1991 when IT had very low visibility, Nasscom found out through the Department of Electronics that the World Bank is working on a report on Indian software capabilities. "We managed to work with the WB team in producing the report and then used the same report to gain much required visibility," says Harish Mehta, CEO of Onward Novell and the then chairman of Nasscom.
Dewang's slogan 'Roti, Kapda, Makaan, Bijlee, and Bandwidth' is finally looking credible. It might not even be too surprising to soon find the IT industry and Nasscom lobbying for the much-needed power sector reforms. Already, IT minister Pramod Mahajan is saying in public that without assured power supply IT parks will be useless. Recently, power minister Suresh Prabhu was heard telling a friend: "I wish I get a Dewang for the power sector."
BOX
Peering
CII Ficci Nasscom
Members 3900 540 Chambers and 800
2,000 corporates
Budget 100 crore 18 crore 10 crore
Employees 450 350 19
"The access Nasscom enjoys in the government in all ministries from the PMO to telecom, industry, commerce and finance is amazing," says Amit Mitra. One achievement of Nasscom, and of Mehta in particular, is in converting the IT ministry into a valuable ally within the government, rather than an adversary. In fact, when the ministry was created, most people within the IT industry had said: "We have grown because we did not have any government interference. Now why create a ministry to spoil the sport?" Today Dewang and Pramod Mahajan have developed close ties, leading to easy access within the government for Nasscom. The friendship has drawn jealousy among some in the industry, more so when Mahajan has half jokingly begun introducing Dewang as the minister of state for IT. Perhaps it has fuelled Dewang's political ambitions as well. It certainly led Dewang to talk more of 'nation-building' and less of software. His Website says that he intends to contest the next Parliamentary elections. However, it is interesting to note that Pramod Mahajan had not even met Dewang Mehta till a year back. It is another proof of Dewang's people skills that software pioneer F.C. Kohli talks about. "Dewang is very hardworking, dedicated, has integrity, but most importantly he connects with people," says Kohli. "He has political ambitions but within Nasscom, he does not play politics."
Nasscom has taken up two serious projects as part of its mission. One is revitalising the Indian technical and engineering education to provide a high quantity of high-quality engineers to achieve export goals of $50 billion. This is a major initiative and creating a separate industry fund for this purpose is also being considered. The initiative will obviously be welcomed, as it will have far deeper significance than just munificence of some successful NRIs in regard to their alma maters. "There is serious discussion going on among us on how to raise the standards of the 43 regional engineering colleges to those of IITS," says Dewang. Narayana Murthy's speech in the Nasscom Industry Leadership series during the recently concluded Nasscom 2001 conference was in fact devoted to education.
The other initiative is directed towards making IT a part of common man's life, and introducing IT in governance and in education in a big way. This will mean for example; increasing use of IT in the RTOs for vehicle registration, land records, income tax, customs, municipal taxes, courts, and several other departments that interface with the public. This will obviously remove to a great extent the scourge of touts and agents and make the process more transparent and remotely operable from Internet kiosks without the necessity of visiting faraway government offices and queuing outside them. The use of Internet and video conferencing can bring a lecture by an IIT professor or a scientist to every school and college thereby bridging the divide and using scarce educational resources more intelligently.
However all these require time spent in championing them and demonstrating prototypes and so on, which Nasscom can effectively do. Besides modernising a large part of common man's life, it will also create a major market for software services within the country.
This is not to say that Nasscom does not have dissent among its leading lights. Without open and self-critical views, any such organisation is likely to go to seed. For example, past chairmen of Nasscom, Saurabh Srivastava (chairman of IIS infotech) and Harish Mehta (CEO of Onward Novell) are sounding cautionary notes. "Nasscom must save itself from becoming a victim of its own success. The accomplishments of the past have led to some sectors having unrealistic expectations from Nasscom, many of which are not in its purview at all. Nasscom cannot resolve systemic problems that plague the Indian economy as a whole. Nasscom would be doing a disservice to itself by diluting focus from its core agenda. We must learn and practice the art of saying 'No' when faced with such demands," says Harish Mehta.
However, Dewang is unfazed by dissent. "I have learnt much from Tarun Das (Director-General, CII) and Amit Mitra, who are handling complex issues and large organisations like CII and Ficci with contradictory pulls. Within Nasscom we have openness and I operate within the mandate given by my executive council. If I trespass it anytime I am, of course, open to criticism," says Dewang.
One major challenge facing the IT industry is the new phenomenon of startups, many of which are involved in products rather than services. Will Nasscom, dominated entirely by the service companies, be able to nurture them as well? "Our membership grew by 200, a hefty 33 per cent in one year. Obviously, most of them are startups. We have started incubation networking within Nasscom and will give them all assistance. In fact, in the projected $50-billion target we expect nearly 20-30 per cent to come from product exports. While large established companies will contribute to it, a lot is expected from the startups," replies Dewang.
When the going is good it is easy to do well but as competition from other countries builds up and as the US economy goes through a trough the task gets more challenging. Clearly Nasscom's work is cut out:
• Continued marketing of the "India story". Focusing on CIOs of the other 70 per cent of Fortune 1000 who are not outsourcing from India.
• Organising more focused marketing on specific skills in Indian companies in Internet enabling brick and mortar companies (e-biz), software skills in communications, optical networking, embedded software, and wireless technologies.
• Participating in new educational initiatives for upgrading quantity and quality of IT manpower in India.
• Dealing with the slowdown in the US economy and turn the adversity into an opportunity.
Dewang and Nasscom's immediate agenda is:
• Open 10 offices in India in 2001, Mumbai, Bangalore, Hyderabad, Chennai, Pune, Ahmedabad, Chandigarh, Lucknow, Kolkata and Jaipur.
• International offices in Geneva, London, Tokyo, Washington DC, San Jose, and Sophie Antapolis (France) during 2001 and 2002.
• NICE: A National Internet Center of Excellence, nucleated by Nasscom, to promote the Internet in local languages, for creating standards for content building and delivery, and researching new technologies.
• NISG: National Institute of Smart Governance to promote e-Governance (in association with the Government of India).
• Disaster Management Task Force:
Nasscom will help create the IT infrastructure for disaster-prone areas of India. This is a reaction to the earthquake disaster in Gujarat.
• Work with Civil Aviation ministry to convert airports in Hyderabad, Bangalore, Ahmedabad, and Pune into international airports so that global movement of IT professionals becomes less of a pain.
Personalities aside, growth and particularly fast growth, brings its own problems. A course correction is required from time to time, be it an organisation or an individual. Interpersonal problems can exist in any organisation, whether it's of the old economy or the New Economy or even a housing cooperative society. What's central is that a dynamic industry is created, which can bring great wealth and skills to India. This has charged up a sleeping nation, continuously wallowing in sectarianism and wasted opportunities. It has made the ideas to-riches story a reality rather than a Grimm's fairy tale. Its 50 per cent plus growth brings new problems of management within the components as well as within industry bodies like Nasscom. As long as it operates transparently, it can make mistakes and recover from them. It is, after all, a living organism and only dead organisms remain static, with no problems. The $50-billion pot of gold is the reward for Nasscom's continuing efforts.
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India's Technology Leaders
Business India, July 4-17, 1994
Leaders in Technology
By and large the Indian corporate sector showed little ability to cope with technology development during the Licence Raj. However, less than a dozen companies have achieved technological excellence that is being globally recognized. The investment in technology development by these ‘techies’ is now paying off.
Shivanand Kanavi
Corporate success worldwide has long been fuelled by technology. But since the 1970s, it has become even more crucial as several technology –strong newcomers hit pay dirt and became mega players in the global marketplace. These companies, called ‘techies’ by Wall Street analysts, are being regularly tracked.
However, the important questions for us are: Does India have its own ‘techies’? If yes, who are they? What has lent them the drive to succeed and who are the people who head them?
Some people feel that these questions are irrelevant at present. They argue that the overwhelming atmosphere for four decades after independence has been that of licensed production in a protected market. Indian businessmen have shown an inability to cope with technology development and have largely used their R&D divisions for tax benefits. So, under the circumstances, how can a technology-driven company emerge, they ask.
Does that mean we have to wait another couple of decades to see technological excellence in some Indian companies? Well, yes and no. Though we don't have a Bill Gates or a Seymour Cray in India as yet, there area a handful of examples of technological excellence in the middle level who are being globally recognised.
This handful of Indian techies that we short listed are clear winners within restricted parameters. They shown farsightedness in either developing their own manufacturing technologies (as in the case of agrochemical and bulk drug companies) or in buying it, mastering it and developing it further, thereby acquiring the know-why (as in engineering). As a result, now when the Indian economy is being thrown open to competition, these companies are more ready than others to take on new challenges.
A feature common to all these leaders in technology was that they are led by men who are themselves technologists or those with tech vision- like Dr. Gharda, Dr Parvinder Singh, Dr. Hamied, Dr. Anji Reddy, Desh Bandhu Gupta, Ravindra Reddy, etc. Surprisingly, the large companies in the corporate sector- Reliance, ITC, ACC, Grasim and Hindustan Lever- have done hardly any technology development compared to their resources and scale of operations. One of the many reasons they do not feature on the shortlist. Their success, according to Business India, is largely due to good financial management, economies of scale, marketing, and technology scouting for initial buying.
The only exceptions to this large-company rule are Telco, BHEL and L&T. Even here, though they are no doubt technology –driven companies, one has to tread with caution. For, most of them are multi-product and multi-plant companies, where technology leadership, it does exist, is uneven; and the impact of a particular innovation on the overall company or industry becomes difficult to evaluate. Thus, L&T may be doing brilliant work in terms of heavy fabrication for the nuclear and space programmes, or petrochemicals but the other sections, like cement, are far from technologically superior. By and large, however, the need to be proactive, ready to experiment and take risks, which are essential for technology leadership, are sorely lacking in the large companies.
Surprisingly the techies do not consist of idiosyncratic geniuses but rather dynamic engineers, technologists and R&D personnel who exhibit good market savvy and are incredibly self-assured. Most of the personnel in these companies enjoy the challenges of the job, love the atmosphere of relative autonomy, the elbowroom to experiment and the opportunity to learn from mistakes. And, finally, they live to see their ideas or innovations actually move from lab into production and get a charge out of competing with like-minded individuals in the marketplace. Obviously, in the world of the technology-driven, the intellectual challenge is everything.
So, which are these centres of technological excellence among our midst? What makes them tick? This is what Business India found out..
Agrochemicals
This is a sector that has seen a number of Indian companies coming out with innovative processes and successfully competing with multinationals, both in the domestic and international markets. Gharda Chemicals, Excel Industries, United Phosphorus, Lupin, have all done very well by becoming major players in technical grade agrochemicals, that is, pure agrochemical concentrate that is later diluted using various solvents and sold in the retail market. But even among this pack, one company stands out as a real techy: Gharda Chemicals:
Gharda Chemicals
Perhaps, the incident that , best sums up Dr Keki Gharda, the leader of Gharda Chemicals, is illustrated by a story that has become part of Indian chemical industry folklore. In the early 1980s, Dr Gharda was invited to an MRTP commission hearing which revolved around a multinational's application for a licence to produce isoproturon. Some Indian companies objected to the application for fear that they would not be able to compete. But Dr Gharda, alone, was of the opinion that there was nothing superior about the multinational's technology. To prove his point, he declared that his company would introduce a new, more efficient process within 18 months and compete with the multinational.
Most of the people who comprised the stunned audience that day would not have imagined that Gharda would be able to pull it off. But he did. True to his words, Gharda realised the danger of using the highly toxic isocyanate route in making pesticides, and came out with a process to produce isoproturon, using urea. Today, he is the second largest producer of isoproturon in the world with large exports to Europe, US and the Far East. The superiority of Gharda's process, which is today internationally known as the ‘Indian process', made even Rhone Poulenc, the European giant which had a monopoly in isoproturon earlier, sweat.
Since then, Gharda Chemicals has become the leading Indian company in technical grade agrochemicals. Cypermethrin - a popular insecticide; cypermethric acid chloride - an intermediate for cypermethrin; anilophos - a herbicide used, for rice, originally discovered by Hoechst though it now uses Gharda's process; chlorpyrifos- a new generation insecticide; and napropamide -- another herbicide, have all made Gharda a power to reckon with in the global agrochemical scene. In the last three years, a number of international agrochemical magazines have written about Gharda and even put him on their cover.
Gharda Chemcals started as a three –men-in- a-garage operation in the late 1960s, in Santacruz, a suburb of Bombay. Dr. Keki Gharda who had returned from the US after PhD in Chemical Engineering from the University of Michigan, Ann Arbor, joined the faculty of University Department of Chemical Technology (UDCT), Bombay. However, he could not get a permanent teaching position and he turned instead to industry.
His first success, in the field o dyestuffs, came fast. He synthesized pthalogen blue, a dye that was very popular in the textile industry but had to be imported from Germany. Later azo-dyes provided the bread and butter. However, with the tremendous proliferation of process technology in the small-scale sector, dyestuff manufacturing was no longer as attractive, so Gharda changed course midstream into agro-chemicals.
This time it was not as easy. The early 1980s, the years of transition, were difficult. As a plant engineer in Gharda’s Lote factory remarked, “In those days we were literally living hand to mouth. But unlike other industrialists, Dr. Gharda did not retrench any of the R&D staff. The later years vindicated his visionary faith in in-house R&D”.
That vision has helped him to move with the times. When quality and purity export markets of Europe, Gharda changed tack too. Today, his analytical lab is not only top class but has made a number of original contributions: half a dozen of them (in Fourier Transform Infra Red spectroscopy and in High Pressure Liquid Chromatography) have become part of international standards.
Today, Gharda is going through another round of diversification into bulk: drugs and engineering plastics. But why get into bulk drugs when there are so many players already? "While the Indian' bulk drug industry is strong in organic synthesis, they are not so strong in chemical engineering," answers Gharda. “With our strength in both, we will be ore efficient.” Typically, they are building plants for products that are yet to come out of their R&D.
But this confidence has got him his fair share of detractors. “He is and eccentric,” says an indignant major player in bulk drug manufacture. “He wants to spoil the bulk drug market by driving down the prices.” His anger is partly fuelled by the not-so-polite letter he received from Dr. Gharda, which categorically stated that since Gharda Chemicals is going to enter the bulk drugs market in fluroquinolones at a lower price, the existing competitors might as well quit!
Therein lies the essence of the man. Variously described in the industry as a missionary, a Gandhian, an eccentric, and a spoilsport, he has nevertheless always approached the market in his own unique manner. His strategy is to come out with new products at prices that are at least 20-30 per cent lower than the prevailing ones and hold them at that level for years. Aside from driving the competition out of the market, it even makes giant multinationals wary of him. Perhaps one of the reasons why, today, some of them are queuing up to tie up with him.
And he lives by his own rules. For examples, though he has received many awards for novel processes, he has not patented any. He believes that the superiority of technology should be decided in the marketplace rather than in court rooms. He also shies away from breaking up the manufacturing process into a number of stages and carrying these out in different plants to guard hi trade secrets, as most of his competitors do. “This will lead to the right hand not knowing what the left is doing. And you would lose the team spirit where you troubleshoot together and learn from each other” he says. “The name of the game is to come up with newer and better processes and products through R&D and always stay a step ahead of the competition.”
Which he has done. Gharda’s turnover in 1993-94 is Rs 170 crore; exports: Rs30 crore, but with the smooth functioning of the new cypermethric acid chloride and alphamethrin plants at Lote, the 1994-95 results are expected to show at least a 30 per cent growth. Already the profit before depreciation and tax is a hefty Rs45 crore, i.e. 26.5 per cent. Despite the fact that Gharda is not into formulation and retail marketing in a big way, we believe that it will become a diversified Rs 1000-crore-plus company by 2000AD
Pharmaceuticals
Off all the sectors that have seen growth, the pharmaceuticals sector is probably the most dramatic. In 1947, the total size of the Indian pharmaceutical market was about Rs10 crore. Today, pharmaceutical production in India exceeds Rs7,000 crore and exports exceed Rs2,000 crore. Moreover, although it was controlled by the multinationals till the end of the 1960s, today Indian manufacturers of bulk drugs and formulations dominate the market. And companies like Ranbaxy, Lupin, Dr.Reddy’s Laboratories and CIPLA are dreaming of becoming billion dollar companies by the year 2000 AD.
There is a common misconception that this fantastic growth has been due to stealing patented technology from the West, for the Indian Patent Act of 1970 recognises only process, not product patents. But the fact is that hardly 5per cent of the Rs2,000 crore exports are covered by product patents. The rest are off-patent drugs and, hence, we are competing in the open market with original discoverers, thereby proving the more efficient nature of our processes and manufacturing costs.
Today there are nearly 800 bulk drug manufacturers in India. Some of them are being wooed by multinationals for tie-ups involving manufacture, marketing and even joint research. Market research has shown that a large number of high selling antibiotics and cardiovascular drugs are going off-patent in the next two years. There is also a growing shift towards generic drugs in the North American market. All of which are contributing to tremendous bullishness in the industry.
Initially, most of the Indian drug manufacturers were opposed to India accepting the Paris convention on patents. But finally, recognising its acceptance as inevitable if India wants to globalise, they quickly readjusted their strategies and started exploring opportunities to grow in the global market. Ranbaxy and Dr Reddy's Laboratories have already started a nascent programme of original research into new drug molecules and Lupin plans to follow. The idea is to manipulate the molecular structure of known drugs and come out with 'me too' drugs. Later, hopefully,' path-breaking ones can follow. This is much the same route that the Japanese drug industry took in the last two decades, and the chances of success seem bright.
Ranbaxy Laboratories Ltd.
Overstressed executives might remember Ranbaxy through the popular stress reliever Calmpose. But Ranbaxy, itself, hit big time with Cefaclor. Cefaclor is today one of the largest-selling antibiotics with over a billion dollars worth of sales and one of the top ten drugs in the global market. This advanced cephalosporin, however, is a challenge to any organic chemist trying to synthesize it. According to Desh Bandhu Gupta of Lupin, the problems are compounded by the fact that the discoverer, American giant Eli Lily, made life difficult for potential competitors by patenting various intermediates as 'time bombs' that go off when you reach that stage through synthesis.
Which is why, when Ranbaxy developed their own process technology for Cefaclor and patented it in the us, they not only won a lucrative market and a number of awards in India but made a name for themselves in the pharmaceutical world. A by-product of this success is the tie-up between Eli Lily (1991-92 turnover more than $4 billion) and Ranbaxy, for a joint venture and for joint research and development.
Today, Ranbaxy is buzzing with activity. In its swank R&D centre in Gurgaon, Dr Himadri Sen, who has two decades of experience in the international pharmaceutical industry, and his group are working on novel drug delivery systems and have already come out with some controlled release products and effervescent products. Sen firmly believes that there is still a lot of juice left in the already-discovered drugs, the key is to find effective and more user-friendly ways of administering them.
The bio-technology group, led by Dr K. Kannan, a leading protein chemist, is working on developing diagnostics for hepatitis, blood grouping, pregnancy and AIDS. They are also working on vaccines. The most exciting work, however, is in stem cell-based therapy that could prove a god-send for leukemia, bone marrow transplants and may even be advantageous to the treatment of AIDS. Kannan has done pioneering fundamental work in stem cell haematology, which he is trying to develop into tangible applications.
Dr Sood, who heads the pharmaceutical research, is expecting early results in new molecular research as well. To start with, they have taken the clever route of buying five biological lead molecules and are busy testing them. Information technology is playing a major role in new molecular research by allowing instant patent search hooking into global databases; that way the team can be sure that it is not working on a molecule that was patented only last week.
Ranbaxy has already spent over Rs30 crore on its R&D centre and plans to spend more in the coming years. Dr J.M. Khanna, executive director, who heads R&D, is scouting Europe and North America for further recruits. Everyone you meet in Ranbaxy seems to parrot the goal Dr Parvinder Singh, CMD, has set for the company 'to become a research-driven global pharmaceutical company'. And they seem to be well on their way to achieving it. With a 1993-94 turnover of Rs593 crore and exports of Rs226 crore, Ranbaxy already has joint ventures for manufacture in Canada, China, Malaysia and Nigeria, and is negotiating marketing tie-ups in North America. If all goes as planned, in another two years it may well cross the Rs1000 crore turnover mark.
Lupin
Any other company faced with the same challenge might have refused to pick up the gauntlet. But Lupin decided to take up the manufacture of Vitamin B-6, one of the first technology successes for which it won awards.
Vitamin B-6 has a complex 12-stage process where some of the intermediates are unstable. Dr. A.V. Ramarao, when he was at NCL, took up the challenge amidst much scepticism from peers and came out with the process. The next major question immediately arose: Was there anyone ready to invest crores in this process, which was as yet unproven on a plant scale? Lupin took the risk and mastered this complex technology. Now, they are doubling their Vitamin B-6 capacity.
Lupin Laboratories (1993-94 turnover Rs510 crore, exports Rs100 crore) definitely seems to have arrived. It is now aiming to reach a billion dollar turnover in the highly competitive international pharmaceutical market in four years! Sounds ambitious. However, if we look carefully at the achievements and strategy of this company started by Desh Bandhu Gupta, a chemistry professor, with an initial investment of Rs5,000 in 1968, it does not seem far-fetched. While DBji as he is fondly called in Lupin is obviously a smart businessman he is also a man with tech-vision. Right now, he is firming up his plans for a world class R&D centre with an investment of Rs 100 crore and 250 to 300 personnel in the next few years.
Today, Lupin is known for its successes in basically three fields. The anti- TB drug ethambutol, of which they are the world leaders producing 60 per cent of the global production, the antibiotic rifampicin and the cephalosporins. Their ethambutol process is so efficient that even the original discoverer, Lederle, is buying the bulk drug from Lupin. The company has also gone into cardiovascular drugs that are going off patent.
In addition, the recent breakthrough made in stabilising their Rs80-crore plant devoted to fermentation products will put them ahead of the rest.
Herbal medicine for export markets is another of Lupin's ventures. Its latest venture is making herbal dressings that heal cuts without needing sutures and without leaving a scar, developed by an Indian, Dr Harbada.
Now, the several strands in Desh Bandhu Gupta's net seem to be meshing with greater cohesiveness. Lupin already has a bulk drug joint venture in Thailand and is planning more in North America, Europe and the Central Asian Republics of CIS. With drugs that sell more than $20 billion going off-patent by 2000 AD, Gupta is confident of achieving his ambition of becoming a billion dollar company by that time.
Dr Reddy's Laboratories
Dr Anji Reddy thanks Ethyl Corp, USA, a petrochemical giant, for making him famous. In 1990, Ethyl Corp accused one of Dr Reddy's companies, Cheminor, of dumping the popular analgesic, ibuprofen, in the US market. In the drama that unfolded in the hearings before the US Department of Commerce and the International trade Council, Dr Reddy proved that his prices were lower because his technology was better. As a result, the antidumping moves were dropped.
Reddy a product of UDCT and NCL, learnt the basics of bulk drug manufacturing in the public sector IDPL. From a modest turnover of Rsl.5 crore, in 1985, his group has crossed Rs300 crore in 1993-94. Now, DRL is setting up joint ventures in Russia and the Middle East.
Investing over Rs10 crore, Reddy has set up Dr Reddy's Research Foundation, (DRF) as an independent unit to develop his R&D muscle. Today, DRL can develop organic synthesis and even commercialise a process faster than anyone else in the world. There have been cases where DRL'S office in New Jersey, has faxed an order for samples of a particular molecule, along with its molecular structure and purity specifications, and the group has delivered it in three weeks. Fast work by any standards!
DRL'S current plans are ambitious: it is now developing a programme for new drug molecules, of which they hope to patent a few within a year. Their programme consists of computer-aided molecular modelling, drug designing and research in plant products.
According to Prof V.M. Kulkarni at UDCT, computer-aided, drug designing considerably reduces the time factor in obtaining the lead molecules, avoiding trial and error.
As proof of Dr Reddy's ambitious plans globalisation, today Izvestia carries as many ads of DRL as any Indian newspaper. This company, too, will hit Rs1000-crore-plus by 2000 AD.
CIPLA
The stock market heard of CIPLA when its share hit an astronomical Rs35,000 this year. What most people don't know, however, is that, CIPLA has long been a leader in anti-cancer and anti-asthma drugs and has very popular brands in fluoroquinolones and antibiotics. But what distinguishes it is its penchant for producing high value, low volume products. Some of its specialised products cost about $1,000 a gram!
One of its major triumphs was the commercialisation of the extraction of vinblastine from vinca rosea leaves, which was then converted to vincristine - a popular anticancer drug throughout the world. Earlier, Indians used to export the dried leaves of vinca rosea and Eli Lily, US, used to make vincristine out of them. The capsules, containing one thousandth of a gram of vincristine sulphate, were sold in India for Rs80each.
CIPLA scaled up the known, but difficult process of extracting the alkaloid vinblastine from vinca rosea, and then converting it to vincristine and produced a capsule that was sold at Rs25 only and even exported it abroad. Similarly, when the drug AZT, that stops the AIDS virus from multiplying, was discovered, Dr A.V. Ramarao, director, Indian Institute of Chemical Technology (IICT) and his team synthesised it and transferred the difficult technology to CIPLA. Today, CIPLA is the only producer of AZT besides the original discoverer.
If there is one company that consistently and stubbornly fought the Dunkel Draft till India signed the GAIT treaties in 1994, it is CIPLA. Dr Yusuf Hamied, MD, CIPLA still feels passionately about it. "The issue is not my company or even the industry; the issue is affordable healthcare for millions of Indian people," he says. Dr Hamied's concern is commendable considering that many in the drug industry changed tack midway.
Hamied is sceptical of new molecules being introduced by Indian companies. He says "Our undoubted strengths are in organic chemistry but our infrastructure in biological research is hardly world class." He is getting a number of offers for joint ventures and research tie-ups from Europe and is going global like the rest of the pack.
ENGINEERING
Engineering is a field where considerable activity is customized. Here, incremental innovation, design and analytical skills, concurrent engineering, and a constantly learning manpower, that takes each new job as a challenge, help build up competitive advantage. Three companies stand out in this: MTAR, BHEL and L&T.
An interesting common denominator for all the three companies, is their participation in the nuclear and space programmes. Through this they learnt new technologies of high precision machining, zero defect welding and varied non-destructive testing techniques. They have also learnt careful documentation of each stage of manufacturing leading to traceability of failure. Since each job was a challenge, their engineers were kept constantly on their toes leading to a high level of motivation. Now, they have reached a stage where besides meeting the quality standards of aerospace and nuclear programmes, they can also meet highly competitive delivery cycles and cut manufacturing costs.
MTAR
If there is one thing that characterizes Machine Tools Aids and Reconditioning (MTAR) it is their ‘can do’ attitude. Set up by ex-HMT engineer, Ravindra Reddy, MTAR, Hyderabad, is probably the largest partnership company in the south (1993-94 turnover: over Rs20 crore). In less than a decade, Reddy built up an impressive stable of more than a hundred precision tools. Recognising Reddy's capabilities the Department of Space invited him to be on the board of Antrix Corp, India's only company to market space technology globally.
MTAR's achievements include the manufacture of critical components for Pressurised Heavy Water Reactors of Nuclear Power Corporation (NPC), nuclear fuelling machines, critical components for Fast Breeder Test Reactor at Indira Gandhi Centre for Atomic Research, and the prestigious liquid fuelled rocket engine Vikas for the Polar Satellite Launch Vehicle and the Geostationary Satellite Launch Vehicle.
Another first by MTAR is the capability to manufacture world-class ball screws, varying in length from half a metre to over five metres. These ball screws are essential for any high-speed motion and are thus the mechanical heart of aircraft controls, machine tools, CNC machines, and industrial robots.
Such is the confidence of Dr Ravindra Reddy in his team that he says: "If ISRO solves all the material science problems involved in operation at -250°c, a temperature at which most metals and alloys crumble, then we guarantee that we will provide the engineering back up and deliver the cryogenic engine,"
BHEL
BHEL is synonymous with power in India. "This public sector giant with manufacturing plants at Hardwar, Trichy,
Hyderabad, Bhopal, Jhansi and Bangalore has built hydro power stations, thermal power stations, gas turbine-based
power stations and has been the single nuclear manufacturer. With its turnkey capabilities, it has joined the elite dozen powerhouses in the world such as General Electric and Siemens.
It has developed the most comprehensive welding capabilities in Trichy making it one of the best manufacturers in the world of large capacity boilers for power production, and industrial processes, besides nuclear reactor vessels, and heat recovery systems. Though they bought the technology from an assortment of companies all over the world, BHEL's strength lies in assimilating it and developing the 'know why' leading to appropriate design changes and developments.
It is the same 'know why' that has led them to develop the technology suitable for high ash coal. India, poor as it is in fossil fuel resources, has one fuel in abundance that will last another 50 years: coal. However, Indian coal has its own peculiarities- it has very low sulphur, making it cleaner in terms of sulphur dioxide emissions, but on the negative side it has low calorific value and high ash content. BHEL thus produced fluidised bed boilers that can very efficiently bum high ash coal, lignite, rice husk, bagasse and other agricultural wastes, literally anything.
In addition, they have developed specialised R&D strengths and designed appropriate conventional boilers for Indian coal. One important development is the large tower type boilers (almost twenty storey high) for 210 MW power stations. The novel design is easier to erect and fabricate there by reducing delivery times.
Direct ignition of pulverised coal (DIPC) developed by BHEL's R&D leads to considerable saving of oil in thermal power stations. If all thermal power stations in India were to use this technology then Rs.1 ,000 crore could be saved annually.
BHEL has also put its thorough understanding of power systems to good use by making the appropriate changes to extend the life of old thermal plants. This requires complex computer simulation, stress, creep and fracture analysis of materials, on-line data analysis, and is a growing area of business for them. Soon this should contribute at least Rs.100crore annually to their revenue. Thus, an old plant running at say a 30 per cent plant load factor (PLF), can be run at a much higher PLF. The additional mega wattage is obtained at a cost of Rs 1 crore per megawatt only, a Godsend to energy and capital-starved power infrastructure.
BHEL's technology strength is reflected in the fact that the German giant, KWU which supplied it the gas turbine technology has itself placed orders for three gas turbines of 60 MW each; Reliance,- well-known for its technology scouting capabilities, has placed orders for two combined cycle gas turbine generators for its Hazira petrochemical project; and Malaysia has repeatedly placed orders for gas turbines and thermal power stations. All these have been won amidst stiff international competition.
That is why despite high overheads like its 74,000-strong work force, large townships, etc, BHEL truly has the potential to emerge as an international engineering giant.
L&T
This multi-product company that is into switch gears, cement, electronics, construction and heavy engineering is familiar to many for its board room intrigues in the last five years. But only a small number of people know the technology and engineering strengths in its heavy engineering division.
L&T became a hi-tech, heavy engineering company through its association with the nuclear programme. Prior to the 1970’s they were making some small cement plant and dairy equipment. Fabrications were of the order of about five tonnes. Now, in their Hazira plant, they can fabricate equipment weighing 450 tonnes or more. Thus, while orders have dried up from the nuclear programme, the expertise in engineering, design, analysis and simulation are being built upon to take on bigger challenges.
The thrust of L&T'S effort in heavy engineering is to be recognised as a turnkey Engineering Project Contractor - the coveted goal of any heavy engineering firm globally.
Metallurgy
Mukand
In ferrous metallurgy, basic process technology evolves slowly and gets accepted even more -slowly. Everyone, it seems, wants proven technology rather than taking risks with new ones. The large investments required naturally make one extremely cautious, if not downright conservative. However, Mukand's CMD, Viren Shah, took the plunge and made the bold decision of going for continuous casting technology. Today, the technology is common. But the fact remains that in the late 1960s only two plants in the world had opted for it, though technically it was clear that continuous casting would be more efficient. The third plant to adopt this technology in the world and the first in Asia, including Japan, was Mukand.
Mukand has been a pioneer in more ways than one. In steel refining technology, too, Rourkela Steel Plant and Mukand were pioneers, going for the new top and bottom oxygen-blowing process. Today, all over the world this technology has become the standard in refining.
Mukand's main product line is high quality wire rods. Their R&D team led by Dr R.H.G. Rao, vice-president, technical, has been improving the quality of wire rods while reducing the cost of production. Wire rods that are mainly used by the fastener industry for cold heading need to have special qualities which can only be achieved through advanced refining techniques.
With the upturn in the automobile industry, Mukand's sales have picked up considerably in 1994. It is also developing leaded steels required by the automobile industry. In ferrous metallurgy Mukand is definitely a company to watch.
Aerospace
Antrix Corp
While we have not much to show in aircrafts we have some thing to show in space. Our remote sensing satellite's and communication satellites are world class products. So the Department of Space of the Government of India set up Antrix Corporation to globally market India's space technology. The tie up between Antrix Corp and Eosat US, for distributing Indian remote sensing data in the highly competitive North American market has hit the headlines recently.
N. Sampath, executive director, Antrix Corp, says, "Liquid nitrogen costs in India are high and we need about a million litres of it to test a satellite in the space simulation chamber. Though component costs are much higher in India, still it works out cheaper to fabricate satellites here rather than in the US or Europe by 20-30 per cent. For I can get highly skilled MTechs and PhDs to do the job at less than 10 per cent of their cost in the US or Europe."
However, international competition in the satellite market has become cut-throat. More than 50 per cent of the satellite market used to be in the military sector which has been drastically reduced. So all the biggies like Hughes, Martin Marietta (GE), Loral Aerospace (Ford), and others are aiming at the civilian market. Though Antrix, on its own, stands little chance of getting any orders in the global market, Loral wants to tie up with it and this should stand the company in good stead.
This fledgling hi-tech company can really hit it big in the future. As a communication revolution sweeps over India in the next five to ten years, there will be a big demand for communication satellites for TV and telecom. At that time, no doubt, Antrix will come into its own.
Automobiles
Telco (Now Tata Motors)
Is there someone out there who can give Maruti a run for their money? We think Telco has the potential not only to do that but even to enter the global car market. One other plus point in favour of Telco: it has an R&D facility that does not even exist in Maruti.
The visionary behind this was undoubtedly its former chairman, the late Sumant Mulgaokar. The first all-new Telco product was the Tata 407, introduced in 1985. It was conceived, designed, developed and productionised in 18 months flat to take on the just-introduced Indo-Japanese light commercial vehicles (LCVS). Today, Telco has over a 50 per cent share of the LCV market.
Amongst all Indian automobile companies, Telco's ERC is, by far, the largest R&D set-up, employing over 800 highly qualified engineers and designers. Headed by R&D general manager, S.K. Shome, its employees and equipment rank amongst the best in the world. A full-fledged, 98-terminal IBM RS/6000 CAD system costing nearly Rs.80 crore helps Telco generate concept proposals through to wire-frame diagrams, designing the inner skins, analysing structural integrity, generating cross-sectional views and defining the templates required to make the, final mock-up.
All sophisticated equipment, however, is quite meaningless without the right people handling it. Telco's resident director, V.M. Rawal, points out: "Technology is of no use if you don't have good people. It's the dedication of the people that really matters. The sophisticated Rambaudi machine was being put to use in two weeks flat, with
no special, training programme. It was taken up as a challenge." At the same time, Telco is not trying to reinvent the wheel. After developing the engine and the body design, for fine tuning them they are using the state-of-the-art services of the likes of International Automotive Design, UK, and AVL, Austria.
In conclusion, our techies may not be at the cutting edge of technology but all of them have used the Indian strengths in knowledge engineering and that too in an atmosphere that did not call for it. Thus they stand out for their farsightedness.-
N. Vaghul, chairman, ICICI is optimistic of the future. "The real industrialisation has started only now. Every businessman I meet nowadays, small or big, talks of technology and is aware that without technology he will be sunk," he, says. If these words are really a prophecy of things to come, we'll be seeing a lot more of the Indian 'techies' from now on.
Leaders in Technology
By and large the Indian corporate sector showed little ability to cope with technology development during the Licence Raj. However, less than a dozen companies have achieved technological excellence that is being globally recognized. The investment in technology development by these ‘techies’ is now paying off.
Shivanand Kanavi
Corporate success worldwide has long been fuelled by technology. But since the 1970s, it has become even more crucial as several technology –strong newcomers hit pay dirt and became mega players in the global marketplace. These companies, called ‘techies’ by Wall Street analysts, are being regularly tracked.
However, the important questions for us are: Does India have its own ‘techies’? If yes, who are they? What has lent them the drive to succeed and who are the people who head them?
Some people feel that these questions are irrelevant at present. They argue that the overwhelming atmosphere for four decades after independence has been that of licensed production in a protected market. Indian businessmen have shown an inability to cope with technology development and have largely used their R&D divisions for tax benefits. So, under the circumstances, how can a technology-driven company emerge, they ask.
Does that mean we have to wait another couple of decades to see technological excellence in some Indian companies? Well, yes and no. Though we don't have a Bill Gates or a Seymour Cray in India as yet, there area a handful of examples of technological excellence in the middle level who are being globally recognised.
This handful of Indian techies that we short listed are clear winners within restricted parameters. They shown farsightedness in either developing their own manufacturing technologies (as in the case of agrochemical and bulk drug companies) or in buying it, mastering it and developing it further, thereby acquiring the know-why (as in engineering). As a result, now when the Indian economy is being thrown open to competition, these companies are more ready than others to take on new challenges.
A feature common to all these leaders in technology was that they are led by men who are themselves technologists or those with tech vision- like Dr. Gharda, Dr Parvinder Singh, Dr. Hamied, Dr. Anji Reddy, Desh Bandhu Gupta, Ravindra Reddy, etc. Surprisingly, the large companies in the corporate sector- Reliance, ITC, ACC, Grasim and Hindustan Lever- have done hardly any technology development compared to their resources and scale of operations. One of the many reasons they do not feature on the shortlist. Their success, according to Business India, is largely due to good financial management, economies of scale, marketing, and technology scouting for initial buying.
The only exceptions to this large-company rule are Telco, BHEL and L&T. Even here, though they are no doubt technology –driven companies, one has to tread with caution. For, most of them are multi-product and multi-plant companies, where technology leadership, it does exist, is uneven; and the impact of a particular innovation on the overall company or industry becomes difficult to evaluate. Thus, L&T may be doing brilliant work in terms of heavy fabrication for the nuclear and space programmes, or petrochemicals but the other sections, like cement, are far from technologically superior. By and large, however, the need to be proactive, ready to experiment and take risks, which are essential for technology leadership, are sorely lacking in the large companies.
Surprisingly the techies do not consist of idiosyncratic geniuses but rather dynamic engineers, technologists and R&D personnel who exhibit good market savvy and are incredibly self-assured. Most of the personnel in these companies enjoy the challenges of the job, love the atmosphere of relative autonomy, the elbowroom to experiment and the opportunity to learn from mistakes. And, finally, they live to see their ideas or innovations actually move from lab into production and get a charge out of competing with like-minded individuals in the marketplace. Obviously, in the world of the technology-driven, the intellectual challenge is everything.
So, which are these centres of technological excellence among our midst? What makes them tick? This is what Business India found out..
Agrochemicals
This is a sector that has seen a number of Indian companies coming out with innovative processes and successfully competing with multinationals, both in the domestic and international markets. Gharda Chemicals, Excel Industries, United Phosphorus, Lupin, have all done very well by becoming major players in technical grade agrochemicals, that is, pure agrochemical concentrate that is later diluted using various solvents and sold in the retail market. But even among this pack, one company stands out as a real techy: Gharda Chemicals:
Gharda Chemicals
Perhaps, the incident that , best sums up Dr Keki Gharda, the leader of Gharda Chemicals, is illustrated by a story that has become part of Indian chemical industry folklore. In the early 1980s, Dr Gharda was invited to an MRTP commission hearing which revolved around a multinational's application for a licence to produce isoproturon. Some Indian companies objected to the application for fear that they would not be able to compete. But Dr Gharda, alone, was of the opinion that there was nothing superior about the multinational's technology. To prove his point, he declared that his company would introduce a new, more efficient process within 18 months and compete with the multinational.
Most of the people who comprised the stunned audience that day would not have imagined that Gharda would be able to pull it off. But he did. True to his words, Gharda realised the danger of using the highly toxic isocyanate route in making pesticides, and came out with a process to produce isoproturon, using urea. Today, he is the second largest producer of isoproturon in the world with large exports to Europe, US and the Far East. The superiority of Gharda's process, which is today internationally known as the ‘Indian process', made even Rhone Poulenc, the European giant which had a monopoly in isoproturon earlier, sweat.
Since then, Gharda Chemicals has become the leading Indian company in technical grade agrochemicals. Cypermethrin - a popular insecticide; cypermethric acid chloride - an intermediate for cypermethrin; anilophos - a herbicide used, for rice, originally discovered by Hoechst though it now uses Gharda's process; chlorpyrifos- a new generation insecticide; and napropamide -- another herbicide, have all made Gharda a power to reckon with in the global agrochemical scene. In the last three years, a number of international agrochemical magazines have written about Gharda and even put him on their cover.
Gharda Chemcals started as a three –men-in- a-garage operation in the late 1960s, in Santacruz, a suburb of Bombay. Dr. Keki Gharda who had returned from the US after PhD in Chemical Engineering from the University of Michigan, Ann Arbor, joined the faculty of University Department of Chemical Technology (UDCT), Bombay. However, he could not get a permanent teaching position and he turned instead to industry.
His first success, in the field o dyestuffs, came fast. He synthesized pthalogen blue, a dye that was very popular in the textile industry but had to be imported from Germany. Later azo-dyes provided the bread and butter. However, with the tremendous proliferation of process technology in the small-scale sector, dyestuff manufacturing was no longer as attractive, so Gharda changed course midstream into agro-chemicals.
This time it was not as easy. The early 1980s, the years of transition, were difficult. As a plant engineer in Gharda’s Lote factory remarked, “In those days we were literally living hand to mouth. But unlike other industrialists, Dr. Gharda did not retrench any of the R&D staff. The later years vindicated his visionary faith in in-house R&D”.
That vision has helped him to move with the times. When quality and purity export markets of Europe, Gharda changed tack too. Today, his analytical lab is not only top class but has made a number of original contributions: half a dozen of them (in Fourier Transform Infra Red spectroscopy and in High Pressure Liquid Chromatography) have become part of international standards.
Today, Gharda is going through another round of diversification into bulk: drugs and engineering plastics. But why get into bulk drugs when there are so many players already? "While the Indian' bulk drug industry is strong in organic synthesis, they are not so strong in chemical engineering," answers Gharda. “With our strength in both, we will be ore efficient.” Typically, they are building plants for products that are yet to come out of their R&D.
But this confidence has got him his fair share of detractors. “He is and eccentric,” says an indignant major player in bulk drug manufacture. “He wants to spoil the bulk drug market by driving down the prices.” His anger is partly fuelled by the not-so-polite letter he received from Dr. Gharda, which categorically stated that since Gharda Chemicals is going to enter the bulk drugs market in fluroquinolones at a lower price, the existing competitors might as well quit!
Therein lies the essence of the man. Variously described in the industry as a missionary, a Gandhian, an eccentric, and a spoilsport, he has nevertheless always approached the market in his own unique manner. His strategy is to come out with new products at prices that are at least 20-30 per cent lower than the prevailing ones and hold them at that level for years. Aside from driving the competition out of the market, it even makes giant multinationals wary of him. Perhaps one of the reasons why, today, some of them are queuing up to tie up with him.
And he lives by his own rules. For examples, though he has received many awards for novel processes, he has not patented any. He believes that the superiority of technology should be decided in the marketplace rather than in court rooms. He also shies away from breaking up the manufacturing process into a number of stages and carrying these out in different plants to guard hi trade secrets, as most of his competitors do. “This will lead to the right hand not knowing what the left is doing. And you would lose the team spirit where you troubleshoot together and learn from each other” he says. “The name of the game is to come up with newer and better processes and products through R&D and always stay a step ahead of the competition.”
Which he has done. Gharda’s turnover in 1993-94 is Rs 170 crore; exports: Rs30 crore, but with the smooth functioning of the new cypermethric acid chloride and alphamethrin plants at Lote, the 1994-95 results are expected to show at least a 30 per cent growth. Already the profit before depreciation and tax is a hefty Rs45 crore, i.e. 26.5 per cent. Despite the fact that Gharda is not into formulation and retail marketing in a big way, we believe that it will become a diversified Rs 1000-crore-plus company by 2000AD
Pharmaceuticals
Off all the sectors that have seen growth, the pharmaceuticals sector is probably the most dramatic. In 1947, the total size of the Indian pharmaceutical market was about Rs10 crore. Today, pharmaceutical production in India exceeds Rs7,000 crore and exports exceed Rs2,000 crore. Moreover, although it was controlled by the multinationals till the end of the 1960s, today Indian manufacturers of bulk drugs and formulations dominate the market. And companies like Ranbaxy, Lupin, Dr.Reddy’s Laboratories and CIPLA are dreaming of becoming billion dollar companies by the year 2000 AD.
There is a common misconception that this fantastic growth has been due to stealing patented technology from the West, for the Indian Patent Act of 1970 recognises only process, not product patents. But the fact is that hardly 5per cent of the Rs2,000 crore exports are covered by product patents. The rest are off-patent drugs and, hence, we are competing in the open market with original discoverers, thereby proving the more efficient nature of our processes and manufacturing costs.
Today there are nearly 800 bulk drug manufacturers in India. Some of them are being wooed by multinationals for tie-ups involving manufacture, marketing and even joint research. Market research has shown that a large number of high selling antibiotics and cardiovascular drugs are going off-patent in the next two years. There is also a growing shift towards generic drugs in the North American market. All of which are contributing to tremendous bullishness in the industry.
Initially, most of the Indian drug manufacturers were opposed to India accepting the Paris convention on patents. But finally, recognising its acceptance as inevitable if India wants to globalise, they quickly readjusted their strategies and started exploring opportunities to grow in the global market. Ranbaxy and Dr Reddy's Laboratories have already started a nascent programme of original research into new drug molecules and Lupin plans to follow. The idea is to manipulate the molecular structure of known drugs and come out with 'me too' drugs. Later, hopefully,' path-breaking ones can follow. This is much the same route that the Japanese drug industry took in the last two decades, and the chances of success seem bright.
Ranbaxy Laboratories Ltd.
Overstressed executives might remember Ranbaxy through the popular stress reliever Calmpose. But Ranbaxy, itself, hit big time with Cefaclor. Cefaclor is today one of the largest-selling antibiotics with over a billion dollars worth of sales and one of the top ten drugs in the global market. This advanced cephalosporin, however, is a challenge to any organic chemist trying to synthesize it. According to Desh Bandhu Gupta of Lupin, the problems are compounded by the fact that the discoverer, American giant Eli Lily, made life difficult for potential competitors by patenting various intermediates as 'time bombs' that go off when you reach that stage through synthesis.
Which is why, when Ranbaxy developed their own process technology for Cefaclor and patented it in the us, they not only won a lucrative market and a number of awards in India but made a name for themselves in the pharmaceutical world. A by-product of this success is the tie-up between Eli Lily (1991-92 turnover more than $4 billion) and Ranbaxy, for a joint venture and for joint research and development.
Today, Ranbaxy is buzzing with activity. In its swank R&D centre in Gurgaon, Dr Himadri Sen, who has two decades of experience in the international pharmaceutical industry, and his group are working on novel drug delivery systems and have already come out with some controlled release products and effervescent products. Sen firmly believes that there is still a lot of juice left in the already-discovered drugs, the key is to find effective and more user-friendly ways of administering them.
The bio-technology group, led by Dr K. Kannan, a leading protein chemist, is working on developing diagnostics for hepatitis, blood grouping, pregnancy and AIDS. They are also working on vaccines. The most exciting work, however, is in stem cell-based therapy that could prove a god-send for leukemia, bone marrow transplants and may even be advantageous to the treatment of AIDS. Kannan has done pioneering fundamental work in stem cell haematology, which he is trying to develop into tangible applications.
Dr Sood, who heads the pharmaceutical research, is expecting early results in new molecular research as well. To start with, they have taken the clever route of buying five biological lead molecules and are busy testing them. Information technology is playing a major role in new molecular research by allowing instant patent search hooking into global databases; that way the team can be sure that it is not working on a molecule that was patented only last week.
Ranbaxy has already spent over Rs30 crore on its R&D centre and plans to spend more in the coming years. Dr J.M. Khanna, executive director, who heads R&D, is scouting Europe and North America for further recruits. Everyone you meet in Ranbaxy seems to parrot the goal Dr Parvinder Singh, CMD, has set for the company 'to become a research-driven global pharmaceutical company'. And they seem to be well on their way to achieving it. With a 1993-94 turnover of Rs593 crore and exports of Rs226 crore, Ranbaxy already has joint ventures for manufacture in Canada, China, Malaysia and Nigeria, and is negotiating marketing tie-ups in North America. If all goes as planned, in another two years it may well cross the Rs1000 crore turnover mark.
Lupin
Any other company faced with the same challenge might have refused to pick up the gauntlet. But Lupin decided to take up the manufacture of Vitamin B-6, one of the first technology successes for which it won awards.
Vitamin B-6 has a complex 12-stage process where some of the intermediates are unstable. Dr. A.V. Ramarao, when he was at NCL, took up the challenge amidst much scepticism from peers and came out with the process. The next major question immediately arose: Was there anyone ready to invest crores in this process, which was as yet unproven on a plant scale? Lupin took the risk and mastered this complex technology. Now, they are doubling their Vitamin B-6 capacity.
Lupin Laboratories (1993-94 turnover Rs510 crore, exports Rs100 crore) definitely seems to have arrived. It is now aiming to reach a billion dollar turnover in the highly competitive international pharmaceutical market in four years! Sounds ambitious. However, if we look carefully at the achievements and strategy of this company started by Desh Bandhu Gupta, a chemistry professor, with an initial investment of Rs5,000 in 1968, it does not seem far-fetched. While DBji as he is fondly called in Lupin is obviously a smart businessman he is also a man with tech-vision. Right now, he is firming up his plans for a world class R&D centre with an investment of Rs 100 crore and 250 to 300 personnel in the next few years.
Today, Lupin is known for its successes in basically three fields. The anti- TB drug ethambutol, of which they are the world leaders producing 60 per cent of the global production, the antibiotic rifampicin and the cephalosporins. Their ethambutol process is so efficient that even the original discoverer, Lederle, is buying the bulk drug from Lupin. The company has also gone into cardiovascular drugs that are going off patent.
In addition, the recent breakthrough made in stabilising their Rs80-crore plant devoted to fermentation products will put them ahead of the rest.
Herbal medicine for export markets is another of Lupin's ventures. Its latest venture is making herbal dressings that heal cuts without needing sutures and without leaving a scar, developed by an Indian, Dr Harbada.
Now, the several strands in Desh Bandhu Gupta's net seem to be meshing with greater cohesiveness. Lupin already has a bulk drug joint venture in Thailand and is planning more in North America, Europe and the Central Asian Republics of CIS. With drugs that sell more than $20 billion going off-patent by 2000 AD, Gupta is confident of achieving his ambition of becoming a billion dollar company by that time.
Dr Reddy's Laboratories
Dr Anji Reddy thanks Ethyl Corp, USA, a petrochemical giant, for making him famous. In 1990, Ethyl Corp accused one of Dr Reddy's companies, Cheminor, of dumping the popular analgesic, ibuprofen, in the US market. In the drama that unfolded in the hearings before the US Department of Commerce and the International trade Council, Dr Reddy proved that his prices were lower because his technology was better. As a result, the antidumping moves were dropped.
Reddy a product of UDCT and NCL, learnt the basics of bulk drug manufacturing in the public sector IDPL. From a modest turnover of Rsl.5 crore, in 1985, his group has crossed Rs300 crore in 1993-94. Now, DRL is setting up joint ventures in Russia and the Middle East.
Investing over Rs10 crore, Reddy has set up Dr Reddy's Research Foundation, (DRF) as an independent unit to develop his R&D muscle. Today, DRL can develop organic synthesis and even commercialise a process faster than anyone else in the world. There have been cases where DRL'S office in New Jersey, has faxed an order for samples of a particular molecule, along with its molecular structure and purity specifications, and the group has delivered it in three weeks. Fast work by any standards!
DRL'S current plans are ambitious: it is now developing a programme for new drug molecules, of which they hope to patent a few within a year. Their programme consists of computer-aided molecular modelling, drug designing and research in plant products.
According to Prof V.M. Kulkarni at UDCT, computer-aided, drug designing considerably reduces the time factor in obtaining the lead molecules, avoiding trial and error.
As proof of Dr Reddy's ambitious plans globalisation, today Izvestia carries as many ads of DRL as any Indian newspaper. This company, too, will hit Rs1000-crore-plus by 2000 AD.
CIPLA
The stock market heard of CIPLA when its share hit an astronomical Rs35,000 this year. What most people don't know, however, is that, CIPLA has long been a leader in anti-cancer and anti-asthma drugs and has very popular brands in fluoroquinolones and antibiotics. But what distinguishes it is its penchant for producing high value, low volume products. Some of its specialised products cost about $1,000 a gram!
One of its major triumphs was the commercialisation of the extraction of vinblastine from vinca rosea leaves, which was then converted to vincristine - a popular anticancer drug throughout the world. Earlier, Indians used to export the dried leaves of vinca rosea and Eli Lily, US, used to make vincristine out of them. The capsules, containing one thousandth of a gram of vincristine sulphate, were sold in India for Rs80each.
CIPLA scaled up the known, but difficult process of extracting the alkaloid vinblastine from vinca rosea, and then converting it to vincristine and produced a capsule that was sold at Rs25 only and even exported it abroad. Similarly, when the drug AZT, that stops the AIDS virus from multiplying, was discovered, Dr A.V. Ramarao, director, Indian Institute of Chemical Technology (IICT) and his team synthesised it and transferred the difficult technology to CIPLA. Today, CIPLA is the only producer of AZT besides the original discoverer.
If there is one company that consistently and stubbornly fought the Dunkel Draft till India signed the GAIT treaties in 1994, it is CIPLA. Dr Yusuf Hamied, MD, CIPLA still feels passionately about it. "The issue is not my company or even the industry; the issue is affordable healthcare for millions of Indian people," he says. Dr Hamied's concern is commendable considering that many in the drug industry changed tack midway.
Hamied is sceptical of new molecules being introduced by Indian companies. He says "Our undoubted strengths are in organic chemistry but our infrastructure in biological research is hardly world class." He is getting a number of offers for joint ventures and research tie-ups from Europe and is going global like the rest of the pack.
ENGINEERING
Engineering is a field where considerable activity is customized. Here, incremental innovation, design and analytical skills, concurrent engineering, and a constantly learning manpower, that takes each new job as a challenge, help build up competitive advantage. Three companies stand out in this: MTAR, BHEL and L&T.
An interesting common denominator for all the three companies, is their participation in the nuclear and space programmes. Through this they learnt new technologies of high precision machining, zero defect welding and varied non-destructive testing techniques. They have also learnt careful documentation of each stage of manufacturing leading to traceability of failure. Since each job was a challenge, their engineers were kept constantly on their toes leading to a high level of motivation. Now, they have reached a stage where besides meeting the quality standards of aerospace and nuclear programmes, they can also meet highly competitive delivery cycles and cut manufacturing costs.
MTAR
If there is one thing that characterizes Machine Tools Aids and Reconditioning (MTAR) it is their ‘can do’ attitude. Set up by ex-HMT engineer, Ravindra Reddy, MTAR, Hyderabad, is probably the largest partnership company in the south (1993-94 turnover: over Rs20 crore). In less than a decade, Reddy built up an impressive stable of more than a hundred precision tools. Recognising Reddy's capabilities the Department of Space invited him to be on the board of Antrix Corp, India's only company to market space technology globally.
MTAR's achievements include the manufacture of critical components for Pressurised Heavy Water Reactors of Nuclear Power Corporation (NPC), nuclear fuelling machines, critical components for Fast Breeder Test Reactor at Indira Gandhi Centre for Atomic Research, and the prestigious liquid fuelled rocket engine Vikas for the Polar Satellite Launch Vehicle and the Geostationary Satellite Launch Vehicle.
Another first by MTAR is the capability to manufacture world-class ball screws, varying in length from half a metre to over five metres. These ball screws are essential for any high-speed motion and are thus the mechanical heart of aircraft controls, machine tools, CNC machines, and industrial robots.
Such is the confidence of Dr Ravindra Reddy in his team that he says: "If ISRO solves all the material science problems involved in operation at -250°c, a temperature at which most metals and alloys crumble, then we guarantee that we will provide the engineering back up and deliver the cryogenic engine,"
BHEL
BHEL is synonymous with power in India. "This public sector giant with manufacturing plants at Hardwar, Trichy,
Hyderabad, Bhopal, Jhansi and Bangalore has built hydro power stations, thermal power stations, gas turbine-based
power stations and has been the single nuclear manufacturer. With its turnkey capabilities, it has joined the elite dozen powerhouses in the world such as General Electric and Siemens.
It has developed the most comprehensive welding capabilities in Trichy making it one of the best manufacturers in the world of large capacity boilers for power production, and industrial processes, besides nuclear reactor vessels, and heat recovery systems. Though they bought the technology from an assortment of companies all over the world, BHEL's strength lies in assimilating it and developing the 'know why' leading to appropriate design changes and developments.
It is the same 'know why' that has led them to develop the technology suitable for high ash coal. India, poor as it is in fossil fuel resources, has one fuel in abundance that will last another 50 years: coal. However, Indian coal has its own peculiarities- it has very low sulphur, making it cleaner in terms of sulphur dioxide emissions, but on the negative side it has low calorific value and high ash content. BHEL thus produced fluidised bed boilers that can very efficiently bum high ash coal, lignite, rice husk, bagasse and other agricultural wastes, literally anything.
In addition, they have developed specialised R&D strengths and designed appropriate conventional boilers for Indian coal. One important development is the large tower type boilers (almost twenty storey high) for 210 MW power stations. The novel design is easier to erect and fabricate there by reducing delivery times.
Direct ignition of pulverised coal (DIPC) developed by BHEL's R&D leads to considerable saving of oil in thermal power stations. If all thermal power stations in India were to use this technology then Rs.1 ,000 crore could be saved annually.
BHEL has also put its thorough understanding of power systems to good use by making the appropriate changes to extend the life of old thermal plants. This requires complex computer simulation, stress, creep and fracture analysis of materials, on-line data analysis, and is a growing area of business for them. Soon this should contribute at least Rs.100crore annually to their revenue. Thus, an old plant running at say a 30 per cent plant load factor (PLF), can be run at a much higher PLF. The additional mega wattage is obtained at a cost of Rs 1 crore per megawatt only, a Godsend to energy and capital-starved power infrastructure.
BHEL's technology strength is reflected in the fact that the German giant, KWU which supplied it the gas turbine technology has itself placed orders for three gas turbines of 60 MW each; Reliance,- well-known for its technology scouting capabilities, has placed orders for two combined cycle gas turbine generators for its Hazira petrochemical project; and Malaysia has repeatedly placed orders for gas turbines and thermal power stations. All these have been won amidst stiff international competition.
That is why despite high overheads like its 74,000-strong work force, large townships, etc, BHEL truly has the potential to emerge as an international engineering giant.
L&T
This multi-product company that is into switch gears, cement, electronics, construction and heavy engineering is familiar to many for its board room intrigues in the last five years. But only a small number of people know the technology and engineering strengths in its heavy engineering division.
L&T became a hi-tech, heavy engineering company through its association with the nuclear programme. Prior to the 1970’s they were making some small cement plant and dairy equipment. Fabrications were of the order of about five tonnes. Now, in their Hazira plant, they can fabricate equipment weighing 450 tonnes or more. Thus, while orders have dried up from the nuclear programme, the expertise in engineering, design, analysis and simulation are being built upon to take on bigger challenges.
The thrust of L&T'S effort in heavy engineering is to be recognised as a turnkey Engineering Project Contractor - the coveted goal of any heavy engineering firm globally.
Metallurgy
Mukand
In ferrous metallurgy, basic process technology evolves slowly and gets accepted even more -slowly. Everyone, it seems, wants proven technology rather than taking risks with new ones. The large investments required naturally make one extremely cautious, if not downright conservative. However, Mukand's CMD, Viren Shah, took the plunge and made the bold decision of going for continuous casting technology. Today, the technology is common. But the fact remains that in the late 1960s only two plants in the world had opted for it, though technically it was clear that continuous casting would be more efficient. The third plant to adopt this technology in the world and the first in Asia, including Japan, was Mukand.
Mukand has been a pioneer in more ways than one. In steel refining technology, too, Rourkela Steel Plant and Mukand were pioneers, going for the new top and bottom oxygen-blowing process. Today, all over the world this technology has become the standard in refining.
Mukand's main product line is high quality wire rods. Their R&D team led by Dr R.H.G. Rao, vice-president, technical, has been improving the quality of wire rods while reducing the cost of production. Wire rods that are mainly used by the fastener industry for cold heading need to have special qualities which can only be achieved through advanced refining techniques.
With the upturn in the automobile industry, Mukand's sales have picked up considerably in 1994. It is also developing leaded steels required by the automobile industry. In ferrous metallurgy Mukand is definitely a company to watch.
Aerospace
Antrix Corp
While we have not much to show in aircrafts we have some thing to show in space. Our remote sensing satellite's and communication satellites are world class products. So the Department of Space of the Government of India set up Antrix Corporation to globally market India's space technology. The tie up between Antrix Corp and Eosat US, for distributing Indian remote sensing data in the highly competitive North American market has hit the headlines recently.
N. Sampath, executive director, Antrix Corp, says, "Liquid nitrogen costs in India are high and we need about a million litres of it to test a satellite in the space simulation chamber. Though component costs are much higher in India, still it works out cheaper to fabricate satellites here rather than in the US or Europe by 20-30 per cent. For I can get highly skilled MTechs and PhDs to do the job at less than 10 per cent of their cost in the US or Europe."
However, international competition in the satellite market has become cut-throat. More than 50 per cent of the satellite market used to be in the military sector which has been drastically reduced. So all the biggies like Hughes, Martin Marietta (GE), Loral Aerospace (Ford), and others are aiming at the civilian market. Though Antrix, on its own, stands little chance of getting any orders in the global market, Loral wants to tie up with it and this should stand the company in good stead.
This fledgling hi-tech company can really hit it big in the future. As a communication revolution sweeps over India in the next five to ten years, there will be a big demand for communication satellites for TV and telecom. At that time, no doubt, Antrix will come into its own.
Automobiles
Telco (Now Tata Motors)
Is there someone out there who can give Maruti a run for their money? We think Telco has the potential not only to do that but even to enter the global car market. One other plus point in favour of Telco: it has an R&D facility that does not even exist in Maruti.
The visionary behind this was undoubtedly its former chairman, the late Sumant Mulgaokar. The first all-new Telco product was the Tata 407, introduced in 1985. It was conceived, designed, developed and productionised in 18 months flat to take on the just-introduced Indo-Japanese light commercial vehicles (LCVS). Today, Telco has over a 50 per cent share of the LCV market.
Amongst all Indian automobile companies, Telco's ERC is, by far, the largest R&D set-up, employing over 800 highly qualified engineers and designers. Headed by R&D general manager, S.K. Shome, its employees and equipment rank amongst the best in the world. A full-fledged, 98-terminal IBM RS/6000 CAD system costing nearly Rs.80 crore helps Telco generate concept proposals through to wire-frame diagrams, designing the inner skins, analysing structural integrity, generating cross-sectional views and defining the templates required to make the, final mock-up.
All sophisticated equipment, however, is quite meaningless without the right people handling it. Telco's resident director, V.M. Rawal, points out: "Technology is of no use if you don't have good people. It's the dedication of the people that really matters. The sophisticated Rambaudi machine was being put to use in two weeks flat, with
no special, training programme. It was taken up as a challenge." At the same time, Telco is not trying to reinvent the wheel. After developing the engine and the body design, for fine tuning them they are using the state-of-the-art services of the likes of International Automotive Design, UK, and AVL, Austria.
In conclusion, our techies may not be at the cutting edge of technology but all of them have used the Indian strengths in knowledge engineering and that too in an atmosphere that did not call for it. Thus they stand out for their farsightedness.-
N. Vaghul, chairman, ICICI is optimistic of the future. "The real industrialisation has started only now. Every businessman I meet nowadays, small or big, talks of technology and is aware that without technology he will be sunk," he, says. If these words are really a prophecy of things to come, we'll be seeing a lot more of the Indian 'techies' from now on.
Friday, December 21, 2007
Nasscom remake
Business India, February 16-29, 2004
Coming of age
Nasscom, the apex body of Indian software and services companies, has overcome setbacks and reinvented itself to thrive in adversity.
Shivanand Kanavi
Kiran Karnik is the most unlikely face of the year. Thoughtful, self deprecating, cultured, always giving credit to others, no self promotion ... these are the many epithets that come to mind on meeting him.
When he took over the stewardship of Nasscom (National Association of Software and Services Companies) in September 2001, a comparison between him and his predecessor - Dewang Mehta, was inevitable. Mehta had died tragically in harness at 39, in a hotel in Australia. Dewang was a dynamo of manic energy that made him the premier IT evangelist of India and the face of the entire Indian IT industry. Many wondered if Karnik could fit into Mehta's big shoes. In short, if Mehta was the irrepressible Elvis Presley of Indian IT (including the side burns and hair do) then Kiran Karnik is the tambourine man - Bob Dylan.
"My answer to such posers was, 'look at it differently, I am standing on a very tall man's shoulders’”, says Karnik, in his typically modest style. Today as Karnik gets featured as the Face of the Year, 2003 by Forbes.com, one can objectively say that Karnik and Nasscom have finally moved out of Mehta's shadows in more ways than one.
Quietly Karnik and a host of IT stalwarts - Phiroz Vandrevala, Harish Mehta, Saurabh Srivastava, Arun Kumar and others - helped reengineer Nasscom. It is no longer centred around personalities and individuals but is becoming an institution. It is not just plain old lobbying based on contacts and charm, which Mehta excelled in, but research-based policy interventions; it is not any more a one man army of Mehta working 20 hour days, but a whole host of IT entrepreneurs and executives, giving their time willingly for India's most successful industry association.
Business India recognised Nasscom's contribution to the business landscape in India long ago in a cover story in February 2001, 'Power lobbying'. We said then, "Nasscom has functioned more than just a trade body. To be sure, it has advocated the cause of its members, but at the same time it has looked well beyond this and it has advocated changes in the national interest. In fact, Nasscom has morphed from a mere trade association to a catalyst for change on the national scale."
Three years later we can safely say that despite catastrophic events, like the loss of Mehta, a recession in the US and 11 September, Nasscom has come out trumps. Advanced countries with high cost economies are outsourcing services to countries like India. Today outsourcing has become a big buzzword. India is the first destination for many western companies and when they land up here the first address they visit is that of Nasscom. No wonder Forbes.com chose Karnik. "I am no celebrity, they took bits and pieces of what is happening the world over and what Nasscom is doing, and when they put it all together the face that appeared was mine," reacts Karnik.
Nasscom's annual conference showed clearly the coming of age of Nasscom and the Indian IT industry. Why do we say that? There are many small changes, some tangible and some intangible, which all add up to a new phase of Nasscom.
Earlier Nasscom brought in celebrities, Indian and foreign, to draw media and delegates. This year, celebrities in the opening session were the billion dollar club of IT companies, made in India. The panel consisted of S. Ramadorai, CEO, TCS; Nandan Nilekani, CEO, Infosys; Ramalinga Raju, chairman, Satyam; and Vivek Paul, CEO, Wipro Technologies (through a video conferencing link from California). They were not great orators, there was no grand standing, they were not a Steve Jobs, a Scott McNealy or a Larry Ellison, but there was tremendous self assurance. They impressed Suhas Patil, the grand old man of Silicon Valley. "We have come of age," he said, later.
In fact, more Indian tech gurus from the Silicon Valley, are rescinding their earlier views and admitting that Indian offshore development is a new model and it has worked. Earlier many of them used to look down upon the Indian IT sector as mere 'labour arbitrage' - a fancy word for middlemen between Fortune 500 clients, and poorly paid but highly qualified Indian programmers.
But Indian IT companies were quietly confident that they are their own models. "From the beginning that has been the case. We could not learn even from services companies like IBM or EDS. They had different cost structures and delivery models. We could not benchmark against them. So we had to go into a huddle, brainstorm, share our data and woes, pass tips to the next guy who is entering a new market, etc, and the forum that we created for that was Nasscom," says Saurabh Srivastava, chairman, Xansa, and one of the founders of Nasscom.
"It is a great place where CEOs and entrepreneurs do really share data, and their worries without any inhibitions," says Revathi Kasturi, president, Tarang Software Technologies, a Bangalore-based startup, the first woman to become an executive council member.
And that tells us something about the internal working of Nasscoml and what makes it different from other industry lobbies. While other industry associations get activated come budget time and are riven with factionalism and contrarian pulls, Nasscom has survived and thrived. Of course, some might say it is narrowly focused into software and hence the cohesion, but that is only a part of the story. After all, it consists of 800 members, only five of who contribute to 35 per cent of the industry turnover. It consists of MNCS, it consists of services companies and product companies, it consists of third party BPOs (Business Process Outsourcing companies) and captive BPOs of MNCs. SO there is enough scope for all kind of push and pull. But Nasscom continues to draw them together.
The biggies of software like TCS, Infosys, Wipro, HCL, Satyam, Cognizant and so on have long out grown their start up phases, have enough financial muscle to invest in marketing, research, overseas offices, etc, so commonsense says that they do not need the hand-holding of Nasscom. But out of 30-odd executive council members, at least 20 attend all meetings. As for the annual conference, everybody keeps it on the top of their agenda of them give a lot of their valuable time for the affairs of Nasscom. Why?
"Nasscom has a voice that carries more weight than any of the individual companies so we make the best of it. Moreover, it is a forum where we grow out of our narrow companywide concerns and brainstorm about what is good for the whole country and the entire IT industry," says Phiroz Vandrevala, executive V.P, TCS, who became a full-time spokesman for Nasscom in the post-Dewang period, before Karnik took over.
But what the industry needed in terms of tax benefits for software exports, and lower telecom tariffs that are crucial to deliver software to clients all over the world was won long ago by the diligent work Dewang Mehta and others, so what kind of policy intervention are they talking about?
Well there are always issues which affect the IT industry, where the knee-jerk reaction is usually the wrong one. For example, when everyone wanted duty protection from imports, Nasscom asked the government for zero duty on imports. When IPR had scant value in India, Nasscom carried out campaigns against software piracy, despite the fact that it could only benefit MNCS like Microsoft and not Indian services companies. Recently, when the government made noises about taxing the foreign BPO companies, Nasscom as a body advised against it, even though Indian BPO companies would have 'benefited' from it.
Why? Well let us look at the big picture. The zero duty on imported software helped in reducing the cost of IT in the domestic sector. Even though the bulk of Nasscom members depend on exports for their bread and butter, it has been their firm belief that without a large domestic base no product companies can come up here. "Moreover as Indians, all of us would like to see an IT-enabled knowledge based economy grow in India and not just in the rest of the world. We may not use fancy words like 'nation building', but we are after all proud to be Indians and want it to shine," says Harish Mehta, chairman, Onward Novell group and another founding member.
Similarly, copyright and IPR issues taken up by Nasscom have helped in the growth of product companies in India and have endeared Nasscom to MNCs as well. This is already paying off. Product companies contribute over Rs.6,600 crore to software exports, and are growing at a rapid clip of no less than 30 per cent per annum, according to Rajiv Mody of Sasken Communications, who heads the Nasscom Product Forum. The product forum is also promoting the 'India Inside' campaign, showcasing MNCS which are doing high-end research and development in India.
As a result, Microsoft, SUN, BT, Intel, Siemens and Price Waterhouse Coopers are very active participants of Nasscom. "We are deeply interested in promoting IT in the domestic sector. The benefits of e-governance, as a tool of transparency and using IT as a productivity tool in manufacturing and financial services are going to take India forward as a major economy and they transcend our narrow company interests," says Rajiv Kaul, MD, Microsoft India, who heads Nasscom, domestic IT market forum.
But why did Nasscom advise the government against taxing foreign captive BPOs? They are doing value added work here but are not showing it as a profitable business. As a result, not only is the government losing taxes but if an Indian company like TCS does it in the US then the US government's Internal Revenue Service would promptly put them in jail!
"Many times reciprocity is not the right response. If the circular issued by CBDT had gone through, then we would have got low-end work, which is not taxable and high-end work could have gone to other destinations. Our estimations are that by 2006-7 this industry might grow to about $70 billion. We know that 40 per cent of that will go as salaries. That means the government will get about $10 billion as taxes, which it would not get otherwise. So why do you want to kill the golden goose for a few dollars today?" asks Srivastava.
Business India spoke to several Nasscom executive members and all of them echoed the same sentiment independently. This shows several things. Firstly, Nasscom members are thinking their policy positions through, which are widely debated internally and backed up by hard data, leading to a united stand. Secondly, lobbying is now based on hard statistical data and not personal charm. Thirdly, they are rising above their immediate interests and looking at what is good for the country in the long term.
"If we had stayed in the same mould as we have been, then Nasscom would soon become irrelevant. I divide the growth of Nasscom into three phases, in the first phase it needed evangelizing and Mehta did it brilliantly. The second phase was putting in place the right policies and regulations, and that was hard work: telecom liberalization, 10A/10B in the Income Tax Act, Software Technology Parks, a host of things which helped the industry. The third, which started just before Dewang passed away, was brand building,” says Karnik.
“So far we have done well, but to maintain a 28-30per cent growth we need to be innovative. It cannot be incremental growth. We are promoting start ups, innovation and incubation, and continuing to influence policy, based on solid research, on hard data. For example, about lowering duty on computers and its effect on the PC market, we looked at prices and demand in different countries. But since people say India is different we looked at price elasticity in mobile phones and the CTV market, and what employment multipliers they can be and what they can do to the rest of the Indian industry including the software industry."
"Today, against the backlash to outsourcing jobs to India too, we are going to policy makers in the UK and the US, with hard research data from the Department of Labour, US, etc. We talk of gains to their domestic industry through outsourcing, we look at the demographics and the aging population profile there and the resultant drop in GDP growth, problems with immigration, etc, and hence project outsourcing as the best way out. This is a more professional and sustainable approach," explains Karnik.
Besides e-governance, Karnik himself is very excited about IT in defence, which is not talked about much. Today IT is the primary weapon in defence. One can use IT in blocking, tracking, tracing and directing armament fire, etc. But it is all packaged with the hardware. If the hardware and software are disaggregated then the cost of the system will come down heavily in India's favour and Indian companies can be involved in doing the software. It will save money and make India more secure.
Nasscom, however, is also working behind the scenes on WTO negotiations. If India works out its strategy properly, then there is a great opportunity for the Indian services sector. "There are some genuine problems for CAS, etc, but let us look at the total picture. We put together a high powered task force and got people from four top companies to come and work full time on this, and put together a document on the services opportunity and how it can grow to 10 times our other exports in six to seven years, if we can get the foreign markets opened up," says Karnik.
"There are two reactions to globalisation. Either there are people who are ideologically for globalisation or old socialists like me, who are sceptics, who say for 10 years nothing has happened so it is bad per se. But today we can see that unlike other developing countries we have a great opportunity. We should open up earlier. Tactically you can have different stances.
You can hold back retailing, till they open up something else, etc, that is a different issue," says an excited Karnik.
Karnik has drawn on the collective wisdom of his members. Ganesh Natarajan, Rajendra Pawar, Rajiv Kaul, Rajiv Mody, Ramalinga Raju, Arun Seth, Bhaskar Pramanik have been drawn in to head specific activity.
What about the 80 per cent of small companies, who might not connect with the concerns of the biggies? "'Within Nasscom there are enough activities which help the SME or startup sector in terms of research, advice on marketing or IPR, etc. I have never felt any kind of discrimination of smaller companies. In fact, even if somebody makes a remark inadvertently, I don't let it get me down after all I represent 80 per cent of the membership," says Revathi Kasturi.
Nasscom is being studied by several countries since there is no other similar example in the world. "National Rifle Association in the US is probably the only other," laughs Harish Mehta. But jokes aside, the diligent Chinese are sending a delegation every month and closely monitoring Nasscom's activities to learn from it. "There is a saying that if you carry a big stick then you can talk softly and others will listen carefully. Dewang gave us a big stick so I can afford to talk softly," acknowledges Karnik.
Looking ahead there will be non-tariff barriers, not just due to job losses but because India has emerged as a major player. Other countries want to know whether they are too dependent on Indian software. "How do we sustain our competitive advantage, after all we have cleared the path for our competitors? China in the long run because of size and bandwidth will be our competitors. They will be offering everything from call centres to R&D. But ultimately our biggest differentiator will be diversity. We are used to working in multicultural teams, being ourselves a multicultural society. So it is easy for us to work in international teams."
"At a more basic level our culture is that of ambiguity. Recognising gray areas helps us think creatively. When things are given step by step as in manufacturing, the East Asians are great. When you look at us five to 10 years ahead, you will see us as great source of ideas and solutions," says Karnik.
Where do we go from here? In Karnik's words, "When I took over, a journalist asked me to summarise in one sentence what I want to do! I thought hard over it and said, 'I want to make India and IT synonymous'. When you think of wines you think of France or with watches you think of Switzerland. Of course, everybody makes wines, California, Australia, Chile and even India. Similarly everybody makes watches, but France and Switzerland stand out in our minds. In the US, associating India with IT, has already happened. That is what is seen in the backlash in a negative way. But my hope is that when this blows over, association of India with IT will remain. "We say Amen to that.
Coming of age
Nasscom, the apex body of Indian software and services companies, has overcome setbacks and reinvented itself to thrive in adversity.
Shivanand Kanavi
Kiran Karnik is the most unlikely face of the year. Thoughtful, self deprecating, cultured, always giving credit to others, no self promotion ... these are the many epithets that come to mind on meeting him.
When he took over the stewardship of Nasscom (National Association of Software and Services Companies) in September 2001, a comparison between him and his predecessor - Dewang Mehta, was inevitable. Mehta had died tragically in harness at 39, in a hotel in Australia. Dewang was a dynamo of manic energy that made him the premier IT evangelist of India and the face of the entire Indian IT industry. Many wondered if Karnik could fit into Mehta's big shoes. In short, if Mehta was the irrepressible Elvis Presley of Indian IT (including the side burns and hair do) then Kiran Karnik is the tambourine man - Bob Dylan.
"My answer to such posers was, 'look at it differently, I am standing on a very tall man's shoulders’”, says Karnik, in his typically modest style. Today as Karnik gets featured as the Face of the Year, 2003 by Forbes.com, one can objectively say that Karnik and Nasscom have finally moved out of Mehta's shadows in more ways than one.
Quietly Karnik and a host of IT stalwarts - Phiroz Vandrevala, Harish Mehta, Saurabh Srivastava, Arun Kumar and others - helped reengineer Nasscom. It is no longer centred around personalities and individuals but is becoming an institution. It is not just plain old lobbying based on contacts and charm, which Mehta excelled in, but research-based policy interventions; it is not any more a one man army of Mehta working 20 hour days, but a whole host of IT entrepreneurs and executives, giving their time willingly for India's most successful industry association.
Business India recognised Nasscom's contribution to the business landscape in India long ago in a cover story in February 2001, 'Power lobbying'. We said then, "Nasscom has functioned more than just a trade body. To be sure, it has advocated the cause of its members, but at the same time it has looked well beyond this and it has advocated changes in the national interest. In fact, Nasscom has morphed from a mere trade association to a catalyst for change on the national scale."
Three years later we can safely say that despite catastrophic events, like the loss of Mehta, a recession in the US and 11 September, Nasscom has come out trumps. Advanced countries with high cost economies are outsourcing services to countries like India. Today outsourcing has become a big buzzword. India is the first destination for many western companies and when they land up here the first address they visit is that of Nasscom. No wonder Forbes.com chose Karnik. "I am no celebrity, they took bits and pieces of what is happening the world over and what Nasscom is doing, and when they put it all together the face that appeared was mine," reacts Karnik.
Nasscom's annual conference showed clearly the coming of age of Nasscom and the Indian IT industry. Why do we say that? There are many small changes, some tangible and some intangible, which all add up to a new phase of Nasscom.
Earlier Nasscom brought in celebrities, Indian and foreign, to draw media and delegates. This year, celebrities in the opening session were the billion dollar club of IT companies, made in India. The panel consisted of S. Ramadorai, CEO, TCS; Nandan Nilekani, CEO, Infosys; Ramalinga Raju, chairman, Satyam; and Vivek Paul, CEO, Wipro Technologies (through a video conferencing link from California). They were not great orators, there was no grand standing, they were not a Steve Jobs, a Scott McNealy or a Larry Ellison, but there was tremendous self assurance. They impressed Suhas Patil, the grand old man of Silicon Valley. "We have come of age," he said, later.
In fact, more Indian tech gurus from the Silicon Valley, are rescinding their earlier views and admitting that Indian offshore development is a new model and it has worked. Earlier many of them used to look down upon the Indian IT sector as mere 'labour arbitrage' - a fancy word for middlemen between Fortune 500 clients, and poorly paid but highly qualified Indian programmers.
But Indian IT companies were quietly confident that they are their own models. "From the beginning that has been the case. We could not learn even from services companies like IBM or EDS. They had different cost structures and delivery models. We could not benchmark against them. So we had to go into a huddle, brainstorm, share our data and woes, pass tips to the next guy who is entering a new market, etc, and the forum that we created for that was Nasscom," says Saurabh Srivastava, chairman, Xansa, and one of the founders of Nasscom.
"It is a great place where CEOs and entrepreneurs do really share data, and their worries without any inhibitions," says Revathi Kasturi, president, Tarang Software Technologies, a Bangalore-based startup, the first woman to become an executive council member.
And that tells us something about the internal working of Nasscoml and what makes it different from other industry lobbies. While other industry associations get activated come budget time and are riven with factionalism and contrarian pulls, Nasscom has survived and thrived. Of course, some might say it is narrowly focused into software and hence the cohesion, but that is only a part of the story. After all, it consists of 800 members, only five of who contribute to 35 per cent of the industry turnover. It consists of MNCS, it consists of services companies and product companies, it consists of third party BPOs (Business Process Outsourcing companies) and captive BPOs of MNCs. SO there is enough scope for all kind of push and pull. But Nasscom continues to draw them together.
The biggies of software like TCS, Infosys, Wipro, HCL, Satyam, Cognizant and so on have long out grown their start up phases, have enough financial muscle to invest in marketing, research, overseas offices, etc, so commonsense says that they do not need the hand-holding of Nasscom. But out of 30-odd executive council members, at least 20 attend all meetings. As for the annual conference, everybody keeps it on the top of their agenda of them give a lot of their valuable time for the affairs of Nasscom. Why?
"Nasscom has a voice that carries more weight than any of the individual companies so we make the best of it. Moreover, it is a forum where we grow out of our narrow companywide concerns and brainstorm about what is good for the whole country and the entire IT industry," says Phiroz Vandrevala, executive V.P, TCS, who became a full-time spokesman for Nasscom in the post-Dewang period, before Karnik took over.
But what the industry needed in terms of tax benefits for software exports, and lower telecom tariffs that are crucial to deliver software to clients all over the world was won long ago by the diligent work Dewang Mehta and others, so what kind of policy intervention are they talking about?
Well there are always issues which affect the IT industry, where the knee-jerk reaction is usually the wrong one. For example, when everyone wanted duty protection from imports, Nasscom asked the government for zero duty on imports. When IPR had scant value in India, Nasscom carried out campaigns against software piracy, despite the fact that it could only benefit MNCS like Microsoft and not Indian services companies. Recently, when the government made noises about taxing the foreign BPO companies, Nasscom as a body advised against it, even though Indian BPO companies would have 'benefited' from it.
Why? Well let us look at the big picture. The zero duty on imported software helped in reducing the cost of IT in the domestic sector. Even though the bulk of Nasscom members depend on exports for their bread and butter, it has been their firm belief that without a large domestic base no product companies can come up here. "Moreover as Indians, all of us would like to see an IT-enabled knowledge based economy grow in India and not just in the rest of the world. We may not use fancy words like 'nation building', but we are after all proud to be Indians and want it to shine," says Harish Mehta, chairman, Onward Novell group and another founding member.
Similarly, copyright and IPR issues taken up by Nasscom have helped in the growth of product companies in India and have endeared Nasscom to MNCs as well. This is already paying off. Product companies contribute over Rs.6,600 crore to software exports, and are growing at a rapid clip of no less than 30 per cent per annum, according to Rajiv Mody of Sasken Communications, who heads the Nasscom Product Forum. The product forum is also promoting the 'India Inside' campaign, showcasing MNCS which are doing high-end research and development in India.
As a result, Microsoft, SUN, BT, Intel, Siemens and Price Waterhouse Coopers are very active participants of Nasscom. "We are deeply interested in promoting IT in the domestic sector. The benefits of e-governance, as a tool of transparency and using IT as a productivity tool in manufacturing and financial services are going to take India forward as a major economy and they transcend our narrow company interests," says Rajiv Kaul, MD, Microsoft India, who heads Nasscom, domestic IT market forum.
But why did Nasscom advise the government against taxing foreign captive BPOs? They are doing value added work here but are not showing it as a profitable business. As a result, not only is the government losing taxes but if an Indian company like TCS does it in the US then the US government's Internal Revenue Service would promptly put them in jail!
"Many times reciprocity is not the right response. If the circular issued by CBDT had gone through, then we would have got low-end work, which is not taxable and high-end work could have gone to other destinations. Our estimations are that by 2006-7 this industry might grow to about $70 billion. We know that 40 per cent of that will go as salaries. That means the government will get about $10 billion as taxes, which it would not get otherwise. So why do you want to kill the golden goose for a few dollars today?" asks Srivastava.
Business India spoke to several Nasscom executive members and all of them echoed the same sentiment independently. This shows several things. Firstly, Nasscom members are thinking their policy positions through, which are widely debated internally and backed up by hard data, leading to a united stand. Secondly, lobbying is now based on hard statistical data and not personal charm. Thirdly, they are rising above their immediate interests and looking at what is good for the country in the long term.
"If we had stayed in the same mould as we have been, then Nasscom would soon become irrelevant. I divide the growth of Nasscom into three phases, in the first phase it needed evangelizing and Mehta did it brilliantly. The second phase was putting in place the right policies and regulations, and that was hard work: telecom liberalization, 10A/10B in the Income Tax Act, Software Technology Parks, a host of things which helped the industry. The third, which started just before Dewang passed away, was brand building,” says Karnik.
“So far we have done well, but to maintain a 28-30per cent growth we need to be innovative. It cannot be incremental growth. We are promoting start ups, innovation and incubation, and continuing to influence policy, based on solid research, on hard data. For example, about lowering duty on computers and its effect on the PC market, we looked at prices and demand in different countries. But since people say India is different we looked at price elasticity in mobile phones and the CTV market, and what employment multipliers they can be and what they can do to the rest of the Indian industry including the software industry."
"Today, against the backlash to outsourcing jobs to India too, we are going to policy makers in the UK and the US, with hard research data from the Department of Labour, US, etc. We talk of gains to their domestic industry through outsourcing, we look at the demographics and the aging population profile there and the resultant drop in GDP growth, problems with immigration, etc, and hence project outsourcing as the best way out. This is a more professional and sustainable approach," explains Karnik.
Besides e-governance, Karnik himself is very excited about IT in defence, which is not talked about much. Today IT is the primary weapon in defence. One can use IT in blocking, tracking, tracing and directing armament fire, etc. But it is all packaged with the hardware. If the hardware and software are disaggregated then the cost of the system will come down heavily in India's favour and Indian companies can be involved in doing the software. It will save money and make India more secure.
Nasscom, however, is also working behind the scenes on WTO negotiations. If India works out its strategy properly, then there is a great opportunity for the Indian services sector. "There are some genuine problems for CAS, etc, but let us look at the total picture. We put together a high powered task force and got people from four top companies to come and work full time on this, and put together a document on the services opportunity and how it can grow to 10 times our other exports in six to seven years, if we can get the foreign markets opened up," says Karnik.
"There are two reactions to globalisation. Either there are people who are ideologically for globalisation or old socialists like me, who are sceptics, who say for 10 years nothing has happened so it is bad per se. But today we can see that unlike other developing countries we have a great opportunity. We should open up earlier. Tactically you can have different stances.
You can hold back retailing, till they open up something else, etc, that is a different issue," says an excited Karnik.
Karnik has drawn on the collective wisdom of his members. Ganesh Natarajan, Rajendra Pawar, Rajiv Kaul, Rajiv Mody, Ramalinga Raju, Arun Seth, Bhaskar Pramanik have been drawn in to head specific activity.
What about the 80 per cent of small companies, who might not connect with the concerns of the biggies? "'Within Nasscom there are enough activities which help the SME or startup sector in terms of research, advice on marketing or IPR, etc. I have never felt any kind of discrimination of smaller companies. In fact, even if somebody makes a remark inadvertently, I don't let it get me down after all I represent 80 per cent of the membership," says Revathi Kasturi.
Nasscom is being studied by several countries since there is no other similar example in the world. "National Rifle Association in the US is probably the only other," laughs Harish Mehta. But jokes aside, the diligent Chinese are sending a delegation every month and closely monitoring Nasscom's activities to learn from it. "There is a saying that if you carry a big stick then you can talk softly and others will listen carefully. Dewang gave us a big stick so I can afford to talk softly," acknowledges Karnik.
Looking ahead there will be non-tariff barriers, not just due to job losses but because India has emerged as a major player. Other countries want to know whether they are too dependent on Indian software. "How do we sustain our competitive advantage, after all we have cleared the path for our competitors? China in the long run because of size and bandwidth will be our competitors. They will be offering everything from call centres to R&D. But ultimately our biggest differentiator will be diversity. We are used to working in multicultural teams, being ourselves a multicultural society. So it is easy for us to work in international teams."
"At a more basic level our culture is that of ambiguity. Recognising gray areas helps us think creatively. When things are given step by step as in manufacturing, the East Asians are great. When you look at us five to 10 years ahead, you will see us as great source of ideas and solutions," says Karnik.
Where do we go from here? In Karnik's words, "When I took over, a journalist asked me to summarise in one sentence what I want to do! I thought hard over it and said, 'I want to make India and IT synonymous'. When you think of wines you think of France or with watches you think of Switzerland. Of course, everybody makes wines, California, Australia, Chile and even India. Similarly everybody makes watches, but France and Switzerland stand out in our minds. In the US, associating India with IT, has already happened. That is what is seen in the backlash in a negative way. But my hope is that when this blows over, association of India with IT will remain. "We say Amen to that.
Profile: Pradeep Sindhu
Business India, January 22-February 4, 2001
Sparc
Shivanand Kanavi
Pradeep Sindhu is a difficult man to interview. "If you are talking money, networth, etc, then I am walking out of this. If you have anything to discuss about Juniper, I will be glad to talk. Anything about myself and family is a no, no," he burst out.
Apparently, he has had a bad experience with Indian media and its crass obsession with dollars made. We, of course, placated him quickly, "Networth, what networth? Perish the thought! We want to ask you about routers, about Internet Protocol (IP), about how you are giving sleepless nights to John Chambers & Co at Cisco."
The effect was instantaneous. He changed into a professor, an ardent researcher, an engineer's engineer who talks English. It was so dramatic, that for a moment one thought the guy was either one-dimensional or unreal. But Pradeep is simply passionate about his work.
That is how Pradeep Sindhu and his colleagues at Juniper Networks have carved out nearly 30 per cent of the high-end router market. Earlier, Cisco was the uncrowned king of Internet infrastructure. It still is, when it comes to enterprise level networks, but for the core of the network, more and more telcos are buying Juniper's equipment.
Pradeep narrates the story of Juniper: "In 1996, when I asked myself how an exponential phenomenon like the Internet could be facilitated, I saw that the only protocol that could do it is IP, since it is a connectionless protocol, it is reliable and easily scalable. The elements that were missing in IP were routers. When I looked at IP routers built by others, I was really surprised at their primitive nature. That is when I realised that there was a great opportunity to build IP routers from the ground up, using all the software and hardware techniques I had learnt at Xerox PARC (Palo Alto Research Centre). I thought every second wasted would lead to some- body else discovering the same. I called Vinod since I had done some work with Sun and he had investments in networking. He gave me an hour. I spoke to him about the macro scene and told him that if we design from first principles we could do 50 times better than what is available. He asked some questions and said he would think about it. He called back two weeks later and said let us do something together."
"When Pradeep came to me, he had no business experience. My view was: 'I like the person and I like the way he thinks'. I asked him to sit next to somebody who was trying to build an Internet network for three weeks and asked him to understand what the problems are. He is such a good guy that he was able to learn quickly what the problems are. Helping a brilliant thinker like Pradeep and guiding him gives me great satisfaction. This is one guy who has really changed what the Internet is. The difference he has made is fabulous," says Vinod Khosla. That is tall praise coming from Vinod, who is no mean thinker himself.
With apologies to Sun Microsystems, who produce chips named Sparc (in fact, Sindhu played a significant role in it), we are using the same for the title, since Pradeep Sindhu is really a spark that came out of PARC.
Sparc
Shivanand Kanavi
Pradeep Sindhu is a difficult man to interview. "If you are talking money, networth, etc, then I am walking out of this. If you have anything to discuss about Juniper, I will be glad to talk. Anything about myself and family is a no, no," he burst out.
Apparently, he has had a bad experience with Indian media and its crass obsession with dollars made. We, of course, placated him quickly, "Networth, what networth? Perish the thought! We want to ask you about routers, about Internet Protocol (IP), about how you are giving sleepless nights to John Chambers & Co at Cisco."
The effect was instantaneous. He changed into a professor, an ardent researcher, an engineer's engineer who talks English. It was so dramatic, that for a moment one thought the guy was either one-dimensional or unreal. But Pradeep is simply passionate about his work.
That is how Pradeep Sindhu and his colleagues at Juniper Networks have carved out nearly 30 per cent of the high-end router market. Earlier, Cisco was the uncrowned king of Internet infrastructure. It still is, when it comes to enterprise level networks, but for the core of the network, more and more telcos are buying Juniper's equipment.
Pradeep narrates the story of Juniper: "In 1996, when I asked myself how an exponential phenomenon like the Internet could be facilitated, I saw that the only protocol that could do it is IP, since it is a connectionless protocol, it is reliable and easily scalable. The elements that were missing in IP were routers. When I looked at IP routers built by others, I was really surprised at their primitive nature. That is when I realised that there was a great opportunity to build IP routers from the ground up, using all the software and hardware techniques I had learnt at Xerox PARC (Palo Alto Research Centre). I thought every second wasted would lead to some- body else discovering the same. I called Vinod since I had done some work with Sun and he had investments in networking. He gave me an hour. I spoke to him about the macro scene and told him that if we design from first principles we could do 50 times better than what is available. He asked some questions and said he would think about it. He called back two weeks later and said let us do something together."
"When Pradeep came to me, he had no business experience. My view was: 'I like the person and I like the way he thinks'. I asked him to sit next to somebody who was trying to build an Internet network for three weeks and asked him to understand what the problems are. He is such a good guy that he was able to learn quickly what the problems are. Helping a brilliant thinker like Pradeep and guiding him gives me great satisfaction. This is one guy who has really changed what the Internet is. The difference he has made is fabulous," says Vinod Khosla. That is tall praise coming from Vinod, who is no mean thinker himself.
With apologies to Sun Microsystems, who produce chips named Sparc (in fact, Sindhu played a significant role in it), we are using the same for the title, since Pradeep Sindhu is really a spark that came out of PARC.
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