India's evolving significance in the global technology and manufacturing landscape

13th November 2023
India's evolving significance in the global technology and manufacturing landscape
Graphic: macrovector on Freepik

By GuruPrasad Sowle, Director and Founding Member of Indus International Research Foundation,  a US-based Think Tank
November 13, 2023:Much water has flowed down the Ganges since 1947. From Aryabhata To Quantum computing, India has come a long way in Science, tech, and manufacturing. Interestingly India is also on the threshold of becoming a major manufacturing hub.
The electronics and semiconductor domain will dominate the next few decades and India is uniquely positioned to be among the world's major hubs for 'Chip' with its 10bn dollar incentive scheme fueling its journey to rub shoulders with other nations that are deep in Semiconductor. India's ascent in Technology leadership has been a historical journey, while its ascent in manufacturing and its recent foray into Semiconductor and Chip, is something to watch. Some of the key highlights include India's capacity-building initiatives, and its ability to address the Global Supply Chain Challenge along with fast-changing geopolitical dynamics. India's role is indeed crucial and much needed as a Tech Hub and as a destination for Global Manufacturing and Electronics Players.
In the evolution of any nation, organization, or institution, there are four key components; People, process technology, and infrastructure!
People power is the component India always possessed. Perhaps even the best in the world. It is not about 1.4 billion people that make India rather, the best brains that make the country great!
India has become a global leader in technology and manufacturing thanks in part to brain drain, which is a testament to the country's talent and brain power. Although process and technology have evolved with limitations of infrastructure over some time, modern India has found a way to overcome the limitations of infrastructure and lead the nation to a different path today, that would potentially make India one of the world's three largest economies going forward.
There is no denying India's depth in technology, whether it be in nuclear science, healthcare, semiconductors, cybersecurity, AI, or intellectual property services.
It is common knowledge that India is a top location for resources, technology, and intellectual capital these days. Manufacturing is evolving rapidly, driven by Global; Supply Chain drivers and geopolitical factors.
Undoubtedly, India's technological and manufacturing development has been fascinating, and the country is quickly approaching the point at which it will become a global hub.
India has shown throughout time why it is one of the world's top exporters of both IT and BPO services. Through their offshore centers and third-party outsourcing centers in India, corporations worldwide have been utilizing the technological talent of India. The combination of these centers, along with captive shared service centers, has resulted in the employment of over 4.5 million people to date.
From low-tech to high-tech, and now on to deep-tech, India has made great strides in developing its technological capabilities. Technology has been broadly interpreted in two components, applications and processes.
On the process side, enabled by technology, India's journey began with simplification in the early 90s which progressed to standardization. And after the internet opened up in the mid-90s.
We looked at shared service centers and captive centers of global multinational corporations transitioning to India.
The fourth component of the journey has been outsourcing. The Fortune 500 companies and the smaller ones look at India as a major tech hub for process and technology. Today the landscape for talent has changed as India's technology capability has moved up the value chain substantially.
Innovation in domains like artificial intelligence, semiconductors, cybersecurity, and fundamental areas of technology—areas where the world needs significant support—is more important than software or services alone!
Over the past 20 years, India's robust services exports have increased by 14%, reaching $254 billion in 2022. Additionally, business process outsourcing (BPO) and information technology services account for a sizable portion of services exported.
IT services and BPO services combined have positioned India to be a global hub for technology and innovation as the world ramps up its technology adoption, they're looking at India to support their transformation. Implying it is not just about the US, but an opportunity, that India is provided with from other continents of the world including Europe and Africa.
According to the Ernst and Young report, as one of the largest exporters of IT and BPO services globally, the Indian workforce is expected to solve the most complex problems and manage digital front to back end functions of global operations. It will help India transform, from a technology back office to a hybrid workforce powering the digital fabric of the world's largest corporations.
India's enormous workforce supplemented by the Youth Power and the talent that will be entering the mainstream of employment in the next five years, will strengthen India's case further towards becoming the global hub for technology talent. India stands a fair chance to become the robotics and AI capital of the world with as many robots and engineers serving 24/7 in the hybrid workforce. There are several organizations for example fortune 500 companies, World Trade Centres, aerospace and defense associations in America that are looking towards India for AI talent and to access capacity for Technology and Innovation resourcing.
Apart from handling the routine technology and process services, Indian IT and BPO service players have been moving up the value chain and will be playing a substantial role in consulting experience, design, full-stack digital engineering product development, and incubation, to industrialize new business process management use cases and processes that are considered core today
In the current context, the nation's rise to prominence in the core technology and process domain is noteworthy. This represents a significant step up from managing non-core processes and technology, as India can now intervene in technology for a variety of global applications across corporations in both the public and private sectors, starting at the design stage
There is also an opportunity to become a platform and product powerhouse, India IT services are being platformed and the Indian business-to-business b2b software as a service SaaS ecosystem has created its unique positioning. The impact is already visible. As the first billion-dollar product company from India has emerged and there are over 20 Indian B2B SaaS unicorns. Altogether, this is creating a great ecosystem for fast movers to emerge over the next two decades.
India's journey began as a destination for cost arbitrage. Now, It is about value not cost. It is about innovation. Not service. It is about impact and not just meeting expectations
India's dominance in technology is also loaded with the responsibility to lead from the front and create a bandwidth for innovation co-creation and impact the global supply chain favorably from being executors to influencing the global enterprise strategy, Indian technology providers have scaled up to provide cutting-edge solutions such as Cloud Data Analytics, artificial intelligence, machine learning chip design system design and software development and to other core areas to make the desired impact.