A short history of the growing IT sector in India

At the start of the 2020s, there is growing discussion about India’s metamorphosis into a worldwide IT hub and a “Indian it miracle.”

What caused that to happen?

The prospects of information technology were realized quite early in India. The Internet appeared in the United States in the 1970s, just as DARPA was developing, and the first personal computers seemed like a risky and rather doubtful proposition. In China, university lecturers were “thrown” into rice fields and beaten by the Red Guards. And in the meantime, India has already implemented a state program that provides the most favorable environment for software development enterprises. They were given subsidies, low-interest loans, and lowered customs duties.

The first special economic zone (SEEPZ) was established near Mumbai in 1973, specializing in the sale of software to foreign consumers. Tata Consultancy Services established the first Indian IT company in 1968, having already sold software to banks in Switzerland, Canada, and South Africa in 1975 – and by 2021 had grown into an international IT conglomerate with a market value of $200 billion US dollars.

However, during the next quarter-century, India’s IT sector was barely noticeable in both national and global markets. Given the country’s massive population, the entire Indian information business in the 1990s was comprised of a few thousand IT specialists and vanishingly few exports in the field of information technology in the amount of around $100 million.

However, behind this unassuming number was hidden the long, serious, and systematic work of the Indian leadership and enterprises in the 1980s and 1990s, which laid the groundwork for future success. As a result, in 1986, India launched a new state program for software development and export, in which the development of the IT sector was referred to as the key to the national economy’s future. All kinds of preferences and benefits were offered for information technologies, prohibitions were eliminated, and instructional programs were formed. More and more Indian IT specialists are working for multinational organizations and traveling to the United States and Europe. Some stayed, while others returned home with a wealth of new information and abilities.

Following that, the Indian IT sector confidently surfed the wave of the information revolution and rapid “internetization” at the start of the twenty-first century. The now-forgotten, but widely publicized in the late 1990s “Problem of the Year 2000,” often known as Y2K, was a watershed moment for them. I’d like to point out that many old programs were written in the twentieth century simply recorded the final two digits of the year number. As a result, the year 1999 had to be substituted by 1900, which could result in widespread computer problems, even in essential systems. Fixing the old code required an army of IT specialists, which India was able to supply to the global market.

At the start of the 2000s, India had surpassed the United States as the leader in IT sector exports and held a commanding position in the worldwide IT outsourcing market. However, back then, they were primarily experts, with the sole advantage of being willing to labor for peanuts by Western standards. After two weeks of training, some of them sat down to create code. But there were a lot of them, and they were willing to labor under similar conditions as Chinese laborers did in the 1980s and 1990s: nearly for food.

Global information corporations like Facebook, Google, and Amazon, as well as American and Arab investment funds, are lined up to invest in the Indian information sphere and build partnerships with Indian IT companies like Jio Platforms, dating apps like Aisle, or popular gay chat site. Indians account for three out of every four IT specialists on the global market. In the next few years, Bangalore, which produces 38% of India’s IT exports, could overtake San Francisco and its Silicon Valley as the world’s most important information technology center.