IT / Software Industries in India and Asian Development

1. IT / Software Industries in India and Asian Development Rajeeva Ratna SHAHSecretaryGovernment of IndiaMinistry of Communications & Information TechnologyDepartment of Information Technology Secretary@mit.gov.in OECD Conference 11th November 2002, Chennai

2. The Broadening sphere of Information Technology DATA INFORMATION KNOWLEDGE Computation Communication Cognition

4. NETWORKS NEURONS Knowledge of the 21st Century STHULA-JAGAT SOOKSMA-JAGAT Macrocosm Microcosm NANOTECH ATOMS Building Blocks & Knowledge Tools of 21st Century BIOTECH COMPUTERS GENES BITS

5. Indian Software Business • One of the fastest growing sectors – • CAGR exceeding 50% over the last 5 years • Turnover of US$ 10 billion & exports of US$ 8.0 billion during 2001-2002. • Exports Target – US $50 billion by the year 2008 • The six OECD countries (USA, Japan, UK, Germany, France and Italy) • Together have almost 71 % of the worldwide (countries) software market. • Indian’s exports to these countries is almost 80% of its total software exports. • The new markets being vigorously explored include Korea, South Africa, Malaysia, Latin and countries in Eastern Europe.

6. The Government is implementing a comprehensive action plan to make India an IT superpower and to achieve a target of $ 50 billion in software exports by 2008. • Steps to accelerate Internet revolution:- • IT education & e-learning programmes in Schools • Software development in Indian languages • Development of web browsers in Indian languages • Development of inter lingua and multi user language interface • Development of OCRs, Lexicon Dictionaries & Machine aided Translation capabilities in Indian languages • Promotion of web based e-governance solution • Promotion of e-commerce and e-biz

7. INITIATIVES TO PROMOTE IT SECTOR IN INDIA • Telecomm Reforms • FOCUS ON LIBERALISATION • Telecom & Internet services opened up • National & International Long Distance opened up • Voice over Internet allowed • Satellite international gateway allowed • Landing station for OFC allowed • Rationalization of Tariff structure: one of the lowest tariff structures world-wide

8. INITIATIVES TO PROMOTE IT SECTOR IN INDIA CONTD.. • Cyber Framework • The Information Technology Act (IT Act) 2000 • Legal framework to facilitate electronics commerce & electronic transaction • Semiconductors (Integrated Circuits lay out design) Act • Convergence bill on the anvil

9. INITIATIVES TO PROMOTE IT SECTOR IN INDIA CONTD.. • Financial Reforms • Fiscal incentives • Foreign Direct Investment 100% allowed • 100 % repatriation of benefits allowed • 100 % income tax exemption on exports upto 2010 • Zero duty on import of software • Zero duty on import of H/w for 100 % export projects

10. INITIATIVES TO PROMOTE IT SECTOR IN INDIA CONTD.. • Building Global MNCs • Limits on use of ADR / GDR funds for acquisition of overseas companies upto 10 times export value through automatic route • ESOP taxation on actual accrual of capital gains

11. QUALITY IMPERATIVES • 46 of the world’s 80+ SEI CMM level 5 companies are based in India • 286 ISO 9002 companies are in India • Over 6 companies are on NASDAQ • 38% Silicon Valley start-ups are by Indians • 80,000 MSCE in India – (Equal to US & Largest outside US) • R&D centres by Microsoft, IBM, DELL, CISCO, Lucent, GE, SGS Thomson, Cadence etc., set up in India • Largest English speaking technical Manpower

12. Indian Higher Education System • Very vast SystemTotal No. In Govt. Universities 237 237 Deemed Universities 47 18 Engineering Colleges 838 215 IITs * 7 7 IIMs ** 6 6 Medical College 171 95 Degree College 10,600 10,600 Dental College 78 27 Polytechnic 1,210 1,210 Schools 11,00,285 NA • Over 25 crore students • 75 Lakh teachers • Evenly spread all over the Country • Challenge for a network implementer • Lot of good work • Many world famous scholars * include Roorkee University ** funded by Govt. of India (Data compiled based on theinput from MHRD)

13. Opportunities • Major demand for IT professionals in Europe (Germany, UK, Italy, France) • Major opportunity in ITES segment • Existing customers are enhancing their offshore component to India • In the domestic market computerization to rapidly increase • More MNCs are setting up R&D facilities in India • IT training services is an area where India can leverage its strengths in qualified manpower and remote education delivery

14. Production of Major Electronics Goods (2000-01)

15. Export Statistics Software (in US $ bn) Growth Achieved in 2001-02: 29% Growth Target for 2002-03: 30%

16. Export Statistics Hardware (in US $ bn)

17. Future Growth Export Targets (in US $ bn)

18. Future Growth (in US $ bn)

19. SOFTWARE EXPORTS - MAJOR DESTINATIONS Software Export (2000-01)

20. Advantage India-IT Enabled Services CAPABILITIES OF WORKERS • Technical Qualifications • English language • Quality of work • Cost differentia Singapore US Ireland Philippines UK Australia India KEY AREAS • CRM [Call Centres] • Medical transcription • Back office operations • Insurance processing • Content development • Legal databases China LOCATION ATTRACTIVENESS • Infrastructure • Country risks • Time zone As per Mckinsey’s study report India is closest to US & UK for development & delivery of quality software products & services

21. Source: Indian Venture Fund Association FUTURE GROWTH VENTURE FUNDS OVER 70 VENTURE FUNDS OPERATING IN INDIA • SVF operated by SIDBI • Rabo bank • Merryl Lynch • Stanchart • High gate Ventures • Chrysalis Capital • Angel Investments by American Indians Chandersekhar Sabir Bhatia Rajat Gupta K.Rekhi Vinod Khosla S.Sidhu

22. Digital Divide The Flip-side of the Knowledge Era Haves Have-Nots Knows Know -Nots “Our objective is freedom from distance. We are determined to link all the villages of India not only with good roads but also with good telecom and internet services” ------ Prime Minister of India 15th August, 2001

23. Bridging the Digital Divide : DIT’s Initiative • Media Lab Asia • CIC Projects : IT-Infrastructure in North East • E-Learning • Vidya Vahini • Gyan Vahini

24. Media Lab Asia

25. Media Lab Asia Programme - Major Project Areas TOMORROWS TOOLS: PDS for ANMs, water, power, schools, crafts, GIS OLS DIGITAL VILLAGE: Community Connection Village Voice WORLD COMPUTER: Low cost computing devices Linux CE, Village Interfaces, Village Info Systems BITS FOR ALL: Wi-Fi nets, DakNet

26. Media Lab Asia : Deliverables • BITS FOR ALL • Broadband Bandwidth delivery in rural areas • WORLD COMPUTER • Low-cost / functionally versatile computing devices • INTERLINGUA : Multilanguage User Interface based on internal interlingua (visual / conceptual) representation enabling • Multi-lingual programme • Web access • Data based search

27. Media Lab Asia : Deliverables • TOOLS FOR TOMORROW • IT Tools for upgrading skills and productivity of artisans and promoting e-enterprise • DIGITAL VILLAGE • Convergence of all IT applications for achieving • 100% connectivity • Providing Rural Information Kiosks for enabling • e-governance • e-commerce • e-learning • e-enterprise • Digital applications/tools improving productivity and rural artisans • Digital applications / equipments for ameliorating living conditions of rural folks

28. Last Mile Technology Solutions : 802.11(b) 500 Meters ( ( NIC-Centre New Administrative Building Mantralaya

29. BITS for All

30. Low cost Computing Devices - Choice of Technologies • High-bandwidth option: IEEE 802.11B/802.11A • Typical transfer rates: • 11 Mbps @180m • 1 Mbps @500m • Prices still falling: • Access point, <US$180 • Transceiver, <US$80 • Peer-to-peer supported

31. Low Cost Computing Devices • Ruggedized terminals with medium functionality and low cost < US$100 (also has smart card port and musical keyboard)

32. Bio-informatics Bio-informatics has been defined as the discipline that generates computational tools, databases, methods & procedures to support ‘genomic’ and ‘post genomic’ research. Bio-informatics has been also described as a graceful blending of computer science and bio-technology. Bio-technology per se is experimentation in-vivo (in real life) and in-vitro (in test tubes); bio-informatics carries the experimentation a step further and makes in-silico ( in silicon / micro chip).

33. Stupendous size of Genomic Data • Genome sequencing on for 100 organisms • Human Genome has 3.2 billion pairs of DNA sequences. • Data exploding @ 5000 DNA sequences or 2 million nucleotides/day • Refinement, review, reclassification and annotation of the above data Information explosion a challenge to Knowledge Management

34. Bio-informatics - India’s Inherent Strengths • High international profile of Software industry • Vibrant pharmaceutical industry and rapidly emerging bio-tech industry • World class network of educational and research institutions • Rich Biodiversity • Large population – reservoirs of valuable diagnostic and clinical data • Known strengths in mathematics, logic and computational skills

35. Road Ahead • Cogent policy framework to give fillip to Bio-informatics Industry in India • Bio-informatics is inextricably linked to the fortunes of new drug research and new crop research • The fiscal, FDI and Import / Export Policy regimes in respect of wet labs facilities should be identical to the policy regimes governing software technology development and exports of software and IT-enabled services • Industry to get access to clinical data and to data relating to human genetic diversity • India should position itself globally as knowledge partner and not as a source of genetic material and a solution or service provider

36. Nano World Nanotechnology is concerned with the design and manufacture of molecular scale devices by manipulation and placement of individual atoms and molecules with precision on the atomic scale as opposed to the “top down” fabrication techniques employed in today’s microelectronics technology.

37. Dimensions in Scale 100 nanometers 1 nanometer (nm) 1 cm 10 mm 10-2 m Head of a pin 1-2 mm 0.1 cm 1 mm 10-3 m 0.1 mm 100 μm 10-4 m Human hair ~ 60-100 m 0.01 mm 10 μm 10-5 m Red blood cells with white cell ~2-5 m 1 μm 1000 nm 10-6 m Visible spectrum 0.1 μm 100 nm 10-7 m The Nanoworld 0.01 mm 10 nm 10-8 m DNA ~2.5 nm width 10-9 m 1 nm Atoms of silicon spacing ~tenths of nm 10-10 m 0.1 nm

38. Worldwide Govt. Funding for Nano Technology R&D NOTE: Industry Funding is extra&about the size of Govt. funding

39. MCIT Proposed New Initiative Center of Excellence 8 R&D Groups ……. Regional Center of Excellence 1 Center of Excellence 5 Core National Facility For Nano Sciences R&D Groups Center of Excellence 2 Center of Excellence 4 Center of Excellence 3 It envisaged that an Indian Nano initiative be launched with following components:

40. Suggested Nano Tech Initiative The Indian nano initiative will be very capital intensive, needs infrastructure creation and sustenance over at least 10 years to produce results and would necessitate liberal funding for operations. (i) National Facility for Nano Sciences (Initial seed support includes prototype Fab provision) & Running costs/ Updating for 10 years (ii) At least 8-10 Centres of excellence in - NEMS - Molecular & Bio-Electronics - Nano Electronics - Nano Computing - Modeling and Characterization - Capital equipment development - Manufacturing Techniques - Nano materials

41. Super computational support for post genomic R&D • In-silico-computation & in-silico simulation • Genome assembly and sequencing • Proteome or Protein architecture / structures • Metabolome – for acquiring understanding of metabolic reaction and enzymatic mechanism • Genome Annotation • In-silico • Drug target identification • Design • Toxicity testing & • Modeling

42. Nano Scene Nano materials Nano actuators Nano sensors • Artificial muscle • Nano robot components Nano electronics • • Carbon nanotubes • Dielectric and ferroelectric Materials • • Multifunctional polymers • • Bio compatible materials • Scalpel, tweezers & Nano tools • Nano - and Micro - pumps • Nano - and Micro - motors • • • • Nano systems - Resonant Tunneling Devices - Single Electron Transistors - Quantum well structures - Memories - Logic circuits - IR Detectors - Sensors • • • • NEMS (Nano Electro Mechanical Systems) • Nano-machines and robots • Tele-surgery • Drug delivery • Reconfigurable Systems • • • • • •

43. Indian Nano Effort • DST has initiated an exercise in nano about 5 years back under Prof. D Nagchoudhary. Committee examined various aspects in a 3 year period, 2 projects could only be started due to application criteria. • 2 years ago, DST reconstituted the nano panel with Prof. CNR Rao as Chair. The group has most recently funded 2 D academic/ research groups in nano. • DST has allocated Rs. 100 crore for nano effort in 10th Plan. DST thrusts are in basic research, some device applications, Bio-nano, nano education. • DRDO has under nano funded DMSRDE at Kanpur with Rs. 30 crore funding for nano tube project. • Besides above, country does not have any other funded national effort.

44. R&D groups within the country having nano related activities are : IIT Mumbai - Nanoelectronics, Biochips, Molecular Electronics. IIT Kanpur - Nano crystal materials. IITKGP - Nanoelectronics IIT Chennai - MEMS, Nano materials IIT, Delhi - MEMS, Nano processes CSIO, Chandigarh - DNA bio-chips CEERI, Pilani - MEMS packaging, NEMS SCL - Nano electronics (Scaled devices) BEL - MEMS, Nano processes Indian Institute of - Nano structure material and Chemical Technology, applications. (IICT) Hyderabad CEMET - Nano materials Under the DIT initiative, a meeting of key R&D/industry/ user groups with nano related efforts was held in end July 2002 and preliminary interests as emerged from this meeting are being followed up.

45. Manpower Development over 10 years, @ 100 Cr/Yr • (iv) Sponsored R&D in Nano electronics @ 100 cr./year • including indigenous development of nano • capital equipment over 10 years • After seeing the experience of the proposed system over a 2-3 Year period, the set ups could be duplicated as needed.

46. Thank You