India’s ‘Silicon Valley,’ Bangalore is fast becoming a serious global player

Ask natives of Asia’s two giants, China and India, what they think of the other, and not infrequently, the jokes and stereotypes fly. At least some people in each country seem to enjoy secretly — or not so secretly — looking down on the other.

So when an Indian official took the stage at a Chinese-sponsored high-tech conference in San Francisco last fall, made a joke about Chinese having to check with the teachings of Chairman Mao before they could answer a simple question, and then made the case for "why India Rocks, Bangalore roars, and Silicon Valley will soon be Bangalored," some of the Chinese members of the audience were practically sputtering.

“Just to be more objective … one in five drugs exported from India are fake,” one said in the question period. “And also, electronics, India exports the most fakes to the US."

The official, Srivatsa Krishna, permanent secretary of e-governance for the state of Karnataka, of which the IT hub Bangalore is the capital, started to answer. “I’m not debating that data. I’m saying every country has its problems, and we have ours."

“But it’s too much!” the questioner broke in.

“Can I answer?” Krishna replied.

Other Chinese questioners jumped in to ask just how he thought India could really be a challenger to China, in innovation, in tech, in economic growth, in anything. After all, for three decades, China has been the uncontested great power rising in Asia, powered by pragmatism and efficiency, while as recently as the ‘80s in India, it could take two years to get a phone line.

But things change. And they’re changing now. China’s economic growth is slowing, its working population is aging and contracting, and the government of Xi Jinping has been more focused on promoting aggressive nationalism and defending against Western ideas like democracy and free speech than on encouraging China’s continued opening up to the world.

Meanwhile, India is rising.

Its economic growth rate is now faster than China’s. Half of all Indians are under 25, and most of those are digital natives. That means India is coming into the same "demographic dividend" that China enjoyed as its baby boom generation moved through the workforce and drove economic growth in the 1980s, ‘90s and early 2000s.

China’s growth is far from over, the potential of its younger generation remains great, and India’s ascent will have its challenges. But India’s increasingly showing that it’s a serious contender to become a regional and global leader, in tech, and perhaps beyond.

“By 2020, a recent McKinsey study says, we will become the single largest IT cluster on the planet — overtaking Silicon Valley — with 2 million IT professionals, 6 million indirect IT jobs, and $80 billion in IT exports,” Krishna says. Already, Bangalore’s population has doubled over the past 15 years, to 11.5 million, as growing opportunities in IT, biotech and other fields, have drawn young, educated professionals from around India. Some have even started to return from Silicon Valley.

“I’m just here for a short trip,” says Niketh Sabbineni, who cofounded a startup called Bookpad a couple of years ago, and then sold it to Yahoo. He’s now working with Yahoo in Silicon Valley, but he thinks Bangalore’s the place to be. “So I’m looking to start again. I’m looking around for opportunities. I’ve talked to a lot of entrepreneurs and investors in the US, and I find this space more exciting. I find that the energy and the sheer number of people starting up here, are far more. So I want to come back here.”

Sabbineni says this, surrounded by the buzz of the Startup Warehouse, a government-funded incubator for startups in a newer part of Bangalore. His own company came through an earlier incarnation of the Startup Warehouse. He credits it not just with connecting him with peers and with investors, but also with teaching him how to be an entrepreneur.

The Startup Warehouse is part of both national and local government goals to increase entrepreneurship and innovation in China. A “10,000 Startups” project, started three years ago, has already helped launch 12,000 startups, and the program is just getting started.

“The idea is that over the next 10 years, we want to impact 10,000 startups,” says Ashok Madaravally, who oversees the Startup Warehouse, and is deputy director of the National Association of Software and Services Companies. “That means we help them get started, connect them with customers, get them significantly mentored and help them grow at a global scale.

This is a new, welcome level of help from the government, in a country where red tape and bureaucracy strangled many an entrepreneurial impulse in decades past. That’s not to say that the red tape and bureaucracy have disappeared entirely; but they’re not the tiring obstacles they once were.

Drive around Bangalore, though, and compare its physical infrastructure with that of Beijing, or Shanghai and Shenzhen, and you may end up wondering how India could be a contenders in high-tech. China’s cities are full of broad boulevards and big, modern high-rises.

Central Bangalore looks almost village-like, with stray dogs ambling past the charred remains of campfires on uneven sidewalks, with small shops with whimsical signs, motorized trishaws and squatting street vendors. But the infrastructure gets better, fast, as you move out to the newer parts of town, where the tech and biotech areas are fast expanding. 

Even Chinese investors have started to realize that many Indian companies are a good bet. After investing just $1.2 billion total from 2000 to 2015, Chinese investment is pouring in, and is expected to total $5 to 10 billion over the next three years.

“I think there’s absolutely no gain saying the fact that India is at least 20 years, in some cases perhaps 100 years, behind China in terms of physical infrastructure," Srivatsa Krishna says. “But we are ahead of them in innovation, knowledge and the IT economy. And this hasn’t happened overnight. This has been going on for the last 25 to 30 years, to reach where we have reached today. And the good news for India is, it has only scratched a very, very small bit of the global pie. The way ahead is long. The rewards are many, and very, very fruitful, and so are the risks. And we are very, very aware of that.”

And here's what India has to help it create a different kind of future than China — a functioning democracy in a multicultural country, a free press and a long tradition of vigorous public and private debate, an independent court system, and a not insignificant number of entrepreneurs less interested in creating a unicorn — a startup valued at a billion dollars — and more interested in solving problems that hundreds of millions of the poorest in India, and the world, face.

At Bangalore’s Bioinnovation Center, also government-funded, scientists are working on how to more quickly heal wounds, neutralize allergens, diagnose pathogens quickly and cheaply in village clinics, even how to predict epilepsy attacks.

“I have a son. He’s about 5,” says Rajlakshmi Borthakur, a career IT professional who worked for Infosys and Ernst & Young before becoming a mom, and finding out that her son had severe epilepsy. His attacks would go on long stretches, and left him developmentally delayed. He can’t talk, and he wobbles when he walk. As his attacks have kept coming, emergency trips to the hospital have become part of life.

“Because it would be life-threatening for him, otherwise,” Borthakur says. “So we started looking for some answers. We wanted an indication that he was about to have an attack, so we could at least get out of our pajamas and into our clothes and take him to the hospital. We needed at least that much time, and there was nothing available in the market."

Borthakur started reading widely about epilepsy. “And I am an Internet of Things enthusiast, on the side, and I was reading up about sensors,” she says. “I knew about epilepsy. I knew about neural networks. So somewhere, somehow, this all came together, that epilepsy is related to electrical signals, electrical signals could be extracted with the help of sensors, and once you pass this onto a processing hub, maybe we could predict epilepsy. So that was the beginning.”

She experimented. She streamed data from her own body. Doctors told her she was on the right track. She entered a competition called “Innovate for Digital India,” supported by the Department of Science and Technology, and of 1,900 entrants, she ended up in the top 10, and with a slot in the Bioinnovation Center.

By the end of this year, Borthakur’s company, Terrablue XT, hopes to launch a glove with embedded sensors that can detect an oncoming epileptic seizure. This, and other wearables to come, could make life easier for many of the 50 to 60 million people worldwide with epilepsy, and for those who care for them.  Doctors could monitor patients, even in remote villages. The collected data — big data — from all epilepsy patients using this device, could help doctors better recognize patterns, and prescribe treatment. It’s potentially a pretty big deal.

That’s also the kind of innovation encouraged down the street, at the Indian Institute of Information Technology.

“Indians are starting to solve India’s problems,” says professor S. Sadagopan, IIIT’s director. “I think what people are realizing is, unless the poorest in India are going to make more money, this country has no future. Some startups are starting to look at ways to make a difference. Will it make a Facebook? Will it make a Google? Honestly speaking, I don’t care. Does it make a difference to a billion people? I care.”