DURING his recent high-profile visit to India, Apple CEO Tim Cook opened two stores, met with the Prime Minister and other ministers, did some sightseeing, ate vada-pao and spent some time talking to the media.
During the course of one such conversation with the Times of India, Cook said: ‘’It’s been great to spend time with developers here in India! It’s such a vibrant developer community, made up of people with so many great ideas, so much creativity, and so much passion for their work and the impact it can have on the world. To support them, we created our App Design and Development.
Accelerator in Bengaluru in 2017, which has helped thousands of developers take their ideas to the next level and bring cutting-edge apps to the market. The iOS app economy in India now supports more than 1 million jobs, which is a testament to the tremendous growth of the developer community and the incredible creativity that we see here.’’
Tip of the iceberg
What Cook said is the tip of the iceberg. Bengaluru, Hyderabad, Pune, Bhubaneshwar, and Delhi-Gurgaon are emerging as some of the hottest markets for offshore R&D work in this country. If one looks at growth patterns, it is evident that growth is usually driven primarily by cities and then regions within any country. India is no exception. Two of the three fastest growing cities in Asia are, no surprise, from India— both in Southern India – Bengaluru and Hyderabad.
According to Oxford Economics, ‘’Bangalore should achieve average annual real GDP growth of 9.9 per cent over 2020-2024 – far above aggregate growth for India of 6.8% and average growth for Asian cities of 3.9 per cent over the same period. The second fastest-growing Asian city should be Ho Chi Minh City at 8.1 per cent, with Hyderabad in third place at 7.8per cent.’’
Global tech hub
Bengaluru is the India headquarters for close to about 80 per cent of global technology companies and accounts for almost 40per cent of the country’s IT exports. Now, mind you, it is not just that companies like Rockwell Collins or Apple or Cisco and Dell that are headquartered in the Karnataka capital, but includes big guns like Airbus, Boeing,GE,Rolls Royce and Safran among scores of others who are essentially high-quality aerospace and technology OEM (original equipment manufacturers). Out of the over 700 global companies that have off shore research and development (R&D) centres in India, close to 400 are located in Bengaluru.
A piece in knowledge Wharton published sometime back is perceptive in its observations: “All the leading pharmaceutical companies have set up research operations in India,” notes Harbir Singh, a management professor at Wharton. “These companies have realized that India is not just a location where you conduct clinical trials; you can also do basic research. R&D in India isn’t just about low-end work.” Singh believes that the movement of global R&D into India is still in its early stages, but will expand over time. “Indian firms are starting to realize that they must become innovators,” he says. “Their capital outlays are lower than those of their counterparts in the U.S., but that also makes them more selective about choosing projects.”
Top start-up hub
Post-Covid, this effort has only seen a high upward climb with most Indian pharma majors realising that R&D will hold the key to their ultimate success in the global market place and simply being a manufacturing power house will not suffice.
If one adds to this the Startup Genome annual Global Startup Ecosystem Report 2022, then the story is complete. What the reports states is that, “Delhi, Mumbai, and Bengaluru have featured among the world’s top start-up hubs.’’ Cook is right when he says “India is at a tipping point and it feels great to be here. You can feel the vibrancy, and dynamism. The feeling that anything here is possible.
