Over the past few years, India has steadily emerged as a major research and development (R&D) centre for the world's leading telecom and IT players, thus shedding the image of just a low-cost destination for outsourcing back-office jobs.
Increasingly, despite various constraints like the shortage of high-skilled work force, with relative inexperience in the field of high-end research and poor infrastructure overall, India is witnessing a surge in good quality R&D work.
Experts say this trend has gathered momentum, especially over the past few years, and is evident in the work being done by companies like Intel, Cisco, IBM, EMC and Nokia. Executives at these companies are keen on showcasing the work they have been doing in India, although some shy from sharing technical details of the R&D work that demand some confidentiality.
"Cisco Development Organisation (CDO) India has grown from a team extension mode to an ownership of a component model to becoming a centre of excellence in several technology areas,'' says Aravind Sitaram, VP, CDO.
Sitaram adds that CDO India has generated over 110 US patents and another 400-odd with the US Patents and Trademark Office. "'The India team works on several key international deals working with sales teams, partners, and customers on defining solutions and architecture."
Actually, Cisco's development centre in Bangalore is the largest outside the US. Despite that, the company has forged tie-ups for joint development centres with top IT firms like Wipro, Infosys; HCLT; Satyam and Zensar.
Cisco says its focus has not been on cost arbitrage but on growth, talent and innovation, and that it owns many of its platforms and technologies developed at Indian facilities. A large number of its 3,600 employees work at CDO India and have been involved in its optical product line, flagship products like the gigabit switch router (GSR), and software development in areas like security.
Intel is another technology major that has been getting its high-end work done out of India. "We have been doing R&D work in India across our businesses, be it client or enterprise," says Sandeep Shah, director at Intel's mobility group.
The Intel India Development Centre (IIDC), the company's largest non-manufacturing facility outside the US, has grown quite fast in the past five years and already employs 3,000 people who work on chip design, platform design and software development. Indian engineers have contributed substantially to Intel's Centrino Duo platform, the quad core processor and to delivering teraflop performances.
Shah says that Intel is very bullish on India and the development centre here is already involved in developing products that are slated for two to three years from now.
EMC, a leading data storage company, is looking to raise the bar as much, especially in the R&D work that it does out of India. "'The trend to source research started in India 4-5 years ago as cost arbitrage, but in the past 18 months or so, things have changed greatly," says Sarv Saravanan, MD and VP of EMC's India Centre of Excellence (COE), the company's largest R&D facility outside North America. Within a year, EMC has grown to around 1,500 people, up from 900. The company has filed for about 30-odd patents from India and is tapping talent for its various businesses.
"At the India centre, we deliver product-engineering, services and integrated innovation for every product group within the company," says Saravanan. These include storage, information management, security, virtualisation, enterprise content management, and global services. Saravan says, besides building IP for EMC, the India centre is also building expertise domains with deep subject capabilities.
Although companies like Intel, Cisco and EMC have been tapping the engineering skills, they have yet to go in for big-time manufacturing. But Nokia, the world's leading mobile handset manufacturer, has taken the lead in manufacturing and is fast building on that strength to develop products. The company has already manufactured over 125 million phones in India, exporting half of its production to about 50 countries.
Nokia has three R&D centres in India-Bangalore, Mumbai and Hyderabad-and are focused on the next-generation packet-switched mobile technologies. The company has about 1,000 people working on various R&D projects. "While all the three centres are an integral part of Nokia's global R&D infrastructure and, therefore, work on global projects, these centres play a pivotal role in assimilating local flavors from the market and act as a conduit for information to the global product development teams," says a Nokia executive.
Nokia's Bangalore R&D centre, the largest in India, was set up in 2001 after the acquisition of Amber Networks. "It plays a crucial role in developing new applications, software platforms and chipsets for high-end Nokia mobile devices," says the executive. Quite a few of Nokia's innovations for emerging markets, like a dust-free keypad and a small but powerful torch/flashlight on mobiles, have come from India.
IBM India's R&D lab, too, has some interesting examples of having developed technologies and solutions that tap local opportunities, apart from working on its products for local markets. The IBM India lab recently developed a web-based interactive online voice and accent training technology that helps people speak better English. Similarly, the company's desktop Hindi speech recognition technology 'understands and transcribes speech with little use of keyboards'.
While all this is heartening, some experts caution that India needs to churn out high-quality engineers and have adequate work force to be able to sustain the technological edge and grow in the highly competitive arena of R&D. Not only that. Shah says, for instance, Indian experts need to develop depth in technology that their counterparts in the US have. He says India needs to look for a leadership role in R&D, and the access to highly talented, experienced human capital is going to be the most important factor.
Towards that end, IT industry executives have long called for a sustained commitment to investment in science and technology, strengthening the research infrastructure, aligning the university curriculum to industry needs and making teachers' training at all levels up-to-date.