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Check out this review – posted on the Global Themes blog of friend and contributor to 2point6billion, Shantanu Bhagwat - from last week’s FT piece looking at the comparative scenarios of India and Israel’s IT industries by TN Ninan, editor and publisher of Business Standard (one of India’s leading business newspapers)…
I’d be curious to know what you all have to say about the likes of this comparison with China included…
In the article, Ninan noted that:
“…it takes a quick visit to Israel to put these signal achievements (of the Indian software industry) in perspective. At dinner in Tel Aviv with the man who advises Israel’s prime minister on economic policy, the subtle point is made to us that those armies of people walking every morning into the campuses of Infosys and Wipro are not in the same category as the large numbers of high-tech entrepreneurs being turned out by Israel.
…Israel has no fewer than 3,000 high-tech companies, supported by a flourishing venture capital industry that buys into garage-scale enterprises and takes them public once they have reached a certain scale. Last year alone saw foreign investors coughing up $10bn to buy into just 30 Israeli tech firms.
…more than a third of Israel’s total exports in some years have come from the high-tech area, and 20 per cent of the revenue earned by the electronics industry is ploughed back into R&D – some of which is a spin-off from the country’s massive investment in defence research.
…when you are told that firms in Israel have developed the voice over internet protocol (VoIP), Intel’s multi-core processor, the cellular telephone and most of Microsoft’s Windows NT operating system, and that the world’s electronics giants have invested much more in Israel than in India, Bangalore’s very creditable record begins to pale.
To be sure, Indian companies and the Indian branches of international firms have been doing more high-end work in recent years and helping to develop cutting-edge technologies useful for a range of industries. But for every product development claim that you can make on behalf of India, Israel can perhaps make a matching if not superior claim…”
Ninan’s footnote profile mentions that he is an award-winning journalist but this particular report was far from any award-winning news-story.
At the very least, it could have done with a little more homework…and in any case, a comparison between India and Israel is not simply apples and oranges…it is just PLAIN BAD.
Why do I say that?
The two countries have been on vastly different growth trajectories, have had very different business environment for several decades and share very little in common when it comes to development challenges…
To make it a more “apples with apples comparison”, you need to factor in (on the Indian side) an impoverished population of several hundreds of millions, stage of development, questionable government policies, problems of national identity, challenges of running a democracy on an empty (or partially-filled stomach) etc etc…Once you do that, India (surprise) begins to look much much better…or may be it is just the proud Indian in me rushing to India’s defense?
You decide.
P.S. I hope Barak is still talking to me after this!
P.P.S. some critical opinions available on this at: http://global-themes.com/india-israel-bad-comparison/#comments
