19 September 2024 : Daily Answer Writing

Q1) Enumerate the factors behind the proliferation of the IT industry in India. Also, Explain the reasons behind the skewed concentration of the IT industry within the country.

(150 Words/10 Marks)

ANS

The IT industry in India has been a flag-bearer of socio-economic transformation of the country. The factors behind the proliferation of IT Industry in India can be summarised as:

1. Familiarity with English language led to easy acquisition of IT related knowledge.
2. Coastal states like Karnataka, present similar climatic conditions like Silicon Valley (USA), encouraging entrepreneurs to set-up industry.
3. Innovative entrepreneurship has also contributed in establishing India as the hub of IT and ITeS industry. E.g., Narayan Murthy of Infosys.
4. Availability of technically skilled manpower, especially in the metropolitan cities. E.g., IT hubs in Bangalore, Chennai, Gurgaon etc.
5. Government policies:
6. 1991 LPG reforms.
7. Export Oriented Units (EOUs), Software Technical Parks (STPs) with supportive infrastructure.
8. Removal of duties from import of IT products.
9. Make-in-India, Smart Cities Mission, and Digital India.

Reasons behind the skewed concentration of the IT industry are as follows:

1. Poor supply chain infrastructure to complement the growth of the IT industry has led to their limited penetration in tier 2/3 cities.
2. Education/developmental indicators:
3. Prevalence of poverty, poor spending ability etc., restricts the customer base for IT industries. E.g., difference between per capita income of Uttar Pradesh and Karnataka.
4. Low educational outcomes, poor penetration of IT education has also diluted the resource base, HR pool for the IT industries.
5. Harsh climatic conditions, prevalence of primary industries, and lack of an innovative ecosystem has also resulted in poor spread of IT industries in north India. E.g., high share of population engaged in agriculture in Punjab.
6. Corruption/poor-governance:
7. Lawlessness, corruption and poor governance keeps away investors.
8. High level of red-tapism in some states and non-responsive bureaucracy also mars the potential of a region for becoming an IT hub.

Lack of infrastructure:

1. Poor penetration of internet facilities in the rural areas have restricted the growth of the IT industry in these regions.
2. Lack of connectivity makes it difficult for the human resource to relocate in these areas. E.g., lack of air connectivity in Uttarakhand, North East etc.
3. Inadequate and disruptive supply of power/electricity is a major hindrance in development of IT industries in these regions.

In order to ensure a well-rounded growth of IT sector, there is a need to ensure:

1. Availability of skilled manpower through training and capacity building.
2. Growth by policy support. E.g., digital north-east vision 2022.
3. Infrastructure growth E.g., internet connectivity in all village panchayats.
4. Growth of start-ups, entrepreneurships etc., through credit support and hand holding.
5. Multimodal-connectivity. E.g., PM-GATISHAKTI masterplan.

The IT industry is a tool to make India a leader in the global knowledge economy. However, the need is to ensure its well-rounded distr