We need to first Design in India

Ajai Chowdhry, Founder of HCL and Chairman - of Board of Governors, IIT – Patna, takes a detailed stock of Make in India, its strengths, weaknesses, and the path ahead. Edited excerpts from the video interview…

On the government’s Performance Linked Incentive (PLI) schemes…

The schemes on their own are excellent. They are serving the purpose for which they were created, which is increasing electronics manufacturing in India in different areas. They all started with phones and then want to components, then on to IT hardware, etc, and recently semiconductors also. All of them are designed towards creating more manufacturing in India. So that objective gets served.

What is not happening and that is the area that is now getting the attention of the government as I read from the semiconductor policy is that we need to have more value addition in India. If we continue to just manufacture with 5-10% value addition and give away large amounts of incentives for low-value addition, then we will not achieve our objective. One of the things that we have tried to impress on the government is to introduce schemes where design comes to the center.

All products in India in the last 10 years are not made in Indian electronics. Pretty much every product is made either in China or in the US or South Korea. How many brands in India have vanished in the last 10-15 years?

Fortunately, in the semiconductor policy, they have not just announced a design-led incentive, but they have also specifically mentioned that to help the growth of the industry, they will aggregate the government demand for semiconductors. I think that’s a huge breakthrough as far as we are concerned. This is something that I have been telling the government for a while. Use the power of your large government demand to create industry. This is something that they have added to the semiconductors. I would like to see this happen in every area.

Bringing back Indian brands…

Secondly, design should become the centre of it all. If you want to manufacture semiconductors in India, who will give you the business today? All products in India in the last 10 years are not made in Indian electronics. Pretty much every product is made either in China or in the US or South Korea. How many brands in India have vanished in the last 10-15 years?

If you look at that situation, we need to work on bringing those brands back. We need to work on creating Indian brands. Only when you have Indian brands will the design happen in India, the components will be bought in India, and the assemblies will be bought in India. Finally, when the semiconductor plant comes up, the chips will be bought in India. Today all these decisions are not taken in India. Fifty percent of the products or more than that in every category are from China. The Chinese use their own chips. They will not buy chips from us even when they make it here.

What’s been proven now is that many startups have created products in India which are not just Made for India but are Made for the World. You are seeing companies that are amazing and happening.

The importance of Design in India

I think this is a very major change that we need to bring around. We need to make sure that products become the center of it all. With products, with design, with value addition, we will have a very thriving industry. Design in India is what will get us far.

If we continue to depend on other people’s designs, we are not using our intelligence, our capabilities, our IQ, our knowledge, and the skills that we have acquired over the years. You will be surprised that there are many electronic design companies in India that design for the world. But we don’t design anything for India.

Startup products will give us global recognition

Startups are important in every area you can think of. I am very deeply involved in the whole ecosystem of startups. I think in the last 8-10 years you have seen very good growth of startups. To my mind, the products and the work that they are doing are not a fad. They are really creating global world-class products. Ten years ago, we all used to ask this question in the drawing rooms: Why doesn’t India have a Google? I think that’s history now. What’s been proven now is that many startups have created products in India which are not just Made for India but are Made for the World. You are seeing companies that are amazing and happening.

Look at Zoho. Their headquarters are in a village in Tamil Nadu, but they are catering to the world. There has been a huge movement from services to products. Startups have taken the lead in creating products in India, not the large companies. I do believe that the valuations are very stretched today. But we are going towards being a product nation and that makes me very happy because it is products that will make us be recognized globally.

The government did a great job of bringing research, academia, and startups together. They had so many schemes, campaigns and strategies which they put together to create products in India.

Our leadership position with India Stack

One very good thing that’s happened in India is that because of the initiatives of the government and some of the organizations like iSPIRT, there is a huge growth of India Stack (Editor’s Note: The largest open API in the world). This is driving a lot of the product development growth that is happening. India today has an absolute leadership position in the world as far as this is concerned. If we want to do soft marketing of India globally, the government should take this up and do a G2G agreement with many governments, and very softly we will be in the minds of the world, just like China. The US and Europe don’t have what we have.

Collaboration between academia, research institutes, industry

Academia and research are really important if we want to be a world-class tech country. I think it’s our weakest link. Academia and research organizations still do not work very closely with the industry. I think the linkages are pretty much very poor or broken. A lot of times numerous top institutes wait for the industry to come and talk to them. It should be the other way. Academia and research institutes should go out and talk to the industry and give their knowledge, their skills, and their capabilities to the industry. They should involve startups, students, and industry in research at an early stage. Worldwide universities grow with research and not just with teaching.

What is required is that all the various institutions change their courses to make sure that people are not just taught how to design, but they should go manufacture. If it doesn’t manufacture, the product is useless.

Something like this happened during Covid. That was very interesting. The government did a great job of bringing research, academia, and startups together. They had so many schemes, campaigns, and strategies that they put together to create products in India. So suddenly when we had a shortage of PPE, we grew by a hundredfold. Same with testing kits. I was part of a team from IIT Kanpur that created a ventilator in 90 days.

A lot of online courses are also available. Lots of companies are doing that, whether you look at management or technical skills… everything is happening online. People who got left behind in the last 5 years have caught up during Covid. The online business has gone places in the last few years.

The roadmap for the future

There’s a large shortage of AR-VR Metaverse type of skills that you see today. Shortage of blockchain and full-stack skills. We need to scale up the education system to keep up with that requirement. A huge amount of work needs to be done on creating the newer IT skills that are missing today.

If you look at software, yes in terms of products we seem to be on track, but if we don’t have the right skills that are required for today’s products, then we are going to have a situation where products will become more expensive and will take longer to develop.

As far as hardware is concerned, we have just got to start doing designs. We need to bring back the brands of India. A lot of times people say if we are doing so well in software how does it matter whether you are not doing well in hardware. I think that’s completely incorrect. Because the real situation is that today the boundaries between hardware and software are blurring. A lot of hardware has a lot of software. There’s no way you can create a hardware product without understanding AI and ML. Very importantly you need to integrate these things even when you design chips. That’s what is required for the country. We have to Make and Design in India.”

(Catch the complete interview on the PCQuest YouTube channel.)

By Sunil Rajguru

sunilr@cybermedia.co.in