City in the Chips

"Dateline Bangalore: Third World Technopolis" by John Stremlau, in Foreign Policy (Spring 1996), Carnegie Endowment for International Peace, 2400 N St. N.W., Washington, D.C. 20037–1153.

During the British Raj, the south Indian ware industry, the onetime "Pensioner’s city of Bangalore, located on a cool, lush Paradise" has become the subcontinent’s plateau 3,000 feet above sea level, a haven "Silicon City," reports Stremlau, a staff advisfrom the torrid coastal cities, was a favorite er at the Carnegie Commission on Preventretirement spot for senior colonial officers. ing Deadly Conflict. Today, with a growing population of nearly Citibank, American Express, General five million and a booming computer soft-Electric, IBM, Texas Instruments, Hewlett-Packard, and Compaq, he writes, are only some of the U.S. companies that are using software developed and tailored to their needs in Bangalore and other Indian cities. Since 1990, India’s annual software exports have jumped 53 percent, reaching $500 million in fiscal 1994–95.

Jawaharlal Nehru, India’s first prime minister (1947–64), envisioned Bangalore as India’s "City of the Future," Stremlau notes. "For more than four decades, India’s central government invested lavishly in the building of Bangalore’s civilian science and technology infrastructure as well as the nation’s most sensitive and advanced military and space research facilities." Today, the city boasts three universities, 14 engineering colleges, 47 polytechnic schools, and an assortment of research institutes.

But during those same decades, in an effort to escape the legacy of colonialism, India shunned foreign trade and investment. That changed in 1991, when Prime Minister P. V. Narasimha Rao’s government introduced free-market reforms and decided to participate more fully in the world economy. Bangalore’s "sudden market-driven success" since then, Stremlau says, is regarded by Indian economists as proof that this still predominantly agricultural country of one billion people "can catapult to the forefront of the 21st century global economy."

In the meantime, however, success has brought problems to Bangalore. Population growth has strained roads and basic public services. Many high-tech firms are creating "their own self-contained communities called technology parks," Stremlau says.

Another problem, he believes, is the growing gap between rich and poor. Experienced computer professionals in Bangalore often earn in the neighborhood of $10,000 a year—"a princely salary" in a city with a per capita annual income of only $404.