The North-South IT divide

Released by Mr Montek Singh Ahluwalia in New Delhi, ‘Waiting to Connect’ has found out that increased IT consumption in the manufacturing industry can propel profits by 30%. But more importantly, instead of taking away jobs it will increase employment opportunities by 30%.

And this is not only for ‘skilled labour’, the study shows that by incorporating IT in the manufacturing sector ‘demand for less skilled and skilled workers increases by 30% and 35% respectively’. On being quizzed as to how will it be facilitated, Subhashis Gangopadhyay said, “I can’t tell the industry how to do it. This revelation is based on hard facts and now it is up to the industry as to how it utilises its workforce.”

The Annual Survey of Industries (ASI) data, on which most of the findings are based, has given the authors their insights into the industry but it has also articulated the helplessness of industry in actually utilising IT on the ground level.

The first and foremost problem is the ‘cost factor’. Good and useful technology doesn’t come cheap and with 85% of factories in India qualifying as ‘small units’ the affordability factor is something that is just impossible to overlook. Next hurdle for the industry comes in the form of lack of skilled labour. This problem can be solved if the government joins hand with the industry to set up basic infrastructure for training and educating the youth. Someone needs to take initiative for this but sadly not many have come to the fore to don this hat.

The last and a rather embarrassing problem is something as basic as availability of power. Imagine the huge potential India’s manufacturing sector being halted by a ‘power-cut’! When it comes to basic infrastructure like power and networking for Internet penetration the condition is absolutely abject in most parts of India.

In some parts of states like Jharkhand, Bihar, Orissa, Chattisgarh and Assam the tele-density was a pathetic 2 telephones per 100 households in 2006. Now these places are still untouched by the ‘IT revolution’ that has managed to penetrate other metros so to think that they can be taken under the purview of this so-called ‘IT revolution’ would be rather preposterous but yes in places where the basic infrastructure exists, usage of IT is definitely a boon.

Another interesting and perhaps less known fact that this study reveals is the geographical distribution of IT penetration in India. Surprisingly North and West India lead the way, Delhi being the flag-bearer, while South India lags far behind when it comes to adopting IT for manufacturing units. The fact that most IT majors are based in cities like Bangalore, Hyderabad and Chennai is counter-intuitive to this finding but there is an explanation for it. Dr Manisha Singh attributes this factor to the large number of small factories and manufacturing units that are spread across the state and also shares an interesting sneak peek in the book that after Delhi it is Lucknow that has the highest percentage of factories adopting IT to simplify the processes in the factory.

So Tamil Nadu that has the highest number of manufacturing units in the country has less than 40% units that are computerised and amongst the 15 Indian states that account for more than 90% of all the factories in India Tamil Nadu is ranked way behind at 11. The study puts Andhra Pradesh at 14, which is pretty surprising as its capital is often referred to as India’s ‘Silicon Valley’.

Now it is up to the government to make the environment conducive for the industry so that they can adopt technology and IT. Basic things such as more stringent Copyright Laws (and their speedy implementation), providing smaller industries with basic infrastructure like power and connectivity are something which the government has to look into.

Problems such as personalised software and content development for local and small manufacturers is another thing that the industry body should look into and if things work out well it can be overcome without much ado. The bottom line is factors like power-cut and piracy shouldn’t be allowed to stop India’s manufacturing segment from realising its true potential and since IT can prove to be an ideal foil for it to blossom its high time we get on with things.