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India, Pakistan and GE – Friedman

August 12th, 2002 · No Comments

Thomas Friedman has an interesting viewpoint on how the IT industry staved off a possible war between India and Pakistan. He writes:

Two months ago India and Pakistan appeared headed for a nuclear war. Colin Powell, the U.S. secretary of state and a former general, played a key role in talking the two parties back from the brink. But here in India, I’ve discovered that there was another new, and fascinating, set of pressures that restrained the Indian government and made nuclear war, from its side, unthinkable. Quite simply, India’s huge software and information technology industry, which has emerged over the last decade and made India the back-room and research hub of many of the world’s largest corporations, essentially told the nationalist Indian government to cool it. And the government here got the message and has sought to de-escalate ever since. That’s right – in the crunch, it was the influence of General Electric, not General Powell, that did the trick.

This story starts with the fact that, thanks to the Internet and satellites, India has been able to connect its millions of educated, English-speaking, low-wage, tech-savvy young people to the world’s largest corporations. They live in India, but they design and run the software and systems that now support the world’s biggest companies, earning India an unprecedented $60 billion in foreign reserves – which doubled in just the last three years. But this has made the world more dependent on India, and India on the world, than ever before.

Friedman’s book “The Lexus and the Olive Tree” is an excellent book – read it if you haven’t. Its on the impact of globalisation. India is now very much a part of the global supply chains.

Tags: Emerging Markets

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