How should the U.S. respond to China’s and India’s growing
clout? Reviewed by Robin Tatu
IT and the East:
How China and India Are Altering the Future of Technology and
by James M. Popkin and Partha
Iyengar, Gartner Inc., Harvard
Business School Press 2007, 226 pps.
The current popularity of the term “Chindia”—a
portmanteau fusing “China” and “India”—reveals
not only a growing fascination with but also concern over these
rising stars of the global marketplace. Both China and India are
now producing great numbers of engineering graduates; engineering
schools, information technology centers and research hubs are springing
up throughout India; and China’s manufacturing capability
far exceeds those of other nations. Were they to join forces, the
two countries could form a daunting economic bloc. Yet both are
also crippled by red tape, inefficiency and corruption—not
to mention troubling intellectual property lapses. India struggles
with serious infrastructure limitations, while China’s human
rights violations continue to hamper its business potential.
What is the reality of Chindia—promise, threat or hype? This
question lies at the core of a new book by James M. Popkin and Partha
Iyengar, two analysts at Gartner Inc., an information technology
research and advisory firm. The authors of “IT and the East”
argue that while uncertainties plague both countries’ futures,
“the growing impact of China and India in the IT industry
is clear to anyone following the money of global trade.” They
offer their study as a tool for tracking future developments and
crafting appropriate business strategies in response. Though geared
for the corporate world, this book is compelling reading for anyone
seeking to understand the emerging international scene.
Divided into three sections, IT and the East focuses in turn upon
China, India and the projected Chindia alliance. The opening chapters
of the country sections analyze the myriad factors influencing each
location’s IT landscape. Popkin and Iyengar acknowledge state
control of business in China, for example, but point out that the
Communist Party is not the unified presence that many Westerners
believe it to be. Instead, city governments tend to operate in fierce
competition with other city governments—not infrequently skirting
official Party strictures. Equally complex dynamics exist in India,
where 28 states and seven territories vie for investments, and languages
and political ideologies vary widely from region to region. The
authors also deflate the hype about vast numbers of Asian engineers,
arguing that many do not meet international standards. Although
the elite Indian Institutes of Technology (IIT) train skilled professionals,
these graduates represent only a small percentage of the total.
Thus, India now faces a shortage of qualified manpower, not a surplus.
Yet governments and businesses in both India and China are racing
to surmount these problems and exert greater influence on the marketplace.
Their success or failure depends on a number of factors, which are
examined in the ensuing chapters. Popkin and Iyengar project three
probable scenarios for each country—ranging from stagnation
to global prominence—then target identifiable milestones of
progress or retrenchment. China could retreat from its liberalizing
policies, but the authors give this scenario scant probability.
More likely is what they term “China Inc.”—increased
private sector innovation and investment. The 2008 Summer Olympic
Games in Beijing mark the first important milestone, they believe,
and strategists would do well to study the Games’ economic
and political dimensions for clues to the future. They similarly
identify India’s 2009 general elections as a crucial indicator
of future developments.
The book’s final section explores the probable rise of a
Chindia alliance, despite past strains, and outlines steps for U.S.
business to take in order to survive such a powerhouse union. Suggestions
in the chapter “Priorities Today for a Chindia Future”
range from pursuing opportunities in the countries’ rural
development to establishing local research and development capabilities.
Two appendices provide summations of “scenario milestones
and signposts” for China and India, respectively.
While several recent books discuss the Chindia phenomena, “IT
and the East” stands out in offering clear analysis of both
countries’ strengths and weaknesses, accompanied by concrete
strategies. The authors make a convincing case for addressing the
Chindia challenge early on, arguing that “the national economies
of China and India—and of a nascent Chindia—are stirring
unprecedented threats and opportunities.”
Robin Tatu is a freelance writer based in Washington, D.C.