As India Rises, Silicon Valley Falls Behind

So says the Bay Area Council, which is talking up a 3,000-page report documenting the ever shifting relationship between India and the San Francisco Bay Area — home to the second-largest population of Indians in the U.S. after New Jersey-New York.

Indian technologists who came to work in Silicon Valley in the 1980s would often stay on and sometimes start companies. Vinod Khosla, for example, not only co-founded Sun Microsystems in 1982 but also became one of Silicon Valley’s top venture capitalists. By 1999, nearly a quarter of Silicon Valley’s engineers were Indian, according to AnnaLee Saxenian at U.C. Berkeley. and around 6% of valley companies had Indian CEOs.

Things changed after 9/11, when the tech bubble collapsed and restrictions on visas tightened, and Indians who came to work in Silicon Valley more often returned home.

Now, despite the very close ties between the two regions — Stanford is advising the Indian government on telecommunications reform, for example, while San Francisco firms are designing the Chennai airport and housing for slum dwellers in Mumbai — there are more and more opportunities for skilled Indians in India as Indian wages rise and the Indian tech and biotech industries get more sophisticated.

“For now…innovation in India focuses more on business processes and models,” the report says. “(But) America’s turn to India and other countries for engineering talent is largely the result of the U.S. failure to generate an adequate number of home-grown scientists, engineers and technicians.”

Predictably, the Council calls for better public schools in California and immigration reform so the U.S. can retain talented foreigners.

But it also calls on the Indian government to remove trade barriers with the U.S. and make government more efficient and on Indian IT firms to hire more “non-Indian nationals” if they truly want to become global companies.

For a U.S. group to be calling on Indian companies to create more jobs for U.S. workers is a big change.

The reports executive summary (only 16 pages) is below, and the full report is here.

Global Reach Execsum Only Web