For decades, India has celebrated its rise as an IT superpower.

And rightly so.

From Bengaluru to Hyderabad, Chennai to Pune, Indian engineers have become an essential part of the global technology industry. Companies such as TCS, Infosys, Wipro, HCLTech and others built enormous businesses serving some of the world’s biggest corporations.

But there is an uncomfortable question we need to ask.

Did India really become a technology superpower—or did India become the world’s most successful technology services provider?

There is a big difference between the two.

One creates intellectual property.

The other creates manpower-driven revenue.

One owns the product.

The other builds, maintains, implements, customises and supports the product.

One can sell the same invention to millions of customers.

The other often has to sell human expertise repeatedly, project after project.

And this distinction explains a lot about where India stands today.

We became exceptionally good at doing the work

The Indian IT story is genuinely remarkable.

Western companies created operating systems, databases, enterprise software, semiconductor technologies, cloud platforms and eventually the major consumer internet platforms.

India created a huge pool of technically capable engineers who could build, customise, maintain and operate these technologies at a much lower cost.

That became India’s competitive advantage.

The model was brilliant.

A company in America could spend heavily on software development, product architecture and technology innovation.

An Indian company could provide thousands of highly trained engineers to develop, test, implement and maintain those systems at a fraction of the cost.

The customer saved money.

The Indian company made healthy margins.

Indian engineers got employment and global exposure.

Indian IT companies grew into enormous corporations.

Everybody benefited.

But there was one question that was not asked loudly enough:

What happens when the country that supplies the engineers also starts creating the technology?

That is where India’s story becomes complicated.

TCS, Infosys and Wipro are not simply “body-shopping companies”

It is important to be fair.

The criticism that Indian IT companies have done nothing of their own is not true.

TCS has built products and platforms such as TCS BaNCS, iON, ignio and several industry platforms. It reported 9,596 cumulative patent filings and 5,500 patents granted as of March 2026. It also reported 1,833 AI-led patent filings.

Infosys has products and platforms including Finacle, Edge Suite, Panaya, Stater and Infosys McCamish, and reported 823 patents granted or pending in its 2024-25 annual report.

Wipro has substantial engineering and R&D capabilities as well, including work in semiconductor engineering, AI, 5G, embedded systems and product engineering. Its engineering business has reported hundreds of patents and thousands of products delivered for clients.

So we can’t say:

“Indian IT companies invented nothing.”

That would be wrong.

The more important argument is:

Why didn’t India’s enormous IT-services success produce more Microsofts, Oracles, SAPs, Adobe-like companies, Nvidia-like companies or global software platforms originating from India?

That is a much harder question.

The real problem: we optimised for services, not ownership

India discovered a highly profitable formula:

Engineer + laptop + foreign client = export revenue.

And we became extraordinarily good at it.

But technology wealth works differently when you own the intellectual property.

Imagine two companies.

Company A has 100,000 engineers and earns money by providing technology services to thousands of customers.

Company B has 10,000 engineers but owns a software platform used by 100 million customers.

Company A may have enormous revenues.

But Company B can potentially create extraordinary value because the product can be replicated at almost zero marginal cost.

That is the magic of software.

You build once.

You sell many times.

And you continue improving the same intellectual property.

India mastered the first model.

We did not scale the second model to anything close to the same extent.

And what did we do with the money?

This is where the debate becomes uncomfortable.

Indian IT companies generated enormous amounts of cash.

They paid dividends.

They bought back shares.

They acquired companies.

They expanded offices around the world.

They increased employee strength.

They built delivery centres.

All of that is perfectly rational from a shareholder perspective.

But national technological leadership requires something else.

It requires companies willing to say:

“We will spend billions today building something that may not make money for ten years.”

That is the uncomfortable part of deep technology.

Research is uncertain.

Products fail.

Scientists leave.

Patents may become worthless.

Competitors may beat you.

A product may take a decade to reach the market.

Services are much easier to monetise.

A client signs a contract.

Engineers are assigned.

Revenue starts.

Margins can be measured.

The quarterly presentation looks good.

Deep R&D does not work like that.

And perhaps India’s corporate culture became too comfortable with the predictable model.

Our R&D problem is much bigger than IT

This is not merely an IT-industry problem.

It is an Indian economic problem.

India’s gross expenditure on R&D is only around 0.64% of GDP, compared with approximately 2.43% in China, 3.48% in the United States and 4.91% in South Korea.

Even more revealing is who pays for that research.

Business contributes only around 41% of India’s R&D expenditure.

In China, it is around 77%.

In the United States, around 75%.

In South Korea, around 79%.

That tells us something fundamental.

India has historically expected the government and public institutions to carry too much of the research burden while private industry focuses on commercial execution.

That model can produce competent companies.

It struggles to produce technological monopolies.

Then came AI

And suddenly the weakness of the old model became much more visible.

Artificial intelligence is not just another software implementation opportunity.

The biggest value is moving toward:

• foundation models
• computing infrastructure
• proprietary datasets
• algorithms
• chips
• model architectures
• AI research
• intellectual property
• developer ecosystems
• platforms built around those technologies

And once again, India entered the race late.

The United States already had companies such as OpenAI, Google, Microsoft, Meta, Anthropic and Nvidia operating at the frontier.

China had companies such as Alibaba, Baidu, Tencent, Huawei and others investing heavily in AI.

India had extraordinary engineering talent.

But engineering talent alone is not enough.

You need computing power, capital, research institutions, data, scientists, product companies and the willingness to burn money for years before the business model becomes obvious.

India is now trying to build that ecosystem.

The IndiaAI Mission, launched in 2024 with an outlay of ₹10,372 crore, has since onboarded more than 38,000 GPUs and selected multiple teams to develop indigenous foundation models.

Sarvam AI has been selected to build India’s sovereign large language model, while other teams including BharatGen, Soket AI, Gnani AI and others are also working on Indian foundation models.

So it would be wrong to say:

“India has no AI.”

The better statement is:

India is now trying to build an AI industry after the global AI race had already begun.

And that difference matters.

The Zoho exception

There is one Indian company that demonstrates what could have happened much more often.

Zoho.

Zoho did not build its business primarily by sending Indian engineers to implement somebody else’s software.

It built software products.

CRM.

Email.

Books.

Projects.

Creator.

Analytics.

And dozens of other products.

It built a global SaaS ecosystem.

Zoho now serves more than 100 million users across more than 150 countries, demonstrating that an Indian company can create software in India and sell it globally as a product.

That is the important lesson.

The question isn’t whether Indians can build global products.

We clearly can.

The question is why we have produced so few companies that chose this path at enormous scale.

The pharmaceutical story is remarkably similar

The pharmaceutical industry gives us an even more interesting example.

India became one of the world’s great pharmaceutical manufacturing countries.

But much of that success was built around generics.

And there is a historical reason.

India’s 1970 patent regime did not allow product patents for drugs and chemicals; it permitted process patents. This created an environment in which Indian companies could develop alternative manufacturing processes for medicines whose underlying products were protected elsewhere.

Between 1970 and 1994, the Indian pharmaceutical industry became increasingly self-sufficient and emerged as a major exporter of generic medicines.

This was not necessarily a mistake.

In fact, it was an extremely effective development strategy.

India built chemical expertise.

It built manufacturing capacity.

It dramatically reduced medicine costs.

It became an important supplier of affordable medicines to developing countries.

But there was a consequence.

The economic incentive was stronger for becoming excellent at producing existing medicines than for spending billions discovering entirely new medicines.

India eventually introduced pharmaceutical product patents in 2005 as part of its TRIPS obligations.

But by then, the global pharmaceutical innovation ecosystem was already dominated by companies with enormous R&D budgets and decades of accumulated research infrastructure.

Again, India became extremely good at the downstream part of the value chain.

The upstream intellectual property remained elsewhere.

And then comes the API problem

This is where the irony becomes painful.

India is one of the world’s major pharmaceutical producers.

Yet in FY2024-25, India imported around $4.35 billion worth of APIs, bulk drugs and drug intermediates.

China accounted for approximately 73.7% of those imports.

For some individual APIs, China’s share of Indian imports is even higher than 70%.

The Indian government itself has acknowledged this dependence and has been attempting to rebuild domestic manufacturing capacity through Production Linked Incentive schemes and bulk-drug parks.

Think about the paradox.

We manufacture the medicine that the world consumes, but in many cases depend on another country for the chemical building blocks needed to manufacture it.

That is not complete technological sovereignty.

It is manufacturing strength sitting on top of supply-chain vulnerability.

Now look at electric vehicles

The same pattern appears again.

The world started moving toward electric vehicles.

China did not simply decide to manufacture electric cars.

It built an entire ecosystem.

Batteries.

Battery materials.

Motors.

Power electronics.

Charging infrastructure.

Manufacturing equipment.

Software.

Vehicle platforms.

Mass production.

And then it pushed the products into global markets.

The results are extraordinary.

China produced almost 16 million electric cars in 2025, representing nearly 75% of global electric-car production.

Chinese electric-car exports more than doubled in 2025 to over 2.5 million vehicles.

More than 35% of China’s total car exports were electric models.

This isn’t simply about BYD selling cars.

It is an ecosystem story.

China understood something India repeatedly underestimated

China realised that manufacturing capability itself is strategic technology.

It did not want merely to assemble products.

It wanted to control the supply chain.

If the world needed solar panels, China wanted the factories.

If the world needed batteries, China wanted the factories.

If the world needed electric motors, China wanted the factories.

If the world needed EVs, China wanted the brands.

If the world needed electronics, China wanted the components and manufacturing ecosystem.

And increasingly, it wanted the technology and intellectual property too.

That is why China has moved from being the world’s low-cost factory to becoming a serious competitor in many high-technology industries.

The transformation is visible in innovation data too.

China ranked 10th globally in the 2025 Global Innovation Index, while India ranked 38th.

India remains an innovation overperformer for its income level and has major strengths, particularly in ICT services exports and entrepreneurship.

But China has moved far further up the innovation ladder.

This is where India’s development model needs to change

There is nothing wrong with services.

India should absolutely remain a global services powerhouse.

But services cannot be the ceiling of India’s ambition.

We need to move from:

Services → Products

Implementation → Intellectual Property

Manpower → Machines

Outsourcing → Ownership

Assembly → Design

Generic → Original

Consumer → Creator

Technology adopter → Technology inventor

That transition is the real challenge.

Cheap labour was our advantage. It cannot remain our strategy.

For decades, India’s cost advantage was powerful.

Indian engineers were cheaper than engineers in Silicon Valley.

Indian software developers could work remotely for global companies.

But what happens when AI itself starts reducing the amount of human labour required?

What happens when one highly productive engineer with AI tools can do the work that previously required five?

What happens when companies no longer need enormous offshore teams to perform repetitive coding, testing and maintenance?

The very advantage that created India’s IT services boom can become less powerful.

This does not mean Indian IT companies will disappear.

Far from it.

They have enormous client relationships, domain expertise, infrastructure and talent.

But their competitive advantage has to evolve.

The next generation cannot simply be cheaper engineers.

They must be owners of technology.

India has the talent. The missing ingredient is the risk appetite.

This is perhaps the biggest lesson.

India does not lack intelligent people.

It does not lack engineers.

It does not lack entrepreneurs.

It does not lack a huge domestic market.

It does not lack capital completely.

And it certainly does not lack problems that need solving.

What we have historically lacked is enough willingness to make very large, very long-term bets on original technology.

Research for ten years.

Build something nobody understands.

File patents.

Lose money.

Try again.

Build a product.

Fail.

Build another.

Create an ecosystem around it.

And then take that Indian technology to the world.

That is how technological giants are born.

Not by asking:

“How many engineers can we deploy next quarter?”

But by asking:

“What technology can we own for the next 25 years?”

And perhaps this is the biggest lesson from China

China was once described as a country that copied Western products.

That description has become dangerously outdated.

China learned from the world.

Then it manufactured.

Then it scaled.

Then it improved.

Then it invested in R&D.

Then it built supply chains.

Then it built brands.

Then it started exporting its own technology.

The transformation did not happen overnight.

It happened because the country kept moving up the value chain.

India also needs to move up the value chain.

Not by copying China.

But by learning the underlying lesson.

A country becomes technologically powerful when it controls what it designs, what it manufactures, what it patents and what the rest of the world is willing to buy from it.

The real question is not “Why did we miss AI?”

That question is too narrow.

The bigger question is:

Why have we repeatedly become excellent at the downstream part of global technology while allowing others to dominate the upstream part?

IT services.

Pharmaceutical generics.

Electronic manufacturing.

EVs.

AI.

Semiconductors.

In sector after sector, the pattern has been similar.

We become very good at adoption, execution, manufacturing, implementation or cost optimisation.

But the biggest economic value often sits one level above that.

Who owns the technology?

Who owns the patent?

Who owns the platform?

Who owns the operating system?

Who owns the chip architecture?

Who owns the battery technology?

Who owns the AI model?

Who owns the global brand?

That is where the real wealth is created.

India does not need another thousand service companies

India needs companies that can become global technology owners.

We need the next generation of Indian companies to say:

“We are not going to build software for Microsoft. We are going to build something the world compares with Microsoft.”

“We are not going to manufacture somebody else’s battery. We are going to invent better battery technology.”

“We are not going to wait for pharmaceutical patents to expire. We are going to discover the next drug.”

“We are not going to merely implement AI. We are going to build AI models, infrastructure and platforms.”

“We are not going to assemble EVs. We are going to own the technology behind them.”

That is the mindset shift India needs.

We should not throw away what we built

And this is not an argument against TCS, Infosys, Wipro or Indian pharma.

Quite the opposite.

They built an extraordinary foundation.

Indian IT services gave millions of engineers global exposure.

Indian pharma created world-class manufacturing and regulatory capabilities.

Our enormous domestic market gives us something many countries would love to have.

Our startup ecosystem is growing.

Our research ecosystem is improving.

Government programmes are beginning to push strategic technology.

India’s 2025 Global Innovation Index ranking of 38th also shows that the country is not standing still; India has major strengths in ICT services exports, domestic market scale and venture capital activity.

The foundation exists.

What is missing is the next layer.

From “Made by Indians” to “Invented in India”

This should become one of India’s biggest ambitions.

Not just:

“Indian engineers work on this.”

But:

“This technology was invented in India.”

Not:

“India provides the software team.”

But:

“India owns the software platform.”

Not:

“India manufactures the generic medicine.”

But:

“India discovered the medicine.”

Not:

“India assembles the EV.”

But:

“India invented the battery, motor, software and vehicle architecture.”

Not:

“India uses AI.”

But:

“The world uses AI created in India.”

That is the transition from being a participant in the global economy to becoming one of the countries that shapes it.

The next 25 years will decide whether India moves up

India has already proved that it can create enormous companies through human capital.

Now it has to prove something much harder:

Can India turn human capital into intellectual capital?

Can our engineers become inventors?

Can our service companies become product companies?

Can our pharmaceutical manufacturers become drug-discovery companies?

Can our EV manufacturers become technology companies?

Can our startups become global platforms?

Can our universities work with industry?

Can Indian corporations spend seriously on research instead of treating R&D as a small line item?

Can we tolerate failure long enough for breakthrough technology to emerge?

Because the next economic race will not be won by the country with the cheapest engineers.

It will be won by the country that owns the most valuable technology.

India was the world’s back office.

There is nothing shameful about that.

It was an extraordinary achievement.

But we should not spend the next 25 years proudly defending the same model.

The world has changed.

AI is changing software.

Automation is changing labour.

EVs are changing automobiles.

Biotechnology is changing pharmaceuticals.

Semiconductors are becoming strategic assets.

Energy technology is becoming geopolitically important.

Manufacturing is becoming technologically sophisticated.

The old formula of “We will provide the talent and somebody else will own the technology” cannot be India’s long-term strategy.

We have already demonstrated that Indians can build world-class companies.

Now we need to demonstrate something bigger.

That India can build world-class technology that the rest of the world cannot do without.

That is the real transition India has yet to complete.

From service provider to product owner.

From executor to inventor.

From back office to technology headquarters.

From “Made by Indians” to “Invented in India.”

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