JANUARY 19, 2003
 Letter From The Editor-In Chief
 Overview
 Features
 Trends
 Sectoral Snapshots
 The CEO Listing
 Code-Jock Factory
 The Lever Legacy
 Letter From The Editor
 Columns
 Brain Distillation
 20 For The World

Two Slab
Income Tax

The Kelkar panel, constituted to reform India's direct taxes, has reopened the tax debate-and at the individual level as well. Should we simplify the thicket of codifications that pass as tax laws? And why should tax calculations be so complicated as to necessitate tax lawyers? Should we move to a two-slab system? A report.


Dying Differentiation
This festive season has seen discount upon discount. Prices that seemed too low to go any lower have fallen further. Brands that prided themselves in price consistency (among the consistent values that constitute a brand) have abandoned their resistance. Whatever happened to good old brand differentiation?

More Net Specials
Business Today,  January 5, 2003
 
 
Code-Jock Factory
Tamil Nadu has made a winning proposition out of supplying warm bodies to the IT revolution.
The US consulate in Chennai issues the maximum visas any US embassy office in India does
The men wear khakis or jeans and classic tees; the women wear starched cotton saris; and both wear walking shoes so clean and new it hurts the eye to look. Adidas, Reebok, Nike, New Balance, and Converse, these are the real things, not Rs 300-a-pair Pondy Bazaar rip-offs. That's a Chennai shopping district, and this is pre-dawn Chennai when the grey hairs come out for their morning constitutionals. The walkway by either of the city's two popular beaches (yes you poor inland types, it has t-w-o) is a popular spot, as is the tropical forest like campus of the Theosophical Society in Adyar, and the central-yet-exclusive Boat Club Road. Everyone seems to know everyone else and when classic New Balance meets pink Reebok or white Nike meets Red Converse the usual small talk follows. Only, in addition to words such as lumbago, stroke, cholesterol, doctor, and heart that are traded anywhere in the world where greys congregate, a passer-by would hear seemingly out of place words such as visa, Niagara (not Viagra), h1b, routing, Seoul, and mortgage. Welcome to the world of the software parent. Every city has its share of this globe-trotting, Pacific Standard Time calibrated community of retirees; Chennai-the US consulate in the city issues the maximum visas any US embassy office in India does, over 100,000-has, arguably, more than any other.

Referring to the phenomenon, the late R.K. Narayan, a resident, remarked that Chennai would soon be a "city of parents". And there are pockets of San Francisco, Dallas, Houston, Atlanta, and New Jersey, swears A.P. Shivaram, a software pro at iNautix Technologies in Chennai who spent six years in the US, that remind him of West Mambalam, a predominantly middle-class Chennai borough. "A software professional knows three languages," says Vivek Harinarain, it Secretary to the Government of Tamil Nadu, proferring the latest version of a chestnut. "XML, C++, and Tamil." He guffaws.

Chennai's Tidel Park: After Bangalore, Chennai is the preferred destination for software companies

Coding In The Genes

The average Tamil's coding abilities have been ascribed to several things, from spicy Tamilian cuisine to genes that just seem more equipped to handle numbers and analytics. The actual answer may lie more in the direction of Tamil Nadu's education system and some simple demand-supply inequities.

Seven years ago, Tamil Nadu had 65 engineering colleges. Today, it has 245 that turn out a little over 75,000 engineers each year, more than the US does. The four hot specialisations in any college, in order of their appeal, are it, Computer Science, Electronics and Communications Engineering (sweetly shortened to ECE), and Electrical Engineering. Then there are the 180-odd training companies that run it schools in the state-from national players NIIT, Aptech, and SSI to one-neighbourhood shows such as CSC Computer Education. "Tamil Nadu has the numbers," explains Harinarain. "It is purely driven by demand and supply." For the record, Karnataka, with 115 engineering colleges, graduates 35,000 engineers each year; Andhra Pradesh, with 174, does 46,090. "The Tamils, especially the middle classes, have always placed a great emphasis on education," says V. Jacob John, a sociologist with Madras Institute of Development Studies. Nor are they happy with a graduate degree; almost every Tamil engineer has eyes set on a masters, even a doctoral degree, either from an Indian university or a US one. Ergo, Tamils constitute a significant proportion of the admits into the various IITs, RECs (Regional Engineering Colleges), government and private colleges in other states, and institutes of higher education in India and the US.

The technical education boom in Tamil Nadu closely mirrors the great Indian software story. "The state realised the value of engineering education and decided to allow privatisation in the early 1980s," says K.S. Lakshminarayanan, Chief Technical Advisor & General Manager, Electronics Corporation of Tamil Nadu. That saw the creation of private engineering colleges-today there are 237 of the kind. In contrast, Andhra Pradesh allowed the creation of private engineering colleges in 1996, Karnataka in the early 1990s, and Kerala in 2000. By 1990, colleges such as Sree Venkateshwara College of Engineering in Chennai, Mepco Schlenk Engineering College in firework-town Sivakasi, and PSG College of Technology in Coimbatore acquired the reputation of sending out entire batches to the US. Then the network and cluster effects took over.

There are 180-odd training companies that run IT schools in the state-from national players NIIT, Aptech, and SSI to one-neighbourhood shows such as CSC Computer Education

West Mambalam In New Jersey

Almost every engineering college in Tamil Nadu boasts an unofficial equivalent of the USEFI, the United States Education Foundation in India, which counsels students who wish to study in that country.

The underground versions are run by alumni that has made it to the US and the help it provides ranges from tips on cracking graduate record examination (GRE) to practical instructions on matters financial. Then, says S. Mahalingam, Executive Vice President, TCS, there's the network effect. "If a classmate of mine goes aboard, he will try to help me get there too." That's what V. Varadarajan, now 28 and a software engineer at a Chennai-based product development company, did. Post graduation (from Bharat Engineering College in Chennai) he picked up some Java-skills, found an agent who sent him abroad, stayed there three years, switched as many jobs, got benched and returned. Along the way he also helped three friends he met in a Yahoo! chat room find jobs in the US. All three are still there.

The Tamil-in-the-US, West Mambalam-in-New Jersey phenomenon has fed off itself, a self-perpetuating wave that has only got bigger and more powerful with time. A student of class VII sees his neighbour, a fresh graduate from an engineering college in Coimbatore head for the Illinois Institute of Technology for a MS degree in computer science. A year later, he sees him again, a TA at the institute down for the summer with a newly acquired accent and wondrous tales of the US. Four years later he sees him again, now an analyst at Computer Sciences Corp who plans to fly his parents-the farthest west they've been before this is Jaipur-down to Boston where he is based for a holiday and decides being a code-jock isn't so bad after all. Egged on by his parents-"See how well Ram has done for himself in Boston?"-he manages to secure admission to a halfway decent engineering college in Chennai. And his life is made. "With so many software success stories around in Tamil Nadu, there's no shortage of role models for people in search of them," says sociologist Jacob John. "It's almost as if the city's young have been brainwashed into believing it is the thing." In Tamil Nadu it really is.

 

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