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24 September 2015, Gateway House

Innovation bridge: Silicon Valley to India

Sharad Sharma, co-founder, iSpirt, talks about Prime Minister Modi’s visit to the Silicon Valley on September 27. In an in interview to Gateway House, he outlines the steps that would make Modi’s visit a success for Digital India campaign and other key issues.

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As Prime Minister Narendra Modi begins his U.S. visit today, 24 September, his Silicon Valley itinerary is getting a lot of attention. On 27 September, Modi will address an estimated 20,000-strong audience of Indian-Americans in the Valley. He will also participate in the India-U.S. Startup Konnect 2015 event organised by NASSCOM, The Indus Entrepreneurs (TiE), California,and IIM Ahmedabad’s Centre for Innovation Incubation and Entrepreneurship (CIIE)

What does his Valley visit hope to achieve? How is it being viewed by people in the industry? To understand this, Gateway House interviewed Sharad Sharma, co-founder of iSpirt (Indian Software Product Industry Round-Table), a think tank based in Bangaloreof 30 product companies and individuals. The collective aims to help the government create policy initiatives for social, legal, and economic infrastructure so that private enterprise can flourish.

What is iSpirt? How it is different from an industry entity like NASSCOM?

We, at iSpirt, convert ideas into policy proposals to take to the government. As a part of our advocacy efforts, we explain, educate and inform policy-makers and policy-making bodies that a vibrant software product industry is vital to India’s future.

NASSCOM is a trade-body and iSpirt is a think tank. Both have their own roles. Trade bodies represent their members and think tanks chase their missions. In our case, it is building public goods without public money. Both are complementary and coexist. iSpirt was incubated inside NASSCOM. We strive to have a symbiotic relationship with trade organisations, and see them leading the charge of converting our policy prescriptions into reality.

What does Modi’s visit to Silicon Valley hope to achieve? 

If it leads to favourable policy announcements, then we would say that the visit to the Valley is a success. We know that the government is working to exempt start-ups from all government regulations for three years. .I would, therefore, say that if this visit precipitates necessary policy action, it will turn out to be useful.

We also hope that his visit will create an “innovation bridge” between Silicon Valley and India. Such a bridge can help India achieve its governance, infrastructure and empowerment goals under the Digital India framework.

The Modi government wants to engage with the Indian diaspora, and Indians in the U.S. want the elimination of capital gains tax for their angel investments in India.

So the visit will be successful if it results in policy actions that benefit the technology sector.

What can ‘Digital India’ learn from this visit? 

For ‘Digital India’ to be successful, it has to reach rural areas. This is very hard to do with Silicon Valley. The Valley isn’t interested in the bottom half of the population. This is where the “innovation bridge” comes into the picture. India can capitalise on the “bridge” with Silicon Valley and take it forward to build ‘Digital India’ projects for the poor.

Hardware companies like Foxconn are coming to India to set up massive production units. How can India use this to its own benefit?

There is no doubt that a company like Foxconn provides large-scale employment, but in the technology sector the goal should be to move up the value-chain and manufacture high-value products. This is already happening in India and must be further encouraged.

What could be the Bilateral Investment Treaty’s role in technology transfer between India and the U.S.? How do intellectual property rights (IPR) fits into this the picture? 

The software patent system in the U.S. is broken. We should not bring this system to India. It will have detrimental impact on India’s nascent software product industry.

IPR is important, but patents are not. Software should be protected under the copyright regime and not as patents. This is the position of Silicon Valley start-ups as well. In an article in August, The Economist said that the patents system is broken not only for software, but for everything.

But it is particularly broken in the area of software and India is under pressure from the U.S. to bring that broken regime to the country, even as other countries like New Zealand are moving away from it. This is not helping the underlying cause of the technology ecosystem.

This interview was exclusively conducted for Gateway House: Indian Council on Global Relations. You can read more exclusive content here.

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