New Industries from New Places: The Emergence of the Hardware and Software Industries in China and India

Over the past 15 years, the twin giants of Asia―China and India―have jumped on the opportunity provided by the IT revolution to turbocharge their economic growth. India has become a software services powerhouse, while China churns out much of the world's IT hardware. How did these countries achieve global competitiveness so quickly? Why did software predominate in one and hardware the other?

This book represents the first attempt to go beyond anecdote and generalization in discussing the unprecedented emergence of these new industries over such a short period. It presents the first rigorous comparison of the growth performance of hardware manufacturing and software services sectors in China and India. It examines the economic context and the business environment for private enterprise in China and India, and considers how far differences in economic policies or the business environment can go in explaining the observed distinctions between the two. The book concludes by evaluating explanations for the growth performance of hardware and software in each country, drawing conclusions for future economic policies and business strategies.

Neil Gregory is Adviser to the Vice President for Financial and Private Sector Development, World Bank Group. Stanley D. Nollen is Professor of International Business at the Georgetown University's McDonough School of Business in Washington D.C. Stoyan Tenev is Head of the Independent Evaluation Group of the International Finance Corporation.