Silicon Valley is dominated by tech leaders of Indian origin. While Chinese tech companies have achieved global dominance across multiple sectors, why are India-based tech firms – other than in select areas such as software outsourcing – less influential? Why does Indian talent seem to flourish more outside India?
Silicon Valley has risen to third place in the innovation cluster rankings of the World Intellectual Property Organization (WIPO), long dominated by East Asia. This year, the Greater Bay Area surpassed Greater Tokyo to claim the top spot as the largest innovation cluster.
Indian innovation clusters have also advanced, with Bengaluru climbing from below 50th place to just outside the top 20. India now boasts four clusters in the top 100, behind China, the United States and Germany, but ahead of two other East Asian tech powerhouses, Japan and South Korea.
The key to India’s dramatic rise in the WIPO rankings is the inclusion of venture capital deal activity as a new metric. Before New Delhi’s clampdown on Chinese investment in 2020, Chinese venture capital went towards many unicorns in India. But for these restrictions on investments, Bengaluru would in all probability have made the top 20.
With three clusters among the world’s top 10, China must be doing something right. The Greater Bay Area is ahead of Silicon Valley, while the Beijing and Shanghai-Suzhou clusters, in fourth and sixth place respectively, are ahead of ninth-placed Boston-Cambridge. Are there lessons for India here?
Within China, it is notable that the Greater Bay Area is ahead of Beijing, where the country’s top universities concentrate. Clearly, it is more important to be a magnet for talent than their training ground. Likewise, Indian Institutes of Technology (IIT) graduates may be legendary in Silicon Valley, but it is the US that reaps the greatest benefits from them.
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