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My Profile Top News Reuters top ten news stories delivered to your inbox each day. Subscribe You are here: Home > News > Technology > Article Home Business & Finance News U.S. Politics International Technology Internet Entertainment Sports Lifestyle Oddly Enough Health Science Special Coverage Video Pictures Your View The Great Debate Blogs Weather Reader Feedback Do More With Reuters RSS Widgets Mobile Podcasts Newsletters Your View Make Reuters My Homepage Partner Services CareerBuilder Affiliate Network Professional Products Support (Customer Zone) Reuters Media Financial Products About Thomson Reuters India becomes R&D hot spot as high-tech firms cut costs Mon Jul 20, 2009 9:22pm EDT Email | Print | Share | Reprints | Single Page [-] Text [+] By Rina Chandran BANGALORE (Reuters) - At Microsoft's research center in a leafy lane in India's tech capital, a new generation of researchers are being groomed half a world away from the software giant's sprawling headquarters in Seattle. Complete with beanbags and coffee served in steel tumblers, the center is helping change the perception that India is no place for top-end research and development. Staffed with about 60 full-time researchers, many of them Indians with PhDs from top universities in the United States, the center is at the cutting edge of Microsoft's R&D. It covers seven areas of research including mobility and cryptography. Its success, including developing a popular tool for Microsoft's new search engine Bing, underscores the potential of R&D in India at a time when cost-conscious firms are keen to offshore to save money by using talented researchers abroad. Showing off the Bing tool which enables searches for locations with incomplete or even incorrect addresses, B. Ashok, a director of a research unit at the center, said the innovation would never have taken root if the R&D had been done in the United States. "It was completely inspired by the Indian environment, but is applicable worldwide," he said. While India might seem like a natural location to expand offshoring into R&D, it is hampered by some serious structural problems that range from not enough home grown researchers to a lack of government support. India produces about 300,000 computer science graduates a year. Yet it produces only about 100 computer science PhDs, a small fraction of the 1,500-2,000 that get awarded in the United States, or China, every year. "Students here are not exposed to research from an early age, faculties are not exposed to research and there's no career path for innovation because there's a lot of pressure to get a 'real' job," said Vidya Natampally, head of strategy at the Microsoft India Research Center. With few government incentives and an education system that emphasizes rote learning, India lacks the kind of environment found in say, Silicon Valley, where universities, venture capitalists and startups encourage innovation. "China has a policy in place for R&D; we don't," Natampally said, adding that India could move up the value chain faster if even a small percentage of its engineering graduates went into research. The small numbers of PhDs and the lack of government incentives for India's fledgling R&D sector are blunting the country's edge, analysts warn. COMPETITION Rival China has already pulled ahead with more than 1,100 R&D centers compared to less than 800 in India, despite lingering concerns about rule of law and intellectual property rights. Aside from providing funding to encourage students to complete their PhDs, China also offers fiscal incentives such as tax breaks for R&D centers and special economic zones provide infrastructure for hi-tech and R&D industries. Continued... View article on single page Share: Del.icio.us Digg Mixx Yahoo! Facebook LinkedIn Next Article: Google cleared in UK defamation suit also on reuters Blog: YouTube’s mythbusters: When blogs attack "Madoff" bill would charge rich NY inmates for jail Commentary: Three urban myths of healthcare reform More Technology News Yahoo set to unveil new homepage Warner Music and YouTube still talking on deal Google cleared in UK defamation suit Barnes & Noble unveils store for digital books EU sets hearing over Google books deal More Technology News... Editor's Choice Slideshow A selection of our best photos from the past 24 hours. Slideshow Most Popular on Reuters Articles Video China dust cloud circled globe in 13 days Beastie Boy Adam Yauch diagnosed with cancer Heat wave to test Southern California power grid India becomes R&D hot spot as high-tech firms cut costs California governor, lawmakers agree on state budget Apollo astronauts bemoan state of U.S. space program "Idol" fans campaign to keep Paula Abdul on show DEALTALK-What shareholders don't know about Elan/J&J deal Asia stocks hit 10-month high as earnings reassure "Madoff" bill would charge rich NY inmates for jail Most Popular Articles RSS Feed Video Japan calls election Hostagetaking as a weapon Astronauts pitch Mars trip Beckham confronts angry fans Astronauts pitch Mars trip Family butchered in Australia Endeavour's astros second spacewalk Clinton: Pakistan shows commitment Pile-up causes autobahn chaos Cloned dogs sniff out drugs Most Popular Videos RSS Feed We want to hear from you Join the Reuters Consumer Insight Panel and help us get to know you better Please take a moment to complete our survey Reuters.com: Help and Contact Us | Advertise With Us | Mobile | Newsletters | RSS | Labs | Archive | Site Index | Video Index Thomson Reuters Corporate: Copyright | Disclaimer | Privacy | Professional Products | Professional Products Support | About Thomson Reuters | Careers International Editions: Africa | Arabic | Argentina | Brazil | Canada | China | France | Germany | India | Italy | Japan | Latin America | Mexico | Russia | Spain | United Kingdom | United States Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. 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