The news couldn’t have come at a better time. The boost to the city’s ego is badly needed, having been battered over the past several years by the ups and downs of the tech industry and a major accounting scandal at one of the city’s biggest companies. In March 24, 2000, when President Clinton addressed a gathering of technology entrepreneurs in Hyderbad, Mr. Clinton’s visit might have been seen as a sign that we had arrived on the global scene, but it also coincided with the beginning of the end of the dot-com bubble…
Not since March 24, 2000, when President Clinton addressed a gathering of technology entrepreneurs in Hyderbad, has theHyderabad software industry’s swagger been more pronounced, now that Satya Nadella, a Hyderabad native, has been named the chief executive of Microsoft. “It is an exciting and proud moment for all of us,” said Aditya Marri, a member of the Board of Governors, at the Hyderabad Public School, where Mr. Nadella was a student. “Satya has been a role model for all current and past students of the school.”
On the morning after Mr. Nadella’s appointment was announced overnight, the school conducted a special assembly session to solemnly celebrate what it called the “finest success” of its old students, with several of his classmates and even former teachers attending. The news couldn’t have come at a better time. The boost to the city’s ego is badly needed, having been battered over the past several years by the ups and downs of the tech industry and a major accounting scandal at one of the city’s biggest companies. Mr. Clinton’s visit might have been seen as a sign that we had arrived on the global scene, but it also coincided with the beginning of the end of the dot-com bubble.
To fully understand where the capital of Andhra Pradesh gets its attitude, one has to consider where it was before the first tech boom. When I landed in the city after college to interview with three media organizations in 1995, my first impressions convinced me that I had made a mistake by not opting for Bombay, Delhi or Bangalore as a career destination – all I saw were the congested narrow roads marked with quaint shopping streets, a laidback work culture with no sense of modernity and a huge polluted lake at the city’s heart.
Reeling under the fiscally bankrupting impact of the electoral promises of complete prohibition and other populist welfare measures, the city had frequent power cuts and no money for development. Sweeping changes resulting from the revolutionary economic reforms of the central Government left the city untouched.
Then Andhra Pradesh’s Chief Minister, Nara Chandrababu Naidu, his laptop, an integrated transformation vision and software exports hit the city’s nucleus and exploded in a transformation unmatched for any city in India’s history. The software industry achieved a halo, a panacea status under the imaginatively bold leadership of its biggest champion, Mr. Naidu, who pitched himself as C.E.O. of the State. Broad roads and flyovers were built, the airport was modernised, the prohibition on alcohol sales that was imposed in 1994 was abolished, and businesses were aggressively welcomed to invest. Software was adopted as one of five major growth engines, besides pharmaceuticals, infrastructure, tourism and human resources.
Within a record time, a HiTech City was built, a symbol of the new Hyderabad, a world-class software district where the greatest software companies would set up office. Microsoft was wooed to set up its first development center outside of United States. Chief minister Naidu personally pitched to Bill Gates, then the Microsoft chief executive, using a PowerPoint presentation. The seven-minute appointment became a three-hour conversation, and Mr. Gates agreed to set up a development center.
Major American software giants followed in rapid succession: Oracle, IBM, Google. Power reforms, Government reforms, administrative reforms; every major reform was scripted in India from Hyderabad. It was seconded as an educational and sports hub. Soon it began to be dubbed Cyberabad, India’s Silicon Valley, and became the fountainhead of the tech gold rush. Every sector in the city accelerated faster than anywhere else in the country: real estate, contract research, manufacturing, Government missile programs, higher education and entertainment.
All the while, we kept an eye on Bangalore, which was developing as a formidable rival in the tech industry. Hyderabad was gleeful when it stole the Indian School of Business, a first-of-its-kind business school set up by Wharton and Kellogg, from Bangalore, with an unusually aggressive pitch by Mr. Naidu’s Government. Mr. Naidu had put Hyderabad as a global software destination by itself, his electoral loss in 2004 meant a deliberate reversal of focus. The software industry was told to stand on its own two feet, and the city plunged. No more news of investments poured in, no more major global conventions were making their way to Hyderabad.
Even the next American Presidential visit to the city, by George W. Bush, was a low-key affair. No more was Hyderabad the focal point at Davos or World Bank and I.M.F. conferences. No more were youngsters huddling at coffee shops and cybercafes to launch startups with dreams of acquisitions by Google or Facebook. Everyone, not unlike me before it all started, was convinced dreams would now come true elsewhere, in Bangalore, Pune or Gurgaon. To make things worse, in 2009, B. Ramalinga Raju, founder of Satyam Computers, admitted he had falsely reported $1 billion in profits. His arrest led to the limelight falling on another facet of the city, the widespread corruption.
Reeling under a loss of confidence and robbed of its sheen, the software industry in Hyderabad plummeted. The global slowdown and the economic downturn in the United States completed the picture of gloom. Though Hyderabad’s fortunes have recovered slowly since the global financial crisis, the city had forgotten to how to hold its head up high until news reports started saying Mr. Nadella could be the C.E.O. of one of the world’s biggest companies. The day the reports were confirmed will forever remain a red-letter day forHyderabad. “The entire city is delighted because it symbolises how much can be achieved,” said Faiz Khan, one of Mr. Nadella’s classmates in the graduating class of 1984 at Hyderabad Public School. To Mr. Khan, Mr. Nadella has achieved legendary status already, likening him to one of India’s great modern-day heroes. “His success will inspire the young and an entire industry. Make no mistake: He is software’s Sachin Tendulkar,” he said.