The Indian software industry appears to provide a startling confirmation of the benefits of multinational investment in
a fledgling industrial sector. The main question explored in this paper is how and why this happened. We find that
multinational firms had an important catalysing effect on the industry’s evolution, even though foreign firms
established by expatriate Indians probably exerted more competitive pressure. We do not accept a popular view,
which ascribes this benign influence to the development of human capital. We argue it was tight labour markets due
to foreign competition, which induced domestic firms to both acquire unique organisational capabilities and to improve
the value-adding strategies of multinational firms.

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Software companies of India

The Software Industry comprises of businesses related to the production and maintenance of computer software. The roots of the industry lies in the IT phenomenon. Services regarding software such as training, consulting and maintenance are a part of this ever-growing industry. The IT industry is witnessing a rapid growth and offers lucrative job opportunities making IT a premium career option for the youth. Infact it is one of the fastest growing sector of Indian industry. India is emerging as a Global IT superpower. The success can be attributed to factor advantage of high quality of software human resources. The Software Industry has succeeded in converting this comparative advantage to increasing exports. More and more companies are receiving the ISO 9000 certification and the day is not far when India will have the highest number of ISO 9000 companies in the world. Indian Software Industry is estimated to be worth USD 1.2 billion. Unfortunately the growth has been limited to a few cities around Bangalore, Mumbai, Delhi and Noida. One problem that software companies in India are facing is that of outflow of IT professionals. This can be looked into by ensuring the conditions for investment and growth in the industry are safeguarded by political stability. Wipro, HCL, Tata Consultancy Services, Satyam computer Services, CMC, IBM etc are some of the major Software companies in India.