U.S.-India technology cooperation and capability building : the role of inter-firm alliances in knowledge-based industries

Abstract

The paper reviews some Indo-US technology cooperation initiatives and analyses data on inter-firm alliances in knowledge based industries, especially Information Technology (IT). It shows that the market driven increase in the alliances between Indian and US enterprises has significantly enhanced the variety of linkages between Indian and US entities, both public and private. And that these linkages have contributed to capability building and diversification by Indian partners. A variety of spillover benefits of international technology alliances are highlighted. It is suggested that issues relevant for Indo-US co-operation at different levels need to be analyzed together in order to appreciate the complementarities across linkages of various types. For example, linkages between the public sector entities of the two nations may enhance the potential private sector networking initiatives. The paper also argues that while building of public institutions and policies relating to trade, technology and investment remain important for Indo-US technology co-operation, a shift in policy focus to "market induced" inter-firm alliances may be desirable.

This paper was prepared when the author was a Jhamandas Watumull Foundation Visiting Fellow at the East-West Center, Honolulu, Hawaii.