Silicon Valley & Technology

Why Bangalore Doesn’t Need Silicon Valley

Visitors to Bangalore, India, these days can see street art, have beer at local microbreweries or take an Uber ride to a distant neighborhood to meet with venture capitalists about a recent startup that grabbed their attention.

Gone are the days of a city dominated by call centers and American visa seekers.

“There’s an artisanal hot dog place there,” Sean Blagsvedt, founder of online job portal Babajob, said of a nearby neighborhood, speaking over his plate of salmon sashimi. “You have a bazillion 20-something tech people who don’t like to cook and suddenly have a [large amount] of money to start paying for interesting food. … You saw the same things in San Francisco.”

A wide variety of dining options, nightlife and other activities has blossomed alongside the tech industry in “India’s Silicon Valley.”

Bangalore was rated the most dynamic city in the world, two spots ahead of California’s Silicon Valley — which isn’t a city but was ranked as one — by the JLL City Momentum Index this year. The index looks at more than 100 cities around the world, rated by their “ability to embrace technological change, absorb rapid population growth and strengthen global connectivity.”

Not looking abroad

Call centers and outsourced IT workers still make up a part of Bangalore, but a vibrant crowd of modern, enthusiastic, tech-minded people has grown to dominate the city — and for most of them, the promise of “a better life” abroad is not on their radar.

Bangalore, however, has been attracting Americans and Europeans to start companies in India for Indians. And this phenomenon is hardly new.


Blagsvedt, who is also Babajob’s CEO, moved to Bangalore from his hometown of Seattle, Washington, when he was 28 to work with Microsoft. Although Blagsvedt enjoyed his work, he felt compelled to work more directly with Indians, for Indians.

“I always had this nagging thing, like, am I doing enough to address the inequity that I saw, am I doing enough to make the best use of my skills, to try to do something important to make a difference?” he said.

After reading a study that said to get out of poverty, one needed to either change jobs or start a successful business, Blagsvedt was inspired to change how people found those positions.

“If only we could find a way to digitize all the jobs, make it accessible to people who don’t use computers, and digitize the social network, then we might be able to catalyze the escape from poverty for a lot of people,” he said.

Twelve years, a successful company and a family later, Blagsvedt is “more Bangalorean than me!” according to an Indian on his team, Akshay Chaturvedi.

In the past 10 years, however, it’s not just Americans and Europeans with humanitarian motivations who are starting companies in Bangalore.

Indians, even those who paid for American educations and planned to pay off those debts with American jobs, have seen the increasing opportunity back home.

‘A lot of vibrancy’

“[There is] a lot of young talent trying to build solutions that are uniquely India on almost every sector, whether that’s health services, education, digital media, even financial inclusion,” said Vani Kola, a venture capitalist who has been in Bangalore for 10 years after working in Silicon Valley. “I see a lot of vibrancy with respect to opportunity for building unique companies with unique solutions for India.”

And Indians have taken advantage of that opportunity. The number of startups in Bangalore rivals those in the top tech cities around the world. In 2015, San Francisco research firm Compass rated Bangalore as the second fastest-growing startup ecosystem in the world, and it was the only Asian city besides Singapore to place in the top 20 startup ecosystems.


Chaturvedi is one such person who, after completing a fellowship in the United States, returned to India, specifically Bangalore, to join the world of unique Indian startups.

“I can’t imagine my life without startups,” Chaturvedi told VOA. “Everything I do — I’m touched by a startup at least 20 times a day. Every single dinner I order by some food tech startup.”

In the days after we spoke with him at Babajob, Chaturvedi quit to work on his own startup — Leverage, an online platform for higher education services.

Although the question of the future of H1-B visas, a visa most often granted to IT workers from India, is on the minds of American companies that employ them, Bangalore seems less concerned.

“When students studied there, I said, ‘Look, there’s a lot of opportunity calling in India — can’t I do something here?’ That, I think, was a trend that was already there for the last few years,” Chaturvedi said. “And now [the] Indian economy seems to be strong and the opportunity from startups seems very viable in India.”

Fewer seeking H1-Bs

Blagsvedt holds a stronger opinion, saying that H1-B visas are exploitative, and that the rise of opportunity in Bangalore has limited the number of people desperate for those options.

“They haven’t raised that minimum salary in 22 years,” Blagsvedt said. “Now you tell me where you can hire a five-year programmer in Silicon Valley for $65,000 [a year]. You just can’t. And what does that guy have as recourse? If he doesn’t like the job, his visa is sponsored fully … he can’t complain, he can’t even switch jobs!”

Blagsvedt and Chaturvedi both said that in the Bangalore startup ecosystem, they had heard no talk, or worry, about the proposed changes to the U.S. visa program.

Chaturvedi did admit, however, that any threats to the H1-B program “would have been far scarier 10 years back.”

In today’s Bangalore, any widespread panic that Silicon Valley might imagine simply hasn’t taken hold.

Silicon Valley & Technology

Peru Startup Founders Discuss Business Challenges in Developing Countries

Mariana Costa Checa, a Peruvian entrepreneur, runs a coding boot camp for women in Peru, many of whom have no formal education.

She attended the South by Southwest conference and festivals in Austin, Texas, as part of a Peruvian contingent showing its work and sharing the challenges of starting an enterprise.

Entrepreneurship is one of the main themes at South by Southwest, which also includes artists, musicians, elected officials and company representatives.

Costa Checa spoke to VOA about overcoming challenges, including misconceptions of poverty.

“I grew up with a whole set of concepts around what getting a job entails, how to behave at work,” she said. “I realized if you grow up in a context where you’ve never seen someone working in an office, in a formal sector, then you don’t have that basis. … That entails a series of challenges in how to prepare someone to not only get a job, but be able to sustain a career.”

But helping underserved communities means truly understanding their conditions, she said.

“Much more goes into making a decision than just the sort of consumer aspect,” Costa Checa said. “A lot of it is the stress of poverty.”

Costa Checa was joined by Vania Masias, founder of D1 Asociacion Cultural, a dance program for at-risk youth in Lima.

Also attending was Isabel Medem, whose startup provides and services portable toilets in Peru’s poorest households.

Like other entrepreneurs here, she took a gamble.

“We didn’t know how long we would be around,” said Medem. “We didn’t know whether the model would be successful. So it was really, like, ‘Six months — we’ll just try and see.’ ”

Arts & Entertainment

Trudeau in New York for Broadway Play About Canada on 9/11

Canadian Prime Minister Justin Trudeau plans to be in New York on Wednesday for a Broadway play about Newfoundlanders who opened their doors to thousands of passengers who descended on the town of Gander the day U.S. airspace was shut on 9/11.

More than 200 flights were diverted to Canada. Little-used Gander became the second busiest airport, taking in 38 flights. The 6,600 passengers arrived without warning on the town of 10,000.

Canadians took care of the stranded passengers for days. Americans say they experienced overwhelming kindness.

It’s now a musical called “Come From Away” that has won critical raves. It opened Sunday at the Gerald Schoenfeld Theater.

Trudeau spokeswoman Andree-Lyne Halle said Tuesday the prime minister and his wife look forward to showing New Yorkers “Canada at its best.”

“We embrace the opportunity to highlight how we are there for each other in times of need,” she said.

Flight crews quickly filled Gander’s hotels, so passengers were taken to schools, fire stations and church halls. The Canadian military flew in 5,000 cots. Stores donated blankets, coffee machines, barbecue grills. Unable to retrieve their luggage, passengers became dependent on the kindness of strangers, and it came in the shape of clothes, showers, toys, banks of phones to call home free of charge, an arena that became a giant walk-in fridge full of donated food.

Once all the planes had landed or turned back to Europe, Gander’s air traffic controllers switched to cooking meals in the building nonstop for three days.

Years later, that huge, comforting hug of Gander still warms the memories of the passengers.


Economy & business

IATA Still Wary of Protectionism After Positive Meeting with US Officials

Airline industry group IATA said it remains concerned about protectionist rhetoric from the United States and other governments, but also sees the new U.S. administration’s plans to invest in infrastructure as positive for the industry.

IATA’s Director General Alexandre de Juniac told reporters in Abu Dhabi on Tuesday that the group had recently held a meeting with U.S. President Donald Trump’s administration, which he described as “positive”. However, he also said the group was “heavily concerned” about plans by governments “to raise barriers on borders for trade and for travel.”

He did not say when the meeting took place.

“It was the opportunity for us to meet the new administration, to express our view and to understand what the new administration had in mind for aviation,” de Juniac said, adding that U.S. plans looked positive in terms of investment in infrastructure and regulation.

IATA and its members were critical of President Trump’s Jan. 27 executive order that blocked refugees and nationals of seven Muslim majority countries from traveling to the United States.

Many in the industry have said the ban was rolled out haphazardly without clear communication, causing chaos and confusion at airports globally. The Trump administration’s revised travel ban is due to come into effect on Thursday.

As well as in the United States, IATA is still concerned about “significant” protectionist rhetoric in Europe and other parts of the world, although it would take time before protectionist measures are felt in the industry, De Juniac said.

This year has started off better than expected, he said.

Passenger demand reached a five-year high in January.

However, IATA said in December that it expects profit in the airline industry to fall this year after a five-year rally and de Juniac said that view remained unchanged.

Economy & business

US Central Bank Expected to Boost Interest Rates Slightly on Wednesday

Most analysts predict the U.S. central bank will boost interest rates slightly on Wednesday as the economy nears full employment and inflation rises modestly.

Leaders of the U.S. Federal Reserve are gathered in Washington through Wednesday to debate interest rate policy.  

Experts at Moody’s Investor Service say the Fed will raise rates a quarter of a percent and predicts a couple of similar increases later this year.  Moody’s says even with several increases, rates will still be low enough to encourage growth.

The Fed slashed the benchmark interest rate nearly to zero during the recession to bolster growth and fight unemployment.  Many economists say declines in unemployment mean the economy no longer needs such help.

If officials keep interest rates too low for too long, they risk sparking an abrupt inflationary jump that could force the Fed to raise rates high and fast, disrupting the economy.  Officials raise interest rates to cool the economy and fend off inflation.  Overall, the Fed is trying to guide the economy toward full employment while keeping prices increases around two percent a year.

More evidence of economic strength was published Tuesday, as leaders of many of the largest U.S. companies raised their outlook for hiring, sales, and investment for the next six months.  The Business Roundtable represents companies that employ 15 million people and generate $6 trillion in annual revenues.  

These CEOs are eager to see promised cuts in taxes and regulation carried out in ways that help their businesses grow.

Economy & business

Got a Spare $3.85 Million? Oregon Town Could be Yours

Aspiring property moguls take note – the town of Tiller, Oregon, is for sale, asking price just $3.5 million. For an extra $350,000, you can have the old school too.

The mostly uninhabited, unincorporated town about 225 miles (362 km) south of Portland originally went up for sale in 2015, but that did not include the building that used to house the school, said Garrett Zoller, the owner of Land and Wildlife, the real estate firm selling the 250-acre (100-hectare) town.

The current deal, at a reduced price, includes six houses and an apartment, industrial and commercial lots, and a building that once housed a gas station and general store. Adding the school, on an adjacent parcel, swing sets and all, would set a buyer back about $3.85 million.

About 250 people live in the surrounding area. But aside from the family that owns and is now selling the town, only two residents remain in Tiller itself, a former teacher who lives next to the school, and the pastor of the local church. Neither of their parcels is for sale, Zoller said in a phone interview on Monday.

The emptying out of the town came as timber harvesting declined in the region and the town’s mill closed, he said.

“When the federal money started dwindling away for timber, basically the mill shut down,” Zoller said. “And when the mill shut down, a lot of the loggers started having to go away.”

The family that owns Tiller now, he said, accumulated the town lot by lot as other families left.

Daydreamers aside, a complete town could also be an opportunity for a developer, Zoller said, since part of the town has already been divided for a 13-acre (5-hectare) subdivision.

He said he had fielded calls from would-be buyers ranging from Chinese investors to people interested in starting medical facilities and hemp-growing operations.

Arts & Entertainment

Playwright Uses Art to Help France Fight Radical Islam

As France wrestles with questions of security and immigration during its presidential election campaign, a Belgian playwright is using his art as a weapon in the fight against radicalization.

Ismael Saidi, 40, has an unexpected hit with his dark comedy “Jihad”, which follows three men on their hapless journey from Brussels’ Schaerbeek district to Homs in Syria.

“I’ve written this play to say ‘That’s enough, it has to stop’,” says Saidi, a Muslim. “It’s now become more than a play, it’s become a real social issue.”

France was traumatized by violence including a truck attack that killed 86 people in Nice last July and coordinated attacks in Paris in November 2015 when 130 people died.

Saidi says writing was a way to “free himself” of the guilt he felt, having dodged the trap some of his acquaintances fell into.

He says militants recruited boys like him to fight in Afghanistan when he was a teenager living in Schaerbeek and years later, in 2014, a former classmate posted a photo on Facebook holding a rifle in Syria.

The departure of about 700 French citizens to fight for Islamic State in Syria and Iraq has also made terrorism and immigration important issues in France’s presidential race.

Centrist Emmanuel Macron, the front-runner, has proposed setting up detention centers to “re-socialize” jihadists returning from Syria and Iraq.

Far-right National Front leader Marine Le Pen would expel all foreigners linked to Islamist fundamentalism, while conservative Francois Fillon has repeatedly warned of the risk of French Muslims being radicalized.

The government, which estimates 11,500 people are radicalized in France, plans to spend 15 million euros ($19 million) this year on preventing radicalization, up from around one million euros in 2014. It’s unclear if those funds will remain in place after the presidential election.

The current campaign includes websites to raise awareness of recruitment techniques.

Critics say the government has not delivered a coherent strategy to counter radicalization among France’s five-million Muslims.

But government officials say state-sponsored programs must be supplemented by private projects, such as Saidi’s play, which has drawn large crowds in its two-year tour of France and Belgium.

More than 700 secondary-school students saw it recently in the northern French city of Valenciennes.

“With plays like that, we can really make change happen,” said 16-year-old Sarah Moussaddak.

Muriel Domenach, who leads government efforts to prevent radicalization, supports the initiative.

“Making Daesh [Islamic State] uncool is very important,” she said.

Some experts argue former jihadists are the only ones who can reach people at risk.

“They have lived it from the inside, they know the invisible threads of jihadi utopia,” says French anthropologist Dounia Bouzar, who until last year helped the government train local authorities to fight radicalization.

David Vallat, who appears in one government online counter-radicalization campaign, was jailed for five years in the 1990s for joining networks linked to Algeria’s Armed Islamic Group.

He had previously traveled to Bosnia and Afghanistan. Now, the 45-year-old project manager from Lyon wants to spend all his time telling his story. But Vallat says that without public funding, he cannot make his voice heard.

French authorities are reluctant to work closely with former jihadists, wary about whether their reform is sincere.

Last year, Bouzar tried to persuade the government to work with Farid Benyettou, the infamous ex-mentor of the Kouachi brothers, who attacked satirical weekly Charlie Hebdo in January 2015, killing 12 people. Her proposal was rejected.

“The government is too timid,” says Bouzar. “Even the best imam, the best psychologist or the best teacher cannot instill doubts about something he hasn’t lived.”

Economy & business

Chinese CEOs Protest Curbs on Foreign Investments

China is witnessing a rare protest from heads of some major Chinese companies who say government controls on the outflow of funds are hurting their ability to strike business deals overseas. Starting late last year, the government began imposing strict controls on currency transfers in a desperate bid to curb outbound investments and stop the yuan from weakening. 


Last year alone, Chinese companies struck deals overseas worth $225 billion; but according to data compiled by Bloomberg, there have only been $19 billion in acquisitions abroad, announced by Chinese companies so far this year, a 74 percent drop from the previous year. 

Beijing asked banks to closely scrutinize money transfers, and reject requests from certain companies to move funds to foreign countries for investments in late 2016, a year when Chinese companies struck deals overseas worth $225 billion. China feels that massive fund outflows put pressure on the Chinese Yuan, which has been steadily devaluing against the U.S. dollar since early last year. 

The government clampdown has had a significant effect. According to Bloomberg’s data, there has only been $19 billion in acquisitions abroad announced by Chinese companies so far this year, a 74 percent drop from the previous year. 

Feeling the pinch


On the sidelines of high-level political meetings in Beijing, a time typically seen as an opportunity to build consensus and not air dissent, business leaders who attended the talks were blunt in their criticism of the controls.


Zhang Yichen, chief executive officer of investment firm Citic Capital Holdings, told reporters that it is almost impossible to use the yuan to invest overseas.


“To say that capital controls don’t have any impact – it’s a lie,” said Zhang.


Zheng Yuewen, chairman of Chinese drugmaker Creat Group, said, “The foreign exchange management is so strict now that it’s almost impossible to move funds out.”


Investments plunge 


Over the past two months, China’s outbound investments have nearly been cut in half and government controls are a key reason for this, Julian Evans-Pritchard, China economist for Capital Economics, told VOA.


“It has certainly hurt a lot of Chinese companies who are active in the overseas market,” he said. “But I don’t think the government is going to ease controls until outbound flows come down to the level it is comfortable with.”


According to China’s Ministry of Commerce, outbound investments plunged by 39.5 percent in December 2016 and 35.7 percent in January of this year as the government began applying the brakes. The drop was dramatic when compared to the surge seen in the previous two months when outbound investments increased 48.4 percent in October and 76.5 percent in November of last year. 


The government’s control of fund outflows could become even more stringent as the U.S. Federal Reserve is expected to review interest rates this week. A rate increase would make it more lucrative to invest in the United States, and make it increasingly difficult for Beijing to stem the exodus of money, analysts said. 


Standing firm


Although the blunt remarks from CEOs were aimed at persuading officials such as the head of the People’s Bank of China and others to loosen restrictions, the government is showing little sign of budging.

At a press conference on the sidelines of the Beijing meetings, People’s Bank of China Chairman Zhou Xiaochuan stuck to the government’s view that curbs were necessary to manage the currency. He also blamed “irresponsible investments” made by Chinese companies in foreign markets for causing the problems.


Zhong Shan, China’s minister of commerce, said a small number of companies was investing “blindly and irrationally overseas” and running into a range of financial problems. He said that is hurting the image of Chinese investors overseas; but, he did assure investors that what he called “normal investments” would not be impacted.


“There are clearly some who are of the view that China is cooling down, that it is not encouraging investments overseas, but this view is incorrect,” said Zhong.


Analysts agree that not all investments are off limits, but the government’s statements downplay the impact controls are having. A quick glance at the numbers reveals that clearly there are some types of investments authorities are looking to slow.


No superheroes


Right now, there is a big focus on property developers looking to invest overseas, said Andrew Collier, managing director of Orient Capital Research. Media and entertainment investments are also facing challenges, he said, but adds the government is being very selective about just who it is saying no to.


“They are focusing most of their opposition on deals where they feel have no value to the Chinese country,” Collier said. In some cases, the government is saying, “It might be nice for you and your business to expand your business overseas, but we don’t think that making films about superheroes is going to benefit the Chinese economy.”


Chinese companies such as Dalian Wanda have been ramping up investments in Hollywood and entertainment over the past year. Last Friday, however, a $1 billion deal for the Chinese conglomerate to purchase Dick Clark Productions – which produces the Golden Globe Awards – fell through.


At the same time, however, a $43 billion deal between ChemChina and Swiss crop protection and seed group Syngenta is moving forward.


“That is a very large deal, and so far there has been no opposition to it,” Collier said. “If you have a deal for a-half-a-billion or a billion dollars it might get a lot of attention in the press, but it is actually not that much money compared to some of the other stuff that is still committed to be going forward.