India’s $200 billion IT industry received its biggest boost ironically at a time of great anxiety for businesses across the world. This came from the so-called “Millennium Bug”, a flaw in the original code written for computers through the 1960s, when programmers used a two-digit code for the year, instead of the now- standard four-digit one. With data storage costs high, the coders left out “19” believing it was superfluous. But as the year 2000 approached, there were fears that the “00” date that would start from the last midnight of 1999 could cause computers to malfunction since they might interpret that as the 00 for 1900.
This had profound implications for sectors like banking and finance, transportation, power and retail. An airline reservation system, for instance, could throw out all scheduled flights because of the date mismatch. A bank could end up deducting interest instead of crediting it. Extrapolated over millions of transactions, this was building up to a gigantic mess.
Fearing the worst, companies scrambled for ways to fix the problem and as the dreaded date neared, there was an urgent requirement for debugging the systems. The task wasn’t complex but to trawl through the millions of lines of code to fix the bug called for the deployment of trained programmers at an unprecedented level.
India’s fledgling IT companies sensed the opportunity and offered their services. The country had one major advantage. Most of the programmers in India had learnt Common Business Oriented Language (Cobol), a computer language that was no longer popular in markets like the US and wasn’t taught in colleges. But it was Cobol that powered most of the large mainframe installations dating back to the 1960s. Suddenly, Cobol skills were in great demand and soon hundreds of Indian companies were addressing the needs of a wide swathe of companies like Ford, American Airlines and tobacco major Philip Morris. Computer training institutes like NIIT and Aptech were running special courses that could quickly turn out the thousands of extra programmers needed.
The result was a bonanza for Indian IT firms. In 1997 India's software exports went past the billion-dollar mark but by 2000-01, while total IT software and services revenue galloped to $8.26 billion, about $6.2 billion, or 75 percent, was through software exports. That year, software and services accounted for 14 percent of India's total exports of $44 billion, up from barely 2.5 percent a few years ago.
That was largely to do with the Y2K boom though many experts believed that the country hadn’t taken full advantage of the opportunity because of bandwidth issues and the regulatory hurdles that dogged the sector. There might have been some truth in it. The estimated expenditure on resolving the problem in the US alone was around $100 billion and Indian companies bagged only a small fraction of it.
Still, Y2K provided the launchpad for the industry, serving as proof of its ability to handle reasonably complex computing issues. The current $150 billion of software exports owes much to the fortuitous opportunity thrown up by a bug that turned out to be vaporware. When the new millennium dawned, companies and countries that had largely ignored the Y2K issue and done nothing to change the code, faced no major problems. Their systems had been robust enough to handle the changeover.
—Sundeep Khanna is a former editor and the co-author of the recently released Azim Premji: The Man Beyond the Billions. Views are personal
(Edited by : Ajay Vaishnav)
First Published: Nov 29, 2021 7:21 PM IST
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