while in India IT accounts for 65% of the funding. For early-stage VC fund Accel Partners, the $260-million India fund focuses only on technology, while in China it is across sectors with a corpus size of $2.5 billion.
Prashanth Prakash, partner, Accel Partners India, feels it will be tough for Chinese companies to replicate the product engineering expertise that IT product companies in India have developed over the years.
“The product companies in China are not yet serving global clients like the Indian peers. When they will try to go global, they will find it difficult to do the language transition.”
But India cannot afford to rest on its laurels, feel analysts. Says Kumar R Parakala, KPMG, head of IT Advisory, the investment in academics, along with the collaboration with industry and huge money poured by angel investors and VCs, is also fueling innovation in product space as well. “There are a lot of incentives for start-ups in China apart from getting many infrastructure facilities for free,” notes Parakala.