I recently met a gentleman who worked for IBM in India in 1977. He confirmed the political environment written up in this Software Magazine article which forced IBM (and Coca Cola) to leave India that year. He added color - apparently someone IBM had treated arrogantly years before was now powerful enough in government to push them out. But IBM's departure left about 1,200 employees many of whom seeded India's now well known software services industry.
30 years later IBM is back in full force. NY Times reports this Tuesday Sam Palmisano, CEO will address 10,000 local employees at "the Bangalore Palace, a colonial-era mansion once inhabited by a maharajah. He will share the stage with A. P. J. Abdul Kalam, India's president, and Sunil Mittal, chairman of the country's largest cellular services provider, Bharti Tele-Ventures" (which as Sukumar wrote outsources much to IBM).
"An additional 6,500 employees will look in on the town hall-style meeting by satellite from other Indian cities."
"On the same day, Mr. Palmisano and other top executives will meet here with investment analysts and local customers to showcase I.B.M.'s global integration capabilities in a briefing customarily held in New York. During the week, the company will lead the 50 analysts on a tour of its Indian operations."
One of the reasons IBM was not popular in India in the 70s was it charged too much for dated US equipment. With India such an important node in the IBM network now, its US customers today have reason to ask if they are being charged too much for its global mix of services.
Update: In the mid-70s, Steve Jobs of Apple was finding harmony in India while IBM had heartburn. In reverse, today I just read Apple cannot make a go in India while IBM makes plans for a $ 6 billion investment there.