India set to invest US$500 million in Brazil. What does this have to do with IT startups?
Diego Remus on May 02, 2010
According to the Ministry of Foreign Relations of India - a country famous for its competitive work in IT - India is planning to invest US$500 million in Brazil. The investment is part of a government plan which has already invested US$2 billion here and wants to negotiate further deals.
(some of the information in this post is from the BBC, as well as from our own research and opinions)
Indian consultants and public officials say the main opportunities will be in mining, sugar and ethanol production. Petroleum production has already received US$1.57 billion from an Indian state-owned agency which is said to be planning to invest a total of US$6 billion by 2011, both in exploration in foreign countries and refining domestically.
Brazil leads the list of Indian investments in Latin America. India announced US$12 billion aimed at the region, 10 of it intended for trade with various Latin American countries. Venezuela, Bolívia, Chile and Argentina round out the list, after Brazil.
What does this have to do with IT startups?
I suppose it offers some possibility of creating embedded or integrated systems - what else? They want to buy into our natural resources? Some of these are renewable, others not. We know billions in the hands of a Brazilian state agency can evaporate rapidly. Will commercial trade suffice to compensate? Who am I to criticize? But I suggest, in this negotiation, they invest in some of our best renewable resources, which they don’t seem to have much of to sell (at least in IT): creativity and innovation.
Some say IT is strategic only for aggregating value in other sectors. We have shown that our IT can range from green in the northeast to clean in the southeast. Our IT startups are involved with biotechnology as much as social networking!
I think that an open door gives a visibility that can grow capital (one has heard of various Indians who have invested in startups in the USA; perhaps now they will see that Brazil offers competitive advantages relevant to their business.) To conclude, TechCrunch itself has pointed out some particular advantages of Brazil that certainly impact its position among the BRICs.
