Kanwal Rekhi on the Indian Institutes of Technology

"In the last three years, my sense is IITs have raised more than $100 million from alumni in the U.S. So we have brought this notion of payback in the U.S. style, paying back your alma mater. And it's sort of catching on in the U.S. now, so people are paying back. " — Kanwal Rekhi

(CNN) – Mr. Kanwal Rekhi graduated from the Indian Institute of Technology (IIT), Mumbai and received a master's degree in engineering from Michigan Technology University. He is a co-founder of Excelan, a maker of add-on boards for desktops. Rekhi served as executive vice president and chief technology officer for Novell, until he branched out into venture capital investing and mentoring for start-up companies such as Exodus Communications, CyberMedia, and Xpede.

The companies he helped found and The IndUS Entrepreneurs (TiE), an organization that works to foster and nurture entrepreneurs, are having a profound effect on the technical world. He has donated millions of dollars to IIT to help build a new school of information technology.

Chat Moderator: Thank you for joining us today, Kanwal Rekhi, and welcome.

Kanwal Rekhi: Greetings to everybody. It's an honor to be here.

Chat Moderator: Can you give us some background on the Indian Institutes of Technology (IIT)?

Kanwal Rekhi: The IIT was conceived in the 1940s when India was on the threshold of achieving independence. There was a debate on the future of technology and the future of science. And there was a sense that India would have to develop its own base of expertise in science and technology and train its people, if it was to achieve economic growth. Under that part, they planned five centers of excellence in science and technology. That's how the IITs were conceived.

I should also mention that five IITs were set up in collaboration with five different countries. The IIT in Bombay was set up with Russian help. IIT in Delhi was set up with British help, IIT in Madras with German help, IIT in Kampur with American help --thirteen U.S. universities helped with setting that up -- and, IIT in Kharagpur was set up with help from various countries, including the U.S. Many, many countries have been helping.

Question from Vinay: How does the research area get decided at IIT?

Kanwal Rekhi: IIT is not a research institute. By and large, they train undergraduates. And there's not much graduate work or research at IITs.

Question from Jude: Can you name a few instances where collaboration between the IITs and the industry paid off?

Kanwal Rekhi: Until recently, about 1996 or 1997, there wasn't much cooperation between IITs and industries. It's only in the last three to four years that there has been more collaboration.

I don't know of situations where IITs have done any major research for the industry yet. They were designed to train undergraduates that the industry needed.

Question from Agni: About the IITs, I have heard a lot of complaints that IITs would be on par with the world’s best technical institutes, if only they had the resources. Are the IITs facing a lack of resources? If they are, how can it be tackled?

Kanwal Rekhi: IITs are poorly resourced. When I went to IIT in 1994, for the first time since I left in 1967, I discovered the buildings had not been painted in 30 years, and plaster was coming off the buildings. It was falling apart. I remember them to be brand new, vibrant campuses. Now there was overgrowth of vegetation and buildings were falling apart.

I discovered they'd been given no maintenance money in four years. I understood they had been starved of resources. Labs had no money to upgrade. Overall, funding was very poor.

At that time, I felt it was time to help with private funding from IIT alumni. That's what we've been doing the last three years. The typical IIT budget is about $25 million a year, and that's it. A typical U.S. university will spend about five times as much for the same sized school.

Question from Mjacob: Is it justified to train a few engineers who end up in the U.S. with the money of the poor people, who are still working in the same conditions as 50 years back?

Kanwal Rekhi: This is hard to answer, the notion of people being trained at government expense and leaving India. What has happened recently, in the last five years, has been a flow of resources back to IITs. I personally gave $5 million, and others have done more than that.

In the last three years, my sense is IITs have raised more than $100 million from alumni in the U.S. So we have brought this notion of payback in the U.S. style, paying back your alma mater. And it's sort of catching on in the U.S. now, so people are paying back.

There's also a sense that we need to build more IITs with private initiative. We also need to provide them with resources from people, rather than government.

Comment from Sdfgdsg: You stated earlier that IITs are not research institutes. However, if India is to provide goods and services higher up in the value chain, Indian Technology Institutes need to become areas of innovation, rather than training institutes.

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Kanwal Rekhi: That's what we're pushing for now. In India when the IITs were set up, at the same time the government set up research labs, which were not part of IITs. The notion of a research university that we have in the U.S. is not there in India.

So there has been a recent effort from some people, led by a person in New York whose name is Chattergee, who has been influential in setting up U.S.-style research universities in India. We haven't had these style universities, where graduate studies were done.

In India, the notion of undergraduate education was separate from research, which is not the case in the U.S. For sure, if India is to move forward, it will have to build U.S.-style research education in universities.

Question from Techie: Mr. Rekhi, I am a big fan of your work, and I have tons of respect for you. Sir, I have a couple of questions. It is often said that entrepreneurs convert problems into opportunities. If this is true, then why do so many American-based Indian entrepreneurs shy away from India, where there is no shortage of problems to be solved? Plus, Indian marketing is being opened and liberated every day.

Kanwal Rekhi: This was true in the past. The Indian entrepreneurs shied away from India, mostly because India was socialistic and was unwelcoming of outsiders, even of Indian origin. It was hard to do anything in India, but that's not true anymore at all.

There are more and more entrepreneurs going back to India in the past five years, and the whole world is changing. If you went to India now, you'd see the influence of Indian entrepreneurs from the U.S. like you had never seen before.

Question from Rajdeep: Mr. Rekhi, would the Indian Institutes of Management (IIM) see equal exposure/scope as the IITs in the coming years and more so in the U.S.?

Kanwal Rekhi: Absolutely. IIMs have started to emerge on par with IITs. They are emerging as very high-quality management. Over the last ten years, the U.S. business schools have discovered them as high-quality institutes. IITs gained their fame in the 1970s and 1980s. IIMs are gaining their fame in the 1990s.

Question from Vins: Mr. Rekhi, which are the hot technology centers in the U.S. where there are a lot of successful IIT professionals?

Kanwal Rekhi: Silicon Valley for sure has a large Indian population -- more than 100,000 Indian professionals here in Silicon Valley. Seattle, with Microsoft, and Boston has always been much in the center of Indian presence. Austin has emerged as a new center of pretty sizeable Indian presence. Indians are spread all over, but these are the main centers.

Question from Agni: There have been complaints that IITs tend to be too technical, too focused on engineering. One of the reasons for my choice to go to California Institute of Technology (Caltech) instead of IIT was because I wanted to have enough exposure to other fields -- humanities, business, etc. What do you think of this? Would you say IITs have a well-rounded curriculum?

Kanwal Rekhi: No, IITs definitely do not have a well-rounded curriculum. They are absolutely focused on technology. This is an area where I've been pushing them to broaden their curriculum.

But in the past, the IIT graduates have moved on to other fields after the IITs. If you look at what IIT people have done in the U.S., it's unbelievable. More CEOs are coming out of IITs, even compared to U.S. universities. The CEOs of Citibank, US Airways, United Airlines, and McKinsey & Company -- the list is very long of the number of IIT graduates who are CEOs. The CEO of Providian in San Francisco is a graduate.

They've achieved great success and also are professors at major universities in the U.S. They've done well, although the education has been narrow.

Chat Moderator: Do you have any final thoughts for us today?

Kanwal Rekhi: The point I want to make is that IITs have shown that Indians, when properly educated, can compete with the best and the brightest in the world. What they need to do in India is really expand the education. The government needs to put larger emphasis on education than in the past.

There were five IITs built in the 1950s under Nehru, but none under Mrs. Gandhi and Rajiv Gandhi, too. They haven't built any more in the past 35, or so, years. That's a shame. If India is to achieve its potential, it needs to build lots more IITs, maybe 30.

Chat Moderator: Thank you so much for joining us today. We hope you will join us again at CNNdotCom.

Kanwal Rekhi: I wish I had more time and I wish best of luck to everybody. Thank you.

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