Although these figures are low by global standards, the industry's average annual rate of growth in the last five years has been 46 per cent, with exports growing much faster than domestic sales. This paper presents a case study of the software industry in Bangalore, with the aim of analyzing the factors that led to its integration into the global software industry and the development dilemmas that arise for Bangalore from this integration. The geographical dispersion of the software industry, which spans from Silicon Valley all the way to Bangalore brings to light the nature of global integration or globalization. This type of integration has become all the more prevalent in the last decade in a variety of industries. Given the advancements in telecommunication technology and transportation, these production activities can be located just about anywhere.
Location depends on a number of factors including resource availability, cost and infrastructure.
This approach consists of analyzing firm strategies at the many stages of the production chain, with the aim of examining the decisions and choices made by firms and the impact that these may have on the rest of the chain. This approach recognizes the interdependence between actors, and hence, between locations. It is this particular aspect that makes it useful to this study, as it views the process of globalization as occurring not only through the activities of multinationals and local firms but also through the integration of locations and labour markets. Section 3 analyses the role of policy in leading to India's involvement in the ind industry. Section 4 presents the case study of Bangalore, followed by the summary and conclusions.