Punjab Didn’t Lose the IT Race—It Was Held Back for Seven Years in the Name of “Security”.....by KBS Sidhu

Punjab did not lose the IT race because it lacked brains, discipline, English, or institutions—everything a software economy needs in its people. If anything, the Chandigarh–Mohali periphery was unusually well placed: a professional civic culture, strong schools and colleges, decent air connectivity, proximity to Delhi, and a workforce whose reliability, stamina and practical problem-solving temperament map naturally to services-led industries.

And yet Punjab missed the foundational decade of Indian software exports. The tragedy is that this was not inevitable. Terrorism had largely been tamed by 1993; what followed was not a continuing national-security imperative so much as a security-habit—a reflex of governance that carried on by default even after the context had changed, leaving the satellite uplinking ban unrevoked.

The infrastructure Punjab didn’t get when it mattered

To grasp the scale of what went wrong, we have to remember what “IT exports” meant in the early and mid-1990s.

This was not the age of ubiquitous fibre, cloud platforms, cheap internet, or mobile data. For Indian software exporters, the critical enabler was the STPI-style data communications backbone—especially satellite-based connectivity that made high-speed cross-border transfer possible when dependable links were scarce. In that era, the “factory” was not a shed and machines; it was the ability to transmit code and data securely, reliably and fast.

Punjab’s own official material records that STPI Mohali was established in 1998, when IT activity in the region was still described as “nascent”. By contrast, the very first Software Technology Parks were set up at Bengaluru, Bhubaneswar and Pune in 1989, and the national STPI framework was consolidated in 1991—giving those early centres a decisive first-mover advantage.

The Chandigarh–Mohali region may have had the human capital and the urban ecosystem, but for years it did not have the export “pipe” that the 1990s required. That delay is not a footnote; it is the central plot. In a sector where early credibility snowballs into permanent advantage, Punjab’s late start meant it was absent while India’s global IT reputation was being formed and consolidated elsewhere.

When peace returned, but the state didn’t “stand down”

By 1993, the insurgency had been comprehensively defeated. Yet the administrative mindset of a security state often outlives the security emergency. Chandigarh itself illustrates this institutional hangover: it had been classified “disturbed” through notifications issued during the militancy peak of the 1980s, and that tag survived for decades until the Punjab & Haryana High Court quashed it in 2012 as no longer relevant.

This matters because “disturbed area” is not merely a label; it becomes a way of governing—centralised permissions, risk-avoidance, and an implicit preference for policing over economic imagination.

Even without a single dramatic “ban” that everyone can quote from one page, the practical effect is familiar in post-conflict bureaucracies: clearances slow down, private investment hesitates, and the state’s own apparatus becomes conditioned to saying “not yet”.

The cost of a seven-year delay in a network-effect industry

Punjab entered the 1990s with a double handicap. The first was real—militancy and the national security response. The second was avoidable: after 1993–94, Punjab did not urgently unwind the postures of exceptionalism or replace them with mission-mode economic rebuilding—precisely when the technology sector rewarded speed and first movers.

In software services, timing is destiny. When one city becomes the default destination for early global contracts, it doesn’t just earn revenue; it builds the whole ecosystem—experienced project managers, vendor networks, specialised lawyers and accountants, global sales linkages, and the “brand” that convinces the next client to come without persuasion.

One IPS batchmate of mine—who was in the thick of things and has viewed Punjab from multiple vantage points—told the KBS Chronicle that, after normalcy returned, “the authorities at both the Centre and the state appeared to have conveniently forgotten the old restrictions”. It was only when his report landed on the right desks that the P&T/telecom technocracy was jolted out of its deep slumber, and the ban on satellite communications—by then long stripped of logic or utility—was finally revoked.

The consequences were immediate and lasting. During the very years when India’s reputation as an outsourcing destination was being forged, Punjab could not credibly market itself as “plug-and-play” for global clients. By the time Mohali’s STPI platform existed in 1998, the national map of tech confidence was already taking shape elsewhere. And when private sector anchor projects began to appear, they were late by definition.

A Quark-linked entity came to Punjab in 1999 and developed Quark City as an IT SEZ in Mohali’s Phase 8 industrial area—another signal that the ecosystem’s “take-off” arrived after the decisive 1990s clustering race had already been run.

Even mainstream reportage of the region’s export curve hints at what might have been. When STPI set up in Mohali in 1998, Tricity’s IT exports were reported to be around ₹7 crore; later they rose sharply—proof, in hindsight, that infrastructure and policy attention were the binding constraints, not talent.

The real apathy: a vacuum of intent

The deeper failure, therefore, was not simply an infrastructure delay; it was a vacuum of intent—at Chandigarh (UT), in Punjab, and at the Centre—about what a post-1993 Punjab should become. A serious leadership would have treated 1993–94 as “Year Zero” for economic transformation: fast-track export connectivity and clearances (because, in the 1990s, connectivity was the factory); create a single empowered mission with authority across land, power, permissions and marketing; and sell the Chandigarh–Mohali periphery globally as the safest and most liveable northern base for technology work, rather than allowing the “Punjab memory” of the 1980s to define the 1990s.

Instead, governance drifted on autopilot—just when India was entering the Y2K-driven global hiring and outsourcing surge, the very wave that created enduring client relationships and scaled Indian IT for the world. Punjab, constrained by delay and indecision, missed much of that early momentum; and a generation of its talented, trained youth was compelled to seek work in the southern hubs where the ecosystem already existed—many of them settling there for good. In a globally contested industry, that is apathy: not a lack of speeches, but a lack of urgency.

Why it still matters in 2025

Some will object: “But Mohali has grown; start-ups exist; exports rose.” True—and that later jump itself strengthens the argument that Punjab’s constraints were policy-and-infrastructure shaped rather than cultural. Yet Punjab is not being compared to “what Punjab once was”. It is being compared to what the early-mover ecosystems achieved over three decades—deep clusters, global headquarters presence, dense angel and VC networks, and a talent flywheel that keeps attracting more talent.

Punjab’s past delay continues to echo because network effects compound. Late entry means fewer HQs, fewer global sales leaders, thinner alumni networks, fewer angel investors, and fewer serial founders per million people. You cannot make up for that with a few IT parks. You need a strategy that is coherent, measurable, and relentlessly executed.

The Quantum Valley provocation—and Punjab’s own answer

This is where Andhra Pradesh’s much-touted “Quantum Valley” push around Amaravati is useful less as a template than as a provocation. It signals what happens when a state decides to bet big, builds an infrastructure narrative around that bet, and aligns skills, industry and branding in one direction. Punjab needs that clarity of intent—but a Punjab-shaped strategy, not a southern photocopy.

(For a fuller argument, see our companion piece: “Andhra’s Quantum Leap — Why Can’t Punjab Quit the Quagmire and Reinvent Itself?”.) If Punjab is to leap rather than jog, it must stop talking about generic “IT” and start building a technology mission rooted in Punjab’s real economy and strategic location—one that uses the Chandigarh–Mohali region as a high-skill anchor while pulling the wider state into the productivity story. That means backing a few chosen strengths—technology for agriculture and water stress, health services, logistics and supply chains, manufacturing modernisation for SMEs, and AI-enabled governance—with non-negotiable infrastructure (connectivity, reliable power, data readiness), a single accountable investment-and-execution command, and a diaspora bridge that converts goodwill into capital, market access and mentorship.

The lesson Punjab must not miss again

The security era ended; the governance mindset must change too. Chandigarh’s long “disturbed” tagging—only quashed in 2012—shows how long exceptionalism can linger when nobody forces a reset. Punjab’s lost decade is, therefore, not only an economic story; it is a governance lesson. If you do not consciously return to normal rules after a crisis, abnormal rules quietly become permanent—and in a fast-moving sector like technology, “permanent” is simply another word for falling behind.

Punjab did not fail the IT race because Punjab was incapable. Punjab postponed the race. The corrective is not nostalgia and not imitation. It is intent, focus and execution—driven with the urgency that should have arrived in 1993–94, when peace returned and the state’s imagination should have returned with it. And the point is not to lament endlessly, but to rededicate ourselves to a framework that is globally relevant now—one that recognises what held Punjab back, names the apathy that allowed it, and then builds the next chapter with clarity and speed.