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Acknowledging that even though there was a huge talent pool in the technology sector, Prime Minister Manmohan Singh said: "India made the mistake of concentrating only on software. The country should also focus on hardware development."
The prime minister was speaking to the media at the East Asia Summit in Kuala Lumpur on Monday.
He said that while Bangalore remains the intellectual capital of India, Hyderabad was fast catching up.
"As a matter of fact, along with Bangalore, Chennai, Hyderabad and Delhi are also hubs of IT related services," he said.
Speaking about the row between Infosys chairman N R Narayana Murthy and former prime minister H D Deve Gowda, the prime minister said that the Murthy-Gowda incident was not a typical instance of how the state governments interact with businesses.
He said that since competition was attracting investment, the right sort of signal was being created in the minds of politicians. And the number of politicians who obstructed the growth of business was getting increasingly lesser.
On airports:
The prime minister said that while the Mumbai and Delhi airports have been opened for public-private partnership, in March the government would open the Kolkata and Chennai airports for the same.
Further, he said new airports were being built at Bangalore and Hyderabad. In the next 5-6 years India's infrastructure would undergo a sea change.