These have benefited from India's willingness to allow free trade and minimal regulation for new industries, often involving computer software, telephone service centers for financial institutions and other service industries that do not involve moving goods on India's poor roads.
But success stories like Bangalore and Hyderabad remain a tiny part of the overall economy, since software companies hire workers by the hundreds and not by the tens of thousands the way manufacturers do.
"You look around and the rest is a disaster," said Joydeep Mukherji, an Asia analyst with Standard & Poor's. "One billion people are not going to be programming computers; they're going to be making shoes and cars, and serving coffee."
Indian shoe companies had as much cheap labor available two decades ago as Chinese companies, and workers here were better educated. Yet Chinese manufacturers increasingly dominate the global shoe market.
"In the shoe industry, China has gotten ahead and will stay ahead," said Martin Merz, a partner of NJB Merz Ltd, a shoe trading company in Hong Kong.
Gupta and his family control the Action Group, India's second-largest shoemaker after Bata. But the newest of Action's dozen factories, a warehouse-like white building next to a dirt road across the city line in New Delhi, is unlikely to inspire fear in foreign competitors. The cramped building has room for just 150 workers, not enough to achieve the economies of scale of Chinese factories, where up to 20,000 toil in a single complex.
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