Sridhar Vembu, the billionaire behind Zoho Corporation, has highlighted the economic disparity between urban and rural India, asserting that the growth of IT hubs like Bengaluru is fueled by the decline of rural areas. Vembu points out that rural areas face a significant trade deficit due to the low value addition in agriculture compared to urban-based manufacturing and services.

Vembu explained in a post on X that this divide is rooted in basic economics rather than just social disparity. Rural India consistently suffers from a trade deficit with urban centers, where the value addition in sectors like healthcare, finance, law, and accounting is much higher. He illustrated this imbalance by noting that rural communities sell rice paddy at ₹25 per kilogram but buy smartphones at ₹1 lakh per kilogram, leading to a cash drain from rural to urban areas, fueling migration and the selling off of rural land. Government-sponsored cash transfer schemes are used to alleviate some of this economic pressure.

India also faces a broader trade deficit in manufactured goods, largely imported from countries like China, which is only partially offset by service exports from urban centers. Vembu noted that even remote areas with surplus labor are buying goods manufactured in China, where laborers earn significantly more than their Indian counterparts. This is sustained by urban service exports but fails to empower rural India, making migration the only viable option for many rural residents.

Bengaluru, a leading city in service exports, has become a magnet for internal migration, straining its infrastructure. To address this, Vembu advocates for a rural manufacturing revolution to slow migration and ease the burden on urban centers. He illustrates the urban-rural services imbalance with the example of struggling to earn Rs 50 an hour only to pay a doctor Rs 1000 an hour when sick.

Sridhar Vembu, born in 1968, is known for his commitment to rural development. He relocated to a rural village in Tamil Nadu, championing the idea that world-class technology can be developed from non-urban centers. As of 2024, Forbes ranked him as the 39th richest person in India, with a net worth of $5.85 billion. He was awarded the Padma Shri in 2021 for his contributions to business and technology. Vembu's leadership inspires entrepreneurs across India through his belief in decentralization, education, and economic empowerment.