STPI's role began in the government's shadow and it was more of an entrepreneurial role of working directly with software companies and working like a corporate. However, this did not mean that STPI functioned like a typical government department. The role of STPI was more of a service provider that could be leveraged by software companies.
Therein emerged three important factors that gave the necessary impetus to the concept. These were the newness of the business model, Internet infrastructure facilities and the government interface; all these brought a positive response from industry, especially the SME sector, which needed this support for their business to grow.
The concept of STP Scheme was evolved in 1991 and enunciated the following objectives:
To establish and manage infrastructure resources such as Data Communication facilities, Core Computer facilities, Built-up space and other common amenities.
To provide 'single window' statutory services such as Project approvals, import certification software valuation and certification of exports for software exporters.
To promote development and export of software services through technology assessments, market analyses, market segmentation and marketing support.
To train professionals and to encourage design and development in the field of software technology and software engineering.
In 1990, the STPIs were established through three separate autonomous societies at Pune, Bengaluru and Bhubaneswar, which were later, merged in June 1991 into a single autonomous society and in quick succession STPIs at Noida, Gandhi Nagar, Hyderabad and Thiruvananthapuram were established. All STPIs were equipped with dedicated earth station equipment for providing Data Communication links.
The erstwhile Department of Electronics, Govt. of India with the support of World Bank had carried out a study on the opportunities presented by the Global IT Industry. This study identified the factors that are very essential for the growth of the Software Industry and compared the potential of the countries competing in the Global Market. Some of the factors which needed improvement were clearly identified from the study and STPI focused in improving those factors.
International Communication is one such factor which needed much attention and India was factored -2 as against +8 factored to Ireland. This is one of the primary reasons why STPI took up the responsibility of providing the International Data Communication facilities exclusively for the Software Export Industry.
Since 1996, the State Government's started taking a very proactive role in promoting the IT industry. After the Govt. of Karnataka came out with the first IT policy, many of the State Government's followed suit. The success of STPI was not limited to the capital cities alone with STPI spreading its wings to secondary cities like Mysore in Karnataka and has, at the last count, spread to as many as 21 cities in a short span of 2 years.