One of the projects, 99DOTS, has looked at low-cost ways to ensure tuberculosis patients regularly take their medication

From hacking agriculture to developing inexpensive tools for tuberculosis patients, Microsoft researchers in India are trying to solve myriad social problems in the subcontinent. India is a research and development hot-bed for large tech companies like Microsoft for several reasons: It has an increasingly middle-class young population and it has significant challenges present in society that can be solved using advanced technology.

Microsoft CEO Satya Nadella delivers his keynotes at the company’s flagship technology and business conference -- Future Decoded 2017 in Mumbai, India. Satish Bate | Hindustan Times | Getty Images

U.S. market research firm Forrester said in a report earlier this year that India's rising levels of education, abundance of technical talent, open and growing economy and rising mobile penetration will also contribute to digital proliferation. The firm predicted that, by 2020, India will have about 690 million internet users. That implies that there's going to always be a market for new tech products or services that address specific issues in society. So, for companies like Microsoft, there is a big potential customer base. In fact, the number of research and development centers being set up by large multinational companies in India is rising, according to a report widely cited by Indian media.

Microsoft takes on social issues

Microsoft Research India investigates machine learning, natural language processing, algorithms, cryptography and data sciences for the tech giant. It also explores creating technology for emerging markets. The organization works extensively with the Indian and international scientific community, academia and other Microsoft Research Labs in places like the U.K., China and the U.S. "One of the things that we're trying to do in an organization like Microsoft Research is to predict and invent the future," Sriram Rajamani, managing director of Microsoft Research India, told CNBC. Rajamani oversees a team of about 55 full-time staff, 30 research fellows who are usually fresh graduates and approximately 100 interns throughout the year. Current projects from the research lab include Melange, which is trying to study multilingual speech that can help to humanize virtual assistants in the future, and make them more accessible to the developing world. Another project — Harnessing AutoMobiles for Safety (HAMS) — uses sensors like a smartphone's front-camera, a phone's GPS and a vehicle's on-board diagnostics scanner to detect and alert if a driver is distracted or sleepy while driving.

The interesting thing to understand is that research is a social process. Most of the research teams (at Microsoft Research India), they have decided to form together on their own. Because I don't tell them to do this together, but they cannot do it alone. Sriram Rajamani managing director, Microsoft Research India

Most of the projects are rolled out in small pilots, sometimes in cooperation with state governments in India. The successful ones then go on to scale up. Sometimes they are also brought to other markets. One of the more prominent programs is 99DOTS, a four-year-old project that makes special envelopes for health-care providers to use for tuberculosis medication. After the patient takes the daily dose of medicine, a unique, toll-free phone number is revealed. With each daily call, the patient's doctors can monitor if they missed a dose in real-time and send reminders and other incentives. Bill Thies and Andrew Cross, who were the two main researchers working on 99DOTS, have formed a separate company called Everwell Health Solutions. There's now a licensing agreement with Microsoft Research and the company is employing people to scale 99DOTS throughout the country, according to Rajamani. He added that, if it works, there are plans to bring the concept abroad. Microsoft also rolled out a skills development initiative in India called Project Sangam. It is a cloud-based platform that integrates with LinkedIn, where users complete online courses for new skills and are then matched with relevant job vacancies. Part of the idea behind Project Sangam came from the Massively Empowered Classrooms project that was experimenting with how technology can improve the quality of higher education in India, according to Rajamani. Another Microsoft team in India, he explained, was also thinking about how to skill and train blue collar labor in the country, and so Project Sangam was created.

Localizing

Having research and development centers in India also allows companies to localize their existing products to fit the target demographic. For tech companies, those are people who are newly acquainted with technology and are connecting to the internet for the first time. Analysts have argued that localization of products and services in emerging markets like India is key to success for multinationals. Ashutosh Sharma, a research director and vice president at Forrester, told CNBC that, when it comes to the Indian market, there are some similarities to the West on the surface: an English-speaking, younger demographic with growing disposable income. But beyond that, it's a lot more complicated. "When you scratch the surface, there's a lot of issues with respect to the digital population in India," he said. "First of all, the awareness level beyond using their mobile phones for (social media) is non-existent." Sharma also pointed out that language is an issue in a country with more than a dozen main languages and hundreds of dialects. In fact, beyond the major cities, few people interact in English. Moreover, the disposable income in India's smaller cities and rural areas is low. "So people are very careful about the way they spend money. There's not that much money to go around with respect to the income level," said Sharma. But the Indian government has expressed well-documented interest in promoting digital literacy and technological advancements throughout the country. On a national level, that includes Prime Minister Narendra Modi's "Digital India" campaign to improve online infrastructure and services, the rolling out of a national identification system, and the newly passed goods and services legislation that requires businesses to file their tax returns online.