• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Indian IT Companies Move into the E. Asia Market

Posted on: Sunday, 1 January 2006, 15:00 CST

By Shubhra Tandon, Kyodo News International, Tokyo

Jan. 1--NEW DELHI -- Raj Khosla, an Indian software developer, 23, is working in Malaysia for an Indian software company based in the western state Maharashtra.

Away from home, Khosla has spent five months in product development for the East Asian market and is now a permanent employee there.

Ask him about Indian information technology (IT) interests in East Asia and he answers: "Computer use started off in the West and Europe. Soon, Asia followed, so likewise companies started off with the West and now are extending to East Asia and Asia-Pacific. It's not a drift, it's more of an extension."

Vishal Borker, another software engineer who is 26, spent nearly six months in Japan working for Nature Soft, a Chennai-based offshore outsourcing company providing open source technology solutions to clients the world over.

Vishal feels that while earlier Japanese software was dominated by Chinese for "reasons of proximity, language, script and so on."

"But with more Japanese learning English, and more Indian professionals learning Japanese, the movement towards Indo-Japanese business has increased," he said.

After proving their prowess in the United States, Europe and the rest of the world, the Indian IT companies are now looking to closer vicinities such as East Asia.

So much, so that young IT professionals are flocking to Japan, China, Malaysia, Thailand and Singapore more than ever before.

And Raj and Vishal are just two examples from among the teeming populace of Indian IT professionals who are heading for East Asia and the Asia-Pacific.

And what is the driving force for the Indian IT market in East Asia?

"Diversify," is the mantra for the Indian IT companies, answers Sangeeta Gupta, vice president of the National Association of Software and Service Companies.

"What companies are recognizing is that you are going for software development and don't want to be dependent only upon the U.S. and U.K., which are obviously our large markets. But at the same time you want to make sure that you also diversify and be present in more markets," Gupta said.

She is quick to add, "Also, these economies are opening up.

Earlier, they were closed economies. They did not want to work with us. So, there has been liberalization on both sides." And the phenomenon of expansion is not limited to just business.

Indian IT professionals aspiring to capture market in East Asia undergo a thorough training in language, culture, ideas, people and the East Asian environment.

According to NIIT, an Indian IT education institute and one of the pioneers in IT education in Asia, the global IT education and training market was estimated at $28 billion in 2003 and the projected growth until 2012 is 9 percent.

Therefore, it would not be wrong to suggest that the IT market is moving in tandem with a larger vision of India's "Look East Policy." Like other areas of cooperation, even in the IT market in East Asia, Japan leads the race with roughly 3-4 percent of India's software export and it is the largest market for Indian IT companies in the region with more than 70 Indian IT companies having a presence in Japan.

The focus of the industry is on different areas of software development, embedded software and other newer avenues.

China, Malaysia and Taiwan are other prominent markets for the Indian industry.

The question now is whether the East Asian market for Indian IT will grow and become parallel to the market in United States and Britain.

The experts suggest the market dynamics for East Asia have changed considerably in the last few years, but it is still an emerging trend.

According to the industry association, countries such as China are themselves players competing for that market and there are companies in East Asian countries that have a far greater compatibility as to culture and language with East Asian companies.

Hence, Indian companies that want to expand into East Asia will need to have physical presence in East Asia.

They will need to hire local people there and work more closely with the government and other people to understand barriers to trade and help remove them, concerns that no longer exist in American and British markets.

Now, the United States and Britain account for nearly 85 percent of Indian IT exports.

But the companies do realize that to grow in size they need to venture into novel markets and make their presence felt.

Thus, for an Indian IT professional East Asia is a Pandora's Box.

Naveen Vohra, a systems analyst, has been in Singapore for the last seven years and feels no difference in opportunities in East Asia or other native English-speaking economies.

But he prefers Singapore for its "proximity to India.""An Asian environment with a large Indian diaspora makes it a breeze to fit in the culture," he said.

Vishal agrees, saying people are "extremely compassionate, understanding, and friendly. At the same time, very professional I was amazed at their diligence to the work ethos." With fast-aging populations in Europe and some East Asian countries, India is demographically perhaps the best location for the companies in East Asia to grab market opportunities.

With a large number of efficient young IT people making a mark, it is best in the interests of the East Asian market to export work in India as well.

As Sangeeta Gupta of the industry group puts it: "We would want a model where we can emerge as the preferred partner for corporations in East Asia --corporations who want to partner and outsource our software development."

-----

To see more of Kyodo News International, go to http://www.kyodonews.com

Copyright (c) 2006, Kyodo News International, Tokyo

Distributed by Knight Ridder/Tribune Business News.

For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

Source: Kyodo News International, Tokyo

More News in this Category