Can China Overtake India in Software?
siliconindia.com
Monday, March 05, 2001
Will India once again snatch defeat from the jaws of victory? Can China overtake India in software exports? China’s growing strength in software development has been creating a panic in Indian IT circles for sometime.
China’s software exports are close to $1 billion, while India’s software exports are expected to touch $6.24 billion in the fiscal 2001-02 as against $4 billion earned during 1999-2000. Prof. Sumantha Goshal, dean of the Indian School of Business and professor of strategic leadership at the London Business School, says, “China is working its way towards setting up a software base and could repeat their toy story in software tomorrow.” He adds “The Chinese government is teaching English to IT professionals and engaging institutions like the MIT Lab to strengthen their skills in software development.”
Goshal suggests that though Indian companies like, Infosys Technologies Ltd (Nasdaq: INFY), Wipro Ltd (NYSE: WIT) and TCS are players in the global arena, they are still competing with each other on the local level and have yet to witness actual global competition. He warns that true global competition could come from China. Ghoshal says, "The only way Indian software companies can retain their competitive edge is by shifting focus from a sustainable competitive advantage to a continuous self-renewal, from corporate earnings to customer value creation and most importantly from financial capital to human capital.”
Why are Indian IT companies in panic about China’s growth? Are we underestimating India’s skills in IT? Dewang Mehta, president of NASSCOM, replies, “Indian IT companies should think positively that every country will be a competition to India, not just China. It’s a global competition. It is true that China is growing in software exports. However, the country is still long way to go in software. China’s strengths are basically in the hardware segment not in software exports like India,” he says.
Oft cited is India’s advantage in terms of the number of English-speaking workers. Feroz Chand Kohli, vice chairman of Tata Consultancy Service (TCS), says, “Working in an English atmosphere is a different. China has a major disadvantage in this. The nation’s IT professionals do not think in English.”
Giving a cautious note to Indian IT firms, Ghoshal says, the premier institutions such as MIT Labs are training Chinese IT professionals in software development and it is the high time for the Indian companies to focus on discover new technologies. It is noteworthy to say that Chinese IT firms, after the US, are slowly discovering the excellent software skills of Indians for making inroads into the country to grab a share of the booming IT Pie that is ever growing.
For instance, Huawei Technologies Ltd, a $2.6-billion leading Chinese telecom giant, has recently chosen Bangalore as a site to set up its largest software development center (SDC) outside China for advanced R&D in telecommunications and networking solutions. Remarkably, about 160 Chinese software professionals are already working on several projects at the Bangalore facilities.
Phiroz Vandrevala, chairman of NASSCOM, is of the opinion that India has made its brand in the global arena. It is high time for India to further strengthen its brand in the global IT scenario. |
