From: bijal@fusion.Berkeley.EDU (Bijal C. Modi)
Newsgroups: soc.culture.indian
Subject: Indian Software News
Date: 9 Sep 1992 04:22:47 GMT
Organization: University of California, Berkeley
Distribution: world
NNTP-Posting-Host: fusion.berkeley.edu


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Source : Clarinet Newsfeed
Disclaimer : Taken without permission
Date : July 28 '92
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NEW DELHI, INDIA, 1992 JUL 28 (NB) -- India is in a reasonably
favorable position to compete in the major software markets world-
wide, according to a report just out. The report, which was funded by
the World Bank, indicates that India can grow its software services
exports to be worth $1,000 million a year, provided the industry's
actions are well-coordinated.

The study report, which focused on the export potential and strategies
for India's software and services industry, has just been released by
the Department of Electronics here in India.

The $620,000 study was undertaken by Maxi/Micro Inc. -- which recently
merged with Infotech Consulting Inc., of Parsippany, New Jersey -- in
conjunction with International Data Corporation and its Indian
subsidiary of the same name.

A detailed study of issues related to software exports was carried
out, looking at several issues, including international market
potential, marketing channels, pricing and distribution patterns,
financing, data communications, manpower needs and training, and market
niches.

Identifying a potential market for Indian software exports, the report
identifies six potential country markets -- Italy, UK, France,
Germany, Japan and US -- which between them account for 80 per cent of
the world's total spending on information technology products.
India's software services exports were worth a total of $164 million
in 1991 -- that is 11.7 percent of, what the report calls "total
foreign opportunity." India's share is expected to shrink to nine
percent ($660 million) in 1996, if India goes on with its "business as
usual" approach, the report notes.

The report recommends that India's software services export target
be raised by the government to $1,000 million (a 13.5 percent share)
in 1996. Identifying the market opportunity for developing countries
in the target countries, the study estimates that, in professional
services (valued at $4,000 million in 1996), the major demand will
shift toward offshore projects than on-site projects in the coming
years -- these represent 54 percent and 46 percent of the market
respectively.

A detailed analysis of the eight competing countries ranks India in
number two spot, with Ireland topping the list. The six contenders
are: Singapore, Israel, Philippines, Mexico, Hungary and China.

Apart from calling for coordinated action between the government,
industry and the individual companies, opening the domestic market
place and "eliminating the remaining red tape," the report identifies
a number of action areas to be tackled, including targeting of markets,
upgrading the population skills and increasing the level of training
in the Indian computer industry.

One of the main recommendations of the report is the formation of a
Software Development Board (SDB) to plan, coordinate and direct
actions with specific responsibilities for marketing. The SDB would
have a proposed budget of about $1 million for core operations; $3-5
million for overseas liaison in six target countries; and $4-5 million
for general promotions.

Where will the funds come from? Initial suggestions about the
exporting companies contributing two percent of their earnings to SDB
have been scoffed at by the industry. The World Bank, however, is
apparently eager to grant $220 million towards enhancing information
technology projects in India, which should go some way toward putting
exporting IT companies in the right frame of mind.

The World Bank-funded study is a precursor to that benevolence. After
the ongoing deliberations of the report, the Indian government is
expected to give its nod of approval. Meanwhile, the 800-page tome has
more than enough data to satisfy any prospective software exporter.

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-Bijal
 bijal@garnet.berkeley.edu
Newsgroups: soc.culture.indian