<PAGE>

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                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549
--------------------------------------------------------------------------------

                                   FORM 20-F

(Mark One)
[_]  Registration statement pursuant to section 12(b) or (g) of the Securities
     Exchange Act of 1934

[X]  Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934
     For the fiscal year ended March 31, 2000

[_]  Transition Report pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934
     For the Transition period from ______ to ______

                       Commission File Number 333-72195

                         INFOSYS TECHNOLOGIES LIMITED
            (Exact name of Registrant as specified in its charter)

                                Not Applicable
                (Translation of Registrant's name into English)

                          Bangalore, Karnataka, India
                (Jurisdiction of incorporation or organization)

                         Electronics City, Hosur Road,
                              Bangalore, Karnataka
                                 India  561 229
                                +91-80-852-0261
                    (Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act:
    Title of Each Class            Name of Each Exchange on Which Registered
          None                                   Not Applicable

          Securities registered pursuant to Section 12(g) of the Act:

                          American Depositary Shares,
  each represented by one-half of one Equity Share, par value Rs. 5 per share.
                               (Title of class)

 Securities for which there is a reporting obligation pursuant to Section 15(d)
                                  of the Act:
                                Not Applicable
                               (Title of class)

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report - 66,150,700 Equity Shares

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
                Yes _________          No _____X_____

Indicate by check mark which financial statement item the registrant has elected
to follow.
            Item 17 _________    Item 18 ______X_____
<PAGE>

Currency of Presentation and Certain Defined Terms

Unless the context otherwise requires, references herein to the "company" or to
"Infosys" are to Infosys Technologies Limited, a limited liability company
organized under the laws of the Republic of India. References to "U.S." or
"United States" are to the United States of America, its territories and its
possessions. References to "India" are to the Republic of India. Yantra
Corporation, a Delaware Corporation ("Yantra"), in which the company holds a
minority interest, is considered a subsidiary of the company for purposes of
Indian GAAP. "Infosys" is a registered trademark of the company in the United
States and India. All other trademarks or tradenames used in this Annual Report
on Form 20-F ("Annual Report") are the property of their respective owners.

In this Annual Report, references to "$ " or "dollars" or "U.S. dollars" are to
the legal currency of the United States and references to "Rs." or "rupees" or
"Indian rupees"" are to the legal currency of India. The company's financial
statements are presented in Indian rupees and translated into U.S. dollars and
are prepared in accordance with United States generally accepted accounting
principles ("U.S. GAAP"). References to "Indian GAAP" are to Indian generally
accepted accounting principles. Except as otherwise specified, financial
information is presented in dollars. References to a particular "fiscal" year
are to the company's fiscal year ended March 31 of such year.

Unless otherwise specified herein, financial information has been converted into
dollars at the noon buying rate in New York City for cable transfers in foreign
currencies as certified for customs purposes by the Federal Reserve Bank (the
"Noon Buying Rate") on March 31, 2000, which was Rs. 43.65 per $ 1.00. For the
convenience of the reader, this Annual Report contains translations of certain
Indian rupee amounts into U.S. dollars which should not be construed as a
representation that such Indian rupee or U.S. dollar amounts referred to herein
could have been, or could be, converted to U.S. dollars or Indian rupees, as the
case may be, at any particular rate, the rates stated below, or at all. Any
discrepancies in any table between totals and sums of the amounts listed are due
to rounding. For historical information regarding rates of exchange between
Indian rupees and U.S. dollars, see "Key Information - Exchange rates".

Forward-Looking Statements May Prove Inaccurate

IN ADDITION TO HISTORICAL INFORMATION, THIS ANNUAL REPORT CONTAINS CERTAIN
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES
ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934,
AS AMENDED. THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN ARE SUBJECT TO
CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE REFLECTED IN THE FORWARD-LOOKING STATEMENTS. FACTORS THAT
MIGHT CAUSE SUCH A DIFFERENCE INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED
IN THE SECTION ENTITLED "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS" AND ELSEWHERE IN THIS REPORT. READERS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH
REFLECT MANAGEMENT'S ANALYSIS ONLY AS OF THE DATE HEREOF. IN ADDITION, READERS
SHOULD CAREFULLY REVIEW THE OTHER INFORMATION IN THIS ANNUAL REPORT AND IN THE
COMPANY'S PERIODIC REPORTS AND OTHER DOCUMENTS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION ("SEC") FROM TIME TO TIME.
<PAGE>

                                    Part I
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Item 1.  Identity of Directors, Senior Management and Advisers

Not applicable.

Item 2.  Offer Statistics and Expected Timetable

Not applicable.

Item 3.  Key Information

  3.A.1 & 2  Selected financial data

  This information is set forth under the caption "Summary of Selected
  Consolidated Financial Data" on page 96 of the Infosys Annual Report for
  fiscal 2000 and is incorporated herein by reference.

  3.A.3  Exchange rates

  Fluctuations in the exchange rate between the Indian rupee and the U.S. dollar
  will affect the U.S. dollar equivalent of the Indian rupee price of the equity
  shares on the Indian stock exchanges and, as a result may affect the market
  price of the ADSs in the United States, and vice versa. Such fluctuations will
  also affect the U.S. dollar conversion by the Depositary of any cash dividends
  paid in Indian rupees on the equity shares represented by the ADSs. The
  following table sets forth, for the fiscal years indicated, certain
  information concerning the exchange rates between Indian rupees and U.S.
  dollars based on the Noon Buying Rate:

<TABLE>
<CAPTION>
  -------------------------------------------------------------------------------------------------
  Fiscal year ended March 31,    Period end /1/    Average /1/,/2/      High            Low
  -------------------------------------------------------------------------------------------------
  <S>                            <C>               <C>                <C>           <C>
  1994/3/                           Rs. 31.37           Rs. 31.52     Rs. 31.75     Rs. 31.37
  1995/3/                               31.43               31.38         31.90         31.37
  1996                                  34.35               33.47         38.05         31.36
  1997                                  35.88               35.70         36.85         34.15
  1998                                  39.53               37.37         40.40         35.71
  1999                                  42.35               42.10         43.68         39.25
  2000                                  43.65               43.46         43.68         42.84
  --------------------------------------------------------------------------------------------------
</TABLE>

  1. The Noon Buying Rate at each period end and the average rate for each
     period differed from the exchange rates used in the preparation of the
     company's consolidated financial statements.
  2. Represents the average of the Noon Buying Rate on the last day of each
     month during the period.
  3. From March 1, 1992 through August 19, 1994, the rupee was not permitted to
     fully float and convert on the current account. Instead, a dual exchange
     rate mechanism made the rupee partially convertible by permitting
     conversion of 60% of the foreign exchange received on a trade or revenue
     account at a market-determined rate and the remaining 40% at the official
     Government of India rate.
  4. The high and low exchange rates for the previous six months are as follows:

<TABLE>
<CAPTION>
  ------------------------------------------------------------------------
  Month                          High                   Low
  ------------------------------------------------------------------------
  <S>                         <C>                   <C>
  October 1999                Rs. 43.73             Rs. 43.39
  November 1999                   43.51                 43.43
  December 1999                   43.60                 43.43
  January 2000                    43.65                 43.55
  February 2000                   43.75                 43.58
  March 2000                      43.65                 43.58
  ------------------------------------------------------------------------
</TABLE>

  3.B  Capitalization and indebtedness
  Not applicable.

  3.C  Reasons for the offer and use of proceeds
  Not applicable.
<PAGE>

  3.D    Risk factors

  This information is set forth under the caption "Management's Discussion and
  Analysis of Financial Condition and Results of Operations" on pages 97 through
  110 of the Infosys annual report for fiscal 2000 and such information is
  incorporated herein by reference.

Item 4.  Information on the Company

  4.A    History and development of the company

  4.A.1  Company overview

  Infosys was originally incorporated as Infosys Consultants Private Limited on
  July 2, 1981, as a private limited company under the Companies Act, 1956
  ("Indian Companies Act"), of the Republic of India. The name of the company
  was changed to Infosys Technologies Private Limited in April 1992 and
  subsequently to Infosys Technologies Limited in June 1992 when it became a
  public limited company. Information about the registered office of the company
  is disclosed on the cover page to this Form 20-F. The name and address of the
  agent for service in the United States is CT Corporation System, 49, Stevenson
  Street, Suite 900, San Francisco, CA 94105.

  The company, one of India's leading information technology ("IT") services
  companies, utilizes an extensive non-U.S. based ("offshore") infrastructure to
  provide managed software solutions to clients worldwide. Headquartered in
  Bangalore, India, the company has seventeen state-of-the-art offshore software
  development facilities located throughout India and one global development
  center in Canada, that enable it to provide high-quality, cost-effective
  services to clients in a resource-constrained environment. The company's
  services, which are offered on either a fixed-price, fixed-time frame or a
  time-and-materials basis, include custom software development, maintenance,
  re-engineering services, e-commerce and internet consulting as well as
  dedicated offshore software development centers ("OSDCs") for certain clients.
  In each of its service offerings, the company assumes full project management
  responsibility in order to strengthen client relationships, offer higher
  value-added services and enhance its profitability. In addition, the company
  develops and markets certain company-owned software products. As a result of
  its extensive network of offshore software development facilities, its quality
  systems, its disciplined processes and its significant investment in people,
  the company has built a platform from which it has been able to achieve
  significant growth to date.

  The company's initial public offering ("IPO") was in February 1993 on the
  Bangalore Stock Exchange and raised approximately $ 4.4 million in gross
  aggregate proceeds. To further fund its capital programs, Infosys raised
  approximately $ 7.7 million in gross aggregate proceeds through a private
  placement of shares in October 1994. These shares were purchased by foreign
  institutional investors, mutual funds as well as Indian domestic financial
  institutions and corporations. Most recently, in order to partially fund the
  expansion of its existing Indian facilities and telecommunication
  infrastructure in Bangalore, Bhubaneswar, Chennai, Mangalore and Pune and to
  develop new facilities, the company raised approximately $ 70.38 million in
  gross aggregate proceeds through its initial U.S. public offering of American
  Depositary Shares ("ADSs") on March 11, 1999. The company has incurred $ 35.9
  million, $ 16.1 million and $ 7.9 million in fiscal 2000, 1999 and 1998
  respectively towards capital expenditure. The company intends to spend
  approximately $ 46.0 million in capital expenditure, during fiscal 2001, the
  majority of which will be utilized in India. This would be funded out of the
  internal accruals and existing cash balances of the company.

  Through its worldwide sales headquarters in Fremont, California and 19 other
  sales offices located in the United States, Canada, the United Kingdom,
  Belgium, Sweden, Germany, Australia, Japan, and India, the company markets its
  services to large IT-intensive businesses. During fiscal 2000, the company
  derived 78.0% of its revenues from North America, 14.8% from Europe and 1.4%
  from India. While the company derives its revenues primarily from the United
  States, Infosys maintains a diversified client base, with its largest client
  representing 7.2% of fiscal 2000 revenues. As of March 31, 2000, the company
  had approximately 194 clients. This diversified client base is comprised
  primarily of Fortune 500 companies, growing internet companies and other
  multinational companies. As a result of its commitment to quality and client
  service, the company enjoys a high level of repeat business. For fiscal 2000
  and 1999, existing clients from the previous fiscal year generated 87.0% and
  90.0%, respectively, of the company's revenues.

  The company was incorporated in 1981 by seven founders who shared a vision to
  build a world-class IT services organization based on a deeply-held value
  system, leadership by example, and continuous innovation. Six of these
  original founders remained with the company (one of the six founders, Mr. N.
  S. Raghavan retired on February 7, 2000), and, together with other members of
  the company's management council, have pursued their vision by focusing on
  certain key strategies including: (i) pursuing a world-class operating model;
  (ii) investing heavily in
<PAGE>

  human resources; (iii) focusing on managed software solutions; (iv)
  capitalizing on a well established offshore development model; (v) maintaining
  a disciplined focus on business and client mix; and (vi) pursuing growth
  opportunities. In recognition of its efforts, the company was voted "Best
  Managed Company" in India by Asiamoney magazine in each of the last four
  years, was selected as "Company of the Year" by The Economic Times Awards for
  Corporate Excellence in 1999, was voted "India's Most Admired Company" in a
  poll by The Economic Times, was the first recipient of the National Award for
  Excellence in Corporate Governance instituted by the Ministry of Finance,
  Government of India and sponsored by the UTI Institute of Capital Markets and
  was awarded the Silver Shield in each of the last five years by the Institute
  of Chartered Accountants of India as the Indian company with the best
  presented financial statements by a non-financial company. Management believes
  that this reputation for leadership and innovation and the recognition it has
  received has been and will continue to be a key competitive advantage,
  particularly in attracting and retaining the highest quality IT professionals.

  4.B    Business overview

  4.B.1  Industry overview

  In today's increasingly competitive business environment, companies have
  become dependent on IT not only for efficiency in day-to-day operations, but
  also as a strategic tool for re-engineering business processes, restructuring
  organizations and for reacting quickly to competitive, regulatory and
  technological changes. For these reasons, IT capabilities are particularly
  critical in certain vertical markets that are undergoing rapid deregulation
  and globalization like financial services, utilities and telecommunications.
  As corporations are becoming increasingly reliant on their IT systems, the
  technological challenges of managing such systems have increased. IS
  departments must not only implement new systems based on technologies such as
  internet and client/server systems, but maintain and update legacy systems to
  work with the latest software and hardware, to expand functionality, to
  recognize and process dates that begin in the year 2000 and to handle other
  developments such as the conversion to Eurocurrency.

  As businesses have become more dependent on IT, corporate budgets for IT
  services have grown dramatically. According to the NASSCOM-McKinsey Study, on
  "Indian I. T. Strategies", the total market for IT products and services is
  expected to grow from $ 461 billion in 1998 to $ 1.92 trillion by 2008.
  India's share of the relevant market will grow to nearly $ 57 billion by 2008.
  The need to outsource is particularly acute for companies whose IT staff lack
  the requisite skill set and project management capabilities to implement new
  technologies, yet are reluctant to work solely with outdated technology. As a
  result, such companies seek third-party IT service providers to implement new
  technology and support existing legacy systems. Additionally, in many cases,
  businesses are being forced to outsource IT projects due to the difficulty and
  expense of recruiting and training sufficient IT staff in a resource-
  constrained environment. Outsourcing enables businesses to minimize the risks
  and reduce the time-to-completion of large IT projects by shifting some or all
  of their IT responsibilities to capable service organizations. In addition to
  this trend towards outsourcing, the IT services industry has also benefited
  recently from a significant demand for Year 2000 conversion services.

  Simultaneously with this significant increase in demand for IT services, the
  supply of qualified IT professionals has decreased in most developed
  countries, particularly the United States, Western Europe and Japan. According
  to the United States Department of Education, the number of bachelor degrees
  in computer science awarded annually at U.S. universities fell 41.7% from
  41,889 in 1986 to 24,404 in 1995. One result of this downward trend is a
  growing shortage of IT professionals in the United States; furthermore, the
  United States Department of Commerce has estimated that between 1994 and 2005,
  U.S. companies will require more than one million new IT professionals to fill
  newly created positions and to replace workers who are retiring or are
  otherwise leaving the IT sector.

  This shortage of IT professionals, along with recent advances in
  telecommunications and the growing acceptance of telecommuting, has led to the
  globalization of the market for IT services. It is now well accepted that
  remote offshore software development and maintenance is possible if the
  offshore facilities leverage world-class physical and technological
  infrastructure, quality processes, project management methodologies, and data
  communications infrastructure to provide video conferencing, internet/e-mail
  connectivity and remote computer access. By outsourcing software development
  and maintenance projects to offshore IT service providers, establishing
  overseas facilities, or entering into joint ventures with foreign partners,
  companies have been able to access skilled IT professionals in lower cost
  environments with a large population of English-speaking technical talent.

  India: A source for software services. According to a survey of U.S. software
  service vendors conducted by the World Bank, India is the leading offshore
  destination for companies seeking to outsource software development or IT
  projects. India's National Association of Software and Service Companies
  ("NASSCOM") estimates that
<PAGE>

  India's export revenue from software, including software services, was
  approximately $ 2.7 billion in fiscal 1999 and will reach $ 4.0 billion by
  fiscal 2000, contributing to total Indian software industry revenues of
  approximately $ 5.9 billion by fiscal 2000.

  There are three key factors contributing to this rapid growth of India's
  software market. First, India has a large, skilled labor pool that is
  available at a relatively low labor cost. With over four million engineers,
  India ranks second only to the United States as the country with the largest
  population of English-speaking technical personnel. According to NASSCOM, the
  number of software professionals employed by the Indian software industry was
  around 250,000 in 1998-99 as compared to 200,000 in the previous year. India
  has more than 1,800 engineering colleges and technical institutes which
  produce approximately 68,000 IT graduates annually. This sizable pool of IT
  talent in India is available to companies worldwide. According to Software
  Productivity Research, the average annual wage for software professionals in
  India is approximately 15% of the average U.S. rate. Although wages in India
  are rising faster than in the United States, the labor rate differential is
  anticipated to remain a competitive advantage for Indian companies in the
  foreseeable future.

  A second key factor driving the Indian software market is the capability of
  Indian IT firms to produce high-quality software deliverables. A NASSCOM
  analysis of international quality standards of the top 300 Indian software
  companies undertaken in August 1999, showed that 137 had already acquired ISO
  9000 or SEI Level 2 equivalent certification, with an additional 74
  anticipated to acquire such certification by March 2000. These capabilities
  have led to the recognition of India's IT talent by companies worldwide. To
  take advantage of India's high-quality IT services at attractive prices,
  companies worldwide have outsourced their software services needs to India
  unrestrained by distances or transportation limitations that often handicap
  Indian manufacturing firms. In fact, the 10 to 12 hour time difference between
  India and its largest market, the United States, allows work to be carried on
  by teams spanning both countries on a 24-hour basis, shortening cycle times
  and improving productivity and service quality.

  The final factor driving the Indian software industry is the recognition by
  successive Indian governments in recent times of the importance of the IT
  sector in the Indian economy. In 1991, the Government of India introduced a
  number of measures to liberalize the economy and thus addressed the economic
  difficulties that India had been facing. These measures included policies to
  stimulate investment in infrastructure industries and the growing Indian
  software industry. This commitment to the software sector has been and
  continues to be pursued by each successive government since 1991. For example,
  the most recent Government of India established the National Task Force on
  Information Technology in April 1998 with a mandate to make recommendations
  that detail policies designed to increase India's IT exports. In addition,
  software firms benefit from a variety of incentives, such as relief from
  import duties on hardware, a tax deduction for income derived from software
  exports, and infrastructure support for companies operating in Software
  Technology Parks.

  4.B.2   Strategy

  4.B.2.1 Business strategy

  The company's vision is to become a globally respected corporation providing
  best-of-breed solutions employing best-in-class professionals. In order to
  achieve this goal, the company focuses on the following key elements of its
  business strategy:

  Pursue world-class operating model. The management believes that one of the
  most critical contributing factors to the company's success has been its
  commitment to pursue high-quality standards in all aspects of its business,
  including deliverables to the customers, human resource management, investor
  relations, planning, finance, physical and technological infrastructure, sales
  and marketing. In its services and operations, the company achieves quality
  through rigorous adherence to highly evolved processes, including a detailed
  approach to planning and execution, multi-level testing and careful tracking
  and analysis of quality control. The company is certified under the ISO 9001
  and TickIT quality standards. In addition, the company has been certified at
  Level 5 of the Capability Maturity Model, a software-specific quality
  management model developed by the Software Engineering Institute at Carnegie
  Mellon University. This model defines five levels of process maturity for a
  software organization. Certification to Level 5 has been achieved by only
  around 20 companies worldwide assessed under the Capability Maturity Model.
  Infosys also adheres to high-quality standards in its investor relations. For
  example, the company was one of the first public Indian companies to adopt
  U.S. GAAP reporting in fiscal 1995 and quarterly-audited Indian financial
  statements in fiscal 1998.

  Invest heavily in human resources. The company believes that its continued
  success will depend upon its ability to recruit, train, deploy and retain
  highly talented IT professionals. Even as the field of software engineering
  has been attracting the best and brightest Indian students, management
  believes the company has become, for Indian engineering graduates, one of the
  most sought after employers. The company focuses its recruiting efforts on the
<PAGE>

  top 20% of the students from the engineering departments of Indian
  universities and uses a series of tests and interviews to identify the best
  applicants. In an effort to attract the most highly qualified candidates, the
  company has spent significant resources in creating a quality work
  environment. For example, its main facility in Bangalore, which spans five
  acres, encompasses not only 160,000 sq. ft. of office space but also 150,000
  sq. ft. of landscaping, a cafeteria, outdoor sitting area, library and
  gymnasium as well as tennis, volleyball and basketball courts. Through this
  campus-like environment, the company fosters a collegial atmosphere and
  informal culture, which is further promoted by its "open door" operating
  philosophy where communication and ideas flow freely irrespective of title or
  tenure. The company also offers its IT professionals challenging assignments,
  competitive salaries and benefits and one of the first stock option plans
  adopted by a public Indian company. In addition, the company invests heavily
  in training, including three-month training sessions for newly recruited IT
  professionals as well as a variety of two-week continuing education courses in
  technology and management skills conducted by a 50-person faculty. As a result
  of this high level of investment in its people, management believes that the
  company has become one of the most attractive employers for Indian software
  professionals and that its attrition rate is significantly below the industry
  average.

  Focus on managed software solutions. Since its inception, the company has
  dedicated itself to providing managed software solutions, many of which are
  offered on a fixed-price, fixed-time frame basis. By taking full project
  management responsibility in every project, the company provides its clients
  high-quality, cost-effective solutions with low risk. Such services offer the
  company the opportunity to build client confidence with the potential benefit
  of enhanced margins. Management believes that by demonstrating its ability to
  manage and successfully execute large projects, the company is better
  positioned to become a long-term partner to its clients for all of their
  software needs. In addition, by retaining project management responsibility,
  the company accumulates significant industry expertise and continues to
  develop and refine its software development tools and proprietary
  methodologies.

  Capitalize on a well-established offshore development model. As one of the
  pioneers of the offshore software development model, the company has made
  significant investments in its infrastructure and has developed the advanced
  processes and expertise necessary to manage and successfully execute projects
  in multiple locations with seamless integration. The company has high levels
  of project management skills and rigid controls as evidenced by its Level 5
  Capability Maturity Model certification. This commitment to quality allows the
  company to successfully execute approximately 68% of its project work in India
  while maintaining a high level of client satisfaction. These capabilities not
  only provide significant cost advantages but also shorten the time to deliver
  a solution to the client. With significant investments in offshore software
  development facilities, plans to expand its available facilities significantly
  and plans to hire additional IT professionals, the company believes that it is
  well-positioned to serve clients globally in a resource-constrained
  environment.

  Maintain disciplined focus on business and client mix. The company provides a
  wide range of software services and maintains a disciplined focus on its
  business mix in an effort to avoid service or client concentration. Beginning
  in fiscal 1996, the company aggressively sought to minimize its client
  concentration and to accept as clients only those that met strict guidelines
  for overall revenue potential and profitability. In fiscal 2000 and 1999, the
  company's largest client accounted for 7.2% and 6.4%, respectively, of
  revenues and its five largest clients accounted for 30.2% and 28.4%,
  respectively, of revenues. Similarly, the company has endeavored to maintain a
  balance among its service offerings despite certain trends in the marketplace,
  in particular, Year 2000 remediation services. This balance is key to ensuring
  that the technology skill sets of the company's IT professionals remain
  diversified. Such diversification is critical not only in providing the
  company the flexibility to adapt to changing market conditions but also in
  attracting and retaining highly skilled professionals who seek the opportunity
  to continue to learn new technologies.

  4.B.2.2  Growth strategy

  From fiscal 1994 to fiscal 2000, the company experienced compounded annual
  revenue and net income growth rates of 62% and 73%, respectively, and grew
  from approximately 480 IT professionals to approximately 4,625. The following
  are the key elements of the company's growth strategy:

  Broaden service offerings. To meet all of its clients' IT needs, the company
  strives to offer a comprehensive range of services by continuously evaluating
  new and emerging technologies. As a full-service provider, the company
  believes that it can increase its revenues from existing clients as well as
  attract new clients. Toward this end, the company has opportunistically
  expanded its services beyond its core development, maintenance and re-
  engineering services. For example, the company has recently begun initiatives
  to develop practices focused on packaged applications implementation, e-
  commerce and
<PAGE>

  internet/intranet services. E-commerce and internet/intranet services
  constituted 18.8% during fiscal 2000. The management believes that these
  services will increasingly become a significant part of the company's
  portfolio of services.

  Increase business with existing clients. In fiscal 2000, the company provided
  software services for more than 190 clients in the United States, Europe,
  Australia, Asia and Japan. A key objective of the company's growth strategy is
  to expand the nature and scope of its engagements with existing clients both
  by increasing the volume of its projects and by expanding the breadth of
  services offered. Establishing broad, long-term relationships potentially
  increases the quality and efficiency of the company's service to a particular
  client since each project performed for a client increases the company's
  understanding of the client's systems, requirements and business practices.
  For the same reason, establishing broad, long-term relationships with a client
  also reduces the company's marketing costs, increases the client's reliance on
  the company and creates barriers to entry for competitors. The company seeks
  to foster such relationships by delivering high-quality services on time and
  on budget and, over the course of a relationship, by increasing the
  integration of its services with the client's internal IT operations. To date,
  this approach has been highly effective. Despite the company's high rate of
  growth during the last few years, over 85% of revenues in both fiscal 2000 and
  1999 were generated from companies who were clients in the prior fiscal year.

  Develop new clients. The company pursues several new client development
  strategies. First, the company offers a broad array of managed software
  solutions that provide an initial entry into a new client. Second, Infosys
  believes that it can leverage the industry-specific expertise it has developed
  in key vertical markets (financial services, manufacturing and distribution,
  retail, telecommunications and technology) to further develop its portfolio of
  clients in these targeted markets. This vertical market orientation continues
  to help Infosys design and develop re-usable software tools and processes
  which have specific applications to clients in these markets and which can
  improve the company's efficiency and productivity. Finally, the company
  intends to expand its global sales and marketing infrastructure by hiring new
  sales and marketing personnel, opening additional regional sales offices and
  increasing its marketing expenditures. Infosys currently maintains sales and
  marketing offices in 20 locations and intends to add new offices in North
  America, Europe and Asia. The management believes that increasing the
  company's geographic presence will enhance its ability to establish and
  support new client relationships.

  Increase revenue per IT professional. To increase its revenue per IT
  professional, the company continually focuses on building expertise in
  vertical markets, refining its software development tools and methodologies,
  and storing and disseminating experiential knowledge in order to improve
  efficiency and productivity. Additionally, to enhance productivity per IT
  professional, Infosys continually monitors client accounts for profitability
  and seeks to focus on select new clients and on those existing client
  relationships that have the potential for high long-term profitability. The
  company's policy is to decline or discontinue projects that do not offer the
  potential to meet its profitability targets. Finally, the company is seeking
  to increase the proportion of projects that are undertaken on a fixed-price,
  fixed-time frame rather than a time-and-materials basis. The management
  believes that effectively structured fixed-price, fixed-time frame projects
  benefit the client by reducing the client's risk, while offering the company
  the potential benefit of enhanced margins for projects that are performed
  efficiently.

  Expand and diversify base of IT professionals. Management believes that a
  critical element of the company's growth strategy is its ability to increase
  its base of IT professionals. To address this issue, the company plans to
  build new software development facilities in locations where it can access
  local pools of talent as well as increase the number of professionals employed
  at its existing locations. In addition, the company looks at other fields of
  expertise, such as business school graduates and accountants, for recruiting.
  Accordingly, the company has approved plans to expand its facilities in
  Bangalore, Bhubaneswar, Chennai, Mangalore, Pune and has opened new facilities
  in Hyderabad, Mysore and Mohali, Punjab all in India and one global
  development center in Toronto, Canada. The company is also contemplating
  addition of facilities in the United States, Europe and Asia.

  Pursue selective strategic acquisitions. The company believes that pursuing
  selective acquisitions of IT services and software applications firms could
  potentially expand the company's technical expertise, facilitate expansion
  into new vertical markets and increase its client base. Although no
  acquisitions are currently being contemplated, the company anticipates that it
  will seek to identify and acquire companies that have well-developed
  applications in vertical markets, extensive client bases, proprietary
  technical expertise, or other strengths that would complement the company's
  business.

  4.B.2.3 The Infosys offshore development model

  The Indian offshore development model became popular in the mid-1990's as a
  method of dividing software project activities between a service provider's
  offshore software development facility and a client's on-site location. This
  model contains many features that are attractive to IT consumers who are
  primarily located in the
<PAGE>

  United States, Europe and Japan, including: (i) access to a large pool of
  highly skilled, English-speaking IT professionals; (ii) relatively low labor
  costs of IT professionals offshore; (iii) the ability to provide high-quality
  IT services at internationally recognized standards; (iv) the capability to
  work on specific projects on a 24-hour basis by exploiting time zone
  differences between India and client sites; and (v) the ability to accelerate
  the delivery time of larger projects by parallel processing different phases
  of a project's development. While some U.S. and European companies have
  commenced their own operations in India, most large corporations have opted to
  form strategic alliances with local Indian IT companies to reduce the risks
  and start-up costs of operations in India.

  As one of the pioneers of the offshore development model, Infosys has a long
  history of successfully executing projects between its clients' sites in North
  America, Europe and Asia and the company's offshore software development
  facilities in India. In a typical software development or re-engineering
  assignment, the company assigns a small team of two to five IT professionals
  to visit a client's site and determine the scope and requirements of the
  project. Once the initial specifications of the engagement have been
  established, the project managers return to India to supervise a much larger
  team of 10 to 50 IT professionals dedicated to the development of the required
  software or system. A small team remains at the client's site to track changes
  in scope and address new requirements as the project progresses. The client's
  systems are then linked via satellite to the company's facilities enabling
  simultaneous processing in as many as four offshore software development
  facilities. Once the development stage of the assignment is completed and
  tested in India, a team returns to the client's site to install the newly
  developed software or system and ensure its functionality. At this phase of
  the engagement, the company will often enter into an ongoing agreement to
  provide the client with comprehensive maintenance services from one of its
  offshore software development facilities. In contrast to development projects,
  a typical maintenance assignment requires a larger team of 10 to 20 IT
  professionals to travel to the client's site to gain a thorough understanding
  of all aspects of the client's system. The majority of the maintenance team
  subsequently returns to the offshore software development facility, where it
  assumes full responsibility for day-to-day maintenance of the client's system,
  while coordinating with a few maintenance professionals who remain stationed
  at the client's site. By pursuing this model, the company completes
  approximately 68% of its project work at its offshore software development
  facilities in India.

  The company's project management techniques, risk management processes and
  quality control measures enable it to complete projects seamlessly across
  multiple locations with a high level of client satisfaction. Certified under
  ISO 9001, TickIT and at Level 5 of the Capability Maturity Model, the company
  rigorously adheres to highly evolved processes. These processes govern all
  aspects of the software product life cycle, from requirements to testing and
  maintenance. The company seeks to prevent defects through its quality program,
  which includes obtaining early sign off on acceptance test scripts, project
  specifications and design documents, assigning software quality advisors to
  help each team set up appropriate processes for each project and adhering to a
  multi-level testing strategy. Defects are documented, measured, tracked and
  analyzed, and feedback is provided to the project manager. The company
  compiles metrics for not only defect density and size, but also actual effort
  as compared to project estimates, adherence to schedule and productivity.
  Frequent internal and external audits are conducted to assure compliance with
  procedures. All of these procedures have been continuously refined throughout
  the company's history of providing its clients with offshore software
  development services.

  In addition to the processes and methodologies necessary to successfully
  execute the offshore model, the company has invested significant resources in
  its infrastructure to ensure uninterrupted service to its clients. The company
  has invested in redundant infrastructure with "warm" backup sites and
  redundant telecommunication capabilities with alternate routings to provide
  its clients with high service levels. Additionally, the company utilizes two
  telecommunications carriers in India and has installed in its principal
  facilities multiple international satellite links connecting with network hubs
  in Fremont, California and in Quincy, Massachusetts. A different ocean cable
  connecting Europe and the United States serves each of these hubs. Moreover,
  the company has installed wireless links among its facilities in Bangalore and
  intends to install wireless links among its other Indian facilities by the end
  of 2000.

  4.B.3  Service offerings and products

  The company's services include software development, maintenance and re-
  engineering services, e-commerce and internet/intranet consulting as well as
  dedicated OSDCs for certain clients. In each of its service offerings the
  company assumes full project management responsibility for each project it
  undertakes rather than providing supplemental personnel to work under a
  client's supervision. In addition to its IT services, the company as well as
  its minority-owned subsidiary, Yantra, also develop and market certain
  packaged applications software.
<PAGE>

  4.B.3.1 Software development

  The company provides turnkey software development, typically pursuant to
  fixed-price, fixed-time frame contracts. The projects vary in size and may
  involve the development of new applications or new functions for existing
  software applications. Each development project typically involves all aspects
  of the software development process, including definition, prototyping,
  design, pilots, programming, testing, installation and maintenance. In the
  early stage of a development project, Infosys personnel often work at a
  client's site to help determine project definition and to estimate the scope
  and cost of the project. Infosys then performs design review, software
  programming, program testing, module testing, integration and volume testing,
  primarily at its own facilities in India. For example, for a
  telecommunications client facing deregulation and subsequent declining market
  share, the company partnered with a specialty marketing firm to design and
  implement a customer rewards program. Infosys was able to work with both the
  marketing firm and the client to complete this project within six months,
  ensuring the system's technical proficiency and enabling the client to reverse
  the trend of declining market share.

  4.B.3.2 Software maintenance

  The company provides maintenance services for large legacy software systems.
  Maintenance services include minor and major modifications and enhancements
  (including Year 2000 and Eurocurrency conversion) and production support. Such
  systems are either mainframe-based or client/server and are typically
  essential to a client's business, though over time they become progressively
  more difficult and costly for the client's internal IT department to maintain.
  By outsourcing the maintenance responsibilities to Infosys, clients can
  control costs and free their IT departments for other work. The company's IT
  professionals take an engineering approach to software maintenance, focusing
  on the long-term functionality and stability of the client's overall system
  and attempting to avoid problems stemming from "quick-fix" solutions. The
  company performs most of the maintenance work at its own facilities using
  satellite-based links to the client's system. In addition, the company
  maintains a small team at the client's facility to coordinate support
  functions. Infosys was a pioneer in managing time-zone differences between
  India and the United States to provide near 24-hour maintenance services. As
  an example, the IT department of a large retailer with inadequate and
  inflexible systems was overburdened by both building new systems and
  maintaining the current legacy infrastructure. The company was able to assume
  maintenance responsibilities for these systems in a short time frame and
  reduce maintenance costs to the client by utilizing its offshore facilities.

  4.B.3.3 Software re-engineering

  The company's re-engineering services assist clients in migrating to new
  technologies while extending the life cycle of existing systems that are rich
  in functionality. Projects include re-engineering software to migrate
  applications from mainframe to client/server architectures, to extend existing
  applications to the internet, to migrate from existing operating systems to
  UNIX or Windows NT, or to update from a non-relational to a relational
  database technology. For companies with extensive proprietary software
  applications, implementing such technologies may require rewriting and testing
  millions of lines of software code. As with its other services, the company
  has developed proven methodologies that govern the planning, execution and
  testing of the software re-engineering process. For instance, for a nationwide
  manufacturer and distributor experiencing operating inefficiency with a legacy
  system installed in its two call centers, the company re-engineered the system
  to run in a distributed processing environment with front-end internet
  browser-based capabilities allowing 24-hour internet access to the client's
  distribution systems. As a result, the client was able to consolidate its call
  center workforce into one location and reduce its workforce by over 50%.

  4.B.3.4 Dedicated offshore software development centers

  The company has pioneered the concept of dedicated OSDCs in which a software
  development team that is dedicated to a single client uses technology, tools,
  processes and methodologies unique to that client. Each dedicated OSDC is
  located at a company facility in India and is staffed and managed by the
  company. Once the project priorities are established by the client, the
  company, in conjunction with the client's IT department, manages the execution
  of the project. By focusing on a single client over an extended time frame,
  the dedicated OSDC team gains a deeper understanding of the client's business
  and technology and can begin to function as a virtual extension of the
  client's software team.

  4.B.3.5 New services

  The company is also focussed in certain new service areas such as (i) internet
  consulting, which includes developing
<PAGE>

  e-commerce and internet/intranet solutions; (ii) Euro conversion, which
  assists clients in making their systems Euro compliant; and (iii) engineering
  services, which include software product design. For example, the company
  recently developed an intranet-based application to automate the sales order
  creation process of one of the world's largest office solution companies,
  using Java on an Oracle application server. Also, the company recently
  developed an intranet client service portal for a leading US life insurance
  firm that enables its agents to view customer policies, insurance history and
  rates, etc.

  4.B.3.6 Software products

  In addition to the IT services described above, the company develops and
  markets certain proprietary software applications. Bancs2000 is an online,
  retail and corporate banking system that offers rich functionality,
  scalability and flexibility for automation of banking operations. This product
  is used by banks in emerging markets that seek to implement state-of-the-art
  banking technology and achieve high levels of client service. Bancs2000 has
  been installed at more than 535 bank branches in India, Sri Lanka, Nepal,
  Indonesia and Tanzania. In addition, BankAway was implemented at four banks
  during the year.

  4.B.4   Markets and sales revenue

  The company markets its services primarily to large IT-intensive organizations
  in North America, Europe, and Japan The company focuses on certain market
  segments, including financial services, manufacturing and distribution,
  retail, telecommunications and technology. The company provides a wide range
  of IT services and maintains a disciplined focus on its business mix in an
  effort to avoid service or client concentration. Beginning in fiscal 1996, the
  company aggressively sought to minimize its client concentration and to accept
  as clients only those that met strict guidelines for overall revenue potential
  and profitability. For fiscal 2000, 1999 and 1998, the company's largest
  client accounted for 7.2%, 6.4% and 10.5%, respectively, of revenues. Revenues
  for the last three fiscal years by geographic area are as follows:
<PAGE>

<TABLE>
<CAPTION>
  --------------------------------------------------------------------------
  Year ended March 31,                    2000          1999          1998
  --------------------------------------------------------------------------
  <S>                             <C>           <C>            <C>
  North America                   $158,723,649  $ 99,203,989   $56,211,753
  Europe                            30,064,939    11,302,791     6,179,621
  India                              2,912,091     2,051,492     1,799,368
  Rest of the world                 11,743,075     8,396,954     4,139,219
  --------------------------------------------------------------------------
                                  $203,443,754  $120,955,226   $68,329,961
  ==========================================================================
</TABLE>

  4.B.5   Sales and marketing

  The company sells and markets its services and products from 20 sales offices
  located in nine countries. In the United States, the company presently has
  sales offices located in Atlanta, Boston, Chicago, Dallas, Detroit, Fremont,
  Los Angeles, New York and Seattle. Additionally, the company's international
  sales offices are located in Australia, Belgium, Canada, Germany, India,
  Japan, Sweden and the United Kingdom. With its global sales headquarters in
  Fremont, California and its corporate marketing group in Bangalore, India, the
  company targets its sales and marketing efforts towards IT-intensive
  organizations in North America, Europe and Japan. As of March 31, 2000, the
  company had 48 sales and marketing employees outside of India. To continue
  this focus on countries with sophisticated IT services needs, the company
  intends to expand its global sales and marketing infrastructure by opening
  additional regional sales and marketing offices in North America and Europe.
  In addition, the company has partnered with Teksels S.A., a Swiss firm, to
  assist its marketing efforts in Switzerland.

  From its offices located around the world, the company's sales professionals
  contact prospective clients in developed markets and position the company as a
  leading IT services provider with operations in India. In many cases,
  potential clients in their search for offshore IT service providers submit a
  request for proposal from leading Indian software firms, including the
  company. The company's superior management team, quality of work, competence
  of its IT professionals, and competitive prices are often cited as reasons for
  the award of competitive contracts. In addition, the company's impressive
  client references and endorsements as well as its willingness to participate
  in trade shows and speaking engagements, have helped the company to generate
  greater awareness for its services. The company believes that its NASDAQ
  listing and its profile as a public company in the United States will further
  enhance its corporate marketing efforts. The company has focused its sales and
  marketing efforts on expanding the scope and depth of its relationships with
  existing clients. Although initially the company may only provide one service
  to a client, the company seeks to convince the client to expand and diversify
  the type of services the client outsources to the company. As a result, the
  company strengthens its relationships with its clients by closely integrating
  its services with its clients' IT operations. The success of this targeted
  strategy is reflected in the company's high rate of repeat business. Over 85%
  of the company's revenues in each of the last two fiscal years were generated
  from pre-existing clients.

  4.B.6   Competition

  The market for IT services is highly competitive. Competitors include IT
  services companies, large international accounting firms and their consulting
  affiliates, systems consulting and integration firms, temporary employment
  agencies, other technology companies and client in-house MIS departments.
  Competitors include international firms as well as national, regional and
  local firms located in the United States, Europe and India. The company
  expects that future competition will increasingly include firms with
  operations in other countries, potentially including countries with lower
  personnel costs than those prevailing in India. Part of the company's
  competitive advantage has historically been a cost advantage relative to
  service providers in the United States and Europe. Since wage costs in India
  are presently increasing at a faster rate than those in the United States, the
  company's ability to compete effectively will become increasingly dependent on
  its reputation, the quality of its services and its expertise in specific
  markets. Many of the company's competitors have significantly greater
  financial, technical and marketing resources and generate greater revenue than
  the company, and there can be no assurance that the company will be able to
  compete successfully with such competitors and will not lose existing clients
  to such competitors. The company believes that its ability to compete also
  depends in part on a number of factors outside its control, including the
  ability of its competitors to attract, train, motivate and retain highly
  skilled IT professionals, the price at which its competitors offer comparable
  services and the extent of its competitors' responsiveness to client needs.

  4.B.7   Intellectual property

  Ownership of software and associated deliverables created for clients is
  generally retained by or assigned to the client, and the company does not
  retain an interest in such software or deliverables. The company also develops

<PAGE>

  software products and software tools which are licensed to clients and remain
  the property of the company. The company relies upon a combination of non-
  disclosure and other contractual arrangements and copyright, trade secret and
  trademark laws to protect its proprietary rights in technology. The company
  currently requires its IT professionals to enter into non-disclosure and
  assignment of rights agreements to limit use of, access to and distribution of
  its proprietary information. The source code for the company's proprietary
  software is generally protected as trade secrets and as unpublished
  copyrighted works. The company has obtained registration of "INFOSYS" as a
  trademark in India and in the United States. The company does not have any
  patents or registered copyrights in the United States. The company generally
  applies for trademarks and service marks to identify its various service and
  product offerings.

  The laws of India may not, under some circumstances, permit the protection of
  the company's proprietary rights in the same manner or to the same extent as
  the laws of the United States. India is a member of the Berne Convention and
  the Universal Copyright Convention, as revised at Paris (1971), both
  international treaties. As a member of the Berne Convention, the Government of
  India has agreed to extend copyright protection under its domestic laws to
  foreign works, including works created or produced in the United States. The
  company believes that laws, rules, regulations and treaties in effect in the
  United States and India are adequate to protect it from misappropriation or
  unauthorized use of its copyrights. However, there can be no assurance that
  such laws will not change in ways that may prevent or restrict the protection
  of the company's proprietary rights. There can be no assurance that the steps
  taken by the company to protect its proprietary rights will be adequate to
  deter misappropriation of any of its proprietary information or that the
  company will be able to detect unauthorized use and take appropriate steps to
  enforce its intellectual property rights.

  Although the company believes that its services and products do not infringe
  on the intellectual property rights of others, there can be no assurance that
  such a claim will not be asserted against the company in future. Assertion of
  such claims against the company could result in litigation, and there is no
  assurance that the company would prevail in such litigation or be able to
  obtain a license for the use of any infringed intellectual property from a
  third party on commercially reasonable terms. There can be no assurance that
  the company will be able to protect such licenses from infringement or misuse,
  or prevent infringement claims against the company in connection with its
  licensing efforts. The company expects that the risk of infringement claims
  against the company will increase if more of the company's competitors are
  able to obtain patents for software products and processes. Any such claims,
  regardless of their outcome, could result in substantial cost to the company
  and divert management's attention from the company's operations. Any
  infringement claim or litigation against the company could, therefore, have a
  material adverse effect on the company's results of operations and financial
  condition.

  4.B.8  Government of India incentives and regulation.

  The company benefits from a variety of incentives given to software firms in
  India, such as relief from import duties on hardware, a tax exemption for
  income derived from software exports, and tax holidays and infrastructure
  support for companies, such as Infosys, operating in specially designated
  "Software Technology Parks". There can be no assurance that these incentives
  will continue in future. Further, there is a risk that changes in tax rates or
  laws affecting foreign investment, currency exchange rates or other
  regulations will render the Government of India's regulatory scheme less
  favorable to the company and could adversely affect the market price of the
  company's equity shares and its ADSs. Should the regulations and incentives
  promulgated by the Government of India become less favorable to the company,
  the company's results of operations and financial condition could be adversely
  affected.

  4.C    Organizational structure

  The company holds a minority interest in Yantra and is a joint venture member
  of the JASDIC Park Company ("JASDIC") which is an Indo-Japanese consortium
  founded by Kenichi Ohmae. Yantra's primary objectives are to develop, sell and
  support software products in the retail and distribution areas. When Infosys
  established Yantra, it transferred the intellectual property rights in Eagle
  (now known as WMSYantra), a software solution for warehouse management, to
  Yantra, for shares of common stock of Yantra. Subsequently, in September 1998,
  Yantra raised working capital funds from the company and U.S. venture
  capitalists through a private placement of its convertible preferred stock. In
  the third quarter of fiscal 1999, the company sold 1,363,637 shares of
  Yantra's preferred stock held by it to a U.S. venture capital fund based in
  Boston. As a result of this sale, the company reduced its economic interest in
  Yantra to less than one-half of the voting stock of Yantra. The company
  continues to own all of the outstanding common stock in Yantra but has no
  financial obligations or commitments to Yantra and does not intend to provide
  it with financial support, and therefore does not recognize Yantra's
  performance in financial statements after October 20, 1998. On June 14, 1999,
  Yantra sold Series C Convertible
<PAGE>

  Preferred Stock for an aggregate purchase price of $ 15.0 million to various
  existing and new investors, which reduced Infosys' economic interest in Yantra
  to approximately 25%.

  JASDIC was formed as a consortium of several Japanese companies and three
  Indian companies, including Infosys. JASDIC's primary objectives are to
  provide high-quality software services from India to the Japanese market.
  During fiscal 1999, the company invested 24 million Yen equivalent to $ 0.18
  million in JASDIC with the purpose of promoting the company's strategy of
  diversifying its geographic customer base.

  Additionally, the company has begun an incubation mechanism for its existing
  employees to launch their own ventures while continuing to derive benefits
  from a close association with Infosys. The company has piloted Onscan - a web-
  focused wireless-enabled notification service.

  4.D    Property, plants and equipment

  The company's principal campus situated at Electronics City, Bangalore, India,
  is owned by Infosys and consists of its corporate office and two new software
  development facilities. The corporate office consists of 220,000 square feet
  of land with 150,000 square feet of landscaped area, a 160,000 square feet
  building with 32 conference rooms and leisure infrastructure, including
  cafeteria, sports facilities and gymnasium. The technological infrastructure
  at the corporate office includes over a 1,000 networked workstations, several
  Netware, UNIX and WINDOWS NT servers, systems from HP, IBM, SUN, DEC, COMPAQ,
  ACER and AST, a video-conferencing facility, and multiple 64 kbps data
  communication links. In addition, the company has set up "Infosys Park I", a
  new software development facility, consisting of 435,600 square feet of land
  with 323,400 square feet of building including one block of 77,000 square
  feet, currently under construction. The other new software development
  facility, "Infosys Park II", consisting of 693,900 square feet of land with
  proposed building of 290,000 square feet is under construction, of which,
  120,000  square feet of building is ready for use.

  As part of its strategy to provide high-quality services to its clients, the
  company has a detailed facility management plan. First, the company seeks to
  provide its Indian IT professionals with facilities that are comparable to
  those used by software companies in the United States and Europe. Second, the
  company seeks to establish facilities near large sources of technical talent.
  Third, the company equips its facilities to minimize vulnerability to
  interruptions in local utility and telecommunication services.

  The company acquired the land where its corporate headquarters are located
  from the State of Karnataka in 1993 and has subsequently acquired parcels for
  various other offices, pursuant to certain lease cum sale agreements (the
  "Conditional Purchase Agreements"), which are used by the State of Karnataka
  to make land available to private companies for specific purposes. Under the
  Conditional Purchase Agreements, property is sold subject to a long-term
  (typically 25-year), rental-free lease which transfers ownership to the buyer
  at the end of the period provided that the buyer uses the land for specified
  purposes. The Conditional Purchase Agreements require the company to use the
  various parcels for software development facilities. Typically, the company
  pays 99% of the purchase price at the time the agreement is signed and pays
  the remaining 1% when the term is concluded.

  The company has its worldwide sales headquarters in Fremont, California and
  branch sales offices in Atlanta, Bangalore, Boston, Brussels, Chennai,
  Chicago, Dallas, Detroit, Frankfurt, London, Los Angeles, Mumbai, New Delhi,
  New York, Seattle, Stockholm, Tokyo and Toronto. All sales offices, except the
  Mumbai office, are in leased facilities.

  The company plans to expand its facilities to meet its anticipated growth.
  Currently, the company is planning new facilities in Bangalore, Bhubaneswar,
  Chennai, Mangalore and Pune. The table on the following page sets forth
  certain information as of March 31, 2000 relating to the company's principal
  facilities and proposed developments:
<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
Location                                          Approximate                  Ownership                  Type of facility
                                                       Sq.ft.
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                       <C>                     <C>
Bangalore, India                                     323,400/1/                Conditional          Software development
  facility
  (Plots 45, 46, Electronics City)                                             purchase
Bangalore, India                                     290,000/2/                Conditional          Proposed software
  (Plots 4/1, 4/2, 4/3, 4/4, 26/1, 26/2,                                       purchase             development facility
  97C, 97D and 97E, Electronics City)
Bangalore, India                                     160,000/3/                Conditional          Corporate headquarters,
  (Plots 44 and 97A, Electronics City)                                         purchase             software development
  facility
Bangalore, India                                           -/4/                Conditional          Proposed software
  (Survey No. 8 and 9, Electronics City)                                       purchase             development facility
Bangalore, India (Dickenson Road)                      7,000                   Owned                Office premises
Bangalore, India (BTM Layout)                         11,300                   Leased               Software development
  facility
Bangalore, India (Koramangala)                        22,000                   Leased               Software development
  facility
Bangalore, India (J. P. Nagar, Phase II)                   -/5/                Owned                Proposed office premises
Bangalore, India (J. P. Nagar, Phase III)             59,500                   Leased               Software development
  facility
Bangalore, India (Adarsh Gardens)                     78,700                   Owned                Employee residence flats
                                                                                                    and guesthouses
Hyderabad, India                                       5,000                   Leased               Software development
  facility
Mangalore, India, (Kankanady).                        14,100                   Leased               Software development
  facility
Mangalore, India, (MUDA Building)                     33,900                   Leased               Software development
  facility
Mangalore, India                                       5,100                   Owned                Guesthouses
Mohali, Punjab, India                                 20,000                   Leased               Software development
  facility
Mumbai, India                                          1,200                   Owned                Sales and marketing office
Mysore, India                                          6,000                   Leased               Software development
  facility
Pune, India                                           43,700                   Leased               Software development
  facility
Pune, India                                          202,700/6/                Conditional          Software development
  facility
                                                                               purchase
Pune, India                                            3,300                   Owned                Employee residence flats
Bhubaneswar, India                                    52,900                   Leased               Software development
  facility
Bhubaneswar, India                                   189,100/7/                Conditional          Proposed software
  development
                                                                               purchase             facility
Bhubaneswar, India                                         -/8/                Conditional          Proposed software
  (S/2, Jayadev Vihar Mouza)                                                   purchase             development facility
Chennai, India                                        26,600                   Leased               Software development
  facility
Chennai, India                                        23,200                   Leased               Software development
  facility

Chennai, India                                       193,800/9/                Conditional          Proposed software
  development
                                                                               purchase             facility
Delhi, India                                           2,500                   Leased               Sales and marketing office
Fremont, California                                   17,700                   Leased               Worldwide sales
  headquarters and
                                                                                                    proximity development
  center
Toronto, Canada                                       13,000                   Leased               Global development center
</TABLE>
<PAGE>

<TABLE>
<S>                                                   <C>                     <C>                   <C>
Boston, Massachusetts                                  7,400                   Leased               Proximity development center
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

1. Total land parcel is 435,600 square feet. One block of 77,000 square feet is
   under construction.
2. Total land parcel is 693,911 square feet.
3. Total land parcel is 220,000  square feet.
4. The company has not yet determined the aggregate square feet of the proposed
   development. The land parcel is approximately 435,600 square feet.
5. The company has not yet determined the aggregate square feet of the
   proposed development. The land parcel is approximately 16,500 square feet.
6. Total land parcel is 1,089,000 square feet.
7. Total land parcel is 1,089,000 square feet.
8. The company has not yet determined the aggregate square feet of the proposed
   development. The land parcel is approximately 293,333 square feet.
9. Total land parcel is 577,607 square feet.
<PAGE>

  Material plans to construct, expand and improve facilities

  The company intends to create new software development facilities in various
  places in India partly to shift the operations which are in the existing
  leased facilities and partly to expand the existing capacities to provide for
  the growth in business. Such expansions are planned in Bangalore, Bhubaneswar,
  Chennai, Mangalore and Pune. Most of these facilities would be operational in
  the next 24 months. As of March 31, 2000, the company had contractual
  commitments for capital expenditure of $18.4 million. The company has not yet
  made contractual commitments for the majority of its budgeted capital
  expenditure. The company intends to spend approximately $46.0 million on
  various capital expenditure during fiscal 2001 and the same would be met out
  of the internal accruals and existing cash balances of the company. In the
  opinion of the company, the working capital is sufficient for the company's
  present requirements.

Item 5.  Operating and Financial Review and Prospects

  5.A  Operating results

  This information is set forth under the caption "Management's Discussion and
  Analysis of Financial Condition and Results of Operations" on pages 97 through
  110 of the Infosys Annual Report for fiscal 2000 and such information is
  hereby incorporated herein by reference.

  Investment in Yantra Corporation

  Up to October 20, 1998, the company owned a majority of the voting stock of
  Yantra. Consequently, all of Yantra's operating losses through October 20,
  1998 were recognized in the company's consolidated financial statements. For
  fiscal 1998 and fiscal 1999, Yantra's losses recognized in the company's
  financial statements were $1.6 million and $2.0 million, respectively. On
  October 20, 1998, the company sold a portion of Yantra's shares held by it,
  thereby reducing the its interest to less than one-half of the voting stock of
  Yantra. The company continues to own all of the outstanding common stock of
  Yantra but has no financial obligations or commitments to Yantra and does not
  intend to provide Yantra with financial support. Accordingly, Yantra's results
  subsequent to October 20, 1998 were not recognized in the company's financial
  statements under U.S. GAAP. Yantra's revenues were $1.3 million and $2.0
  million for fiscal 1998 and for the period ended October 20, 1998,
  respectively, while gross profits were $574,000 and $546,000, respectively,
  for these same periods. Yantra's revenues were 1.9% and 2.3% of the company's
  revenues for fiscal 1998 and for the period ended October 20, 1998,
  respectively. Its gross profits were 2.0% and 1.4% of the company's gross
  profits for these same periods. Yantra currently provides e-commerce
  operations solutions through PureEcommerce(TM), a scalable web-based solution
  that facilitates real-time transaction management across the extraprise. On
  June 14, 1999, Yantra sold Series C Convertible Preferred Stock in the amount
  of $15.0 million to unrelated existing and new investors, further reducing
  the company's voting control to approximately 25%.

  5.B  Liquidity and capital resources

  This information is set forth under the caption "Management's Discussion and
  Analysis of Financial Condition and Results of Operations" on pages 97 through
  110 of the Infosys Annual Report for fiscal 2000 and is incorporated herein by
  reference.

  5.C  Research and development, patents and licences, etc.

  The company has committed and expects to continue to commit in the future, a
  material portion of resources to research and development. Research and
  development efforts are focused on development and refinement of
  methodologies, tools and techniques, implementation of metrics, improvement in
  estimation process, and the adoption of new technologies. The company's
  research and development expenses in fiscal 2000, 1999 and 1998 were $1.9
  million, $2.8 million and $1.8 million, respectively which amounts to
  approximately 0.9%, 2.3% and 2.6% of total revenues, respectively.

  5.D  Trend information

  This information is set forth under the caption "Management's Discussion and
  Analysis of Financial Condition and Results of Operations" on pages 97 through
  110 of the Infosys Annual Report for fiscal 2000 and is incorporated herein by
  reference This information is set forth.
<PAGE>

Item 6.  Directors, Senior Management and Employees

  6.A  Directors, senior management

  The directors and executive officers of the company, their respective ages as
  of March 31, 2000, and their respective positions with the company are as
  follows:
<PAGE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
Name                                       Age     Position
------------------------------------------------------------------------------------------------------------------------------------
<S>                                        <C>    <C>
N. R. Narayana Murthy                      53     Chairman and Chief Executive Officer
Nandan M. Nilekani/4/                      44     Managing Director, President and Chief Operating Officer
Susim M. Datta* /1,2,3/                    63     Non-executive director
Deepak Satwalekar /1,2/                    51     Non-executive director
Ramesh Vangal /1,2,3/                      45     Non-executive director
Marti G. Subrahmanyam, Prof. /1 2 3/       53     Non-executive director
Philip Yeo/3/                              54     Non-executive director
Gopalakrishnan S.                          44     Deputy Managing Director - Customer Service & Technology
Dinesh K./4/                               45     Director - Human Resources Development, Information Systems, Quality &
                                                  Productivity and Communication Design Group
Shibulal S. D./4/                          45     Director - Customer Delivery
Ajay Dubey                                 42     Vice President - Delivery - Europe
Balasubramanian P., Dr.                    50     Senior Vice President - Domain Competency Group
Balakrishnan V.                            35     Associate Vice President - Finance
Basab Pradhan                              34     Regional Manager and Vice President - Sales - West North America
Deepak Sinha, Gp. Capt. (Retd.)            52     Senior Manager - Computers & Communications Division
Girish Vaidya                              49     Senior Vice President - Banking Business Unit
Hema Ravichandar                           38     Senior Vice President - Human Resources Development
Jan DeSmet                                 41     Vice President - Infosys Business Consulting Services
Mohandas Pai T. V.                         41     Senior Vice President - Finance & Administration and Chief Financial Officer
Phaneesh Murthy                            36     Senior Vice President - Sales & Marketing and Communication & Product Services
Prabhu M. S. S., Dr.                       52     Senior Vice President - Engineering Services and Consultancy Practice
Raghavan S.                                38     Associate Vice President - Quality & Productivity
Raghupathi G. Bhandi                       39     Senior Vice President - Delivery - Enterprise Solutions
Rajiv Kuchhal                              34     Associate Vice President - Communication & Product Services - Nortel and PCC,
                                                  Development Center - Mohali
Sobha Meera P. R.                          32     Regional Manager and Vice President - Sales - Canada & East North America
Srinath Batni                              45     Senior Vice President and Head - West North America
Vasudeva L. Rao                            38     Senior Vice President - Delivery - Canada & East North America
Yegneshwar S., Dr.                         39     Vice President - Education & Research
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

* Mr. S. M. Datta is due for retirement by rotation at the ensuing Annual
General Meeting of the company and is not seeking re-election.

1.  Member of the Compensation Committee
2.  Member of the Audit Committee
3.  Member of Nomination Committee
4.  Member of Investor Grievance Committee

N. R. Narayana Murthy has served as Chairman of the Board and Chief Executive
Officer of Infosys since 1981, when he founded the company with six software
professionals. Mr. Murthy also served as Managing Director of Infosys until
February 1999. While at Infosys, from 1992 to 1994, Mr. Murthy also served as
the President of National Association of Software and Service Companies
("NASSCOM"). Mr. Murthy is on the Governing Council of the National Information
Technology Task Force of India and was voted "IT Man of the Year" for 1996 by
Dataquest India. In 1998, Mr. Murthy was awarded the prestigious J.R.D. Tata
Corporate Leadership Award. Since 1998, Mr. Murthy has served as a director of
ICICI Ltd. and as a director of Videsh Sanchar Nigam Ltd. ("VSNL") and since
1999 he has served as a director of India Growth Fund, New York. He is a Fellow
of the All India Management Association ("AIMA") and the Computer Society of
India ("CSI"). Mr. Murthy received a B.E. in Electrical Engineering from the
University of Mysore and a M.Tech. from the Indian Institute of Technology
("IIT") Kanpur.

Nandan M. Nilekani is a co-founder of Infosys and has served as a director since
1981, Head - Marketing and Sales of Infosys since 1987, Head - Banking Business
Unit since 1997 and Managing Director, President and Chief Operating Officer
since February 1999. From 1981 to 1987, Mr. Nilekani was in the United States
<PAGE>

  managing the marketing and development efforts of Infosys. Mr. Nilekani is a
  co-founder of NASSCOM and received a B.Tech. in Electrical Engineering from
  IIT Bombay.

  Susim M. Datta has served as a Director of Infosys since 1997. He is Chairman
  of Castrol India Ltd., Philips India Ltd., Albright & Wilson Chemicals India
  Ltd. and IL&FS Venture Corporation Ltd. He is a director of EID Parry Ltd.,
  TIL Ltd., Bells Control Ltd., Indian Petrochemicals Corporation Ltd., Zodiac
  Clothing Company Ltd., Tata Trustee Company Ltd. and various unlisted
  corporations in India. From 1990 to 1996, he was Chairman of Hindustan Lever
  Ltd. and all Unilever Group companies in India and Nepal. Mr. Datta is a
  Trustee of the government-sponsored India Brand Equity Fund Trust and a member
  of the Advisory Board of the Council for Fair Business Practices, Mumbai. He
  is also Chairman of the Board of Governors of the Indian Institute of
  Management ("IIM") Bangalore and the Goa Institute of Management. Mr. Datta
  received an M.Sc. from Calcutta University.

  Deepak M. Satwalekar has served as a director of Infosys since 1997. He has
  been Managing Director of Housing Development Finance Corporation Ltd. since
  1993, and was Deputy Managing Director since 1990. He was a member of the
  Managing Committee of the Bombay Chamber of Commerce and Industry from 1996 to
  1998. Mr. Satwalekar was also a Member of the Economic Affairs Committee of
  the Indo-American Chamber of Commerce from 1993 to 1994 and 1996 to 1997. He
  is a director of Tata Housing Development Corporation Ltd., HDFC Bank Ltd.,
  HDFC Holdings Ltd., HDFC Investments Ltd., Indian Opportunities Fund
  (Mauritius) Ltd., Iridium India Telecom Ltd., Maruti Countrywide Auto
  Financial Service Ltd., Mahindra Holidays & Resorts India Ltd., SchoolNet
  India Ltd., Tube Investments of India Ltd., Chemplast Sanmar Ltd. and
  Templeton Asset Management India Private Ltd. Mr. Satwalekar received a
  B.Tech. in Mechanical Engineering from IIT Bombay and an M.B.A. from the
  American University.

  Prof. Marti G. Subrahmanyam has served as a director of Infosys since April
  1998. He has served as the Charles E. Merrill Professor of Finance and
  Economics at the Stern School of Business at New York University since 1991
  and has been a visiting professor at IIT Madras, INSEAD, IIM Ahmedabad and
  Manchester Business School, among other academic institutions. Prof.
  Subrahmanyam has written several books and published numerous articles in the
  areas of finance and economics. He is a director of ICICI Ltd., Dextrous Faber
  Ltd., Hindalco Industries Ltd., Aventine Investment Management, Inc., Nippon
  Performance Fund Ltd., Indiaserver.com, Inc., SpeedMerchant.com, Inc., Usha
  Communications, Inc., RMAS Ltd., Sanwa International plc., Nomura Asset
  Management, Inc. and Deutsche Software India Ltd., a subsidiary of Deutsche
  Bank AG. Dr. Subrahmanyam received a B.Tech. from IIT Madras, a Diploma in
  Business Administration, from IIM Ahmedabad and a Ph.D. in Finance and
  Economics from the Massachusetts Institute of Technology.

  Ramesh Vangal has served as a director of Infosys since 1997. He has served as
  the President of Seagram Asia Pacific since 1998 and is currently the Chairman
  of Seagram India Ltd., Asia Net Media, BL.com, and is a director in Indo Bio
  Care, CEBECO India, Kirin Seagram, and several other private companies. From
  1994 to 1997, he was a member of the Worldwide Operating Council of PepsiCo
  and was President of PepsiCo Foods International, Asia Pacific. From 1985 to
  1994, he served in various management capacities for PepsiCo. Mr. Vangal
  received a B.Tech. from IIT Bombay and a M.Sc. in Business from the London
  Business School. He also holds a Certificate Diploma, Accounting and Finance
  from the Institute of Chartered Accountants in England and Wales.

  Mr. Philip Yeo has served as a director of Infosys since October 29, 1999. Mr.
  Yeo has served as the Executive Chairman of the Singapore Economic Development
  Board since January 1986 and as Deputy Chairman of Singapore's National
  Science and Technology Board since June 1999. He is also the Chairman of the
  Institute for Molecular & Cell Biology, Pidemco Land and Singapore Aerospace
  Manufacturing and is a Board member in INSEAD, Paris. Mr. Yeo was the first
  Chairman of Singapore's National Computer Board from 1981 to 1987. Mr. Yeo
  joined the Administrative Service in 1970 and served in the Ministry of
  Defence where he held several appointments including the appointment of
  Permanent Secretary for logistics, technology research & development and
  defence industries up to January 1986. He retired from the Administrative
  Service on March 31, 1999. Mr. Yeo graduated in 1970 in Applied Science
  (Industrial Engineering) from the University of Toronto, Canada under a
  Colombo Plan Scholarship. He later obtained a Master of Science (Systems
  Engineering) from the University of Singapore in 1974. In 1976, he obtained a
  Master in Business Administration from Harvard University, under a Fulbright
  scholarship. He is the recipient of many international awards, and was
  conferred an Honorary Doctorate in Engineering from the University of Toronto.

  S. Gopalakrishnan is a co-founder of Infosys and has served as a director from
  1981 to 1987. From 1987 to 1994, he was Technical Vice President and managed
  all projects at the US-based KSA/Infosys, a former joint venture between the
  company and Kurt Salmon Associates. From 1994 to date he has served as a
  director of Infosys. Mr.
<PAGE>

  Gopalakrishnan was head of Technical Support Services from 1994 to 1996,
  Head - Client Delivery and Technology of Infosys from 1996 to 1999 and has
  served as Head - Customer Service & Technology from 1999 to date. Mr.
  Gopalakrishnan received an M.Sc. in Physics and an M.Tech. in Computer Science
  from IIT Madras. Mr. Gopalakrishnan is a director in Yantra Corporation.

  K. Dinesh is a co-founder of Infosys and has served as a director since 1985.
  He has served as Head - Quality, Productivity and MIS of Infosys since 1996.
  From 1991 to 1996, Mr. Dinesh served in various project management capacities
  and was responsible for worldwide software development efforts for Infosys.
  From 1981 to 1990, he managed projects for Infosys in the United States. Mr.
  Dinesh received an M.Sc. degree in Mathematics from Bangalore University.

  S. D. Shibulal is a co-founder of Infosys and has served as a director from
  1984 to 1991 and since 1997. He has served as Head - Manufacturing,
  Distribution and Year 2000 Business Unit, and Head - Internet and Intranet
  Business Unit of Infosys since 1998. From 1991 to 1996, Mr. Shibulal was on
  sabbatical from Infosys and served as Senior Information Resource Manager at
  Sun Microsystems, Inc. From 1981 to 1991, he worked for Infosys in the United
  States on projects in the retail and manufacturing industries. Mr. Shibulal
  received an M.Sc. in Physics from the University of Kerala and an M.S. in
  Computer Science from Boston University.

  Ajay Dubey has served as Vice President - Financial Services and
  Transportation Business Unit of Infosys since April 1999. From 1995 to 1999,
  he was an Associate Vice President working in the Financial Services and
  Transportation Business Unit. He joined the company in 1993 as a Senior
  project manager. From 1990 to 1993, he served as a Technical Team leader in
  ANZ Grindlays, New Zealand. Mr. Dubey received a B.Tech. from IIT Kanpur in
  1980.

  Dr. P. Balasubramanian has served as Senior Vice President and Head -
  Financial Services and Transportation Business Unit of Infosys since 1995.
  From 1989 to 1992, Dr. Balasubramanian was Chief Executive Officer and
  Technical Director of Hitek Software Engineers Ltd. ("Hitek"), Jamaica, West
  Indies. From 1992 to 1994, he was a Technical Director of Hitek. From 1986 to
  1989, Dr. Balasubramanian was Chief Executive Officer of Cholamandalam
  Software Ltd., Chennai. Dr. Balasubramanian has been invited as guest faculty
  to several executive training programs in India as well as at the University
  of West Indies. Dr. Balasubramanian received a B.Tech. and M.Tech from IIT
  Madras and a Ph.D. in Operations Research and Financial Management from Purdue
  University.

  V. Balakrishnan has served as Associate Vice President - Finance, since 1999.
  After joining Infosys in 1991, he has served in various capacities in the
  Finance department of the company. Prior to joining Infosys, he was Senior
  Accounts Executive for Amco Batteries Ltd.. Mr. Balakrishnan received a B.Sc.
  from the University of Madras and is an Associate Member of the Institute of
  Chartered Accountants of India, a Member of the Institute of Company
  Secretaries of India and an Associate Member of the Institute of Cost & Works
  Accountants of India.

  Basab Pradhan has served as Regional Manager since 1998. After joining Infosys
  in 1994, Basab served in various capacities for the company, including as
  Business Development Manager between 1995-98. Prior to joining Infosys, he was
  Area Sales Manager for Lipton India Ltd. Basab received a B.Tech. in
  Mechanical Engineering from IIT Kanpur in 1987 and a Post Graduate Diploma in
  Management from IIM Ahmedabad in 1989.

  Group Captain (Retd) Deepak Sinha has served as Head - Computer and
  Communications Division (CCD) of Infosys since April 1998. Prior to joining
  Infosys, he was Director - IMMOLS Project for The Indian Air Force. Group
  Captain (Retd.) Sinha graduated from IIT Kharagpur in 1968.

  Girish Vaidya has served as Senior Vice President and Head - Banking Business
  Unit of Infosys since April 1999. Prior to that, Mr. Vaidya was Director and
  Head - Operations India for ANZ Grindlays with whom he had been since 1975.
  Mr. Vaidya received a B.E. from S.P College of Engineering, Mumbai in 1973 and
  a Post Graduate Diploma in Management from IIM Calcutta in 1975.

  Hema Ravichandar has served as Senior Vice President and Head - Human
  Resources of Infosys since 1998. From 1996 to 1998, Ms. Ravichandar was an
  independent consultant. From 1992 to 1995, she served as Head - Human
  Resources at Infosys. From 1983 to 1992, Ms. Ravichandar was Deputy Manager -
  Human Resource Development at Motor Industries Company Ltd.. Ms. Ravichandar
  received a B.A. in Economics and a Post Graduate Diploma in Management from
  IIM Ahmedabad.

  Jan DeSmet has served as Vice President - Consulting Services and Head -
  Strategic Business Unit-4 since January 1999 and is currently Vice President -
  Business Consulting Services. From 1996 to 1998, Mr. DeSmet was Senior
  Principal with Diamond Technology Partners in Chicago. Mr. DeSmet received a
  M.B.A from the University of Dallas in 1982.
<PAGE>

  T. V. Mohandas Pai has served as Senior Vice President, Head - Finance and
  Administration and Chief Financial Officer of Infosys since 1996. From 1994 to
  1996, he served as Vice President of Finance at Infosys. From 1988 to 1994,
  Mr. Pai was Executive Director of Prakash Leasing Ltd.. He was also a member
  of the Capital Markets Committee of the Institute of Chartered Accountants of
  India. Mr. Pai received a B.Com. from St. Joseph's College of Commerce,
  Bangalore and an LL.B. from the University Law College, Bangalore. Mr. Pai is
  a Fellow Member of the Institute of Chartered Accountants of India.

  Phaneesh Murthy has served as Senior Vice President and Head - Worldwide Sales
  of Infosys since 1996. From 1992 to 1996, Mr. Murthy was a Marketing Manager
  for Infosys based in the United States. From 1987 to 1992, he worked in sales
  and marketing for Sonata, the software division of Indian Organic Chemicals
  Ltd. Mr. Murthy received a B.Tech. in Mechanical Engineering from IIT Madras
  and a post graduate diploma in business administration from IIM Ahmedabad.

  Dr. M. S. S. Prabhu has served as Senior Vice President and Head - Engineering
  Services Business Unit of Infosys since 1997. From 1994 to 1997, Dr. Prabhu
  served as head of CAD/CAM group at Tata Consultancy Services. From 1972 to
  1994, he served in various capacities for the Indian Satellite Research
  Organization. Dr. Prabhu received a B.E. in Civil Engineering from Bangalore
  University and a Ph.D. in Aeronautical Engineering from Indian Institute of
  Science, Bangalore.

  Raghavan S. has served as Associate Vice President and Head - Quality &
  Productivity since April 1999. From 1987 to 1999 Mr. Raghavan has served in
  various capacities for the company, starting as a Software Engineer in 1987
  upto a Senior Project Manager in 1999. Mr. Raghavan received a B.E. from
  Osmania University in 1983.

  Raghupathi G. Bhandi has served as Vice President of Infosys since April 1998.
  From 1995 to 1998, he started and developed the company's first software
  development facility outside of Bangalore. From 1991 to 1995, Mr. Bhandi
  worked in the Quality Department of Infosys with attention to ISO 9000
  certification. From 1988 to 1991, he was an Assistant Manager on projects in
  the United States and Europe. Mr. Bhandi received a B.E. from Mysore
  University and an M.Tech. in Industrial Management and Engineering from IIT
  Kanpur.

  Rajiv Kuchhal has served as Associate Vice President of Infosys since 1998 and
  Head--Nortel OSDC Business Unit of Infosys since April 1998. From 1990 to
  1998, Mr. Kuchhal served in various capacities for the company, including
  projects relating to an electronic telex interface and management of the
  Nortel OSDC before it became a separate business unit. Mr. Kuchhal received a
  B.Tech. in Electrical and Electronics Engineering from IIT Delhi.

  Srinath Batni has served as Senior Vice President and Head - Retail and
  Telecommunications Business Unit of Infosys since 1996. After joining Infosys
  in 1992, Mr. Batni was a Project Manager. From 1990 to 1992, he was Manager of
  Technical Support for PSI Bull, an Indian software development subsidiary of
  Bull, S.A., a French company. Mr. Batni received a B.E. in Mechanical
  Engineering from Mysore University and an M.E. in Mechanical Engineering from
  the Indian Institute of Science, Bangalore.

  Sobha Meera P. R. has served as Regional Manager - Canada & East North America
  since 1998. After joining Infosys in 1995 Ms. Meera served as Branch Manager
  between 1995 and 1998. Prior to joining Infosys, she worked in various Sales &
  Marketing positions for HCL Ltd. & Sonata, the software division of Indian
  Organic Chemicals Ltd. Ms. Meera received her Post Graduate Diploma in
  Management from the IIM Ahmedabad in 1995 and a B.E. from Osmania University
  in 1989.

  Vasudeva L. Rao has served as Vice President of Infosys since April 1998,
  operating in the distribution and logistics domains of the Manufacturing and
  Distribution Business Unit. From 1994 to 1996, he was an Associate Vice
  President working in the Manufacturing and Distribution Unit. From 1991 to
  1994, he served as a project manager in the retail industry at Software
  Sourcing Company, formerly KSA/Infosys. From 1985 to 1991, Mr. Rao was a
  software engineer for Infosys based in the United States. Mr. Rao received a
  B.E. in Mechanical Engineering from Bangalore University.

  Dr. S. Yegneshwar has served as Associate Vice President and Head - Education
  and Research of Infosys since 1996. From 1993 to 1996, Dr. Yegneshwar was a
  group leader of the Software Engineering group in the Education and Research
  Department of Infosys. From 1990 to 1993, he was an Assistant Professor of
  Computers and Information Systems at IIM Ahmedabad, where he taught courses in
  software engineering and management to postgraduate and doctoral students. Dr.
  Yegneshwar received a B.E. in Mechanical Engineering from the Birla Institute
  of Technology and Science, Pilani and a Ph.D. in Computer Science and
  Engineering from IIT Bombay.

  6.B  Compensation

  In fiscal 2000, the company's five non-employee directors were paid an
  aggregate of $ 110,500. Directors who are also employees of the company do not
  receive any additional compensation for their service on the board of
  directors. Directors are also reimbursed for certain expenses in connection
  with their attendance at the board and the committee meetings.

  The table below sets forth the compensation for the officers and directors of
  the company, for the fiscal year ended March 31, 2000.
<PAGE>

<TABLE>
<CAPTION>
     ----------------------------------------------------------------------------------------------------------------
     Annual compensation awards                     Stock options                           Amount
     -----------------------------------------------------------------------------------------------------------------
      Name                                   Salary    Bonus    Other      No. of       Grant         Expiration    accrued
                                                               annual     options       price               date  for long-
                                                              compen-     granted                                      term
                                                               sation  during the                                  benefits
                                                                             year
     ----------------------------------------------------------------------------------------------------------------------
     <S>                                   <C>       <C>      <C>      <C>        <C>         <C>                <C>
      N. R. Narayana Murthy                $ 14,986   $3,747  $ 9,741          -           -                  -       4,767
      Nandan M. Nilekani                     14,986    3,747   11,333          -           -                  -       4,767
      Gopalakrishnan S.                      14,986    3,747    9,741          -           -                  -       4,767
      Dinesh K.                              14,986    3,747   11,146          -           -                  -       4,767
      Shibulal S. D.                         14,986    3,747    9,741          -           -                  -       4,767
      Susim M. Datta                              -        -   25,000          -           -                  -           -
      Deepak Satwalekar                           -        -   25,000          -           -                  -           -
      Ramesh Vangal                               -        -   25,000          -           -                  -           -
      Marti G. Subrahmanyam, Prof.                -        -   25,000          -           -                  -           -
      Philip Yeo                                  -        -   10,500          -           -                  -           -
      Options to purchase equity shares
      Ajay Dubey                              9,529        -    9,592      8,000      $99.12  November 10, 2008       3,031
      Balasubramanian P., Dr.                14,072        -   14,437      8,000       93.66  November 10, 2008       4,476
      Balakrishnan V.                         7,620        -   10,899     10,000       93.66  November 10, 2008       2,424
      Deepak Sinha, Gp. Capt. (Retd.)         5,327    1,065   10,422      4,000       93.66  November 10, 2008       1,694
      Girish Vaidya                          14,072        -   14,105      8,000       93.66  November 10, 2008       4,476
      Hema Ravichandar                       11,385        -   10,201      8,000       93.66  November 10, 2008       3,622
      Jan DeSmet                            165,000        -        -          -           -                  -           -
      Mohandas Pai T. V.                     17,756        -    9,289     14,000       93.66  November 10, 2008       5,648
      Prabhu M. S. S., Dr.                   13,321        -   13,329      6,000       93.66  November 10, 2008       4,238
      Raghavan S.                             8,695        -   10,118     10,000       93.66  November 10, 2008       2,766
      Raghupathi G. Bhandi                    9,150        -   11,337      8,000       93.66  November 10, 2008       2,910
      Rajiv Kuchhal                           8,033        -    8,120          -           -                  -       2,555
      Srinath Batni                          16,094        -    6,130     12,000       93.66  November 10, 2008       5,120
      Vasudeva L. Rao                         8,637        -    8,957     12,000       93.66  November 10, 2008       2,747
      Yegneshwar S., Dr.                      7,529        -    7,959     10,000       93.66  November 10, 2008       2,395
      Options to purchase ADSs
      Basab Pradhan                          86,004        -   38,832      5,000       89.50  November 10, 2008           -
      Phaneesh Murthy                       230,004        -   33,128      8,000       89.50  November 10, 2008           -
      Sobha Meera P. R.                      86,004        -   25,800      5,000       89.50  November 10, 2008           -
     ----------------------------------------------------------------------------------------------------------------
</TABLE>

     6.C.1     Board practices

<TABLE>
<CAPTION>
     ----------------------------------------------------------------------------------------------------------------
      Name                                Expiration of current           Term of office
                                          term of office
     ----------------------------------------------------------------------------------------------------------------
     <S>                                  <C>                             <C>
     N. R. Narayana Murthy                April 30, 2002                  5 years /1/
     Nandan M. Nilekani                   April 30, 2002                  5 years /1/
     Gopalakrishnan S.                    October 17, 2004                5 years /1 2/
     Dinesh K.                            April 30, 2002                  5 years /1/
     Shibulal S. D.                       April 30, 2002                  5 years /1/
     Susim M. Datta                       May 27, 2000                    Retirement by rotation /3/
     Deepak Satwalekar                                                    Retirement by rotation
     Ramesh Vangal                                                        Retirement by rotation
     Marti G. Subramanyam, Prof.                                          Retirement by rotation
     Philip Yeo                                                           Retirement by rotation
     ----------------------------------------------------------------------------------------------------------------
</TABLE>

   1.   The period of appointment as an executive director is for five years.
        However, these directors customarily retire by rotation once in three
        years and are to be re-elected by the stockholders.

   2.   Mr. S. Gopalakrishnan's Contract of Service with the company as Deputy
        Managing Director, ended on October 18, 1999. He was re-appointed by the
        board for a new term of five years ending on October 17, 2004 and his
        re-appointment has been recommended for the approval of the stockholders
        in the ensuing Annual General Meeting and forms part of the Items of
        Special Business of the Notice to the stockholders, which is attached as
        an exhibit to this Form 20-F.

   3.   Mr. S. M. Datta is due for retirement by rotation at the ensuing
        Annual General Meeting of the company and is not seeking re-election.
<PAGE>

     4.   The board constantly evaluates the contribution of its members, and
          recommends to stockholders their re-appointment periodically as per
          statute. The Indian Companies Act mandates that two-thirds of the
          members of the board should retire by rotation, of which, one-third of
          such members should retire every year, and qualifies the retiring
          members for re-appointment. However all the directors of the company
          customarily retire by rotation. The executive directors are appointed
          by the stockholders for a maximum period of five years at one time but
          are eligible for re-appointment upon completion of their term. The
          nominations committee of the board, composed entirely of independent
          directors, recommends such appointment / re-appointment. However, the
          membership term is limited by the retirement age for members. The
          board has adopted a retirement policy for its members. Under this
          policy, the maximum age of retirement of executive directors,
          including the CEO, is 60 years, which is the age of superannuation for
          the employees of the company. Their continuation as members of the
          board upon superannuation / retirement is determined by the
          nominations committee. The age limit for retirement from the board is
          65 years. The directors' contracts do not contain material severance
          packages.

6.C.2  Employment contracts

Under the Indian Companies Act, the company's stockholders must approve the
salary, bonus and benefits of all employee directors at an Annual General
Meeting of stockholders. Each employee director of the company has signed an
agreement containing the terms and conditions of employment, including a monthly
salary, performance bonus and benefits including vacation, medical reimbursement
and pension fund contributions. These agreements are made for a five year
period, but either the company or the employee director may terminate the
agreement upon six months notice to the other party.

6.C.3  Board committee information

The details relating to the company's audit committee and remuneration
committee, including the names of committee members and a summary of the terms
of reference under which the committee operates is on pages 45 through 54 of the
Infosys Annual Report for fiscal 2000 and is incorporated herein by reference.

6.D    Employees

As of March 31, 2000, the company had approximately 5,390 employees, including
approximately 4,625 IT professionals, up from approximately 3,770 and
approximately 3,160, respectively, as of March 31, 1999 and approximately 2,190
and approximately 2,610, respectively as of March 31, 1998. The company invests
heavily in its programs to recruit, train and retain qualified employees, and
management believes the company has established a reputation as one of the most
preferred employers for software engineers in India.

The company focuses its recruiting efforts on the top 20% of students from
engineering departments of Indian schools and relies on a rigorous selection
process involving a series of tests and interviews to identify the best
applicants. Because the company emphasizes flexibility and innovation,
applicants are selected on the basis of their ability to learn as well as their
academic achievement, conceptual knowledge and their temperament for, and fit
with, the company's culture. The company's reputation as a premier employer
enables it to select from a large pool of qualified applicants. For example, in
fiscal 2000, the company received approximately 184,000 job applications, tested
approximately 36,610, interviewed approximately 10,180 and extended job offers
to approximately 3,330 of whom approximately 2,050 accepted. The company seeks
to attract and motivate IT professionals by offering: an entrepreneurial
environment that empowers IT professionals; programs that recognize and reward
performance; challenging assignments; a continuous updating of skills; and a
culture that emphasizes openness, integrity and respect for the employee. IT
professionals receive competitive salaries and benefits and are eligible to
participate in the company's stock option plans. In addition, the company spends
significant resources on training and continuing education. To conduct training,
the company employs a 50-person faculty, including 20 with doctorate or master's
degrees. The faculty conducts three-month training sessions for new recruits and
a variety of two-week continuing education courses in technology and management
skills.

At any given time, approximately 30% of the company's IT professionals are
working on-site at client facilities in the United States and elsewhere while
the balance are working off-site in India. On average, approximately 980, 530
and 330 of the company's IT professionals worked on-site in the United States
and elsewhere per month in fiscal 2000, fiscal 1999 and fiscal 1998,
respectively. On average, approximately 3,100, 2,630 and 1,780 of the company's
IT professionals and support staff worked off-site in India per month in fiscal
2000, fiscal 1999 and fiscal 1998, respectively.

The company's professionals that work on-site at client facilities in the United
States on temporary and extended assignments are typically required to obtain
visas. As of March 31, 2000, substantially all of the company's personnel in the
United States were working pursuant to H-1B visas (745 persons) or L-1 visas
(218 persons). Both H-1B and L-1 visas require that recipients meet certain
education requirements; however, only employees
<PAGE>

who have worked for the company for at least one year are eligible to obtain L-1
visas. The company is generally able to obtain H-1B and L-1 visas within two to
four months of applying for such visas, which remain valid for three years.
Although there is no limit to new L-1 petitions, there is a limit to the number
of new H-1B petitions that the United States Immigration and Naturalization
Service may approve in any government fiscal year. In the years in which this
limit is reached, the company may be unable to obtain H-1B visas necessary to
bring critical Indian IT professionals to the United States on an extended
basis. The H-1B limit was reached in March 2000 by the U.S. Government for its
fiscal year ending September 30, 2000 and in May 1999 for its fiscal year ending
September 30, 1999. The company planned for the H-1B limit being reached prior
to the end of the U.S. Government's current fiscal year primarily by forecasting
its annual needs for such visas early in the U.S. Government's fiscal year and
applying for such visas as soon as practicable. In addition, the company
utilizes L-1 visas whenever available and redeploys existing H-1B visa holders
in order to minimize the number of new H-1B visas needed by the company. While
the company anticipated that such limit would be reached prior to the end of the
U.S. government's fiscal year and has made efforts to plan accordingly, there
can be no assurance that the company will continue to be able to obtain a
sufficient number of H-1B visas.

The market for hiring software professionals is highly competitive. Competing
employers include multinational corporations that perform software development
in India through subsidiaries and joint ventures with Indian companies; a number
of well-known Indian IT services and software product companies; and a large
number of small and medium regional companies, many with affiliates or parent
companies in the United States and Europe.

6.E.1  Share ownership (As of March 31, 2000)

The following table sets forth the options to purchase securities, granted to
executive officers and directors, that were outstanding as of March 31, 2000.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
Class of securities                 Total securities  Exercise price   Expiration dates
----------------------------------------------------------------------------------------
<S>                                 <C>               <C>             <C>
 Equity shares                              1,14,000          $93.66  November 2003-2008
 American Depositary Shares                   18,000          $89.50  November 2003-2008
----------------------------------------------------------------------------------------
</TABLE>

The following table sets forth for each director and executive officer, the
total number of equity shares, ADSs and Options to purchase equity shares and
ADSs held as of March 31, 2000.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
Name                                        Shares     % of shares      Shares  Exercise  Expiration
                                      beneficially    beneficially  underlying   price
                                             owned           owned     options
                                                                       granted
----------------------------------------------------------------------------------------
<S>                                   <C>             <C>            <C>         <C>      <C>
 N. R. Narayana Murthy /1/               4,931,300            7.45           -         -           -
 Nandan M. Nilekani /1/                  3,334,900            5.04           -         -           -
 Dinesh K. /1/                           2,143,400            3.24           -         -           -
 Gopalakrishnan S. /1/                   3,090,000            4.67           -         -           -
 Shibulal S. D. /1/                      2,124,500            3.21           -         -           -
 Susim M. Datta                                  -               -           -         -           -
 Deepak Satwalekar                               -               -           -         -           -
 Ramesh Vangal /2/                               -               -           -         -           -
 Marti G. Subrahmanyam, Prof. /2/                -               -           -         -           -
 Philip Yeo                                      -               -           -         -           -
 Ajay Dubey /2/                                  -               -           -         -           -
 Balasubramanian P., Dr. /2/                     -               -           -         -           -
 Balakrishnan V. /2/                             -               -           -         -           -
 Basab Pradhan /2/                               -               -           -         -           -
 Deepak Sinha, Gp. Capt. (Retd.) /2/             -               -           -         -           -
 Girish Vaidya /2/                               -               -           -         -           -
 Hema Ravichandar /2/                            -               -           -         -           -
 Jan DeSmet /2/                                  -               -           -         -           -
 Mohandas Pai T. V. /2/                          -               -           -         -           -
 Phaneesh Murthy /2/                             -               -           -         -           -
 Prabhu M. S. S., Dr. /2/                        -               -           -         -           -
 Raghavan S. /2/                                 -               -           -         -           -
 Raghupathi G. Bhandi /2/                        -               -           -         -           -
 Rajiv Kuchhal /2/                               -               -           -         -           -
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
Name                                        Shares     % of shares      Shares  Exercise  Expiration
                                      beneficially    beneficially  underlying   price
                                             owned           owned     options
                                                                       granted
----------------------------------------------------------------------------------------
<S>                                   <C>             <C>            <C>         <C>      <C>
  Srinath Batni /2/                              -               -           -         -           -
  Sobha Meera P. R. /2/                          -               -           -         -           -
  Vasudeva L. Rao /2/                            -               -           -         -           -
  Yegneshwar S., Dr. /2/                         -               -           -         -           -
----------------------------------------------------------------------------------------
</TABLE>

1.   Number of shares and percentage ownership is based on 66,15,0700 equity
     shares outstanding as of March 31, 2000. Beneficial ownership is determined
     in accordance with rules of the SEC and includes voting and investment
     power with respect to such shares. Shares subject to options that are
     currently exercisable or exercisable within 60 days of March 31, 2000 are
     deemed to be outstanding and to be beneficially owned by the person holding
     such options for the purpose of computing the percentage ownership of such
     person, but are not deemed to be outstanding and to be beneficially owned
     for the purpose of computing the percentage ownership of any other person.
     All information with respect to the beneficial ownership of any principal
     shareholder has been furnished by such shareholder and, unless otherwise
     indicated below, the company believes that persons named in the table have
     sole voting and sole investment power with respect to all the shares shown
     as beneficially owned, subject to community property laws, where
     applicable. The shares beneficially owned by the directors include the
     equity shares owned by their family members to which such directors
     disclaim beneficial ownership.

2.   Hold less than one percent of the class of shares and individual share
     ownership has not previously been disclosed to shareholders or otherwise
     made public.

6. E. 2 Option plans

The company has three Option plans in operation the 1994 Employee Stock Offer
Plan, the 1998 Stock Option Plan and the 1999 Stock Option Plan, a description
of which is provided below:

1994 Employees Stock Offer Plan. In September 1994, the company established the
Employees Stock Offer Plan ("ESOP") which provides for the issuance of 6,000,000
warrants (as adjusted for the stock split effective June 1997, December 1998 and
February 2000) to eligible employees. The warrants were issued to an employee
welfare trust ("Trust") at Rs. 1 each. The warrants were purchased by the Trust
using the proceeds of a loan obtained from the company. The Trust holds the
warrants and transfers them to eligible employees. The warrants are transferred
to employees at Re. 1 each and each warrant entitles the holder to purchase one
of the company's equity shares at a price of Indian Rs. 100 per share. The
warrants and the equity shares received upon the exercise of warrants are
subject to a five-year aggregate vesting period from the date of issue of
warrants to employees. The warrants expire upon the earlier of five years from
the date of issue or September 1999. The fair market value of each warrant is
the market price of the underlying equity shares on the date of the grant.

In 1997, in anticipation of a share dividend to be declared by the company, the
Trust exercised all warrants held by it and converted them into equity shares
with the proceeds of a loan obtained from the company. In connection with the
warrant exercise and the share dividend, on an adjusted basis, 3,011,200 equity
shares were issued to employees of the company who exercised stock purchase
rights and 2,988,800 equity shares were issued to the Trust for future issuance
to employees pursuant to the ESOP. Following such exercise, there were no longer
any rights to purchase equity shares from the company in connection with the
ESOP. Only equity shares held by the Trust remained for future issues to
employees, subject to vesting provisions. The equity shares acquired upon the
exercise of the warrants vests 100% upon the completion of five years of
service. The warrant holders were entitled to exercise early, but the shares
received are subject to the five year vesting period. As of March 31, 2000, the
company's outstanding equity shares included 509,800 equity shares held by the
Trust of which 341,400 equity shares were allotted to employees, subject to
vesting provisions and have been included in the calculation of basic and
diluted earnings per share. The 168,400 equity shares were not considered
outstanding for purposes of calculating diluted earnings per share calculations.
The warrants allotted and the underlying equity shares are not subject to any
repurchase obligations by the company.

The company has elected to use the intrinsic value-based method of APB Opinion
No. 25 to account for its employee stock-based compensation plan. During the
years ended March 31, 2000, 1999 and 1998, the company recorded deferred
compensation of $ 1,029,649, $ 30,407,892 and $ 6,890,343, respectively, for the
difference, on the grant date, between the exercise price and the fair value as
determined by quoted market prices of the common stock underlying the warrants.
The deferred compensation is amortized on a straight-line basis over the vesting
period of the warrants/equity shares.

In fiscal 1998, the company declared a stock split of two equity shares for each
equity share outstanding in the form of a stock dividend to all its shareholders
including participants in the ESOP. Under the terms of the ESOP, the additional
equity shares issued to ESOP participants as a result of the stock dividend were
not subject to vesting. Consequently, the amortization of deferred stock
compensation of $ 1,519,739 relating to these shares
<PAGE>

was accelerated at the time of the stock dividend. Similarly, in fiscal 1999,
the company declared a stock split of two equity shares for each equity share
outstanding to all its shareholders including participants in the ESOP in the
form of a stock dividend and consequently recognized an accelerated compensation
charge at the time of the stock dividend amounting to $ 12,906,962.

1998 Stock Option Plan. The company's 1998 Stock Option Plan ("1998 Plan")
provides for the grant of nonstatutory stock options and incentive stock options
(within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Internal Revenue Code"), to employees of the company. The
establishment of the 1998 Plan was approved by the board of directors in
December 1998 and by the shareholders in January 1998. The Government of India
has approved the 1998 Plan, subject to maximum limit of 1,470,000 equity shares
issuable under the 1998 Plan. A total of 1,600,000 equity shares are currently
reserved for issuance pursuant to the 1998 Plan. Unless terminated sooner, the
1998 Plan will terminate automatically in January 2008. All options under the
1998 Plan will be exercisable for ADSs represented by ADRs.

The 1998 Plan is administered by a committee of the Board (the "Committee"). The
Committee has the power to determine the terms of the options granted, including
the exercise price, the number of ADSs subject to each option, the
exercisability thereof, and the form of consideration payable upon such
exercise. In addition, the Committee has the authority to amend, suspend or
terminate the 1998 Plan, provided that no such action may affect any ADS
previously issued and sold or any option previously granted under the 1998 Plan.

Options granted under the 1998 Plan are not generally transferable by the
optionee, and each option is exercisable during the lifetime of the optionee
only by such optionee. Options granted under the 1998 Plan must generally be
exercised within three months of the end of optionee's status as an employee of
the company, but in no event later than the expiration of the option's term. In
the event of optionee's termination as a result of death or disability, the
vesting and exercisability of the optionee's option will accelerate in full and
the option must be exercised within 12 months after such optionee's termination
by death or disability, but in no event later than the expiration of the
option's term. The exercise price of incentive stock options granted under the
1998 Plan must be at least equal to the fair market value of the ADSs on the
date of grant. The exercise price of nonstatutory stock options granted under
the 1998 Plan must be at least equal to 90% of the fair market value of the ADSs
on the date of grant. With respect to any participant who owns stock possessing
more than 10% of the voting power of all classes of the company's outstanding
capital stock, the exercise price of any incentive stock option granted must
equal at least 110% of the fair market value on the grant date and the term of
such incentive stock option must not exceed five years. The term of all other
options granted under the 1998 Plan may not exceed 10 years.

The 1998 Plan provides that in the event of a merger of the company with or into
another corporation, a sale of substantially all of the company's assets or a
like transaction involving the company, each option shall be assumed or an
equivalent option substituted by the successor corporation. If the outstanding
options are not assumed or substituted as described in the preceding sentence,
the vesting and exercisability of each option will accelerate in full.

1999 Stock Option Plan (the 1999 Plan) The 1999 Plan was approved by the
shareholders and the board of directors in June 1999. The 1999 Plan provides for
the issue of 6,600,000 equity shares to employees. The 1999 Plan is administered
by a compensation committee comprising a maximum of seven members, the majority
of whom are independent directors on the board of directors. Under the 1999
Plan, options will be issued to employees at an exercise price not less than the
Fair Market Value. Fair Market Value means the closing price of the company's
shares on the stock exchange where there is the highest trading volume on a
given date and if the shares are not traded on that day, the closing price on
the next trading day. Under the 1999 Plan, options may also be issued to
employees at exercise prices that are less than Fair Market Value only if
specifically approved by the members of the company in a general meeting.

Options granted under the 1999 Plan are not generally transferable by the
optionee, and each option is exercisable during the lifetime of the optionee
only by such optionee. Options granted under the 1999 Plan must generally be
exercised within three months of the end of optionee's status as an employee of
the company, but in no event later than the expiration of the option's term. In
the event of optionee's termination as a result of death or disability, the
vesting and exercisability of the optionee's option will accelerate in full and
the option must be exercised within 12 months after such optionee's termination
by death or disability, but in no event later than the expiration of the
option's term.

The 1999 Plan provides that in the event of a merger of the company with or into
another corporation, a sale of substantially all of the company's assets or a
like transaction involving the company, each option shall be assumed or an
equivalent option substituted by the successor corporation. If the outstanding
options are not
<PAGE>

assumed or substituted as described in the preceding sentence, the vesting and
exercisability of each option will accelerate in full.

Item 7  Major Shareholders and Related Party Transactions

     7.A    Major shareholders

     The following table sets forth certain information regarding the beneficial
     ownership of the equity shares at March 31, 2000 of (i) each person or
     group known by the company to own beneficially 5% or more of the
     outstanding equity shares and (ii) the beneficial ownership of all officers
     and directors as a group, in each case as reported to Infosys by such
     persons.



<TABLE>
<CAPTION>
     ------------------------------------------------------------------------------------------------------------------------------
     Name of the                            Class of     No of shares     % of     No of shares      % of       No of shares  % of
     beneficial owner                       security     beneficially    class     beneficially      class      beneficially  class
                                                          held /1 2/                held /1 2/                   held /1 2/
     ------------------------------------------------------------------------------------------------------------------------------
                                                                   2000                     1999                         1998
     ------------------------------------------------------------------------------------------------------------------------------
      <S>                                 <C>            <C>             <C>       <C>               <C>        <C>           <C>
      N. R. Narayana Murthy               Equity shares     4,931,300        7.45     5,047,200         7.63       5,107,200   7.97
      Nandan M. Nilekani                  Equity shares     3,334,900        5.04     3,376,400         5.10       3,432,400   5.36
      N. S. Raghavan*                     Equity shares     3,467,860        5.24     3,531,200         5.33       3,572,400   5.57
      Shareholding of all directors and
       officers as a group (29 persons)                    20,194,562       25.03
     ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

     * Ceased to be director of the company effective as of February 7, 2000.

     1.   Number of shares and percentage ownership is based on 66,15,0700
          equity shares outstanding as of March 31, 2000. Beneficial ownership
          is determined in accordance with rules of the SEC and includes voting
          and investment power with respect to such shares. Shares subject to
          options that are currently exercisable or exercisable within 60 days
          of March 31, 2000 are deemed to be outstanding and to be beneficially
          owned by the person holding such options for the purpose of computing
          the percentage ownership of such person, but are not deemed to be
          outstanding and to be beneficially owned for the purpose of computing
          the percentage ownership of any other person. All information with
          respect to the beneficial ownership of any principal shareholder has
          been furnished by such shareholder and, unless otherwise indicated
          below, the company believes that persons named in the table have sole
          voting and sole investment power with respect to all the shares shown
          as beneficially owned, subject to community property laws, where
          applicable. The shares beneficially owned by the directors include the
          equity shares owned by their family members to which such directors
          disclaim beneficial ownership.

     2.   As adjusted to reflect the company's 2-for-1 stock splits in 1998 and
          2000.

     The major shareholders of the company do not have a differential voting
     right in respect of the equity shares of the company.

     The company's American Depositary Shares listed on the NASDAQ National
     Market(R) each representing one-half of one equity share of par value Rs. 5
     per share are registered pursuant to Section 12(g) of the Securities
     Exchange Act of 1934 and are held by approximately 13,500 holders of record
     in the United States of America ("USA"), as of March 31, 2000.

     The company's equity shares can be held by Foreign Institutional Investors
     ("FIIs"), Overseas Corporate Bodies ("OCBs") and Non-resident Indians
     ("NRIs") who are registered with the Securities and Exchange Board of India
     ("SEBI") and the Reserve Bank of India ("RBI"). Currently over 25.13% of
     the Company's equity shares are held by these FIIs, OCBs and NRIs of which
     some of them may be residents or bodies corporate registered in the United
     States of America and elsewhere. The company is not aware which of these
     FIIs, OCBs and NRIs hold these equity shares as residents of or bodies
     corporates registered in the USA and is not aware of the portion of these
     equity shares held by these FIIs, OCBs and NRIs in the USA.

     To the best of its knowledge, the company is not owned or controlled
     directly or indirectly by any government or by any other corporation. The
     company is not aware of any arrangement, the operation of which may at a
     subsequent date result in a change in control of the company

     The above shares are issued and traded within India and is held, directly
     or indirectly, in the beneficial name of the holders.

     7.B    Related party transactions

     The Company had no material transaction with any shareholders owning more
     than 10% of the equity of the company.
<PAGE>

     Yantra Corporation

     In December 1996, the company transferred all rights, title and interest in
     and to the WMSYantra (formerly known as EAGLE) software product to Yantra,
     then a majority-owned subsidiary of the company. Yantra granted Infosys a
     non-exclusive right to reproduce, distribute and service the product to the
     extent necessary to fulfill the company's pre-existing contractual
     obligations for the product. In consideration for this transaction Infosys
     received 7,500,000 shares of common stock of Yantra, which had a fair
     market value at the time of $ 0.20 per share. In September 1997, the
     company purchased 2,000,000 shares of Series A Preferred Stock of Yantra at
     $ 0.75 per share. Certain of the company's directors or officers are
     directors of Yantra. As of March 31, 1998, Mr. Phaneesh Murthy, an
     executive officer of the company, held options to purchase 100,000 shares
     of common stock of Yantra at an exercise price of $ 0.10 per share, all of
     which were granted on September 29, 1997. Other than Mr. Phaneesh Murthy,
     none of the company's directors or officers beneficially owns any shares or
     options of Yantra. On October 20, 1998, the company sold 1,363,637 shares
     of Series A Preferred Stock of Yantra for $ 1.10 per share to an
     unaffiliated purchaser. As a result, the company reduced its interest in
     Yantra to less than one-half of voting stock of Yantra. On June 14, 1999,
     Yantra issued Series C Preferred Stock amounting to $ 15.0 million to
     various existing and new investors. Sales to Yantra in fiscal 2000 were $
     2.6 million.

     7.B.1  Employment agreements

     The company has entered into agreements with its employee directors
     containing a monthly salary, performance bonus and benefits including
     vacation, medical reimbursement and pension fund contributions. These
     agreements are made for a five-year period, but either the company or the
     employee director may terminate the agreement upon six months notice to the
     other party.

     7.B.2  Loans to employees

     Pursuant to an employee loan program, the company grants loans to employees
     to acquire certain assets such as property, vehicles or for personal needs.
     Such loans are made at interest rates ranging from 0% to 4% and are
     repayable over fixed periods ranging from one to 100 months. The loans
     generally are secured by the assets acquired by the employees. As of March
     31, 2000, there were $ 12 million in loans outstanding to employees, of
     which $ 163,881 were loans receivable from executive officers of the
     company in amounts less than $ 60,000. The largest outstanding loan during
     fiscal 2000 was a housing loan for $ 34,404 given to Mr. Ajay Dubey, Vice
     President - Europe. The loan, made on June 23, 1999 carried no interest and
     was outstanding in the amount of $ 33,257 as of March 31, 2000.

     7.C    Interests of experts and counsel

     Not applicable.

Item 8.  Financial Information

     8.A.1  Consolidated statements and other financial information

     The following financial statements of the company and the auditors' report
     appearing on pages 112 through 131 of the Infosys Annual Report for fiscal
     2000 are incorporated herein by reference:

     . Independent auditors' report.
     . Balance Sheets as of March 31, 2000 and 1999.
     . Statements of Income for the years ended March 31, 2000, 1999 and 1998.
     . Statements of Shareholders' Equity for the years ended March 31, 2000,
       1999 and 1998.
     . Statements of Cash Flows for the years ended March 31, 2000, 1999 and
       1998.
     . Notes to financial statements.

     The Infosys Annual Report for fiscal 2000, except for those portions which
     are expressly incorporated by reference in this filing, is furnished for
     the information of the Securities and Exchange Commission and is not to be
     deemed as filed as a part of this report on Form 20-F.

     8.A.2  Legal proceedings

     The company, its directors, senior executive officers and affiliates are
     not currently a party to any material legal proceedings.
<PAGE>

     8.A.3  Dividends

     Dividends

     Under Indian law, a corporation pays dividends upon a recommendation by the
     Board of Directors and approval by a majority of the shareholders, who have
     the right to decrease but not increase the amount of the dividend
     recommended by the Board of Directors. Under the Indian Companies Act,
     dividends may be paid out of profits of a company in the year in which the
     dividend is declared or out of the undistributed profits of previous fiscal
     years. In the last three fiscal years, the company declared an aggregate of
     approximately $ 0.24 per equity share, as adjusted to reflect the company's
     two-for-one stock split in November 1999, in cash dividends (equivalent to
     approximately $ 0.12 per ADS). Although the company has no current
     intention to discontinue dividend payments, there can be no assurance that
     any future dividends will be declared or paid or that the amount thereof
     will not be decreased. Owners of ADSs will be entitled to receive dividends
     payable in respect of the equity shares represented by such ADSs. The
     equity shares represented by ADSs will rank pari passu with existing equity
     shares of the company in respect of dividends. Cash dividends in respect of
     the equity shares represented by the ADSs will be paid to the Depositary in
     rupees and except as otherwise described in the Deposit Agreement dated
     March 11, 1999 (the "Deposit Agreement") will be converted by the
     Depositary into U.S. dollars and distributed, net of Depositary fees and
     expenses, to the holders of such ADSs.

     With respect to equity shares issued by the company during a particular
     fiscal year (including the equity shares underlying the ADSs issued to the
     Depositary, dividends declared and paid for such fiscal year generally will
     be prorated from the date of issuance to the end of such fiscal year. Once
     a cash dividend is declared, equity shares entitled to prorated dividends
     are quoted on the Indian stock exchanges at the same price as equity shares
     entitled to full dividends. However, upon sale of and payment for equity
     shares entitled to a prorated dividend, the selling broker will deduct the
     difference between the full dividend and the prorated dividend from the
     sale price of such shares. Holders of ADSs will only receive dividends
     prorated from the date of issuance of the underlying equity shares to the
     end of the fiscal year for which such dividends are declared and paid.

     The following table sets forth the annual dividends paid per equity share
     for each of the years indicated.

     --------------------------------------------------------------------
     Year ended March 31, Dividend paid per equity share /1/
     --------------------------------------------------------------------
                                          Indian rupee          $
     --------------------------------------------------------------------
     2000                                         4.50       0.11
     1999                                         3.75       0.09
     1998                                         3.00       0.04
     1997                                         2.75       0.02
     1996                                         2.50       0.02
     --------------------------------------------------------------------

     1.  Dividends are retroactively adjusted to reflect the effect of the two-
         for-one stock split in November 1999.

     8.B Significant changes

     None.

Item 9.  The Offer and Listing

     9.1 General

     The company's equity shares are traded on The Stock Exchange, Mumbai
     ("BSE"), the Bangalore Stock Exchange ("BGSE") and The National Stock
     Exchange ("NSE") in India ("Indian Stock Exchanges"). The company's
     American Depositary Shares as evidenced by American Depositary Receipts
     ("ADRs") are traded in the U.S. on the NASDAQ National Market(R) under the
     ticker symbol "INFY". Each equity share of the company is represented by
     two American Depositary Shares ("ADSs"). The ADRs evidencing ADSs began
     trading on the NASDAQ from March 11, 1999 when they were issued by the
     depositary Bankers Trust Company (the "Depositary"), pursuant to the
     Deposit Agreement.

     The number of outstanding equity shares in the company, as of March 31,
     2000, were 66,150,700. As of March 31, 2000, there were approximately
     13,500 record holders of ADRs evidencing 4,163,800 ADSs (equivalent to
     2,081,900 equity shares). As of March 31, 2000, there were 43,000 record
     holders of the 66,150,700 equity shares listed and traded on the stock
     exchanges in India.

     The following table sets forth for the periods indicated the price history
     of the equity shares and the ADSs on the Indian Stock Exchanges and the
     NASDAQ respectively:
<PAGE>

Annual high-low price history for previous five years

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
                                      BSE                      NSE                   BGSE                      NASDAQ
American                         Price per equity       Price per equity       Price per equity          Price per Depositary
                                   share in $               share in $            share in $                 Shares in $
------------------------------------------------------------------------------------------------------------------------------
Fiscal Year                      High         Low       High          Low      High          Low        High            Low
------------------------------------------------------------------------------------------------------------------------------
<S>                             <C>         <C>        <C>          <C>       <C>           <C>        <C>             <C>
2000                            316.84       29.29     319.57        28.90    320.55        55.24      375.00           19.63
1999                             40.73       11.16      40.82        10.84     13.18         7.21       25.00           18.69
1998                             11.56        3.54      11.89         3.32      9.85         3.76           -               -
1997                              4.10        1.67       4.18         1.76      4.08         1.65           -               -
1996                              2.02        1.33       2.00         1.35      1.94         1.33           -               -
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

Stock price per share have been restated to reflect a two-for-one stock-split in
fiscal 1998, 1999 and 2000.

Source: The Economic Times
<PAGE>

Quarterly high-low price history for previous two years

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------
                                   BSE                        NSE                 BGSE                 NASDAQ
American                     Price per equity           Price per equity     Price per equity      Price per Depositary
                                share in $                share in $          share in $ /1/          Shares in $
----------------------------------------------------------------------------------------------------------------------------
Fiscal Year                 High         Low           High          Low     High         Low      High             Low
----------------------------------------------------------------------------------------------------------------------------
<S>                        <C>         <C>          <C>           <C>       <C>          <C>      <C>             <C>
2000

First quarter               44.04       29.29         43.39         28.90         -           -     30.63           19.63
Second quarter              91.56       41.69         91.61         41.91     86.32       55.24     73.88           28.69
Third quarter              168.75       78.70        167.35         78.85    168.19       79.49    180.00           65.50
Fourth quarter             316.84      130.74        319.57        129.88    320.55      131.89    375.00          133.00

1999

First quarter               14.75       11.16         15.30         10.84     13.18        7.21         -               -
Second quarter              15.96       12.76         16.17         12.48         -           -         -               -
Third quarter               17.46       13.03         18.28         12.58         -           -         -               -
Fourth quarter              40.73       17.35         40.82         14.35         -           -     25.00           18.69
----------------------------------------------------------------------------------------------------------------------------
</TABLE>

1. The company's shares were not traded on the BGSE between May 1998 and July
   1999.

Stock price per share have been restated to reflect a two-for-one stock-split in
February 2000.

Source: The Economic Times for Indian quotes and http://finance.yahoo.com for
                                                 ------------------------
ADS quotes

Monthly high-low price history for previous six months

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------
                              BSE                     NSE                     BGSE                      NASDAQ
American                 Price per equity       Price per equity        Price per equity        Price per Depositary
                            share in $            share in $              share in $                 Shares in $
--------------------------------------------------------------------------------------------------------------------------
Month                   High          Low       High          Low      High           Low       High             Low
--------------------------------------------------------------------------------------------------------------------------
<S>                    <C>          <C>        <C>          <C>       <C>           <C>        <C>             <C>
Oct 1999               100.65        78.86     102.44        79.01     98.68         79.64     179.50            65.50
Nov 1999               112.33        75.92     112.59        76.04    112.33         74.31     117.50            71.50
Dec 1999               168.42       103.48     167.02       103.83    167.85        104.62     180.00           102.07
Jan 2000               194.17       130.73     193.52       129.87    192.66        131.88     201.00           133.00
Feb 2000               246.85       163.13     247.76       164.03    250.06        166.90     340.50           159.25
Mar 2000               316.81       201.83     319.54       195.21    320.53        208.85     375.00           180.00
--------------------------------------------------------------------------------------------------------------------------
</TABLE>

Stock price per share have been restated to reflect a two-for-one stock-split in
February 2000

Source: The Economic Times for Indian quotes and http://finance.yahoo.com for
                                                 ------------------------
ADS quotes

  9.2  Trading practices and procedures on the Indian Stock Exchanges

  The Stock Exchange, Mumbai ("BSE") and the National Stock Exchange ("NSE")
  together account for more than 80% of the total trading volume on the Indian
  Stock Exchanges. Trading on both of these exchanges is accomplished through
  online execution. These two stock exchanges handle over 398,000 trades per
  day. Trading takes place on a five-day fixed settlement basis on most of the
  exchanges, including the BSE and NSE. Any outstanding amount at the end of the
  settlement period is settled by delivery and payment. However, institutional
  investors are not permitted to "net out" their transactions and must trade on
  a delivery basis only.

  The BSE permits carry forwards of trades in certain securities by non-
  institutional investors with an associated charge. In addition, orders can be
  entered with a specified term of validity that may last until the end of the
  session, day or settlement period. Dealers must specify whether orders are for
  a proprietary account or for a client. The BSE specifies certain margin
  requirements for trades executed on the exchange, including margins based on
  the volume or quantity of exposure that the broker has on the market, as well
  as mark-to-market margins payable on a daily basis for all outstanding trades.
  Trading on the BSE takes place from 10:00 a.m. to 3:30 p.m. on all weekdays,
  except holidays. The NSE does not permit carry forwards of trades. It has
  separate margin
<PAGE>

  requirements based on the net exposure of the broker on the exchange. The NSE
  trades from 9:30 a.m. until 4:00 p.m. on weekdays, except holidays. The NSE
  and BSE have separate online trading systems and separate clearing houses. The
  BSE was closed from January 11 through January 13, 1993 due to a riot in
  Mumbai. It was also closed on March 12, 1993 due to a bomb explosion within
  the premises of the BSE. From December 14 through December 23, 1993, the BSE
  was closed due to a broker's strike, and from March 20 through March 22, 1995,
  the Governing Board of the BSE closed the market due to a default of one of
  the broker members. There have been no closures of the Indian Stock Exchanges
  in response to "panic" trading or large fluctuations. The equity shares of the
  Company were not traded on the BGSE between May 1998 and July 1999 owing to
  the absence of quotes for trades in the BGSE.

Item 10.   Additional Information

  10.A    Share capital
  Not applicable.

  10.B    Memorandum and Articles of association
  Description of equity shares

  Set forth below is a brief summary of the material provisions of the company's
  Articles of Association ("AOA") and the Indian Companies Act, all as currently
  in effect. The company is registered under the Indian Companies Act with the
  Registrar of Companies, Karnataka, India with Company No. 13115. The following
  description of the company's Articles does not purport to be complete and is
  qualified in its entirety by the AOA and Memorandum of Association ("MOA") of
  the company that are included as exhibits to the company's quarterly report on
  Form 6-K filed with the Commission on January 21, 2000 and is incorporated
  herein by reference.

  Share capital

  The company's authorized share capital is 100,000,000 shares, par value Rs. 5
  per share. As of March 31, 2000, 66,150,700 equity shares (as adjusted to
  reflect the company's stock split effective, February 11, 2000) were issued
  and outstanding. The equity shares are the only class of share capital of the
  company. There are no convertible debentures or warrants of the company
  currently in existence. For the purposes of this Annual Report, "shareholder"
  means a shareholder who is registered as a member in the register of members
  of the company.

  Dividends

  Under the Indian Companies Act, unless the Board of Directors of the Company
  (the "board") recommends the payment of a dividend, the company has no power
  to declare a dividend. Similarly, under the AOA, although the shareholders
  may, at the annual general meeting, approve a dividend in an amount less than
  that recommended by the board, they cannot increase the amount of the
  dividend. Dividends generally are declared as a percentage of the par value of
  the company's shares. The dividend recommended by the Board, and subject to
  the limitations described above, is distributed and paid to shareholders in
  proportion to the paid up value of their shares within 42 days of the approval
  by the shareholders at the annual general meeting. Pursuant to the company's
  AOA, the board has discretion to declare and pay interim dividends without
  shareholder approval. With respect to equity shares issued by the company
  during a particular fiscal year (including the equity shares underlying the
  ADSs issued to the Depositary), cash dividends declared and paid for such
  fiscal year generally will be prorated from the date of issuance to the end of
  such fiscal year. Under the Indian Companies Act, dividends can only be paid
  in cash to the registered shareholder at a record date fixed on or prior to
  the annual general meeting or to his order or his banker's order.

  Under the Indian Companies Act, dividends may be paid out of profits of a
  company in the year in which the dividend is declared or out of the
  undistributed profits of previous fiscal years. Before declaring a dividend
  greater than 10%, a company is required under the Indian Companies Act to
  transfer to its reserves a minimum percentage of its profits for that year,
  ranging from 2.5% to 10% depending upon the dividend percentage to be declared
  in such year. The Indian Companies Act further provides that, in the event of
  an inadequacy or absence of profits in any year, a dividend may be declared
  for such year out of the company's accumulated profits, subject to the
  following conditions: (i) the rate of dividend to be declared shall not exceed
  10% of its paid up capital or the average of the rate at which dividends were
  declared by the company in the prior five years, whichever is less; (ii) the
  total amount to be drawn from the accumulated profits earned in the previous
  years and transferred to the reserves shall not exceed an amount equivalent to
  10% of its paid up capital and free reserves, and the amount so drawn is to be
  used first to set off the losses incurred in the fiscal year before any
  dividends in respect of preference or equity shares are declared; and (iii)
  the balance of reserves after withdrawals shall not fall below
<PAGE>

  15% of its paid-up capital. A dividend tax of 10% of the total dividend
  declared, distributed or paid for a relevant period is payable by the company.

  Bonus shares

  In addition to permitting dividends to be paid out of current or retained
  earnings as described above, the Indian Companies Act permits the company to
  distribute an amount transferred from the general reserve or surplus in the
  company's profit and loss account to its shareholders in the form of bonus
  shares (similar to a stock dividend). The Indian Companies Act also permits
  the issuance of bonus shares from a share premium account. Bonus shares are
  distributed to shareholders in the proportion recommended by the Board.
  Shareholders of record on a fixed record date are entitled to receive such
  bonus shares.

  Preemptive rights and issue of additional shares

  The Indian Companies Act gives shareholders the right to subscribe for new
  shares in proportion to their respective existing shareholdings unless
  otherwise determined by a special resolution passed by a general meeting of
  the shareholders. Under the Indian Companies Act, in the event of an issuance
  of securities, subject to the limitations set forth above, the company must
  first offer the new shares to the shareholders on a fixed record date. The
  offer must include: (i) the right, exercisable by the shareholders of record,
  to renounce the shares offered in favor of any other person; and (ii) the
  number of shares offered and the period of the offer, which may not be less
  than 15 days from the date of offer. If the offer is not accepted it is deemed
  to have been declined. The board is authorized under the Indian Companies Act
  to distribute any new shares not purchased by the preemptive rights holders in
  the manner that it deems most beneficial to the company.

  Annual general meetings of shareholders

  The company must convene an annual general meeting of its shareholders within
  six months after the end of each fiscal year and may convene an extraordinary
  general meeting of shareholders when necessary or at the request of a
  shareholder or shareholders holding at least 10% of the company's paid up
  capital carrying voting rights. The annual general meeting of the shareholders
  is generally convened by the company secretary pursuant to a resolution of the
  board. Written notice setting out the agenda of the meeting must be given at
  least 21 days (excluding the days of mailing and receipt) prior to the date of
  the general meeting to the shareholders of record. Shareholders who are
  registered as shareholders on the date of the general meeting are entitled to
  attend or vote at such meeting.

  The annual general meeting of shareholders must be held at the registered
  office of the company or at such other place within the city in which the
  registered office is located; meetings other than the annual general meeting
  may be held at any other place if so determined by the board. The company's
  registered office is located at Electronics City, Hosur Road, Bangalore, 561
  229, Karnataka, India.

  The AOA provide that a quorum for a general meeting is the presence of at
  least five shareholders in person.

  Voting rights

  At any general meeting, voting is by show of hands unless a poll is demanded
  by a shareholder or shareholders present in person or by proxy holding at
  least 10% of the total shares entitled to vote on the resolution or by those
  holding shares with an aggregate paid up capital of at least Rs. 50,000. Upon
  a show of hands, every shareholder entitled to vote and present in person has
  one vote and, on a poll, every shareholder entitled to vote and present in
  person or by proxy has voting rights in proportion to the paid up capital held
  by such shareholders. The chairman of the board has a deciding vote in the
  case of any tie.

  Any shareholder of the company may appoint a proxy. The instrument appointing
  a proxy must be delivered to the company at least 48 hours prior to the
  meeting. A proxy may not vote except on a poll. A corporate shareholder may
  appoint an authorized representative who can vote on behalf of the
  shareholder, both upon a show of hands and upon a poll.  Ordinary resolutions
  may be passed by simple majority of those present and voting at any general
  meeting for which the required period of notice has been given. However,
  certain resolutions such as amendments of the AOA and the MOA, commencement of
  a new line of business, the waiver of preemptive rights for the issuance of
  any new shares and a reduction of share capital, require that votes cast in
  favor of the resolution (whether by show of hands or poll) are not less than
  three times the number of votes, if any, cast against the resolution.

  Register of shareholders; record dates; transfer of shares

  The company maintains a register of shareholders of the company. For the
  purpose of determining the shares entitled to annual dividends, the register
  is closed for a specified period prior to the annual general meeting. To
<PAGE>

  determine which shareholders are entitled to certain shareholder rights, the
  company, pursuant to a board resolution, may close the register of
  shareholders. The Indian Companies Act and each of the  company's listing
  agreements with the Indian Stock Exchanges require the company to give at
  least 30 days' prior notice to the Indian Stock Exchanges and at least seven
  days' prior notice to the public. The Company may not close the register of
  shareholders for more than 30 consecutive days, and in no event more than 45
  days in a year. Trading of equity shares may, however, continue while the
  register of shareholders is closed.

  Following the introduction of the Depositories Act, 1996, and the repeal of
  Section 22A of the Securities Contracts (Regulation) Act, 1956, which enabled
  companies to refuse to register transfers of shares in certain circumstances,
  the shares of the company are freely transferable, subject only to the
  provisions of Section 111A of the Indian Companies Act. The AOA currently
  contain provisions which give the directors discretion to refuse to register a
  transfer of shares in certain circumstances. In accordance with the provisions
  of Section 111A(2) of the Indian Companies Act, the directors may exercise
  this discretion if they have sufficient cause to do so. Pursuant to Section
  111A(3), if the transfer of shares contravenes any of the provisions of the
  Securities and Exchange Board of India Act, 1992 or the regulations issued
  thereunder or the Sick Industrial Companies (Special Provisions) Act, 1985 or
  any other similar laws, the Company Law Board (the "CLB") may, on application
  made by the company, a depositary incorporated in India, an investor, the SEBI
  or certain other parties, direct the rectification of the register of records.
  The CLB may, in its discretion, issue an interim order suspending the voting
  rights attached to the relevant shares before making or completing its
  investigation into the alleged contravention. Notwithstanding such
  investigation, the rights of a shareholder to transfer the shares will not be
  restricted.

  Under the Indian Companies Act, a transfer of shares is effected by an
  instrument of transfer in the form prescribed by the Indian Companies Act and
  the rules thereunder together with delivery of the share certificates. The
  transfer agent of the company is Karvy Consultants Limited, Bangalore,
  Karnataka, India.

  The company has entered into listing agreements with each of the Indian Stock
  Exchanges. Clause 40A of each of the listing agreements provides that if an
  acquisition of a listed company's shares results in the acquiror and its
  associates holding 5% or more of the company's outstanding equity shares or
  voting rights, the acquiror must report its holding to the company and the
  relevant stock exchange(s). If an acquisition results in the acquiror and its
  associates holding equity shares that have 15% or more of the voting rights,
  then the acquiror must, before acquiring such equity shares, make an offer (in
  accordance with Clause 40B of the listing agreements) on a uniform basis to
  all remaining shareholders of the company to acquire equity shares that have
  at least an additional 20% of the voting rights of the total equity shares of
  the company at a prescribed price. The acquisition of shares of a company
  listed on an Indian stock exchange beyond certain threshold amounts is subject
  to regulations governing takeovers of Indian companies. Although clauses 40A
  and 40B and such regulations will not apply to the equity shares so long as
  they are represented by ADSs, holders of ADSs may be required to comply with
  such notification and disclosure obligations pursuant to the provisions of the
  Deposit Agreement to be entered into by such holders, the company and a
  depositary.

  Disclosure of ownership interest

  Section 187C of the Indian Companies Act requires beneficial owners of shares
  of Indian companies who are not holders of record to declare to the company
  details of the holder of record and the holder of record to declare details of
  the beneficial owner. Any person who fails to make the required declaration
  within 30 days may be liable for a fine of up to Rs. 1,000 for each day the
  declaration is not made. Any lien, promissory note or other collateral
  agreement created, executed or entered into with respect to any share by the
  registered owner thereof, or any hypothecation by the registered owner of any
  share, pursuant to which a declaration is required to be made under Section
  187C, shall not be enforceable by the beneficial owner or any person claiming
  through the beneficial owner if such declaration is not made. Failure to
  comply with Section 187C will not affect the obligation of the company to
  register a transfer of shares or to pay any dividends to the registered holder
  of any shares pursuant to which such declaration has not been made. While it
  is unclear under Indian law whether Section 187C applies to holders of ADSs of
  the company, investors who exchange ADSs for the underlying equity shares of
  the company will be subject to the restrictions of Section 187C. Additionally,
  holders of ADSs may be required to comply with such notification and
  disclosure obligations pursuant to the provisions of the Deposit Agreement to
  be entered into by such holders, the company and a depositary.

  Audit and annual report

  At least 21 days before the annual general meeting of shareholders, the
  company must distribute a detailed version of the company's audited balance
  sheet and profit and loss account and the reports of the board and the
  auditors thereon. Under the Indian Companies Act, the company must file the
  balance sheet and annual profit and
<PAGE>

  loss account presented to the shareholders within 30 days of the conclusion of
  the annual general meeting with the Registrar of Companies. The company must
  also file an annual return containing a list of the company's shareholders and
  other company information, within 60 days of the conclusion of the meeting.

  Company acquisition of equity shares

  Under the Indian Companies Act, the company may not acquire its own equity
  shares because of the resulting reduction in the company's capital. Such a
  reduction in capital is permitted only in certain circumstances and requires
  compliance with specific buy-back regulations, a special resolution passed by
  the shareholders and approval by the high court of the state in which the
  registered office of the company is situated. The Government of India has
  recently published guidelines that would permit a company to form a separate
  trust specifically for the purpose of buying odd lots of shares and disposing
  of such shares through a stock exchange.

  Liquidation rights

  Subject to the rights of creditors, employees and the holders of any shares
  entitled by their terms to preferential repayment over the equity shares, if
  any, in the event of the winding-up of the company, the holders of the equity
  shares are entitled to be repaid the amounts of paid up capital or credited as
  paid up on such equity shares. All surplus assets after payments due to the
  holders of any preference shares at the commencement of the winding-up shall
  be paid to holders of equity shares in proportion to their shareholdings.

  Voting rights of deposited equity shares represented by ADSs

  Under Indian law, voting of the equity shares is by show of hands unless a
  poll is demanded by a member or members present in person or by proxy holding
  at least one-tenth of the total shares entitled to vote on the resolution or
  by those holding an aggregate paid up capital of at least Rs. 50,000. A proxy
  may not vote except on a poll.

  As soon as practicable after receipt of notice pursuant to the Deposit
  Agreement of any meeting of holders of equity shares or other deposited
  securities, the Depositary shall fix a record date for determining the holders
  entitled to give instructions for the exercise of voting rights, if any, as
  provided in the Deposit Agreement and shall mail to the holders a record
  notice which shall contain: (i) such information as is contained in such
  notice of meeting; (ii) a statement that the holders of record at the close of
  business on a specified record date will be entitled, subject to any
  applicable provisions of Indian law and of the MOA and AOA of the company
  governing the deposited securities represented by their respective ADSs
  evidenced by their respective ADRs; (iii) a brief statement as to the manner
  in which such instructions may be given including (a) an express indication
  that the Depositary should demand a poll or instruct the chairman of the
  meeting (the "Chairman") or a person designated by the Chairman to demand a
  poll in the event that a poll is not otherwise demanded pursuant to Indian law
  and (b) an express indication that instructions may be given to the Depositary
  to give a discretionary proxy to a person designated by the company; and (iv)
  a statement that if the Depositary does not receive instructions from a
  holder, such holder may under certain circumstances be deemed to have
  instructed the Depositary to give a discretionary proxy to a person designated
  by the company to vote such deposited securities. Upon the written request of
  a holder on such record date, received on or before the date established by
  the Depositary for such purpose, the Depositary shall endeavor, insofar as is
  practicable and permitted under the applicable provisions of Indian law and of
  the MOA and AOA of the company governing the deposited securities, to vote or
  cause to be voted the amount of deposited securities represented by such ADSs
  evidenced by such ADRs in accordance with the instructions set forth in such
  request. In the event that the Depositary receives express instructions from
  holders to demand a poll with respect to any matter to be voted on by holders,
  the Depositary may notify the Chairman or a person designated by the Chairman
  of such instructions and request the Chairman or such designee to demand a
  poll with respect to such matters and the company agrees that the Chairman or
  such designee will make their reasonable best efforts to so demand a poll at
  the meeting at which such matters are to be voted on and to vote such equity
  shares in accordance with such holders' instructions; provided, however, that
  prior to any demand of a poll or request to demand a poll by the Depositary
  upon the terms set forth herein, the company is required, at its own expense,
  to use its best efforts to obtain and deliver to the Depositary an opinion of
  Indian counsel, reasonably satisfactory to the Depositary, stating that such
  action is in conformity with all applicable laws and regulations and that such
  demand for a poll by the Depositary or a person designated by the Depositary
  will not expose the Depositary to any liability to any person. The Depositary
  shall not have any obligation to demand a poll or request the demand of a poll
  if the company shall not have delivered to the Depositary the local counsel
  opinion set forth in this paragraph.

  The Depositary agrees not to, and shall ensure that the custodian and each of
  their nominees does not vote, attempt to exercise the right to vote, or in any
  way make use of, for purposes of establishing a quorum or
<PAGE>

  otherwise, the equity shares or other deposited securities represented by the
  ADSs evidenced by an ADR other than in accordance with such instructions from
  the holder or as provided below. The Depositary may not itself exercise any
  voting discretion over any equity shares. If the Depositary does not receive
  instructions from any holder with respect to any of the deposited securities
  represented by the ADSs evidenced by such holder's ADRs on or before the date
  established by the Depositary for such purpose, such holder shall be deemed,
  and the Depositary shall deem such holder, to have instructed the Depositary
  to give a discretionary proxy to a person designated by the company to vote
  such deposited securities; provided that: (i) no such discretionary proxy
  shall be given with respect to any matter as to which the company informs the
  Depositary (and the company agrees to provide such information as promptly as
  practicable in writing) that (a) the company does not wish such proxy given,
  (b) substantial opposition exists or (c) the rights of the holders of equity
  shares will be adversely affected; and (ii) the Depositary shall not have any
  obligation to give such discretionary proxy to a person designated by the
  company if the company shall not have delivered to the Depositary the local
  counsel opinion and representation letter set forth in the next paragraph.

  Prior to each request for the delivery of a discretionary proxy upon the terms
  set forth herein, the company shall, at its own expense, deliver to the
  Depositary: (i) an opinion of Indian counsel, reasonably satisfactory to the
  Depositary, stating that such action is in conformity with all applicable laws
  and regulations; and (ii) a representation letter from the company (executed
  by a senior officer of the company) which (a) designates the person to whom
  any discretionary proxy should be given, (b) confirms that the company wishes
  such discretionary proxy to be given and (c) certifies that the company has
  not and shall not request the discretionary proxy to be given as to any matter
  as to which substantial opposition exists or which may adversely affect the
  rights of holders of equity shares.

  10.C    Material contracts
  None.

  10.D    Exchange controls

  Foreign investment in the Indian securities is generally regulated by the
  Foreign Exchange Regulation Act, 1973 ("FERA"). Under Section 29(1)(b) of
  FERA, no person or company resident outside India that is not incorporated in
  India (other than a banking company) can purchase the shares of any company
  carrying on any trading, commercial or industrial activity in India without
  the permission of the RBI. Also, under Section 19(1)(d) of FERA, the transfer
  and issuance of any security of any Indian company to a person resident
  outside India requires the permission of the RBI. Under Section 19(5) of FERA,
  no transfer of shares in a company registered in India by a non-resident to a
  resident of India is valid unless the transfer is confirmed by the RBI upon
  application filed by the transferor or the transferee. Under guidelines issued
  by the RBI, the RBI will approve such transfers if such transfer is transacted
  on an Indian Stock Exchange through a registered stock broker. Furthermore,
  the issuance of rights and other distributions of securities to a non-resident
  also require the prior consent of the RBI.

  10.D.1  General

  Shares of Indian companies represented by ADSs may be approved for issuance to
  foreign investors by the Government of India under the Issue of Foreign
  Currency Convertible Bonds and Equity Shares (through Depositary Receipt
  Mechanism) Scheme, 1993 (the "1993 Regulation"), as modified from time to
  time, promulgated by the Government of India. The 1993 Regulation is distinct
  from other policies or facilities, as described below, relating to investments
  in Indian companies by foreign investors. The issuance of ADSs pursuant to the
  1993 Regulation also affords to holders of the ADSs the benefits of Section
  115AC of the Indian Income Tax Act, 1961 for purposes of the application of
  Indian tax law.

  10.D.2  Foreign direct investment

  In July 1991, the Government of India raised the limit on foreign equity
  holdings in Indian companies from 40% to 51% in certain high priority
  industries. The RBI gives automatic approval for such foreign equity holdings.
  The Foreign Investment Promotion Board (the "FIPB"), currently under the
  Ministry of Industry, was thereafter formed to negotiate with large foreign
  companies wishing to make long-term investments in India. Foreign equity
  participation in excess of 51% in such high priority industries or in any
  other industries up to Rs. six billion is currently allowed only with the
  approval of the FIPB. Proposals in excess of Rs. six billion require the
  approval of the Cabinet Committee on Foreign Investment. Proposals involving
  the public sector and other sensitive areas require the approval of Cabinet
  Committee on Economic Affairs. These facilities are designed for direct
  foreign investments by non-residents of India who are not NRIs, OCBs or FIIs
  (as each term is defined below) ("Foreign Direct Investors"). The Department
  of Industrial Policy and Promotion, a part of the Ministry of Industry, issued
<PAGE>

  detailed guidelines in January 1997 for consideration of foreign direct
  investment proposals by the FIPB (the "Guidelines"). Under the Guidelines,
  sector specific guidelines for foreign direct investment and the levels of
  permitted equity participation have been established. In January 1998, the RBI
  issued a notification that foreign ownership of up to 50%, 51% or 74%,
  depending on the category of industry, would be allowed without prior
  permission of the RBI. The issues to be considered by the FIPB, and the FIPB's
  areas of priority in granting approvals are also set out in the Guidelines.
  The basic objective of the Guidelines is to improve the transparency and
  objectivity of the FIPB's consideration of proposals. However, because the
  Guidelines are administrative guidelines and have not been codified as either
  law or regulations, they are not legally binding with respect to any
  recommendation made by the FIPB or with respect to any decision taken by the
  Government of India in cases involving foreign direct investment.

  In May 1994, the Government of India announced that purchases by foreign
  investors of ADSs as evidenced by ADRs and foreign currency convertible bonds
  of Indian companies will be treated as direct foreign investment in the equity
  issued by Indian companies for such offerings. Therefore, offerings that
  involve the issuance of equity that results in Foreign Direct Investors
  holding more than the stipulated percentage of direct foreign investments
  (which depends on the category of industry) would require approval from the
  FIPB. In addition, in connection with offerings of any such securities to
  foreign investors, approval of the FIPB is required for Indian companies
  whether or not the stipulated percentage limit would be reached, if the
  proceeds therefrom are to be used for investment in non-high priority
  industries. With respect to the activities of the company, FIPB approval is
  required for any direct foreign investment in the company which exceeds 51% of
  the total issued share capital of the company.

  In July 1997, the Government of India issued guidelines to the effect that
  foreign investment in preferred shares will be considered as part of the share
  capital of a company and will be processed through the automatic RBI route or
  will require the approval of the FIPB, as the case may be. Investments in
  preferred shares are included as foreign direct investment for the purposes of
  sectoral caps on foreign equity, if such preferred shares carry a conversion
  option. If the preferred shares are structured without a conversion option,
  they would fall outside the foreign direct investment limit but would be
  treated as debt and would be subject to special Government of India guidelines
  and approvals.

  10.D.3  Investment by NRIs and OCBs

  A variety of special facilities for making investments in India in shares of
  Indian companies is available to individuals of Indian nationality or origin
  residing outside India and to OCBs , at least 60% owned by such persons. These
  facilities permit NRIs and OCBs to make portfolio investments in shares and
  other securities of Indian companies on a basis not generally available to
  other foreign investors. These facilities are different and distinct from
  investments by Foreign Direct Investors described above.

  10.D.4  Investment by Foreign Institutional Investors

  In September 1992, the Government of India issued guidelines which enable
  FIIs, including institutions such as pension funds, investment trusts, asset
  management companies, nominee companies and incorporated/institutional
  portfolio managers, to invest in all the securities traded on the primary and
  secondary markets in India. Under the guidelines, FIIs are required to obtain
  an initial registration from the SEBI and a general permission from the RBI to
  engage in transactions regulated under FERA. FIIs must also comply with the
  provisions of the SEBI Foreign Institutional Investors Regulations, 1995. When
  it receives the initial registration, the FII also obtains general permission
  from the RBI to engage in transactions regulated under FERA. Together, the
  initial registration and the RBI's general permission enable the registered
  FII to buy (subject to the ownership restrictions discussed below) and sell
  freely securities issued by Indian companies, to realize capital gains on
  investments made through the initial amount invested in India, to subscribe or
  renounce rights offerings for shares, to appoint a domestic custodian for
  custody of investments held and to repatriate the capital, capital gains,
  dividends, income received by way of interest and any compensation received
  towards sale or renunciation of rights offerings of shares.

  10.D.5  Ownership restrictions

  SEBI and RBI regulations restrict investments in Indian companies by Foreign
  Direct Investors. Under current SEBI regulations applicable to the company,
  subject to the requisite approvals of the shareholders in a general meeting,
  Foreign Direct Investors in aggregate may hold no more than 40% of the
  company's equity shares, excluding the equity shares underlying the ADSs, and
  NRIs and OCBs in aggregate may hold no more than 10% of the company's equity
  shares, excluding the equity shares underlying the ADSs. Furthermore, SEBI
  regulations
<PAGE>

  provide that no single FII may hold more than 10% of the company's total
  equity shares and no single NRI or OCB may hold more than 5% of the company's
  total equity shares.

  FIIs may only purchase securities of public Indian companies (other than the
  ADSs) through a procedure known as a "preferential allotment of shares", which
  is subject to certain restrictions. These restrictions will not apply to
  equity shares issued as stock dividends or in connection with rights offerings
  applicable to the equity shares underlying the ADSs.

  There is uncertainty under Indian law about the tax regime applicable to FIIs
  which hold and trade ADSs. FIIs are urged to consult with their Indian legal
  and tax advisers about the relationship between the FII guidelines and the
  ADSs and any equity shares withdrawn upon surrender of ADSs.

  More detailed provisions relating to FII investment have been introduced by
  the SEBI with the introduction of the SEBI Foreign Institutional Investors
  Regulations, 1995. These provisions relate to the registration of FIIs, their
  general obligations and responsibilities, and certain investment conditions
  and restrictions. One such restriction is that the total investment in equity
  and equity-related instruments should not be less than 70% of the aggregate of
  all investments of an FII in India. The SEBI has also permitted private
  placements of shares by listed companies with FIIs, subject to the prior
  approval of the RBI under FERA. Such private placement must be made at the
  average of the weekly highs and lows of the closing price over the preceding
  six months or the preceding two weeks, whichever is higher.

  Under the Securities and Exchange Board of India (Substantial Acquisition of
  shares and Takeovers) Regulations, 1997 approved by the SEBI in January 1997
  and promulgated by the Government of India in February 1997 (the "Takeover
  Code"), which replaced the 1994 Takeover Code (as defined herein), upon the
  acquisition of more than 5% of the outstanding shares of a public Indian
  company, a purchaser is required to notify the company and all the stock
  exchanges on which the shares of the company are listed. Upon the acquisition
  of 15% or more of such shares or a change in control of the company, the
  purchaser is required to make an open offer to the other shareholders offering
  to purchase at least 20% of all the outstanding shares of the company at a
  minimum offer price as determined pursuant to the rules of the Takeover Code.
  Upon conversion of ADSs into equity shares, an ADS holder will be subject to
  the Takeover Code.

  Open market purchases of securities of Indian companies in India by Foreign
  Direct Investors or investments by NRIs, OCBs and FIIs above the ownership
  levels set forth above require Government of India approval on a case-by-case
  basis.

  10.E     Taxation

  10.E.1   Indian taxation

  10.E.1.1 General

  The following summary is based on the provisions of the Income Tax Act, 1961
  (the "Indian Tax Act"), including the special tax regime contained in Section
  115AC (the "Section 115AC Regime") and the 1993 Regulation. The Indian Tax Act
  is amended every year by the Finance Act of the relevant year. Some or all of
  the tax consequences of the Section 115 AC Regime may be amended or changed by
  future amendments of the Indian Tax Act.

  THE SUMMARY SET FORTH BELOW IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS
  OF THE INDIVIDUAL TAX CONSEQUENCES TO NON-RESIDENT HOLDERS UNDER INDIAN LAW
  FOR THE ACQUISITION, OWNERSHIP AND SALE OF ADSS AND EQUITY SHARES BY NON-
  RESIDENT HOLDERS. PERSONAL TAX CONSEQUENCES OF AN INVESTMENT MAY VARY FOR
  INVESTORS IN VARIOUS CIRCUMSTANCES AND POTENTIAL INVESTORS SHOULD THEREFORE
  CONSULT THEIR OWN TAX ADVISERS ON THE TAX CONSEQUENCES OF SUCH ACQUISITION,
  OWNERSHIP AND SALE, INCLUDING SPECIFICALLY THE TAX CONSEQUENCES UNDER THE LAW
  OF THE JURISDICTION OF THEIR RESIDENCE AND ANY TAX TREATY BETWEEN INDIA AND
  THEIR COUNTRY OF RESIDENCE.

  10.E.1.2  Residence

  For purposes of the Indian Tax Act, an individual is considered to be a
  resident of India during any financial year if he: (i) is in India in that
  year for a period or periods amounting to 182 days or more; or (ii) is in
  India in that year for 60 days or more and, in case of a citizen of India or a
  person of Indian origin, who, being outside India, comes on a visit to India,
  is in India for more than 182 days effective April 1, 1995 and in each case
  within the four preceding years has been in India for a period or periods
  amounting to 365 days or more. A company is
<PAGE>

  resident in India if it is registered in India or the control and the
  management of its affairs is situated wholly in India.

  10.E.1.3  Taxation of distributions

  Pursuant to the Finance Act, 1997, withholding tax on dividends paid to
  shareholders no longer applies. Distributions to Non-resident Holders of
  additional ADSs or equity shares or rights to subscribe for equity shares
  ("Rights") made with respect to ADSs or equity shares are not subject to
  Indian tax.

  10.E.1.4  Taxation of capital gains

  Any gain realized on the sale of ADSs or equity shares by a non-resident
  holder to another Non-resident holder outside India is not subject to Indian
  capital gains tax. However, as Rights are not expressly covered by the Indian
  Income Tax Act, 1961, it is unclear, as to whether capital gain derived from
  the sale of Rights by a non-resident holder (not entitled to an exemption
  under a tax treaty) to another non-resident holder outside India will be
  subject to Indian capital gains tax. If such Rights are deemed by the Indian
  tax authorities to be situated within India, the gains realized on the sale of
  such Rights will be subject to customary Indian taxation as discussed below.

  Since the issuance of the ADSs has been approved by the Government of India
  under the Section 115AC Regime, non-resident holders of the ADSs will have the
  benefit of tax concessions available under the Section 115AC Regime. However,
  the 1993 Regulation provides that if the equity shares are sold on an Indian
  Stock Exchange against payment in Indian rupees, they will no longer be
  eligible for such concessional tax treatment. The Section 115AC Regime is
  unclear, as to whether such tax treatment is available to a non-resident who
  acquires equity shares outside India from a non-resident holder of equity
  shares after receipt of the equity shares upon surrender of the ADSs. If
  concessional tax treatment is not available, gains realized on the sale of
  such equity shares will be subject to customary Indian taxation as discussed
  below.

  Subject to any relief provided pursuant to an applicable tax treaty, any gain
  realized on the sale of equity shares to an Indian resident or inside India
  generally will be subject to Indian capital gains tax which is to be deducted
  at the source by the buyer. For the purpose of computing capital gains tax,
  the cost of acquisition of equity shares received in exchange for ADSs will be
  determined on the basis of the prevailing price of the shares on any of the
  Indian Stock Exchanges on the date that the Depositary gives notice to the
  custodian of the delivery of the equity shares in exchange for the
  corresponding ADSs. A non-resident holder's holding period (for purposes of
  determining the applicable Indian capital gains tax rate) in respect of equity
  shares received in exchange for ADSs commences on the date of the notice of
  the redemption by the Depositary to the custodian. The Indo-U.S. Treaty does
  not provide an exemption from the imposition of Indian capital gains tax.

  Taxable gain realized on equity shares (calculated in the manner set forth in
  the prior paragraph) for more than 12 months (long-term gain) is subject to
  tax at the rate of 10%. Taxable gain realized on equity shares held for 12
  months or less (short-term gain) is subject to tax at variable rates with a
  maximum rate of 48%. The actual rate of tax on short-term gain depends on a
  number of factors, including the legal status of the non-resident holder and
  the type of income chargeable in India.

  10.E.1.5  Stamp duty and transfer tax

  Upon issuance of the equity shares, the company is required to pay a stamp
  duty of 0.1% per share of the issue price of the underlying equity shares. A
  transfer of ADSs is not subject to the Indian stamp duty. However, upon the
  acquisition of equity shares from the Depositary in exchange for ADSs, the
  holder will be liable for Indian stamp duty at the rate of 0.5% of the market
  value of the ADSs or equity shares exchanged. A sale of equity shares by a
  registered holder will also be subject to Indian stamp duty at the rate of
  0.5% of the market value of the equity shares on the trade date, although
  customarily such tax is borne by the transferee.

  10.E.1.6  Gift and Wealth tax

  ADSs held by non-resident holders and the underlying equity shares held by the
  Depositary as a fiduciary and the transfer of ADSs between non-resident
  holders and the Depositary will be exempt from Indian gift tax and Indian
  wealth tax. Although Indian gift tax was abolished effective October 1, 1998,
  a gift tax may apply to transfers by way of gift of equity shares or ADSs in
  the future. Investors are advised to consult their own tax advisers in this
  context.

  10.E.1.7  Estate duty

  Under current Indian law, there is no estate duty applicable to a non-resident
  holder of ADSs or equity shares.
<PAGE>

  10.E.2  United States federal taxation

  The following is a summary of the material U.S. federal income and estate tax
  matters that may be relevant with respect to the acquisition, ownership and
  disposition of equity shares or ADSs. This summary addresses only the U.S.
  federal income and estate tax considerations of holders that are citizens or
  residents of the United States, partnerships or corporations created in or
  under the laws of the United States or any political subdivision thereof or
  therein, estates, the income of which is subject to U.S. federal income
  taxation regardless of its source and trusts ("U.S. Holders") or are not U.S.
  Holders ("Non-U.S. Holders") and that will hold equity shares or ADSs as
  capital assets. This summary does not address tax considerations applicable to
  holders that may be subject to special tax rules, such as banks, insurance
  companies, dealers in securities or currencies, tax-exempt entities, persons
  that will hold equity shares or ADSs as a position in a "straddle" or as part
  of a "hedging" or "conversion" transaction for tax purposes, persons that have
  a "functional currency" other than the U.S. dollar or holders of 10% or more
  (by voting power or value) of the stock of the company. This summary is based
  on the tax laws of the United States as in effect and on United States
  Treasury Regulations in effect (or, in certain cases, proposed), as well as
  judicial and administrative interpretations thereof available on or before
  such date and is based in part on representations of the Depositary and the
  assumption that each obligation in the Depositary Agreement and any related
  agreement will be performed in accordance with its terms. All of the foregoing
  are subject to change, which change could apply retroactively and could affect
  the tax consequences described below.

  EACH INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE U.S.
  FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF ACQUIRING, OWNING AND
  DISPOSING OF EQUITY SHARES OR ADSs.

  10.E.2.1  Ownership of ADSs

  For U.S. federal income tax purposes, holders of ADSs will be treated as the
  owners of equity shares represented by such ADSs.

  10.E.2.2  Dividends

  Distributions of cash or property (other than equity shares, if any,
  distributed pro rata to all shareholders of the company, including holders of
  ADSs) with respect to equity shares will be includible in income by a U.S.
  Holder as foreign source dividend income at the time of receipt, which in the
  case of a U.S. Holder of ADSs generally will be the date of receipt by the
  Depositary, to the extent such distributions are made from the current or
  accumulated earnings and profits of the company. Such dividends will not be
  eligible for the dividends received deduction generally allowed to corporate
  U.S. Holders. To the extent, if any, that the amount of any distribution by
  the company exceeds the company's current and accumulated earnings and profits
  as determined under U.S. federal income tax principles, it will be treated
  first as a tax-free return of the U.S. Holder's tax basis in the equity shares
  or ADSs and thereafter as capital gain.

  A U.S. Holder will not be eligible for a foreign tax credit against its U.S.
  federal income tax liability for Indian taxes paid by the company and deemed
  under Indian law to have been paid by the shareholders of the company, unless
  it is a U.S. company holding at least 10% of the Indian company paying the
  dividends.

  U.S. Holders should be aware that dividends paid by the company generally will
  constitute "passive income" for purposes of the foreign tax credit. The
  Internal Revenue Code applies various limitations on the amount of foreign tax
  credit that may be available to a U.S. taxpayer. U.S. Holders should consult
  their own tax advisors with respect to the potential consequences of those
  limitations.

  A Non-U.S. Holder of equity shares or ADSs generally will not be subject to
  U.S. federal income tax or withholding tax on dividends received on equity
  shares or ADSs unless such income is effectively connected with the conduct by
  such Non-U.S. Holder of a trade or business in the United States

  10.E.2.3  Sale or exchange of equity shares or ADSs

  A U.S. Holder generally will recognize gain or loss on the sale or exchange of
  equity shares or ADSs equal to the difference between the amount realized on
  such sale or exchange and the U.S. Holder's tax basis in the equity shares or
  ADSs, as the case may be. Such gain or loss will be capital gain or loss, and
  will be long-term capital gain or loss if the equity shares or ADSs, as the
  case may be, were held for more than one year. Gain, if any, recognized by a
  U.S. Holder generally will be treated as U.S. source passive income for U.S.
  foreign tax credit purposes.

  A Non-U.S. Holder of equity shares or ADSs generally will not be subject to
  U.S. federal income or withholding tax on any gain realized on the sale or
  exchange of such equity shares or ADSs unless: (i) such gain is effectively
  connected with the conduct by such Non-U.S. Holder of a trade or business in
  the U.S.; or (ii) in the case of any
<PAGE>

  gain realized by an individual Non-U.S. Holder, such holder is present in the
  United States for 183 days or more in the taxable year of such sale and
  certain other conditions are met.

  If dividends are paid in Indian rupees, the amount of the dividend
  distribution includible in the income of a U.S. Holder will be in the U.S.
  dollar value of the payments made in Indian rupees, determined at a spot
  exchange rate between Indian rupees and U.S. dollars applicable to the date
  such dividend is includible in the income of the U.S. Holder, regardless of
  whether the payment is in fact converted into U.S. dollars. Generally, gain or
  loss (if any) resulting from currency exchange fluctuations during the period
  from the date the dividend is paid to the date such payment is converted into
  U.S. dollars will be treated as ordinary income or loss.

  10.E.2.4  Estate taxes

  An individual shareholder who is a citizen or resident of the United States
  for U.S. federal estate tax purposes will have the value of the equity shares
  or ADSs owned by such holder included in his or her gross estate for U.S.
  federal estate tax purposes. An individual holder who actually pays Indian
  estate tax with respect to the equity shares will, however, be entitled to
  credit the amount of such tax against his or her U.S. federal estate tax
  liability, subject to certain conditions and limitations.

  10.E.2.5  Backup withholding tax and information reporting requirements

  Under current U.S. Treasury Regulations, dividends paid on equity shares, if
  any, generally will not be subject to information reporting and generally will
  not be subject to U.S. backup withholding tax. Information reporting will
  apply to payments of dividends on, and to proceeds from the sale or redemption
  of, equity shares or ADSs by a paying agent (including a broker) within the
  United States to a U.S. Holder (other than an "exempt recipient", including a
  corporation, a payee that is a Non-U.S. Holder that provides an appropriate
  certification and certain other persons). In addition, a paying agent within
  the United States will be required to withhold 31% of any payments of the
  proceeds from the sale or redemption of equity shares or ADSs within the
  United States to a holder (other than an "exempt recipient") if such holder
  fails to furnish its correct taxpayer identification number or otherwise fails
  to comply with such backup withholding requirements.

  10.E.2.6  Passive foreign investment company

  A non-U.S. corporation will be classified as a passive foreign investment
  company (a "PFIC") for U.S. Federal income tax purposes if it satisfies either
  of the following two tests: (i) 75% or more of its gross income for the
  taxable year is passive income; or (ii) on average for the taxable year (by
  value or, if the company so elects, by adjusted basis) 50% or more of its
  assets produce or are held for the production of passive income.

  The company does not believe that it satisfies either of the tests for PFIC
  status. If the company were to be a PFIC for any taxable year, U.S. Holders
  would be required to either: (i) pay an interest charge together with tax
  calculated at maximum ordinary income rates on certain "excess distributions"
  (defined to include gain on a sale or other disposition of equity shares); or
  (ii) if a Qualified Electing Fund election is made, to include in their
  taxable income their pro rata share of certain undistributed amounts of the
  company's income.

  10.G    Statement by experts

  The U.S. GAAP financial statements of Infosys Technologies Limited as of March
  31, 2000 and 1999, and for each of the years in the three-year period ended
  March 31, 2000, have been included herein in reliance upon the report of KPMG,
  India, independent accountants, appearing elsewhere herein, and upon the
  authority of said firm as experts in auditing and accounting.

  10.H    Documents on display
  This report and other information filed or to be filed by the company can be
  inspected and copied at the public reference facilities maintained by the SEC
  at:

  .  Judiciary Plaza
     450 Fifth Street, N.W.
     Room 1024
     Washington, D.C. 20529

  .  Seven World Trade Center
     13/th/ Floor,
     New York, New York 10048; and

  .  Northwestern Atrium Center
     500 West Madison Street
<PAGE>

     Suite 1400
     Chicago, Illinois 60661-2511

  Copies of these materials can also be obtained from the Public Reference
  Section of the SEC, 450/th/ Street, N.W., Washington, DC 20549, at prescribed
  rates.

  The SEC maintains a website at http://www.sec.gov that contains reports, proxy
                                 ------------------
  and information statements, and other information regarding registrants that
  make electronic filings with the SEC using its EDGAR system. As a foreign
  private issuer, we are not required to use the EDGAR system, but currently
  intend to do so in order to make our reports available over the Internet.

  Additionally, documents referred to in this Form 20-F may be inspected at the
  corporate offices of the company which are located at Electronics City, Hosur
  Road, Bangalore -561229.

  10.I    Subsidiary information
  Not applicable.

Item 11.    Quantitative and Qualitative Disclosure About Market Risk

  This information is set forth under the caption "Management's Discussion and
  Analysis of Financial Condition and Results of Operations" on pages 97 through
  110 of the Infosys Annual Report for fiscal 2000 and is incorporated herein by
  reference.

Item 12.    Description of Securities Other than Equity Securities
  Not applicable.


                                    Part II
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Item 13.    Defaults, Dividend Arrearages and Delinquencies
  None.

Item 14.    Material Modifications to the Rights of Security Holders and Use of
            Proceeds
  None.

Item 17
  Not Applicable.


                                   Part III
-------------------------------------------------------------------------------

Item 18.    Financial Statements

  The following financial statements of the company included in Item 18 of this
  Report on Form 20-F are hereby incorporated by reference from the Infosys
  Annual Report for fiscal 2000, filed as Exhibit 13.1 to this Report on Form
  20-F.

  .   Independent auditors' report.

  .   Balance Sheets as of March 31, 2000 and 1999.

  .   Statements of Income for the years ended March 31, 2000, 1999 and 1998.

  .   Statements of Shareholders' Equity for the years ended March 31, 2000,
      1999 and 1998.

  .   Statements of Cash Flows for the years ended March 31, 2000, 1999 and
      1998.

  .   Notes to financial statements.

Item 19.    Exhibits
      ------------------------------------------------------------------------
      Exhibit number  Description of document
      ------------------------------------------------------------------------
            **3.1     Articles of Association of the Registrant, as amended
<PAGE>

            **3.2     Memorandum of Association of the Registrant, as amended

             *3.3     Certificate of Incorporation of the Registrant, as
                      currently in effect

             *4.1     Form of Deposit Agreement among the Registrant, Bankers
                      Trust Receipts issued thereunder (including as an exhibit,
                      the form of American Depositary Receipt)

             *4.2     Registrant's Specimen Certificate for Equity Shares

            *10.1     Registrant's 1998 Stock Option Plan

            *10.2     Registrant's Employee Stock Offer Plan

            *10.3     Employees Welfare Trust Deed of Registrant Pursuant to
                      Employee Stock Offer Plan

            *10.4     Form of Indemnification Agreement

          ***10.5     Registrant's 1999 Stock Option Plan

             13.1     Infosys Annual Report for fiscal 2000

             23.1     Consent of KPMG, India

             27.1     Financial Data Schedule

             99.1     Proxy Information Statement to holders of American
                      Depositary Shares

             99.2     Proxy Information Statement to holders of Equity Shares

             99.3     Proxy Form to holders of Equity Shares

             99.4     Proxy Form to holders of American Depositary Shares
--------------------------------------------------------------------------------

*    Incorporated by reference to exhibits filed with the Registrant's
     Registration Statement on Form F-1 (File No. 333-72195) in the form
     declared effective on March 10, 1999.

**   Incorporated by reference to exhibits filed with the Registrant's Quarterly
     Report on Form 6-K filed on January 21, 2000

***  Incorporated by reference to exhibits filed with the Registrant's Quarterly
     Report on Form 6-K filed on August 4, 1999
<PAGE>

                                   Signatures

  The registrant hereby certifies that it meets all of the requirements for
  filing on Form 20-F and that it has duly caused and authorized the undersigned
  to sign this annual report on its behalf.

                                                for Infosys Technologies Limited

                           /s/ Nandan M. Nilekani      /s/ N. R. Narayana Murthy
                               Nandan M. Nilekani          N. R. Narayana Murthy
Bangalore            Managing Director, President                       Chairman
April 28, 2000        and Chief Operating Officer    and Chief Executive Officer