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Outsourcing

02 Mar

Since most posts in my blog comprises of book reviews and personal musings , i have decided to include some current and relevant topics . So first in series is this one .

I was among those who were much elated when Barrack  Obama  became first black president of United States . But the views which he came up with regarding 60 billion $ Indian IT and ITES industry are pretty disconcerting . Proposed tax cuts in this regard can be blow to our IT sector . What he currently seem to think is that withdrawing order would solve the problem of unemployment over there which is somewhat understood to a certain extent but has much greater adverse impact in disguise .

50% of our GDP is contributed by service sector .  With cheap and english speaking workers Indian IT has pushed our economy on fast road to progress . Some people may call outsourced work as coolies job ,  but ground reality is that America does not has enough infrastructure to compete with India in terms of low cost IT products . In manufacturing sector China and Japan with their low cost product have already seized the market . Even in computer hardware Intel ceded low cost advantage in chip making to companies in China and South Korea . Now Indian giants like TCS , Wipro and Infosys are competing with US biggies like IBM and HP . In short it would be difficult for US to do without outsourcing in global market .

Now India has not only provided services to US  , but it is also major market for those low cost IT product  . Therefore US has been garnering great returns from the sales in India itself . For  US based companies like IBM , HP and sun microsystems   , India is market for their hardware products . Networking companies like CISCO  have been selling  hardware related to wireless and internet . Software companies like Microsoft have huge market for their software products .

With spread of e-literacy across the cities and villages , there has been escalating demand for computer hardware and software . Majority of institution have switched to e-governance . This is beneficial for US companies who sell such products . US cannot let go such advantages to save few thousand jobs if it wants to cure its crippling economy .

So in the times of crisis Mr Obama should think pragmatically and gauge repercussions of steps he takes in this particular issue . Its not the time to espouse protectionism but to mutually cordinate and reap benefits . By this time Indian IT industries should identify emerging opportunities thrown by global recession and turn them around to their benefits . They should focus on R&d work and should develop better and economical products to remain ahead in the market . Innovation is the key here . Then they should focus on domestic markets with their low end IT products . They need foresight ,vision and dream to map the future

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Posted by on March 2, 2009 in Uncategorized

 

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