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| Doing business in emerging economies: panel discussion at NILF |
| Shibangi Das / Mumbai Feb 15, 2012, 20:00 IST |
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 The changing economic scenario across the world over the last 4-5 years has been creating newer categories and definitions in economics. Emerging markets are now making news and Greece is what most people now know as a "submerging economy". Patrick Foulis, India Business and Finance Editor of The Economist moderated a panel discussion at the Nasscom India Leadership Forum (NILF) on "Doing business in emerging economies - Opportunities, challenges, risks and rewards."
The session began with Foulis putting forward the question, "How emerging markets relate to the industry in India?" Co-chair Anupam Govil, partner Avasant and president Avasense first explained emerging economies as markets that have great potential but have not been explored properly. He observed that business dynamics have changed over the last half-decade and bigger businesses are coming from Latin America, Asia and parts of Europe as opposed to US and UK.
Govil said, "Establishing hubs in regional markets has become the keyword rather than establishing low-cost centres. Emerging markets balance the depression affecting developed countries and it makes good business sense to invest in them."
Ganesh Natarajan, vice chairman and CEO Zensar Technologies, also co-chairing the discussion described how Zensar’s market has shifted from Europe and Japan in 1993 to emerging markets like South Africa and West Asia (US continues to remain their biggest market with 70% business coming from there). The company now has 600 people in South Africa, a market where they entered only 4 years ago and it is planning a centre in Jordan in the near future.
"The best way to approach an emerging economy is to check for its receptiveness to technology. Look at Philippines, it is effectively utilising talent and is aruguably turning out to be the second-largest offshore destination after India. We want to identify as many emerging markets as we can," said Natarajan. He added that due diligence and an analysis of the market’s environment is however, essential before any investment is made.
Eunice M. Kariuki, marketing director of the Kenya Information and Communication Technologies Board (ICT) said that Kenya, with its new democratic government and strong transport links to the rest of the world via sea, road and air routes, has a very open attitude to investment. The government is spearheading policies to improve societal, political and economic frameworks. Demographic patterns show strong propensity for success of businesses related to mobile solutions and e-governance.
"The assumption that Jamaicans are laid back because it is a tourist-intensive economy is not right. The industry has given us a culture of hospitality and customer satisfaction," said Patrick Casserly, ICT ambassador and special envoy, industry investment and commerce sector of the Jamaican govt. Better known as a serial entrepreneur, Casserly highlighted the need to retain talent in today’s knowledge-based businesses and said that in his experience, employee attrition has never been a problem.
With a GDP of $5 trillion and a population of 442 million, Columbia is fast emerging as the hub of Spanish-speaking world. JP Morgan has rated Columbia as the second-best country in Latin America to invest in, said Augusto Castellanos, programme director, government affairs, Proexport Columbia. He said that the country has everything that a business needs to grow and become successful - an open and competitive market, big talent pool and a government that is labour-friendly and pro investment.
Candace Kinser, CEO, New Zealand ICT, stressed on the tight cultural and business ties between India and New Zealand. She said that from a dairy-farming based economy, the country has fast moved to technology based services like IT, healthcare, technology applications in farming, and film and entertainment-related technology. Among the top-trusted countries to do business with, New Zealand has a talent pool that matches India’s requirement.
First mover advantage is clearly the biggest factor that drives investment decisions, agreed all. When asked if India is threatened by other emerging economies, especially in the outsourcing arena, Natarajan and Govil said that competition is required in a multipolar world, where India already has about 56% market share globally in the outsourcing business.
The panelists agreed that China is making a mark with its focussed, agressive and strategic entries in technology markets worldwide. Kinser summed the sentiment rightly when she said, "Technology has no traditional barriers and it would be naive for us to think that it won’t make any moves to become the next big powerhouse globally."
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