It Icons See India As Low-End Ites Hub

While the National Association of Software and Service Companies (Nasscom) is trying to portray India as an emerging super power in IT services and IT-enabled services (ITES), industry leaders seem to assign a 'lower-end leader' tag to the country.

"India can become the digital paper work provider to the world since Indians are natural paper workers," Jerry Rao, chairman of Mphasis BFL said on the sidelines of Nasscom summit here today.

While widgets are made in countries such as Taiwan or Malaysia, digital paper work for widgets will move to India, Rao said. Inbound and outbound call centres, web-based services, transaction processing such as correspondence handling, claims processing and accounts reconciliation are some of the processes that can be outsourced to India only, Rao said.

Kiran Karnik, president of Nasscom, supported the argument, "For this country, low-end jobs are very much important because they provide volume business and create a large amount of employment. However, we need to look at the entire span of services and climb up the value chain, he said.

If India fails to attract high-end IT-enabled services business, McKinsey's revised projections for ITES revenues reaching $ 21-24 billion by 2008 might go awry, as it happened in the case of e-commerce revenue projections. The consulting company has projected $10 billion revenue to accrue from e-commerce segment in 1999 and eliminated the entire revenues in its 2002 report.

Countered Arun Kumar, chairman of Nasscom and president and managing director of Hughes Software Systems, "Software services in the country began with low-end jobs such as body shopping and package conversions and later climbed up the value chain by emerging as integrated solution providers. This is likely to happen in ITES also with opportunities growing beyond call centres and services such as engineering design and business process outsourcing will come to Indian companies".

"Challenges to offshore works for Indian companies such as global security policy, high switching costs, end-to-end response time will limit the opportunities for Indian ITES companies especially in the human resource business process outsourcing", Manish Sabharwal, managing director, India Life Hewitt, said.