Indian IT firms look to Japan

India Inc is increasing its focus on Japan. Seeing the country as an important market, leading IT, banking and manufacturing companies are planning to scale up their operations in the land of the rising sun.

A Ficci survey says 75 per cent of the 70 Indian firms doing business in Japan are looking at bagging more projects in that country.

As the firms are aligning themselves with cost-reduction policies, many Indian companies feel that there will be more outsourcing opportunities, says the survey.

Nearly 100 per cent of the respondents from the IT companies feel that Japanese industries are more inclined to outsource ICT work to India. "Japanese companies are aware of the Indian IT capabilities," the survey says.

Most companies are investing in developing Japanese language proficiency among professionals and understanding the business culture of the country.

Some of the qualities which the Japanese firms expect from Indian companies are on-time delivery of projects, availability of high-skilled workforce and low costs, demostrated capability in managing large scale projects, transition management and focus on information security, the survey says.

It points out that the Japanese IT market will be worth 30 trillion yen in 2005 and will grow to 84 trillion yen in 2010.

Around 52 IT firms in the survey, like TCS, Wipro, HCL, Infosys, Patni, Perot Systems, NIIT, Clarity Technologies, Systems & Software, and Indicus Software, already have a presence in the Japanese market and are expecting bigger projects from their clients.

Most respondents said that the Indian IT companies needed to build trust and credibility in the Japanese market. There should be effective and continuous communication between the client and the service provider.

The major problems faced by the Indian organisations in Japan are lack of knowledge about the Japanese language, competition from local companies, lack of business information, labour laws and compensation packages, the survey says.

To overcome these challenges, neary 80 per cent of the companies are sending Indian professionals to work in their Japanese offices to gear up for greater outsourcing of jobs.

Most respondents are also developing specific requirements to cater to Japanese clients and are focusing on value-added rather than low-level programming services only.