Indian software industry will hold out against competition

NEW DELHI: The $60-billion information technology industry in India will continue to attract overseas business, despite competition from other emerging markets that also offer lower costs, says the India head of global software giant Computer Associates.

"Our costs will still be competitive. There are markets like China, Singapore, and the Philippines which offer lower costs. But they are not in the same league as India," said the software gian't India chairman Saurabh Srivastava.

"China has an issue with language, a lot of other countries don't have the same levels of competency and, moreover, a lot of them are still in process of learning business norms," Srivastava, an industry veteran and noted venture capitalist, told IANS in an interview.

According to him, the average spending on information technology by a fair-sized firm was usually two percent of the entire budget. "You will not risk saving on this two percent and endangering the rest of the 98 percent."

Though the sector, which has been hit by the global financial crisis, will grow at a modest 4-7 percent this year, Srivastava contended a turnaround should happen by next year when companies start loosening their purse strings.

"You may not see the 30 percent growth rates of the past. But for the next few years, the growth certainly would be in the range of 15-20 percent," said the alumnus of the Indian Institute of Technology (IIT) at Kanpur and Harvard University.

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