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India Plans to Expand IT Exports to New Markets - 2004-03-28

India's information technology industry is seeking new markets for its exports.

The United States and Britain are the biggest markets for India's booming software exports, accounting for about 80 percent of the country's $12-billion-exports per year.

But India's information technology industry wants to look beyond these countries and explore largely untapped markets, such as Canada, Italy, France and Germany.

The spokesman for the National Association of Software and Service Companies, Kiran Karnik, says the IT sector's phenomenal growth is the basis for expansion.

"We feel the Indian industry is mature now and can go out and look at newer opportunities in addition to what it has established," he said.

But industry analysts say expanding to other markets is partly due to grumbling in the United States and Britain that outsourcing white-collar jobs to other countries is costing their workers jobs. While Indian IT leaders are confident that western companies will continue to outsource work despite the outcry, they still say widening their market base is a good idea.

Indian IT companies are also establishing what they call global operating centers outside India in countries like Hungary, the Philippines and Mexico.

Mr. Karnik says two forces are prompting this expansion. As Indian IT companies go global, they need bases closer to their customers. Second, India could face manpower shortages, as the demand for its low-wage, English-speaking, well-educated workforce begins to outstrip supply.

"This industry is based on human talent, and different countries have different extents, or proportions, or advantages in human talent," said Mr. Karnik.

The Indian IT industry grew by about 30 percent last year, and is expected to grow at the same pace this year.