Africa is gaining status as India's IT hub
By agencies   |   Tuesday, 07 June 2005, 19:30 IST
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NEW DELHI: India is moving towards making Africa the next IT hub after Indian cities like Bangalore and Hyderabad. The number of Indian IT companies that have set up operations in African countries like South Africa, Kenya and Tanzania has gone upto 40, compared with a meager 10 about three years ago. ?This trend has started only in the last three to four years,? said Sangeeta Gupta, vice-president, Nasscom. In terms of business, Africa has a small fraction of IT ventures, but that is expected to increase in coming years,? she added. The last four years have seen South Africa, which accounts for 0.6 percent of total IT exports, emerging as the new IT hot spot, especially for startups. This is because of the pro-active role played by the South African government in attracting investments. Along with majors like TCS, Infosys, and iFlex, which are primarily engaged in the banking software solutions business, it is the new companies like Newgen, Lifetree Convergence, and Infozech Software have substantial interest in East African countries. Kenya, Tanzania and Uganda accounted for about 7 percent of Newgen?s operations. Smaller players Eastern Software Services and Infozech Software, which have operations in Nigeria and South Africa, are expecting a steady rise in their revenues from their operations over the next one-year. The focus on Africa is driven primarily by a dearth of indigenous IT skills in these markets and the presence of a booming telecom sector. Price consciousness, which gives Indian firms an edge over their U.S. and European counterparts, has been crucial in creating a market for Indian companies. Ease of entry, acceptability of Indian products and the absence of many competitors have made Africa a natural choice for many Indian IT firms.

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