Lord Paul urges IT firms to move up value chain

By Sunil Wadhwani   |   Wednesday, 15 October 2003, 19:30 IST
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KOLKATA: Caparo group chairman and British business ambassador Swraj Paul said on Monday Indian IT companies would have to take steps to move up the value chain and also display greater patience while putting up with protests against outsourcing from labour unions overseas. The level of corporate governance in India moreover would need to be improved further to inspire greater confidence among foreign investors, he said. “Protest is a democratic right and workers will do that if they feel their livelihood will be threatened by outsourcing,” Paul said on the sidelines of an interaction organised by the Indian Chamber of Commerce at Kolkata. “Indian IT companies will have to explain why they are more efficient ...costs alone cannot be the reason. It will have to be backed up with quality,” he said. The United Kingdom has seen a surge in investments by Indian IT firms in the last few years. These include investments by India’s biggest software exporters Infosys and Wipro. Technology forecaster Gartner has said India’s offshore BPO exports could rise to $13.8 billion in 2007. It said India’s revenue from this segment would be $1.2 billion in 2003, representing 66 per cent of the global offshore BPO market. Gartner has also pointed out that although India had inherent skills related to transaction processing, Indian service providers could not expect to target the higher value and more lucrative BPO services until they acquired and demonstrated their process skills and industry knowledge to offer process transformation capability. “It (the level of corporate governance) is much better now but it could be better so that the foreign partners of Indian companies do not find it a problem,” Paul said. Paul said there was great potential for India-UK bilateral trade with opportunities existing in several spheres including biotechnology, healthcare and financial services. There was also great scope in engineering goods, textiles, gems and jewellery, rice, processed foods and alcoholic beverages. Bilateral trade is expected to jump to £10 million by 2007. (source: Economic Times)

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