IT in India looking for growth in 2.0

So you noticed too? For a while now, the comments about “the threat of Indian competition” and the “triumphant appetites” of the sub-continent for information technologies have been subsiding. This is probably a miscalculation.

The current trend can be explained in a particular context. First of all, large famous Indian IT service companies (such as Infosys, Wipro, Tata Consultancy Services) have shown their limitations on big project management due to distance and the language barrier. Second, social networking sites focused their efforts on the Anglo-Saxon playing field forgetting that there were also “SN markets” elsewhere and particularly in India.

It was a paradox for India, which remains agressive but is less under permanent scrutiny.

An article in the Indian newspaper The Economic Times sets the record straight. It starts by recalling fundamentals: the Indian IT market is worth 60 billion dollars today (a little over 40 billion euros) and expects to reach 200 billion dollars by 2020 which makes it as ready as anyone to face new contextual challenges. India is in turn facing strong low cost competition from China (which has traditionally had a small presence in the software market), Singapore and the Philippines. The Indian IT market was also hit badly by the current world recession and is growing at a much slower rate than before even though it is still growing faster than other regions of the world.

According to the Indian newspaper, which chooses open realism: “… [the education system] will also have to produce quality graduates to fuel this growth rather than creating thousands of engineers whose knowledge and skill levels are, at best, mediocre“. This opinion may be a bit rash and cannot cover all fields and specialties. Still, it’s true that Web 2.0, cloud computing and online social networks need to tightly mesh development and culture, technology and marketing, universal tools and localized users, more so than traditional IT fields. The powerful engineer-producing Indian matrix now wants to refine, specialize, and upgrade its troops in order to attract large Western customers and stay in touch with new trends. But that is not the whole story…

Domestic demand

This evolution is particularly needed since India is ever more active in online social networks, as reported in this other article from The Economic Times. Last January, Viadeo itself acquired Apna-Circle.com, an Indian social network with 350,000 members. Better still, among the 25 million overall users of social networks in India, many use them mainly to reach professional goals or for tangible local development projects. Still, clear-sightedness is needed to choose the right path: 25 million seems like a lot until you stop to consider that the population of India is over a billion. If you wanted to give it a positive spin, you could say that it’s a great challenge with room for progress with a population hungry for exchanging and opening up to the world.

In its use of social networking and of new technology overall, India is conscious of a nuance when compared with its neighbours (“Singapore, Australia, South Korea and Malaysia“, as listed by the Indian financial newspaper). The reason? Web connectivity penetration which simply needs to be improved. Basic stuff, maybe, but still the cornerstone for other expected evolutions of Web 2.0.

Learn more: read these articles online

• Trends of web 2.0 in India (Cxotoday.com)
• The Indian Economy (Wikipedia.org)