Just an addition to compliment my previous post. This is an article I happened to come across a while back.
Not withstanding India’s emergence as an IT superpower, a global study has ranked India 10th in Asia-Pacific and 46th worldwide in terms of IT industry competitiveness.
In the study commissioned by software industry association Business Software Alliance (BSA) and conducted by the Economist Intelligence Unit, the US, Japan, South Korea and the UK ranked the highest among 64 countries in terms of IT industry competitiveness. The study evaluated countries on factors like supply of skills, a pro-innovation culture, world-class technology infrastructure, a robust legal infrastructure, government support and a competition-friendly business environment.
China was number 49 globally and 12th in Asia-Pacific. Japan, South Korea, Australia, Taiwan and Singapore were the top five countries in Asia-Pacific.
“India and China have been able to parlay unique factors, such as workforce size, low wages or language attributes, into strong IT sector performance, compensating for glaring weaknesses in the industry environment,” the study noted.
However, the two countries will have to innovate more in terms of products and services to remain competitive, as their cost advantage erodes over a period of time.
“Developing a stronger legal and R&D environment, complemented with appropriate support for the IT industry and a better IT infrastructure, will help make Indian firms more competitive in this sector in the years to come,” said BSA India Committee chairperson Sanjay Gupta.
The study said India and China will see greater competition from Russia, Brazil, Malaysia and Vietnam and even smaller markets like Estonia, Lithuania and Chile in future.
I believe that. India is just a “cheaper” location, and soon that will not hold true with the rising infrastructure costs and the salaries of employees. It’s been just going higher and higher, so steep and at a scary pace. It’s bound to come down. Like the dot com bubble that burst, this too will happen one day. And Indian companies will have to move over to cheaper locations to make money. If US companies could layoff employees in the thousands only to shift their work to India, what’s the guarantee that Indian companies wouldn’t resort to the same to shift to other cheaper locations?
Just a thought!
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