echarcha
May 1st, 2001, 01:25 PM
The Dragon is closing in on India in IT race
NEW DELHI: The dragon is snapping at the heels of the Indian information technology (IT) sector and looking to dislodge India from its global superpower status in this field, according to the Manufacturers' Association in Information Technology (MAIT).
"Major software companies have set up shop in China, an economy that is two-and-a-half times that of India and exports six times the IT goods and services that India sells abroad," says Vinnie Mehta, the director of the country's apex body on IT hardware.
Mehta, who has just completed a study on the Chinese onslaught and submitted it to the government, further said: "India is very strong in software, but the main concern is that China is infrastructure ready and for it to leapfrog to software will not be difficult."
"In fact the lack of a hardware base has threatened to take the steam out of India's software run. And now, China is set to invest $5 billion internally in software spending," he adds.
According to industry reports, China is well on the way to becoming an IT superpower. Vis-`-vis India, the trends are disturbing. China has 125 million telephone lines compared to India's 30 million, 70 million mobile phones to India's 2.5 million and 22 million Internet subscribers to India's 1.5 million. Its international bandwidth is already 1.2 giga bits per second compared to India's 860 mega bits per second.
Beijing is also aggressively laying fiber optic cables throughout the country and upgrading its backbone with the latest 3G (third generation mobile) technologies and is expected to surpass the United States as the world's largest mobile telecommunication network by 2003. It is also setting up its own Integrated Circuit (IC) valley as also a notebook zone.
The MAIT report observes that China is the third largest IT hardware supplier in the world. The total turnover of the IT industry is expected to cross $46.1 billion in 2001, an increase of 36.8 percent over the previous year. Hardware exports are likely to increase by 30 percent in 2001 and software sales are also likely to register an increase of 31.7 percent from 2000 ($3.6 billion in 2001).
Apart from international giants like Intel, IBM and Philips, which have set up shop in China, U.S. mobile network major Motorola sources 80 percent of its microchips from China and has invested $1.9 billion in that country for this purpose.
The report notes that leading global IT majors IBM, HP, Cisco, Sun, Intel, Microsoft, Oracle, Compaq and Dell have also established subsidiaries in China, with sophisticated strategies for research and development facilities aimed at customizing products for the Chinese market.
China is the second largest recipient of foreign direct investments (FDIs) in the world after the U.S. and is encouraging it further with the objective making itself a major producer of IT and telecom equipment on the domestic front as well as in the Asia-Pacific region and beyond.
International technology consultancy firm Gartner has predicted that while India would have less than 15 million Internet users by 2004, China would have 51 million. Besides, the World Development Report 2000-01 points out that China has 454 scientists and research personnel per million persons as opposed to India which has 149 such experts per million persons.
"We had the language edge, but now China is fast developing its skills. The cost of its manpower is also much lower. Despite its language advantage, if infrastructure is not friendly to foreign investors, India cannot win," says Amul Gogna, chief of the Investment and Credit Rating Agency's (ICRA) IT division.
A senior advisor to the government on IT matters shares this view, saying "China, which is strong on hardware and capital intensive, is more stable in the current slowdown situation, than a heavily software-dependent India."
http://www.timesofindia.com/today/01busu4.htm
NEW DELHI: The dragon is snapping at the heels of the Indian information technology (IT) sector and looking to dislodge India from its global superpower status in this field, according to the Manufacturers' Association in Information Technology (MAIT).
"Major software companies have set up shop in China, an economy that is two-and-a-half times that of India and exports six times the IT goods and services that India sells abroad," says Vinnie Mehta, the director of the country's apex body on IT hardware.
Mehta, who has just completed a study on the Chinese onslaught and submitted it to the government, further said: "India is very strong in software, but the main concern is that China is infrastructure ready and for it to leapfrog to software will not be difficult."
"In fact the lack of a hardware base has threatened to take the steam out of India's software run. And now, China is set to invest $5 billion internally in software spending," he adds.
According to industry reports, China is well on the way to becoming an IT superpower. Vis-`-vis India, the trends are disturbing. China has 125 million telephone lines compared to India's 30 million, 70 million mobile phones to India's 2.5 million and 22 million Internet subscribers to India's 1.5 million. Its international bandwidth is already 1.2 giga bits per second compared to India's 860 mega bits per second.
Beijing is also aggressively laying fiber optic cables throughout the country and upgrading its backbone with the latest 3G (third generation mobile) technologies and is expected to surpass the United States as the world's largest mobile telecommunication network by 2003. It is also setting up its own Integrated Circuit (IC) valley as also a notebook zone.
The MAIT report observes that China is the third largest IT hardware supplier in the world. The total turnover of the IT industry is expected to cross $46.1 billion in 2001, an increase of 36.8 percent over the previous year. Hardware exports are likely to increase by 30 percent in 2001 and software sales are also likely to register an increase of 31.7 percent from 2000 ($3.6 billion in 2001).
Apart from international giants like Intel, IBM and Philips, which have set up shop in China, U.S. mobile network major Motorola sources 80 percent of its microchips from China and has invested $1.9 billion in that country for this purpose.
The report notes that leading global IT majors IBM, HP, Cisco, Sun, Intel, Microsoft, Oracle, Compaq and Dell have also established subsidiaries in China, with sophisticated strategies for research and development facilities aimed at customizing products for the Chinese market.
China is the second largest recipient of foreign direct investments (FDIs) in the world after the U.S. and is encouraging it further with the objective making itself a major producer of IT and telecom equipment on the domestic front as well as in the Asia-Pacific region and beyond.
International technology consultancy firm Gartner has predicted that while India would have less than 15 million Internet users by 2004, China would have 51 million. Besides, the World Development Report 2000-01 points out that China has 454 scientists and research personnel per million persons as opposed to India which has 149 such experts per million persons.
"We had the language edge, but now China is fast developing its skills. The cost of its manpower is also much lower. Despite its language advantage, if infrastructure is not friendly to foreign investors, India cannot win," says Amul Gogna, chief of the Investment and Credit Rating Agency's (ICRA) IT division.
A senior advisor to the government on IT matters shares this view, saying "China, which is strong on hardware and capital intensive, is more stable in the current slowdown situation, than a heavily software-dependent India."
http://www.timesofindia.com/today/01busu4.htm