West Bengal set to become an IT hub

Kolkata

Aug 8, 2008

Confederation of Indian Industries (CII) recently held a two-day conference
on the prospects and the growth scenario of IT, communication and telecom in
Kolkata.

Major IT enablers and investment drivers in the state attended the event. The
conference focused on the investment and technological possibilities in Kolkata.

Appreciating the efforts made by the state government to woo IT investors in
the recent years, Dr Debesh Das, IT Minister, Govt of West Bengal said, “Last
fiscal, we had a steady growth of 45.6 percent in the IT sector in Bengal with
IT exports topping the charts. We are now targeting to double IT exports in
software. With IBM and Wipro as the major growth enablers in Bengal, we have
revised our IT policy to make it more investment friendly.”

Speaking on the global scenario of IT and the role India can play in the
global forum, Kaushik Chatterjee, CFO, Tata Steel elucidated, “The major
economies in Europe are heading towards stagnation particularly in the field of
IT and manufacturing. As production costs are gradually becoming higher in
Europe, there is an urgent need for them to look into other nations for
production at cheaper rates.”

Touching key issues in investment and expansion process in the region,
Amitabh Ray, Director, IBM India, stated, “Eastern India is less crowded in
terms of investment and capital growth. However, there is a pool of skilled
manpower and a developed distribution system, where IT companies can look for
greater potentials.”

He further added that as the attrition rate is becoming higher in India
particularly in the southern and eastern quarters, companies across the nation
are developing aggressive technical training programs for IT freshers which are
pulling up the company costs. “Moreover, NRI investments in small and medium
range are generating employment on a very small scale but the prospects seem to
be dim compared to the MNCs in terms of operations, marketing policies and the
infrastructure it has,” he said.

Citing the importance of IT companies, Arup Dasgupta, MD, Metalogic Systems
emphasized that academia cannot produce skilled and industry ready professionals
and the onus lies with the IT companies to make them more productive. “IT
major companies share the bulk of software exports, Rs 1.5 lakh is being spent
on each employee every year for training and refresher courses,” he added.

As a solution, CII (East) has recently signed an MoU with Bengal Engineering
and Science University and West Bengal University of Technology for recruitment
and employability issues.

“IT companies need to be more focused and develop their operations in terms
of the dynamics in the market. A change in the operatives has been noticed
recently with major MNCs now focusing on the less developed eastern segment
drawing in more investment and is turning out to be more skilled-manpower
intensive than capital intensive. This may prove to be a major turning point in
the structure of the IT industry,” Roy added.

HCL Infosystems and Capgemini Consulting India are all set to make their
presence felt in the eastern region. In this effort, Capgemini has plans to
increase their headcount by 2,000 in Bengal by the end of Q3 FY 08-09. Capgemini
has already taken up 2,00,000sq ft at Unitech's IT SEZ in the upcoming
Rajarhat project and may acquire BPOs in India and abroad.

Sharing his plans about India operation, Baru S Rao, CEO, Capgemini
Consulting India said, “We will be shifting to the new Unitech SEZ facility by
the next week-end where 1,700 employees may be accommodated. Also, by 2010, we
aim to have 40,000 employees in India raising Indian personnel to 40 percent of
Capgemini's global operations. Currently, 26 percent of our total global
workforce operates from India.”

On the other hand, HCL Infosystems may recruit another 1,200 employees
including freshers in the next fiscal. It is targeting Bengal as its major
consulting hub and system integration.

Discussing the possibilities in IT in Bengal, Kiran Karnik, former President,
Nasscom concluded that Bengal should concentrate on engineering and security
services in the domain of IT, while multimedia and gaming options can be
explored at a later stage.