Communist Chief Minister of West Bengal dreams super growth through IT outsourcing while Gartner Group forecasts collapse – fool’s paradise?
Sudhir Chadda, Special Correspondent
August 28, 2004 

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Indian outsourcers stand to lose more than 45 per cent of their business "because they cannot stay ahead of the competition," claims a new report by consulting firm Gartner. "India has more than 80 per cent of the global market and it stands to lose more than 45 per cent of that," the firm said in the report entitled ''Indian Outsourcing Pie Being Eaten'', published in the Enquirer magazine. At the same time Chief minister Buddhadeb Bhattacharjee chose an industry-academia platform on Friday to reiterate Bengal’s targets from the knowledge economy, hint at an imminent Infosys entry and roll out a things-to-do list. 
“Target: 15 per cent of the country’s export earnings in information technology (IT) and 20 per cent of the IT-enabled services (ITES) pie by 2010” says the communist Chief Minister of West Bengal.

“There is a gap between the demand for and supply of professionals and the gap has to be bridged. In this regard, a working group needs to be constituted with representatives from industry and academia,” said Bhattacharjee.

Addressing the inaugural session of the meet organised by the state government’s IT department, in association with the Confederation of Indian Industry (CII) and the National Association of Software and Services Companies (Nasscom), Bhattacharjee highlighted the achievements of the state in the past few years.

“The industry in West Bengal has grown by 120 per cent in the last year, against the national average of 36 per cent. We will have to continue the good show,” he stressed, adding that Infosys had “in principle” agreed to set up a base in Calcutta. 

“I have been in touch with Mr (N.R.) Narayanamurthy over the past two to three years,” added Bhattacharjee.

State higher education minister Satya Sadhan Chakraborty, IT minister Manab Mukherjee and Nasscom president Kiran Karnik were present at the meet. They were joined by corporate chieftains from ITC, Pricewaterhouse Coopers, IBM and Wipro and representatives from premier academic institutions like IIT-Kharagpur, IIM-Calcutta, Indian Statistical Institute and Calcutta University.

“I know that the chief minister will not forget about this, so we must evolve an action plan over the next two months and go back to him with our recommendations,” observed B. Muthuraman, chairman, CII eastern region.

Karnik stressed the importance of evolving a system that could support growth in the industry. “From Nasscom, we have set an export target of $50 billion from India by 2009. If the country has to achieve that target, Bengal will have to play an important role. The state is powering ahead at great speed, but it has to be supported with human resources and adequate research and development,” said the Nasscom president.

Karnik went on to urge Bengal, “famous for leading research and development initiatives” to contribute in developing cutting-edge technology and also in spreading the benefit to the grassroots.

On the other hand, The problem, according to Gartner, was that the Indian government and industry had "suffered from the erroneous belief" that the sector could match the booming growth of its software and other mainstream IT activities without devising a long-term plan. "The US has flocked to India because of its vast English-educated work force and lower labour costs. But what India has failed to realise is that the sort of outsourcing it provides can be done by any graduate without the technical skills needed for information technology and many emerging countries have English-speaking graduates," it said.