Thursday, March 13, 2008

India on growth wave into new age of tech globalization

No longer simply an epicenter of outsourcing, India is riding a new wave of globalization as the economics of the technology business turn it into a regional design and development hub. The subcontinent is seeing an explosion of business and forging IT partnerships with neighbors as diverse and disparate as China, Egypt, Pakistan, Australia and Dubai, as these and other would-be technology players strive to usher in a new phase of tech-driven development to the region, which includes North Africa, the Middle East and the Gulf states.

This new geotechnology axis is destined to have a profound impact on the global IT and technology sectors, and its arrival marks a turning point in the shift of the industry's balance of power from West to East. "We are seeing a whole new age of globalization today," according to analysts at Bengaluru-based Prayag Consulting. "Three countries that are taking full advantage of this paradigm shift are Israel, China and India."
As India extends its connections throughout Asia, Australia, the Middle East and Africa, it will emerge not just as the region's business and technology leader, but as a more powerful player in the global IT sector. That will have a ripple effect on the entire market as next-generation semiconductor and system development--including embedded-systems design--follows trends that arise from the burgeoning domestic and regional economies.
This factor was topmost in the minds of the India Semiconductor Association as ISA convened its 2008 Vision Summit in Bengaluru recently. The organization expects that India will evolve from a design-oriented industry into a major electronics manufacturing hub before the end of the decade.
It was also the underlying theme at another recent event in Mumbai, as would-be regional tech players like Egypt, Australia and China vied for notice from India-based IT service and technology development companies at the India Leadership Forum.
Among the most revealing sessions at the Mumbai event were the "focused country sessions." These informational and networking meetings underscored the spillover effect of India's IT success, pointing to bright prospects for smaller regional players eager to ride India's coattails and become part of the new regional development axis.
Pakistan is already enjoying the knock-on effect of India's steady rise as a regional and global IT superstar. With a population of 160 million, Pakistan will be the first in the world to complete a nationwide deployment of WiMax wireless communications technology. This boost in infrastructure will help make its technical talent pool more competitive and will serve as another catalyst for regional economic development.
"It's a case of petrodollars at work," noted Shahid Azim, the Harvard-educated CEO of Braintree Group (Islamabad, Pakistan).
Like India, Pakistan has a large pool of well-educated engineering and IT professionals eager to participate in the global IT sector. With the Pakistan economy enjoying robust growth, Western companies are looking to India's neighbor as another source of technical IT talent.
"The idea is to set up R&D centers. It's just beginning," Azim said, projecting optimism that Pakistan will follow India's well-worn path to global significance.
With the aim of unlocking the technology potential of the Middle East, the Gulf and Africa, Egypt's General Authority for Investment (GAFI) also came to Mumbai in search of potential partnerships. Marshaling a 55-person delegation of Egyptian corporate executives and government officials, GAFI mounted an aggressive diplomatic and commercial initiative at the Leadership Forum designed to foster long-term relationships with its historic trading partner, India, and to position Egypt as a player in the evolving regional development hub.
With a GDP growing at 7.2 percent per year and a mobile-phone growth rate of 50 percent per year, Egypt also boasts one of the region's lowest IT outsourcing cost structures--lower than Eastern Europe's--including the world's lowest telecom costs. The nation is undergoing tax, customs and financial-sector reform, and has a talent pool consisting of 300,000 graduates with strong commercial, engineering and science backgrounds. Its unique multilingual heritage with English, French, German, Italian and Spanish language skills also works in Egypt's favor. Multinational investors active there include Mentor Graphics, Oracle, Vodaphone, IBM, Microsoft and Sun Microsystems.

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