Promoting Indo-EU IT business

By N. N. Sachitanand

BANGALORE, APRIL 3. The European Union (EU) is India's biggest trading partner but in one category of products and services - information technology - the interaction between the two has been minimal. The fault has been on both sides - EU's reading of India as merely a vendor of low cost programming manpower and the Indian IT industry's U.S.-obsession. The result has been that the EuroIndia IT business has been limited to some big European MNCs establishing development centres and backoffice operations in India and a few Indian IT companies setting up marketing outlets in Europe.

This is unfortunate, considering the colossal IT market that the EU is becoming since integration. Here are some mind-boggling figures about the EU:

(a) It represents a market of 370 million inhabitants with a per capita income of 17,379 euros per annum;

(b) The investment per capita in IT averages 445 euros per annum;

(c) The number of business PCs per 100 white collar workers is 54 and the number of PCs per inhabitant is 18;

(d) There are 52 direct telephone lines per 100 inhabitants and mobile phones are subcribed to by 14.2 per cent of the population.

Recently, three initiatives have been launched in Europe to further the spread of IT in all walks of European society. They are:

(1) The e-Europe initiative, launched on December 8, 1999, which focuses on 10 priority areas including education, commerce, transport and healthcare.

(2) The IST Programme - an integrated research programme that builds on the convergence of information processing, communications and media technologies. It has an indicative budget of 3.6 billion euros and is managed by the Information Society DG of the European Commission.

(3) The E-commerce Law - Directive 1999/93/EC of the European Parliament and the Council of December 13, 1999, on a European Community framework for electronic signatures.

There is a tremendous complementarity in the requirements of the EU and Indian IT industries. India needs to get away from its over-dependence on the U.S. market. The EU provides an alternative. The EU needs an IT resource pool since its own is limited. The shortage is as high as 1.3 million positions as of 1999 and this will grow as IT expands to more and more user sectors. India can provide some of these resources - not just programming skills but higher levels of technical expertise.

To enable the coming together of the IT industries in the two regions for mutual benefit, a project called the Alllied Team to Manage EuroIndian Relationships (ATMAN) was initiated around a year ago under the aegis of the EU-India Cross-cultural Economic Programme with co-financing from both the Eurpean Commission and the Indian Government.

ATMAN is implemented through a consortium of institutions , namely:

* GAIA, the Association of Electronic and Information Technology Industries of the Basque Country (Spain);

* TEMA, the Association of Telecommunications Equipment Manufacturers of India;

* APM, the Portuguese Multimedia Association;

* 3SE, an Indian company specialised in EU-India cooperation in the field of software;

* APCE, the Association of Exportation of the Automotive Sector in Piamonte (Italy).

According to Mr. Fco. Javier Caceras, Director General of GAIA and the project manager of ATMAN, the main beneficiary of the project will be the small and medium enterprises (SMEs) in the IT sector of EU and India. The principal objectives of the project are to develop more effective communication channels among the associations representing the SMEs and develop programmes to exchange company managers from the SMEs. Of course, there are other related objectives such as organising workshops on topics of common interest such as laws, taxation, tariffs, visas and work permits. There will be an attempt to create a permanent information infrastructure to assist in marketing tie-ups, joint ventures and technical collaborations.

Project ATMAN will enable a much more widespread and longer term collaboration between the IT industries of EU and India, change the business from cut price offers to more technology and methodology oriented ones and promote more partnership among Indian and EU software companies.

The ATMAN project, says Mr. Caceras, is now up and running. A delegation of managers from SMEs participated in various events in Europe during November/December last year. Now a group of 16 IT and communication managers from Spain, Portugal and Italy is on a tour of three Indian cities: Delhi, Mumbai and Bangalore, from April 1 to 10. A website of the project (http://atman.gaia.es/atman.htm) is now operational. Hopefully, the collaboration proposals will start pouring in.

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