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China could surpass India



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India could lose out to China in the opportunity of the millenium unless
the
software industry and government, jointly formulate an action plan to
address the obstacles.

China is spending billions to upgrade its universities in order to
become a
major player in the global software industry,  while in India, the
critics
led by Dr. Roy, are dismissing the very idea as "hype" and nonsense.
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China will gain on India in infotech: Analysts


MUMBAI
CHINA is likely to overtake India as the world's leading pool of
software
professionals, analysts and industry leaders warned on Thursday.

While aggressive marketing to tap the Indian software industry by
ambassadors of the United States, Canada, France, Germany and Singapore
marked the second day of an international technology conference in
Mumbai,
analysts focused on a sustained Chinese effort to train software
professionals and capture more of the growing information technology
market.

A study by consulting company McKinsey and Co said India would be left
behind by a Chinese government and industry program that is providing
billions of dollars to nine Chinese universities, forming tie-ups with
colleges abroad and investing millions of dollars in research
laboratories
and equipment.

With more than 100,000 Indians migrating to the United States each year
for
better-paid software jobs, Indian industry has already started hiring
from
China, analysts said.

"Many Indian companies have already started recruiting from Chinese
universities. China has a systematic program of funding universities,"
said
Vipul Tuli, a principal at McKinsey.

"India needs to make sure we are not overtaken by our friends in the
northeast," he added.

The study by McKinsey and Nasscom, the National Association of Software
and
Service Companies, shows that Indian technical institutes will be unable
to
meet the projected demand for 500,000 professionals in 2006 - up from
340,000 last year.

Tata Consultancy Services, which provides software solutions to
multinational companies in 50 countries, has already set up an office in

Beijing for clients.

"We are beginning to see what is happening in China. They have a large
pool
of trained people and a cost advantage. English is the only barrier,"
said
Phiroze Vandrevala, Tata's executive vice-president.

"We will face a competitive threat from China. It's important we keep
our
momentum."

After the United States, India has the second largest English-speaking
scientific and technical manpower resource in the world. But analysts
believe programs in China will help the country surmount the language
barrier.

"India's technology competence and English skills are no longer
unassailable. The momentum and determination in China is what will carry

them further," said Tuli, who visited China and interviewed government
and
academicians for the study.

During a visit to India in January, Li Peng, China's second most
powerful
leader, spoke of development based on science and technology which he
described as the future of the world.

Li also visited software companies in Mumbai and in Bangalore and
Hyderabad.

China aims to transform a nation of 1.3 billion people from one that
produces some of the world's most inexpensive products to a world-class
technology center.

Media reports from China, however, show that despite industrial zones
modeled on Silicon Valley in many cities, high-tech industries account
for
less than 2 per cent of the Chinese economy.

Investment was scarce largely due to concerns over theft of intellectual

property. But a shift of state support to high-tech industries and a
dlrs
5.4 billion investment in nine Chinese universities last year has
revived
interest in China's information technology market.

India's exports of information technology software and services could
reach
$50 billion by 2008, up from $4 billion in 1999-2000, according to
industry
estimates.

Information technology was the path to wealth for most of the 11 Indians
on
Forbes magazine's list of billionaires this year.

But there are growing concerns about a divide between the
technology-savvy
few and some 300 million Indians who are illiterate in a nation of 1
billion.

Ravi Kumar, professor of operations management at the University of
Southern
California's Marshall School of Business, said China's higher basic
literacy
levels and better standards of living give it an edge.

"Indian software skills could complement China's competencies. Indian
software companies should globalize and set up facilities in China.
That's
the way to go," Kumar said. - AP

 The Economic Times Online. All rights reserved.



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