The Hindu Business Line : Indian cos to gain from EU expansion: ESC

THE accession of new members to the European Commission will throw up greater opportunities for the Indian IT companies, according to the Electronics and Computer Software Export Promotion Council (ESC).

``European Union (EU) has emerged as the world's largest trading bloc accounting for 20 per cent of world trade and would contribute more than 25 per cent of the world's gross domestic product. This will, undoubtedly, benefit India through an even larger single market with a single set of rules for business and a very open economy with a high standard of rules,'' said ESC Chairman, Mr P.K. Sandell.

ESC has prepared a detailed report of the opportunities and challenges for India in the expanded EU. The total electronics and software exports to the EU (including the newly joined countries stood at Rs 12,120 crore (US$2504 million) in 2002-03 compared to Rs 9,831 crore (US $ 2061 million) in the previous year. This translates into a 20 per cent growth.

Mr Sandell said India had already been exporting a number of IT goods to the newly joined countries in the EU.

``India has been exporting IT goods (hardware and software) to the newly joined EU countries to the tune of Rs 84 crore. The trade between India and the accession countries is only 1.5 per cent of India's trade with EU-15. This would suggest that trade diversion as a result of enlargement may be insignificant.''

Major items of exports include soft ferrite, circuit boards, relays, on-site services and computer software to the Czech Republic and project services to Estonia. Other items are personal computers, onsite services, pacemakers , computer software to Cyprus, transformers to Latvia, CDs to Lithuania, consultancy services to Hungary and on-site services to Malta.

ESC has identified the potential areas of co-operation between India and EU in the IT sector . This includes, among others, content development in English, software development, data warehousing, geographical information system, software for banking, IT education and training and IT applications.

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