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Pratap Ravindran

eWorld meets this player keen on promoting Indo-Israeli trade ties, especially in technology.

THE recent, truncated visit of the Israeli Prime Minister, Ariel Sharon, to India to redefine the relationship between the two countries in a world of changing defence and strategic dynamics has triggered off a spirited debate in diverse fora as to the politics and ethics of such an exercise. Whatever may be the outcome of the debate, the reality is the initiative is likely to result in enhanced commercial interaction between the two countries.

Indo-Israeli trade exchanges, almost non-existent a decade ago, are expected to reach $2 billion in 2004 and Israeli investments in India, particularly in the fields of telecom and the Internet, are pegged to touch $7 billion.

All this makes Ari Bloch a happy man. The Managing Director of Israel-India Ventures Ltd, he has been evangelising a relationship between the countries, especially in technology, for quite some time now.

Israel-India Ventures focuses on India's high-profile technology sector and its impact on this country's economy. The company, which has as its Chairman K.V. Seshasaiee who was formerly Chairman of India's Cellular Operators Association and is currently a member of CII's National Telecom Committee, counts among its directors Benjie Bloch (Projects), Saurabh Srivastava, CEO, Xansa Software and Chairman of Infinity Venture Capital, Nachman Shelef, General Partner, Benchmark Capital (Israel), Jacob Duneitz, CEO, Artificial Intelligence Ltd and R. Mohan, CEO, Hinduja TMT. It wants to establish itself as "the partner of choice for technology companies wishing to enter the Indian market and a trusted source of reliable information and business connections. Its range of services covers business development, technology transfer, strategic offshore service sourcing as well as initiation of joint ventures and projects.

In an e-mail interview with eWorld, Ari Bloch says: "Israeli businessmen, like others, are first and foremost interested in doing business and would not generally let politics get in the way (except for example perhaps when selling certain types of technology or products)."

Excerpts from the interview: What is the awareness that the average businessman in Israel has of India?

I would divide the Israeli businessmen into a few distinct groups according to their knowledge and views about India. First there are those that are mostly ignorant about India. They have never dealt with India, have no appreciation for the magnitude of the market and generally consider India a Third World country. Then you have a group that has first-hand knowledge of India because they have either visited in recent years or they are currently involved in business in India. They appreciate both the market opportunity and the inherent complexities of doing business in India. The third group consists of those who are in the middle. They have a notion of India being a possible market for them and a place they might be able to do business but they neither have the contacts to address the market nor are they aware of just how the market landscape has changed in recent years. As you can see, there is a lot of education to be done simply to create the awareness that will hopefully entice people to venture into the market. This is one of the tasks that we are also addressing through seminars and conferences.

In the course of the Israeli Prime Minister, Ariel Sharon's recent visit to India, a measure of understanding was reached between the two countries on strengthening defence and strategic ties - and on not allowing India's long-standing position on Palestine to come in the way. How does the business community in Israel, given India's past position on Palestine, view this? ?

This is not seen as a problem, largely because 99 per cent of Israeli businessmen are simply unaware of Indian politics and the government's position towards this issue. But even if they were, it would not be a hindrance. Israeli businessmen, like others, are first and foremost interested in doing business and would not generally let politics get in the way (except for example perhaps when selling certain types of technology or products). It is a fact that many Arab countries that do not have ties with Israel buy Israeli products through third parties. In fact, this is where we see a major opportunity for Indian companies. Because they have such good ties with Arab countries, they can serve as channels for Israeli companies. So I see an opportunity rather than a problem.

Your company Web site refers to Israel-India Ventures' "60+ cumulative years of experience in Indian and global high-tech markets." Could you please elaborate on the history of the company?

I started working on Israel-India Ventures as early as May 2001 immediately upon finishing setting up the development centre in Bangalore. The initial plan was to assist Israeli companies with their outsourcing requirements from India. But it soon became apparent that there is not as much demand for this as there is in the US or Europe. So the business model was changed to fit the demands of the market and now we focus on two main areas, which are business development and initiating projects. I myself have been involved with technology for over 15 years and have been working in India and with Indian companies for about five years now. We are fortunate to have a great network of advisors and consultants with vast experience and exposure in the Industry so our cumulative body of knowledge is a great asset we can pass on to our customers.

You had started and managed a 180-person software development centre in Bangalore. Could you please tell us something about this project and its current status?

I would say without a doubt that it was one of the most challenging and enjoyable projects I have done, both at a professional level and a personal one. In 1999, an Israeli client of mine for whom I had been consulting for many years approached me and asked if I would establish their development centre. Since I had never been to India before, I considered it interesting and a challenge. I lived in Bangalore for two years and set up the development centre from scratch, not only acting as the liaison and project manager for the client but also serving as General Manager in all aspects. I learned a lot about the industry in India and made many personal friends and professional acquaintances that I am in touch with until today. The center was downsized following the dotcom bubble burst but is still very active and contributing to the client who has subsequently transferred more areas of activity to India.

Your company is of the view that while "synergistic and value-added alliances with suitable OEM partners in India can be profitable and often necessary," the location of a "right partner" is a "daunting task." Why is this task daunting?

I believe that India and Israel are a classic case of the product being greater than the sum of both parts. As such, partnering makes a lot of sense. But finding the right partner can be difficult for Israeli companies. As opposed to countries like China and Japan where one cannot even communicate effectively because of the language barrier, there is an illusion of ease when dealing with India because everyone speaks English. But many companies are disillusioned when progress is very difficult despite the common language. On a person-to-person basis, Israelis and Indians get along great. The cultures are very similar, but business culture is very different. For example, Israelis find the relationship-building process difficult and counter intuitive to their "fighting" nature of going in and getting the job done without wasting time. Overcoming these cultural barriers is often very difficult for Israeli companies and many give up along the way. Indian counterparts that understand this and make an effort to bridge these gaps will gain an advantage.

You say that India has "a vast talent pool" of IT professionals with a wide array of skills ranging from application developers to data entry professionals. You also refer to IT-enabled services or business process outsourcing and to India's track record in call centres, medical transcription services, back-office processing, accounting and legal services, payroll management and so on. But do you see India as becoming something more than a source of low-end work at the global level?

On the one hand, I think that India, by definition, must grow up the value chain and provide higher value-added services and this is an evolutionary process that is both advocated by industry bodies such as Nasscom as well as actually being implemented by companies themselves. Just a few years ago India was mostly about data entry, legacy maintenance and Y2K conversion and now there is a lot of sophisticated work being done in India covering the entire spectrum of technology, including areas such as optical networking, chip design and biotechnology. So there is scope to grow and it is happening.

But I also think that as the saying goes, when you are doing something right - keep doing it. India has a competitive advantage in providing the type of IT services that have catapulted the industry to the level it is at today and is projected to grow even further in the future. In effect, India is one great centre of excellence for the type of work that it does. I do not think that it would be proper to stigmatise some services as low-end when they are giving very good business results. Many product companies can only dream of such margins. So I would not steer the industry away from this type of activity. On the contrary, I would get better and better at it and consolidate India's position as the world leader. So I think India should not trade one type of activity for another, but rather strengthen its competitive advantage while also moving to higher activities.

eworld@thehindu.co.in

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