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Vishwanath Kulkarni

Chinese IT prowess may have been a trifle overestimated. Faced with a shortage of high-end skills, Indian companies working across the Great Wall are, in fact, moving work back to India.

INDIAN software services companies that have crossed The Great Wall of China in the recent past are finding that IT skill sets are costlier in that country. This is contrary to the initial industry perception that China had cheap and abundant supply of skilled labour. The reality is that there is a short supply of skill sets in China, which has forced Indian vendors to either move back a portion of work to India or try and use a combination of Chinese and Indian skill sets.

A cross-section of CEOs that eWorld spoke to agree that IT skill sets in China are a bit costlier compared to India. "IT skill sets, including programming skills, are costlier in China by over 25 per cent as compared to those available in India," says Ravi Ramu, Chief Financial Officer at MphasiS, which has a presence in Shanghai.

MphasiS had acquired Chinese firm Navion to kick-start its China operations some years ago, and is mainly servicing a few US clients. Though the company does not have immediate plans to tap the local Chinese market, it may consider that in the next few years. People with technical skills and project-management skills are hot commodity in China and Beijing's hi-tech sector is short by nearly 90,000 skilled employees, said the South China Morning Post recently.

For Indian firms, having a Chinese presence is becoming something of a norm, as US clients insisting on it. Moreover, China serves as a gateway to other Asian markets such as Japan and Korea. High-end technology skill sets such as Oracle Apps, data warehousing and SAP consulting and implementation skills are very expensive in China. Java and visual basic skills are relatively cheaper, says Upinder Zutshi, Chief Operating Officer of Infinite Computers.

Infinite, which recently forayed into the Chinese market by partnering with a local firm, is moving a lot of the development and customisation work back to India. The company is servicing two US clients, which have a presence in China. "We plan to use the India advantage for tapping the Chinese market," Zutshi says, adding that the company sees a big marketing opportunity in China, mainly in high-end areas such as data warehousing, ERP, SCM and CRM. "High-end skill sets are relatively scarce in China and should become more available over the next three to four years," says Ganesh Natarajan, Deputy Chairman and Managing Director of Zensar Technologies. The costs for project-manager skill sets, which are currently higher in China compared to India, would be equalised over the next few years, he adds.

Zensar is betting on its dual-shore approach and using a combination of design, consulting and team skill-sets. The company is executing work for its Chinese clients from development centres both in China and India. Its China operations are servicing two US clients and two domestic clients.

Picture by Bijoy Ghosh

vishwa@thehindu.co.in

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