Koji,
Let me assure you that already, with the five posts you've made thus far, I and several others on this board have begun to speculate about your true ethnicity and origins. They are reflective of an incommensurate sympathizing with China, as if you were
trying to mollify or commiserate with them - even to the point of bandying about falsities -- a little unusual for a Jap considering they are your most strategic historical arch-rival. If you are an
ethnic Chinese residing or studying in Japan, you ought to come clean with that in your introductory post, the purpose of which is to guage 'where you're coming from': in other words, your ideological origins. If illusiveness is the name of the game you're playing, then let me assure you that we are far better at that if we need be. Consider yourself under close scrutiny.
Your cavalier allegation of China having a "bigger IT industry than India" is a farce. Even more risible are the figures you use to justify that claim. You do realize that the term 'services' includes all deliverable, functionally and technically engenderable, variable, inseparable, comissionable apropos of the needs of consumers, individually or collectively renderable, and simultaneously consumable activities of an intangible nature arising from interminable human needs or wants in what is described as the 'tertiary' sector of the economy, of which the IT industry is merely one.
If in your years as a Japanese University student, you have not come across the use of the term, the term 'services' incorporates several diametrically opposed non-material counterpieces of physical goods- including hotel waiters, janitors, lawyers, coroners and crooners alike. From that rudimentary stat-posting of yours of the relative proportions of 'services' in India's and China's economies, it is half-wittedly sophomoric to conclude that "China
already has a bigger IT industry than India".
Now that we have cleared the chaff off your obscurantism, let us move on to more pertinent things. In the year 2004, when India's IT outsourcing industry was still in its adolescence, India's sharing of global IT outsourcing revenues was 43%, followed by Canada at 32%. China's was a paltry 5%, as the following graph indicates:
Source: InnoVest Group - ITO - China vs India
4 years hence, and by the year 2008, India's share had dropped to 37%, while the relative shares of others- Ireland in particular and Eastern Europe to a lesser extent, increased. China's share expanded marginally, while remaining under 10%. Only in 2008 did China's IT industry witness significant growth- with software exports growing 39% over the previous year to reach USD 14.2 billion and services outsourcing reaching $1.6 billion. In comparison, India's IT industry, which liberalized at a much earlier stage, witnessed average annual growth rates of 37% over the last 4 years. This infact was considered one of our lower growth rates- attributable to two things: the Mumbai attacks which caused investors to shy away from visits to the country temporally; and the cost of spiralling wages due to the immediate, requisite (skilled) supply-demand chasm- a fact which is being consistently remedied by the massive expansion of Universities and technical schools in both the private and public sector. Already however, major Indian IT cos. have bagged several new contracts and announcements of major expansions into the Indian IT sector have been made.
To put this into further perspective, the NASSCOM-Mckinsey Report [ a joint annual detailed survey of the health and future prospects of the Indian IT industry by NASSCOM, the suprastructural organization-cum-consortium that serves as an interface to the Indian software and BPO industry, and McKinsey, the management consulting firm advising companies on issues of strategy, organization, technology and operations ] projected Indian IT revenues for 2008 under the following breakdown: IT services: $38.5 billion, Software products: $19.5 bln, IT-enabled services: $19 bln, and E-services: $10 bln - to arrive at a cumulative figure of $87 bln. Exports of IT goods and services were valued at over $50 bln. A summary of the Report is attached here:
Indian Information Technology Industry
China has several limitations when it comes to the IT industry that will require decades to overcome: to begin with, although China has a large pool of IT talent, few IT workers are good at foreign languages, and thus few can communicate easily with foreign customers; secondly, China also has few inter-disciplinary talents who are skilled not only in technical issues, but also in business process, management and interpersonal communication: Chinese companies are engaged mainly in coding, whereas their Indian counterparts can provide comprehensive solutions to clients; thirdly, China has poor intellectual property protection in the IT sphere, with many Chinese companies not even aware of whether their actions constitute piracy - a consistently crucial factor in selecting an outsourcing partner; and fourthly, Chinese outsourcing companies are minuscule compared to their Indian rivals, with few even approaching annual revenues of 100 million dollars, whereas virtually every major Indian IT player- and there are several- account for annual revenues well in excess of a billion dollars.
Furthermore, a report by the business analyst firm Gartner released April 2009, indicates an expansion (it uses the word '
doubling'), despite the global slowdown and protectionist measures by western countries, of Indian BPO revenues by 2010. I attach an article to the report here. Do take the time to read it:
Indian BPOs’ revenues will be doubled by 2010: Gartner
The ongoing global economic crisis, the intermittent rise in wages and the Mumbai attacks have temporarily caused some shifting of outsourcing business from India to China, but most IT analysts are unanimous in their assertion that this trend will not last. Software clients usually pay more attention to service capabilities: including language and communication skills, intellectual property protection, and an ability to provide comprehensive, encompassing solutions- a capability that China
neither has
nor is likely to develop in the short run.
Willful disinformation is something we have an extreme distaste for.
Enjoy your stay on this forum.
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