“Bangalore is out. Kochi is in,” writes Stephanie Overby, Senior Editor of CIO Magazine, in an article on business process outsourcing (BPO) trends

IT’s glorious opportunities and daunting challenges STATE TRENDS



T. Ramavarman P. Venugopal



There are jobs aplenty and lots to ponder as the State rides the information technology boom





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With IT companies beginning to look at Kerala as a potential investment destination, the State is in for major investment and employment generation and this is likely to bring in its wake major challenges for the government.


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THIRUVANANTHAPURAM: “Bangalore is out. Kochi is in,” writes Stephanie Overby, Senior Editor of CIO Magazine, in an article on business process outsourcing (BPO) trends in India in a recent issue of the widely read IT journal.

As real estate prices and cost of living skyrocket in big cities and high cost of talent and infrastructure squeeze chop off chunks from profit margins, BPO companies are turning to smaller cities and towns and Kochi, Kerala’s emerging IT hub, figures at the very top of their priority destinations.

“The Smart City issue might have helped a bit,” says Joseph C. Mathew, IT Adviser to the Chief Minister of Kerala. “Why should an international infrastructure provider such as the Dubai-based TECOM come to Kochi despite some hard conditions set by the State government if not for the several pluses we have,” asks Mr. Mathew.

Talent on offer


The industry sees very good talent on offer here at a cost much lower than that in the big metros, good communication connectivity, a society quite cosmopolitan in attitude, the best of living conditions and, of course, sparkling environs. And it will not be just Kochi, or the capital city Thiruvananthapuram. The State is more of a sprawling town homogeneous all over in attributes attractive to the IT industry, unlike most other States with disconnected urban pockets in rambling landscapes of backward villages.

Experts believe that there are at least a dozen towns in the State ideal for IT companies. The Government’s IT Policy aims at developing all such towns for the industry along with Thiruvananthapuram and Kochi in a hub-and-spoke model so that the trickle down effect of prosperity too will be distributed evenly across the State. New IT parks at Palakkad, Kozhikode, Alappuzha and Kollam are already in the sprouting stage.

The IT industry employs over 30,000 professionals in the State at the moment, 17,000 of them at the Technopark in Thiruvananthapuram, and 5,000 at the Infopark in Kochi.

The State’s software exports were in the region of Rs.800 crore last year, according to the estimates of Software Technology Parks of India. “This is a gross underestimation, probably because many companies report their turnovers from their headquarters outside the State. The turnover per IT professional cannot be lower than Rs.20 lakh a year. The Technopark and the Infopark, employing more than 22,000 professionals, should by themselves be having more than Rs.4,000 crore of annual export business,” says N. Radhakrishnan Nair, Technopark Chief Executive Officer.

“We are looking at something like one lakh new IT jobs in the State in the next two years. Leading firms such as Infosys, Wipro, TCS, L&T and the Leela Group are working on building facilities here. Some of them want to set up parks as Special Economic Zones,” says IT Secretary Ajayakumar.

Sajan Pillai, Chief Operating Officer of the UST Global, which employs the largest number of IT professionals in the State, and the company’s Technopark unit chief Alexander Verghese say that the present trend will take the number of IT jobs in the State to nearly one million in the next four or five years. They base their forecast on a surmise that at least 10 per cent of the National Association of Software and Service Companies (NASSCOM) projection of IT job generation in the country during this period will be in Kerala.

Soft skills


The opportunities also throw up big challenges. The first concerns training the youth in skills beyond the ones they imbibe in the colleges to make them ‘employable’ with the necessary communication and computer skills, aptitude for IT and a ‘global attitude’ to the profession because IT is a global business.

“Finishing schools have to come up in a big way across the State to help us make the best of the opportunity. The times to come will see not just engineering graduates, but also a large number of graduates in other disciplines getting jobs in the IT sector,” says Mr. Sajan Pillai.

The curriculum will have to be revised and constantly put through fresh revisions in tune with the job market needs, he feels.

The Chief Minister’s IT Adviser feels that the government and the industry will have to show the way with right models of finishing schools and he is confident that private entrepreneurship will do the rest.

Entrepreneurship is waking up in Kerala, one can see it happening all over the State, he says. Ashokan Njarackal, a free software campaigner, is of the view that entrepreneurial skills too require nurturing.

Private players


Then there is the challenge of infrastructure and finding the resources to build it. Industry leaders suggest a string of self-contained ‘techno-cities’ in the State with good road and air connectivity.

Should it be the government’s own responsibility or should the private sector also be asked to chip in?

Ideological confusions, if any, may have to be sorted out fast. At the same time, the State has to guard against the danger of throwing the field totally open to real estate exploitation.

“The government knows the danger,” says the Chief Minister’s political secretary K.N. Balagopal.

“A joint sector company, with majority stake for the government, is being set up to facilitate investment and build IT parks all over the State. In Smart City’s case, we insisted that 70 per cent of the built-up space should be exclusively for the IT industry. Such safeguards may become necessary for other private parks too.”

On road to changes


The State is on the threshold of a change, the nature and scale of which have no precedents. The change that happened when the Gulf job market opened up in the 1970s was of a different nature altogether because a bulk of its beneficiaries belonged to the rural working class. Ultimately, it was more of a levelling process that happened in society through the Gulf boom.

In the present case, the so-called digital divide will take quite some time to vanish, notwithstanding the ‘Akshaya’ computer literacy programme of the government. Also, income divide will be a stark reality.

The emerging new section will also pressurise the system for a higher and higher share of the resources, from the government and society.

The State is entering uncharted seas. Somewhere out on the unfolding expanse, glorious promises await it; as also unknown dangers. This is the time when those who steer the ship will have to keep a very tight vigil.

http://www.hindu.com/2007/12/10/stories/2007121055190500.htm