India's Infosys aims to help Chinese companies go global

By CAI XIAO (China Daily) Updated: 2015-01-23 07:45

Though Infosys China also operates as a China-based global delivery center, the company has faced some hurdles due to the rising labor costs.

Explaining this the chief executive said that the global delivery model is typically associated with companies that provide IT consulting and services and relies on using a pre-determined model for the technology project with a team that is distributed globally.

"Although the costs in China have increased, there are only a few countries like China and India that can give us scale advantage in terms of talent," said Rathangapani. "What we will do is to foster more innovation in China, so that we can deploy them in the global markets and thus make our Chinese business more successful."

The key to fostering innovation will come from Infosys's alliances with Chinese universities and top educational institutions. "We are already in talks with some Chinese universities to establish innovation labs, and we hope to have some concrete agreements soon," the chief executive said.

"Over the next two years, we will see a lot more progress from our side on projects related to mobility and Smart Cities, and we hope to offer more solutions in these areas," he said.

Besides Infosys, IBM and Accenture are also key providers of IT consulting services and solutions in China.

Rathangapani, however, is not too worried about competition. "IBM is one of our close partners, even though we compete with them in several segments. In today's ecosystem, we have to work with even our competitors. The most important objective is to keep our customers happy."

Like most of his industry peers, Rathangapani also does not attach too much of importance to the growth slowdown in China. "There is still enough room for Infosys's growth in China as we anticipate huge growth opportunities over the next decade."

Opening the gates to investment in India

High-tech companies from China have joined their domestic peers in actively scouting for investment opportunities in overseas markets, with some looking to India as a possible destination.

India's strong growth credentials are undoubtedly the prime driver for most of the high-tech companies, said industry experts. The Asian nation is planning to grow its gross domestic product from $1.9 trillion currently to about $10.4 trillion by 2034. That would elevate its per capita GDP from $1,490 to $6,800 during the same period, said a recent report published by global consulting firm PricewaterhouseCoopers.

Indications that Chinese companies are considering India in a big way became evident in November when Jack Ma, the Aliababa chief, indicated that the e-commerce giant would invest more in India, as it believes that the Internet can transform the country's future.

According to media reports, Ma was also expected to hold discussions with Kunal Bahl, the 30-year-old co-founder and chief executive of online marketplace Snapdeal, at a suitable time. Snapdeal, however, declined to confirm any such meeting, even as the reports suggested that Ma might join hands with Snapdeal to build a bigger e-commerce presence for Alibaba in India.

Some Chinese companies have already started reaping the gains from their investments in India.

Xiaomi Corp, the world's third-biggest smartphone maker, will invest in Indian startups and overseas media content, Hugo Barra, vice-president of Xiaomi's global division, said recently. Xiaomi founder and CEO Lei Jun had said, it has already sold over 1 million mobile phones in India after entering the market in June 2014.

Technology giant Lenovo Group Ltd has charted plans to become the third-largest smartphone company in India, according to a report in The Financial Express. Lenovo spent $2.9 billion to acquire Motorola, India's third-largest smartphone maker, in 2014.

Rao Talasila, director at the US-based electronics firm Belkin Corp, said India's steady political environment, rapidly recovering economy, stronger Sino-India ties, offer huge growth potential for Chinese companies.