Wed, Jul 26, 2006 - Page 12 News List

Think before investing in India, says IBM fellow

By Jason Tan  /  STAFF REPORTER

Taiwanese technology firms should be aware of potential risks before they succumb to Indian fever, an IBM Corp research fellow said yesterday.

"India has the largest pool of human resources in the technology industry after the US and Russia, but it is harder to retain people now as they change jobs more frequently," said Chandrasekaran Mohan, an IBM fellow and chief scientist in India.

He made the remarks after speaking at the IBM 2006 Developer Works conference held in Taipei.

The availability of the talent pool does not guarantee employee retention as in the case of IBM India, which has to employ non-computer graduates for its call centers, because computer science and engineering graduates get bored of the job easily and leave, he said.

IBM, whose second largest workforce after the US is in India, is the biggest foreign employer in the country with 42,000 employees to date.

Recruitment problem

Meanwhile, salaries in India are shooting up and it is no easy task recruiting senior researchers with a PhD qualification, said Mohan, who has been working with IBM for 24 years and is one of the 60 or so fellows at IBM -- the highest technologist position in the New York-based company.

Other issues foreign companies should pay attention to include Indian state governments' reluctance in improving basic infrastructure such as rugged roads in Bangalore -- a technology hub in Southern India -- as well as untested labor laws and political friction, he said.

According to Mohan, India's technology strengths today lie not only in software, but also in other areas such as chip design, drug trials and health tourism.

"After India opened up its economy in the early 90s, allowing imports and foreign investments, domestic companies sped up technology adoption to compete with foreign firms," he said.

Diversification

Taiwanese companies have started to set their sights on India in a bid to diversify their investments from China. Cumulative Taiwanese investment in India is currently low, totaling less than US$20 million at the end of last year.

As of the first quarter this year, local investments in China since 1991 had reached US$48.17 billion, according to the government's latest tallies.

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