1.Broad Issues Final statistics show India that in 2003-2004 Indian economy did grow by 8.2%, the highest ever in recent times. Union Budget of the new Government imposes a 2% Education Cess on all taxes. TCS, the oldest software services company, finally goes for an Initial Public Offering (IPO) on July 29, 2004; it is likely to be the largest in Indian stock market. Tatas celebrate a Centenary of Tata Sons. IDBI merges into IDBI Bank and becomes the second largest after SBI. Indian companies continue in their global march - truck manufacturer Ashok Leyland planning a Joint Venture in Iran for CNG buses. On the negative side, we had the “collapse” of the private Bank GTB (Global Trust Bank) and Oriental Bank of Commerce taking over the sick Bank. A Member of the Parliament goes “absconding” and finally surrendering to the Police. Kumbakonam tragedy claims nearly hundred children as victims of a bizarre accident. Globally, US Federal Bank increases Bank rate by 0.25%, after four years of downward slide. Boston Consulting talks of “outsourcing” as an imperative for American companies. US Presidential candidate John Kerry makes the interesting comment “if Bangalore can be all wired up we should do so to the whole of America”! Outsourcing critics in the United States refer to loss of jobs as “getting Bangalored”


2.On the Products front: Ittiam (Srini Rajam founded 3-year old DSP Company) launches the single-processor IP videophone solution and expects sales of 10 Million IP video phones based on its solution. IBM launches Power PC processor 5 family and Power PC 5 based PCs. Apple to launch G5 based iMacs. Sony launches Net Walkman. Microsoft, Yahoo, AOL and EarthLink decide to form an alliance to use innovative compute-based solutions to minimize spam control.


3.In the Marketplace PC shipments in India cross 3 Million in year 2003-04 as per MAIT; PC’s get cheaper by 2-6% thanks to Union Budget; Subash Menon founded Subex Software acquires Alcatel’s Fraud Management software and becomes the World’s No 1 in this segment pushing HP to No 2! HCL launches the innovative scheme “Rs 499 per month PC”. Cognizant Technologies to acquire testing software company RelQ for $ 15 Million. Globally, Samsung edges past Motorola to become the No 2 handset vendor, next only to Nokia. With LG Electronics edging out Siemens and Sony–Ericcson, two Korean companies would be in the Top 5 global mobile handset manufacturers! Flextronics, the global EMS leader with strong Singapore presence, buys out all manufacturing plants of Nortel. Microsoft acquires Lookout software that makes searching Outlook entries far easier.

4.Indian IT Scene; ET (Economic Times) Report talks of another 2 Million jobs in IT by 2008, partly due to growth in global IT services and existing jobs moving from US to India. MindTree Consulting (www.mindtreeconsulting.com) opens a development center for GE. IDBI Bank and Union Bank Philippines to use Finacle core banking solution from InfoSys. Silicon-Valley based eMuzed (www.emuzed.com) (with R & D at Bangalore), a leader in providing multimedia solutions including PVR for global OEMs like HP and Samsung, licenses its software IP to Nokia for their 6600 Family of handsets. Gowri Subramanian and Bhoovarahan founded Aspire (www.aspiresys.com) – a products design outsourcing company - plans to invest Rs 50 - 100 Crores over the next 3 years in Chennai office and increase headcount to 260 from its current 130.

5.MNC IT Companies in India One of the largest career site Monster (www.monster.com), that acquired JobsAhead in India, talks of US labor shortage in 2008 that is likely to benefit Indian IT professionals significantly. Microsoft plans to hire 7,000 professionals globally; a major part could be in India. ST Micro, the second largest semiconductor company in the world, bets on Indian R & D (expects to hire 7,000 people by 2007). Philips decides to ramp up R & D in India. Computer security products company McAfee starts its Research Center in Bangalore. Brooks Automation, the world leader in providing automation solution to semiconductor manufacturers, starts Indian operations at Chennai. Process control giant InvenSys (that acquired Foxboro recently), expands Hyderabad center, and plans to increase headcount to 300 from 200. ERP Company SSA Global is increasing headcount in India and investing $ 10 Million in India operations. UK-based IT services company Xansa (that earlier acquired IIS InfoTech in India) to double headcount from 2,000 to 4,000 in India (Chennai, Pune, NOIDA). Future Techno Design (FTD) (Singapore and Bangalore based) designs the multiple memory card reader that can read 13 different memory cards. Silicon Valley based Agami opens R & D Center in Hyderabad. Continuous Computing (www.ccpu.com) - a telecom hardware and software company with VoIP focus - opens center in Bangalore and plans investment of $ 3 Million and 100 jobs. Acer sets up 100 retail stores and expects Rs 500 Crores sales in India with Rs 70 Crores from rural India – India is shining! VirtUSA (earlier eRunway), promoted by Sri Lankan couple Tilakaratnes, to expand in Hyderabad & Chennai and plans to hire 1,000 this year. UK-based InaTech, an Oracle-solutions provider to increase headcount in Bangalore from 65 to 100.

6.In Telecom After slowing down for 3 months, mobile usage is back to a healthy growth of nearly 2 Millions/month in July 2004, with mobile phone users touching 40 Millions by end July. Subex Software (telecom billing space) acquires Alcatel’s Fraud Management software and becomes the World’s No 1 in this segment, pushing HP to No 2!

7.In ITES Healthcare solutions provider Dr Reddy’s sets up a captive BPO unit, signaling the changing tune that BPO is NOT for IT industry alone. Intelenet (http://evs.iiitb.ac.in/exchweb/bin/redir.asp?URL=http://www.intelenetglobal.com/), a joint venture of TCS and HDFC for BPO in Banking becomes HDFC subsidiary as TCS pulls out.

8.On the People front, Tata Sons Chairman Ratan Tata and NASSCOM President Kiran Karnik get the “Stars of Asia” Award from BusinessWeek. InfoSys Chairman NR Narayana Murthy gets Tilak Award. Tata Motors CEO Venu Srinivasan gets an Honorary Doctorate from Warwick University. Oracle President Charles Phillips Jr. visits India. Dr. Aart De Gues, Chairman, CEO and Co-Founder of the EDA major Synopsys, visits India. Jeff Taylor, CEO of Monster (www.monster.com) - the leading Career Site - visits India. Cornell President Jeffrey Lehman – the first Ivy League University President in recent times - visits several Indian Institutions. Singapore PM visits India. Globally, India-born Ujjal Dosanjh becomes Canada’s health minister. Vishakha Desai becomes the President of the prestigious Asia Society in New York.

9.On the Education & Research front, Union Budget 2004 provides a Cess of 2% on all taxes to fund Education in a big way. The Union Budget paves the way for Banks giving education loan up to Rs 7.5 Lakhs without collateral; no deserving student would be denied access to education. InfoSys launches Campus Connect. Supreme Court keeps BITS (Birla Institute of Technology & Science) out of AIEE (All India Entrance Examination for Engineering). CET (Common Entrance Test) muddle continues, with thousands of students having no place to go for no fault of theirs.

10.On the Applications front, Income Tax Department formally starts e-TDS. Retail majors Food-World and Nilgiris to insist on Bar-coding of all commodities, something that former Chief Vigilance Commissioner and IT Secretary Vittal suggested long back to promote IT, improve efficiency and reduce corruption.

11.On the Infrastructure front, Bangalore Airport gets the final clearance, thanks to Congress Party ruling at the Center and the State.

12. Some interesting statistics Top 20 S/w exporters for 2003-2004 are TCS, Infosys, Wipro, Satyam, HCL, Patni, iFlex, Mahindra BT, Polaris, Digital, NIIT, Perot, iGATE, BirlaSoft, MPhasis, Mastek, Hexaware, L & T InfoTech, Tata InfoTech, and Hughes. This list account for 65% of the $ 8.9 Billion software export representing 30% growth from 2002-3 to 2003-4. Infosys first quarter profit surges by 41%; expects annual business of Rs 6,731 to 6,772 Crores for 2004-2005. About 30,000 foreign professionals work in India with 12,000 in Bangalore alone; of which IT accounts for nearly 3,000. They are mostly from USA, Europe, China, Japan, Korea, Poland & Spain. IT/ITES has 250,000 employees who generate Rs 20,300 Crores of export, earn Rs 8,541 Crores of salaries, save Rs 2,562 Crores, and spend Rs 2,050 Crores on food & rent and Rs 615 Crores on clothing – that is Bangalore! The numbers are expected to be 810,000 employees who generate Rs 69,000 Crores of export, earn Rs 28,980 Crores of salaries, save Rs 11,694 Crores, and spend Rs 6,955 Crores on food & rent and Rs 2,087 Crores on clothing by year 2008-2009 as per Times of India Report! Science PhD’s in India stand at 3,896 while Engineering PhD stand at 696 per year while US has 164,600 PhD’s in Science & Engineering from India-born scientists alone!