China, India can lead global IT, says Chinese premier

A combination of Indian software skills and Chinese hardware expertise can take both China and India to a leadership position worldwide in IT, Chinese premier Wen Jiabao said yesterday in Bangalore, India.

"When that particular day comes, it will signify the coming of the Asian century of the IT industry," he said.

Wen, who is on a four-day official visit to India, started his trip Saturday in Bangalore, India's technology hub, where he visited the facilities of Indian software and services outsourcer Tata Consultancy Services and the Indian research and development center of Shenzhen, China-based networking equipment vendor Huawei Technologies.

The IT industries of the two neighbors, China and India, have until recently grown independently of each other because of political differences and a border dispute. However, they have started to move closer together in recent years after prodding from the political leadership in China and the market opportunities in both countries.

A number of Indian software and services companies like Tata in Mumbai and Wipro and Infosys Technologies in Bangalore have set up software development operations in China. Chinese technology companies have also invested in India.

Huawei's R&D center in Bangalore was established in 2000 and was the first such center set up in India by a Chinese technology company. It employs more than 800 engineers and is one of Huawei's largest R&D centers outside China, according to Gilbert Joseph, head of corporate affairs at Huawei Technologies India. Huawei plans to set up a manufacturing facility in India in the next one to two years, Joseph said.

ZTE, a telecommunications equipment vendor in Shenzhen, announced last month that it has set up a manufacturing facility in India.

Indian apprehensions that China may want to ride piggyback on Indian software and services companies to become the next software and services power in the region are also disappearing. "We have to stop looking at China as only competition and instead look at China as a big market for us," said Subramanian Ramadorai, Tata's CEO and managing director.

Tata, which currently employs 200 people in China, plans to use its China operations as a resource pool to service its multinational clients in China and the rest of the Asia-Pacific region, as well to tap into the domestic Chinese market, Ramadorai said. China's banking, financial services and insurance sectors are going through an enormous change, and that is an opportunity for Indian IT services companies, he said.

Ramadorai is also the chairman of India's National Association of Software and Service Companies in Delhi.

China wants Indian IT companies to invest in China, and to access global markets from China, using local talent, in return for access to the local market, Ramadorai said. "They have a vision of building a software industry."

During his Bangalore visit, Wen also visited the Indian Space Research Organization and the Indian Institute of Science, a leading educational institution in the country. In his meetings this week in Delhi with the Indian prime minister Manmohan Singh, Wen is expected to try to resolve the border issue between the two countries and also propose a free trade agreement for the two countries.

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