India: quality for little money By Robin van Koert Hyderabad - More and more Dutch ICT companies are keeping a keen eye on the low labor costs in India. The ICT sector is gradually recovering from its sales dip, but thousands of jobs have been transferred to the Asian country already. The exodus of jobs to India is also likely to continue for a while. India is a country of ancient traditions and difficult to understand contradictions. Nevertheless, the country boasts highly modern ICT companies surrounded by poverty, gurus and temples. Hyderabad, situated in the state of Andhra Pradesh, is home to the so-called Cyber Towers. New roads, designer offices and fresh greenery define the image of the area. The Cyber Towers are part of Hi-Tec City, the anticipated ICT-city of the future. According to Mohan Reddy, director of KPN supplier Infotech, government involvement is only one success factor. Quality is also very important. "A large number of Indian software-companies meet the highest international standards", says Reddy. Already more than two hundred Dutch companies are offshoring work. India offers a highly motivated, well-trained and perfectly English speaking workforce. The low labor costs make the Asian country even more attractive. Baan, Getronics, Philips en Shell have are having software developed and maintained, while for ABN Amro and ING administrative work is being carried out. Atos Origin already has thousands of employees in Asia. Logica CMG expects to employ about 2.500 people by the end of 2005. In addition, ABN Amro and Shell are talking about moving hundreds more jobs. The trade unions are concerned. The Federation of Dutch Trade Unions (FNV) points at the negative employment effects for the Dutch high-tech sector. Maurice Limmen of the Christian Dutch Trade Unions (CNV) confirms that concern. He is asking for special attention for administrative staff with lower education levels. Their jobs are most at risk. Consultant Paul Tjia of GPI Consultancy voices an entirely different opinion. The Netherlands does not have a choice: "It is about time the Netherlands starts offshoring basic ICT work to India", says Paul Tjia. The alternative is that the entire sector disappears. That would be fatal for the Netherlands as a knowledge society.