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IT industry is the best hope for the unemployed, says Narayana Murthy

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A SALUTE: Infosys Chairman and Chief Mentor N.R. Narayana Murthy being felicitated by Chairman of the Institution of Engineers' Mysore Centre P.J. Bharadwaj (second from right) on Tuesday. Photo: M.A. Sriram
A SALUTE: Infosys Chairman and Chief Mentor N.R. Narayana Murthy being felicitated by Chairman of the Institution of Engineers' Mysore Centre P.J. Bharadwaj (second from right) on Tuesday. Photo: M.A. Sriram

Staff Correspondent

`Which other sector can create 2.2 million jobs by 2008?'

IT companies in Bangalore employ three lakh people Owing to them, about one million jobs have been created in the city Bangalore is home to nearly 1,600 IT firms

MYSORE: Taking exception to the criticism of the information technology (IT) sector from certain quarters, Infosys Chairman and Chief Mentor N.R. Narayana Murthy on Tuesday emphasised the potential of the IT industry to create employment opportunities.

Delivering the D.V. Narasimha Rao Memorial Lecture on "Indian software industry: opportunities and challenges" at the Institution of Engineers here, he said the IT industry is projected to generate 2.2 million jobs by 2008. "It is easy to criticise the IT industry. But it should also be borne in mind that no other industry has the potential to create 2.2 million jobs," he added.

The software industry in the country, which employed 12,000 people in 1991, emerged as a key player in the "global bazaar" owing to economic reforms. The sector now employs one million people, and the McKinsey report has predicted that the employment potential will reach 2.2 million by 2008, Mr. Murthy said.

He stressed Bangalore's pre-eminence in the IT sector. "The IT companies in Bangalore employ three lakh people. On account of money spent by IT employees, one million jobs have been created in the city, which has a population of about six million," he said.

In 1998, Bangalore had 634 IT companies. Today, the city is home to nearly 1,600 IT firms, and 150 new companies start functioning every year. "The IT companies in Bangalore include 622 multinational firms. Perhaps, no other city in India has so many MNCs. The whole world respects Bangalore and Karnataka as a place with a large pool of talented workforce and affordable prices," Mr. Murthy said.

Mr. Murthy referred to the rising labour costs in India, which could make the country a less attractive outsourcing destination. "A 15 per cent rise in labour costs was recorded in the country in 2004," he said and indicated the possibility of a reduction in the availability of low-cost workforce.

If India is to hold its own against global competition, the IT workforce should leverage its ideas and skills and emerge from "low-level" to strategic players in the business goals of clients and prove its efficiency on the world arena, he said.

Mr. Murthy referred to the inadequate infrastructure in India and quoted from a survey that gave the country the 39th position in Asia in terms of "network readiness index". He said the Government should concentrate on key infrastructure clusters such as airports, highways, ports, and power.

Earlier, he traced the growth of the IT industry in the country and said the removal of a regulatory environment gave freedom to the software, biotechnology and pharmaceutical sectors. From $164 million in 1991, software exports grew to $17.2 billion in 2004-05, he said.

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