Opportunities from the financial crisis for the Indian IT industry

The crisis in the global financial services indutry throw up planeloads of challenges and opportunities for Indian IT firms, says Sudhakar Ram, CMD, Mastek

The sub prime crisis and the subsequent meltdown has been the subject of much discussion in the recent past. The magnitude of the crisis, the impact it has had on what we thought were rock-solid institutions and the ripple effect across the globe have been mind-boggling.

Sudhakar Ram, CMD, MastekWhat I'd like to focus on, in this article, is the impact  this will have on the Indian IT services industry and the opportunities it is likely to throw up for companies operating in the Third Wave.

Before getting into the impact of the crisis, let's look at the Three Waves of Indian IT.

The Three Waves of the Indian IT Industry
When we look at globalisation, specific industries in emerging economies typically go through three waves of evolution. The electronics industry, first in Japan, then in South-East Asia and now in China, are good examples of this.

In the first wave, companies in emerging economies typically act as component suppliers to developed countries that manufacture the complete product.

In the second wave, the local industry gains enough expertise to provide cost-effective contract manufacturing services - of either the entire product or major sub-assemblies.