While most of the European economy is reeling under acute slowdown, the information and communication technology sector there is on an upswing, touching a record $152 billion in revenues last year.
Even the Indian software firms notched their highest-ever revenues from the continent last year as the companies there outsourced more to cut costs.
As European companies, especially from the more developed North, are looking to outsource more, experts said the next boom for the Indian software companies is set to come from Europe.
Also, the European firms are looking to tap the rich domain knowledge and talent pool in India.
At the Nasscom Leadership Forum last week, several German and other North European firms were looking for more outsourcing and offshoring opportunities.
“India has innovation capabilities, domain knowledge and high tech expertise, which is what Europe needs now,” said Katharina Grimme, principal consultant, outsourcing and BPO markets, PAC, a European trade body.
She said it is India’s talent pool which Europe, especially the more developed and faster growing northern parts, is seeking.
Helge J Pedersen. chief global economist, Nordea, said the Germany’s IT industry is growing around sub-4% and most of its population is ageing.
“We need a young English- speaking Indian labour pool, which can add enormous value to the region’s offshoring and outsourcing capabilities,” he said, over and above investments from the Indian companies.
The trend has already begun.
Though Jurgen Laub, HP’s head of strategy and business development (enterprises services) in Germany, said the number of inter-region mergers and acquisitions are shrinking, Indian companies including Infosys, Hexaware and Geometric are already eyeing Germany and adjoining markets.
Martic Gummersbach, RWE IT GmbH, a leading German IT service provider, said the key for penetrating the European market is language. Then come understanding of the inter-cultural sensitivities and focused training on these issues.
Krishnakumar Natarajan, managing director and CEO of MindTree and vice chairman of Nasscom, said while the company will get 27% of its revenues from Europe, the overall IT industry will corner close to 50% of its offshoring revenues from that continent.
Concurred officials of Cognizant and Genpact, both expecting over 25% revenues each from the region.
Som Mittal, president, Nasscom, said going forward, the war will not be for market share but talent.