Press Release

African Countries Look to Build on India’s Outsourcing Story

26 Oct 2009, 0050 hrs IST, PP Thimmaya, ET Bureau BANGALORE: Emerging African nations of Ghana, Egypt and Nigeria among several others are emulating India's offshoring success in order to attract outsourcing customers for niche projects by working closely with Indian tech firms and consultants. While it's not possible for the African nations to match India's over $40 billion software exports industry in terms of the available skilled workforce, which is around 2 million engineers-strong, these countries plan to evolve more as outsourcing destinations for niche projects based on the available skills. For instance, Uruguay is more focused on analytics outsourcing for pharmaceutical customers, Costa Rica and Jamaica are emerging as nearshore call centre destinations. "India is our model," said, Mr Alhassan Umar, director - ITES Secretariat, Ministry of Communication, Ghana. Mr Umar is among many professionals from the region who are currently studying the Indian model. According to Mr Umar, a team from Ghana had visited the technology park in Hyderabad in order to explore establishing a similar facility in Ghana. "As much as we would like adopt best practices from India, we would also like to avoid some of the pitfalls which India had faced." "Ghana is very good in graphics and web design skills and it was a very pleasant surprise for us," said Dr Pradeep Mukherji, president of management consulting firm Avasant. Mukherji is among several other Indian outsourcing professionals who are offering advisory services to these countries for replicating the Indian success, although in a much more limited way. Avasant is currently advising Ghana's ministry of communication for building a local outsourcing industry. However, they will lack the scale and entire breadth of solutions that could delivered from cities in India. "There are 10-12 countries in the African continent which could develop a credible IT industry, though none would have the scale of India," Mr Mukherji said. "We are asking newer destinations to put themselves in the customers' shoes and justify the reason for outsourcing," said Avinash Vashishtha, chief executive of offshoring advisory firm Tholons. Countries such as Egypt have already started justifying why customers need to look beyond India. Egypt's attractive subsidies for creating local employment through incentives including waiver on training and salary costs for new recruits in the IT and back office sector is making it compelling for companies such as Wipro to seriously consider sending more work to the country. "Egypt has already reduced taxes from 40% to 20% and ITIDA helps multinationals with incentives like subsidising the training of professionals," said Dr Hazem Abdulazim, chief executive of the Information Technology Industry Development Agency (ITIDA), Egypt. India's second biggest outsourcing company Wipro is already offshoring some work to its centre in Cairo. "We believe that 20% of our work, contracts, can be offshored to Egypt," Anand Sankaran, senior VP and business head India and Middle East business, Wipro told ET in a recent interview. "We are offshoring some jobs from Middle East and India to Egypt. Link: