The Indian Software Industry
Besides offering low-cost IT human resources and high English proficiency, India is able to provide overnight or after-office hours programming solutions and maintenance because of its different time zone to the US and Europe.
According to the Software Institute of Carnegie Mellon University, India ranked second in the world in the number of cases participated in capacity maturity model (CMM) assessment. As at October 2002, 50 out of 77 Level 5 (the top level) CMM companies were in India.
Moreover, as more and more IT giants like Intel, SAP, Cisco, Sun Microsystems and Texas Instruments have established R&D centres in India, India's position in the global IT industry is likely to strengthen, not just as a base for low-level work such as writing code and trouble shooting.
Despite the continued expansion of the industry, Indian IT companies overall face a number of challenges in order to sustain the growth momentum, one of which is the need to develop more overseas markets like China and other parts of Asia.
Moreover, the growth of Internet application and e-commerce has changed the requirements of software development from code programming that earned the Indian IT sector early recognition to more high value-added activities.
Such high valued-added activities include designing web-based e-commerce/m-commerce platform, providing supply-chain management solutions for various business sectors and assisting companies to achieve enterprises resources planning by applying IT etc. These activities require a deep knowledge of the local market and business behavior, something which cannot be obtained by Indian IT companies without going overseas.