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The Indians are coming

Offshore, the process by which a well-paying IT job in, say, Dayton, Ohio, becomes a much lower-paying IT job in Bangalore, India, has been spreading terror through America's cubicle farms recently. But even as jobs go to India—this week, AT&T was the latest big firm to talk of shifting a chunk of its workforce there—the Indians are hiring in America.

This month, two Indian conglomerates, the Godrej Group and the Essar Group, each said they were to buy a struggling American call-centre firm. Wipro, an Indian IT services firm, has announced the purchase of two small American consultancies. Scandent, another Indian group with interests in the IT industry, has bought a minority stake in North American Benefits Network, which administers company health and benefits plans. Other firms flush with cash, such as Infosys, a big rival to Wipro, are said to be seeking deals.

Officials at Nasscom, the Indian software industry's trade group, say that their members have made cumulative investments of $350m abroad recently, most of it in America. Having cut their teeth subcontracting for big western firms such as IBM and Accenture, the Indians now want to build closer relationships with customers—big firms that are outsourcing everything from systems maintenance to accounting. To do that, Indian firms need to offer the ability to run call centres and the like from America as well as from India.

They are also trying to counter the push of firms such as IBM, EDS and Accenture into India, and of western IT service firms into the consultancy business, a move that threatens to strengthen western control of customer relationships. Wipro, for instance, has bought the energy practice of American Management Systems, a Boston-based consultancy, and NerveWire, a business and IT consultancy specialising in the financial services industry.

Pawan Kumar, chair of vMoksha, a young Indian IT firm, thinks that the Indians face a bigger challenge managing their American acquisitions than experienced American multinationals face in India.

At the least, these foreign purchases should help tackle a growing image problem. As Indian firms have sucked jobs out of America, worries have grown in India about a protectionist backlash in Washington, DC. Work visas are harder to come by for travelling Indian programmers. Indian firms also worry about American government use of data-protection and homeland-security laws to thwart business. Nasscom has retained Hill & Knowlton, a big PR firm, to help manage politics and the press in America and Britain (where offshoring is also a hot issue). Their goal, says Harris Miller of the Information Technology Association of America, an industry lobby group, is to convince Americans that they are not just Indian companies but “global firms, with a local face here”.

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