Visa laws hit users, says Indian IT leader

British companies are being placed at a competitive disadvantage because of outdated restrictions on visas for overseas staff,...

British companies are being placed at a competitive disadvantage because of outdated restrictions on visas for overseas staff, India's software and services trade association said last week.

Sunil Mehta, vice-president of India's National Association of Software & Services Companies (Nasscom), said there was a pressing need for reform of the visa system, which he claimed is making it difficult for companies to use overseas IT consultants.

"The problem is that we have a system of using visas that is independent of the way the world is doing business," he said. "It is impeding the ability of companies to be globally effective and their ability to access skills and competitive rates."

Nasscom is pressing for international reform of the visa system, through the World Trade Organisation and similar bodies, to make it easier for companies to contract IT development and maintenance work overseas.

The issue will become increasingly important as the UK's aging population makes it more difficult to find the right IT skills locally, said Mehta in an interview with Computer Weekly.

Nasscom rejected claims that the savings promised by offshoring can often be lower than companies expect. Its research shows that on average UK firms get a payback of £1.40 for every £1 of work they send offshore.

When companies fail to achieve benefits, said Mehta, it is because they embark on work with Indian suppliers without thinking through their strategy and locking down their specifications beforehand.

"You should look at business efficiency and productivity before you look at cost savings. You should also be very careful about which systems you are outsourcing," he said.

Some businesses have voiced concerns over high staff turnover in offshore software firms and the relative lack of experience of Indian programmers, many of whom are in their early 20s.

But Mehta said there was no evidence to show that these concerns had impacted on project delivery times or quality.

"Often these are used as excuses not to go offshore. [Users] need to work with suppliers to make sure they have the internal management process and a library of software objects in place which will help to address issues of experience and staff turnover."

India would continue to remain cost-effective for British firms, said Mehta, despite the competition from China and Eastern Europe, and the rising cost of wages for Indian IT staff, which are escalating by 10%-15% a year.

"The global IT services market is worth £330bn. The offshore work is less than £11bn. There is enormous room for this £11bn to grow. Up to 40% of work can be done offshore. We are talking about £132bn, which means there is enough room for all the players, including India and China."

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