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How Kiran Karnik helped the IT sector
BS Reporters in Mumbai | October 04, 2007 10:46 IST
It might prove a well-deserved break. Karnik took over the IT representative body Nasscom after the sudden death of Dewang Mehta in 2001.
There was scepticism when he took over the reins in 2001. The managing director of Discovery Networks and a 20-year ISRO veteran came with rich credentials but hardly any exposure to the fast-growing IT industry.
After heading the apex body for six years, and being instrumental in placing the Indian IT industry on the global map. Consider this. In 2000, the Indian IT-ITeS industry was around $5.7 billion (including over $4 billion worth of software exports).
It has since been growing at 25-30 per cent per annum to touch revenues of $39.6 billion in financial year 2006-07.
"I had very big shoes (Dewang Mehta's) to fill in. I had to stand on the shoulders of a person who was very tall, and take off from there," admits Karnik.
He was a relatively low-profile person. But he went about slowly building Nasscom as an institution. The industry was initially skeptical, but soon came around to believe that Karnik would do the job well.
So what does he like most about his tenure? "Shortly before I joined, the 9/11 incident had taken place. A recession was round the corner. All this almost coincided with the US elections. Prior to 2001, we as an industry were grappling with issues like quality and delivery. Suddenly, a completely different set of challenges had emerged - outsourcing politics became important. Regulatory issues around data security became important. In retrospect, we collectively handled the situation reasonably well. Though its election time in the US, the rhetoric over outsourcing is far less than it was before."
Karnik has also helped the industry raise a debate over the human resource (HR) issue in the IT industry. "We have put this up on the national agenda. To me it is satisfying since it impinges on growth in all sectors. The IT sector would generate four lakh new jobs this year, which would be about 25 per cent higher than previous year, Karnik had said earlier. The industry employs around 1.6 million people.
"We (Nasscom) have also been able to create awareness in the IT industry that firms need to go to Tier-II towns. While there's a lot to be done in this area, a start has surely been made, and it's satisfying," said Karnik.
He also came to the rescue of BPOs, exhorting the Centre not to be a "nanny government" while reacting to Union Health Minister Anbumani Ramadoss' recent comments on the BPO industry. In his tenure, the IT industry has grown rapidly and become a force to reckon with.
Any regrets? "Well! The growth came despite the industry being saddled with minimum alternate tax, tax on ESOP and tax on service apartments. Last year's budget was a major disappointment in these respects. We hope it will be better in the coming year."
Karnik is happy with Som Mittal's appointment. "It demonstrates that Nasscom is not necessarily the next step in one's career. It is for people looking for a bigger canvas though they will have to work at a fraction of their earlier salaries. A large number of candidates applied for the post. This is very heartening."
Karnik's report card