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Skills shortage hits Indian CIOs
The outsourcer to become the outsourced?

By Gemma Simpson

Published: Monday 11 June 2007

Indian CIOs must consider offshoring as the country is hit by an IT skills shortage.

The offshoring hotspot is also facing "second-class" treatment from local service providers which are eating up the country's skilled IT resources, according to analyst house Gartner.

Linda Cohen, vice president and distinguished analyst for Gartner's IT sourcing group, said local service providers are not allocating enough quality resources for Indian customers and typically give the best resources to global customers, which pay in dollars and yield better margins.

India has a "severe shortage of skilled IT resources" at all staffing levels, Cohen added.

Special Report: Inside India

In February silicon.com's Steve Ranger visited the Indian tech hotspots of Bangalore, Mumbai, Pune and Hyderabad. Click on the links below to see photo galleries of the cities and companies visited.

♦ Satyam's IT campus
♦ Hyderabad's tech parks
♦ Bringing tech to rural India
♦ High-tech on the streets of Pune
♦ Pune - the new Bangalore?
♦ Boom town Bangalore
♦ Bangalore's Electronics City
♦ SAP and Wipro in Bangalore

As businesses demand more from their IT departments, Indian CIOs need to increasingly offshore IT roles to manage the skills shortage, according to Gartner.

Arup Roy, senior research analyst for Gartner's IT services market group, said Indian companies will increasingly source IT skills from Hong Kong and Singapore.

Indian CIOs need to invest heavily in training and develop programmes to retain the talent they already have and start recruiting from alternative local sources - such as from small and medium-sized cities, Gartner recommends.

Last year, the head of India's IT trade body Nasscom said the country will suffer a severe IT skills shortage by 2010.