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Global slowdown casts shadow on IT event

Special Correspondent

Bangalore: The eleventh edition of Bangalore’s annual IT event, named BangaloreIT.biz this year (till last year it was known as Bangalore IT.in) drew less participation owing to the slowdown in the IT industry caused by the global economic turmoil.

The three-day event was inaugurated on Thursday by Chief Minister B.S. Yeddyurappa. Chief Minister of Gujarat Narendra Modi inaugurated the exhibition. Bangalore IT.biz 2008 is being organised by the Department of IT, BT and Science & Technology, Government of Karnataka; Software Technology Parks of India-Bangalore; and MM Activ, a private science communication company.

Mr. Modi urged the IT industry to address the domestic market in order to overcome the problems caused by the slowing down of the world economy.

“We are at a crossroads now, and it will help if the industry addressed the vast untapped potential in the domestic market,” he said. He added that the average productivity in India was still low because companies were still providing “only low-end support services”.

“The Indian IT industry,” he said, “has been content to stay in the comfort zone of low value-addition.”

He warned that if the industry did not move up the value chain, it would find it difficult to deal with competition from China, the Philippines and countries in Eastern Europe. Mr. Yeddyurappa said revenues from Indian software exports were likely to grow by 24 per cent in the current year, compared to 29 per cent in the previous year. The State, he said, was likely to be affected because about 35 per cent of Indian exports originated from Karnataka.

Sudhakar Rao, Chief Secretary, Government of Karnataka, said Indian IT companies were facing difficulties because 40 per cent of the companies were cutting IT-related budgets and negotiating lower rates with suppliers.

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