Services Export : the Silver Lining

 

Context :

Govt bets high services export can trim CAD   /  TNN  /  17  Nov  2022

 

 

Extract :

 

The government is hoping to narrow the current account deficit due to a continued increase in SERVICES EXPORTS, which rose over 40 % to $ 28.6 billion in October, according to official data

 

India has traditionally had a trade surplus on the SERVICES front , which has helped narrow the overall trade deficit.

 

What is providing confidence to the government is a pick-up in SERVICES  EXPORT at a time when merchandise exports are slowing down

During the first half of the current financial year, SERVICES EXPORTS have increased 31 % to $ 181.4 billion, while imports were up 37 % at over $ 106 billion

 

My Take :

 

 

Dear Shri Ashwini Vaishnawji – Shri Rajeev Chandrasekharji – Shri Piyush Goyalji :

 

 

Even as we continue our efforts to make India a Manufacturing Hub for entire world, I urge you to :

 

Ø  Leveraging our Engineering Talent …………………….13  Dec  2018

Extract :

But , if “ Manufacturing Sector “ and “ Service Sector “ were two horses in the

 GDP race , I would bet on the “ Service Sector “, especially from the following

 view-points :

 

        #  “ Capital Investment per Job created “ would be much lower ( may be 10

              % of  Mfg. Sector ? )

 

       #    Jobs created would be much higher  ( may be 5 times of  Mfg sector ? )

 

       #    Time ( to create those jobs ) would be much shorter ( months instead of

             years )

 

  #     Export of  “ Services “ are much easier than export of  “ Goods “

 

      #     Quality of our “ Services “ are comparable – or even better – than from

             other countries

 

      #     We will , soon , have the desired quality / quantity of Internet connectivity ,

             all over India

 

      #    We are turning out thousands of Graduates  each year though some need “

            Skilling “

 

      #    Salaries of our Engineers are 20 - 25 % of similar hires in USA – EU – Japan

             – UK etc

 

 

Ø  Brain Inc 2.0 ………………………………………..21 Aug 2017

Extract :

Now consider this :

  

·         By employing 5 lakh engineers , India’s “ Tech R&D Firms “ earned $ 22 billion

          . That works to a billing of $ 44,000 per man-year of R&D ( Export of Services )

 

 

         

           I presume that the “ Manpower Cost “ constitute approx. 50 % of Billing Rate

           ( rest being OVERHEADS and MARGIN )

 

          

·         Hence , Indian R&D firms must be paying an average of $ 22,000 per year to

          its employees ( approx. Rs 1.2 lakh per month )

 

             { Refer :  Employee Expenses as %age of Sales   /   05   July   2022 }

 

  

·         As against this , both , Indian as well as American firms pay ( on an average )

         , $ 88,000 per year to H1 B  visa holders

        

      With this kind of “ Cost Advantage “ , is there a possibility to do better than

      the projected earnings of $ 40 billion in 2020 ?

 

            It is high time our Policy Makers launch a new initiative ( of Export of

      Intellectual  Property ) , called :

  

                     INDIA  :  the  BRAIN  FACTORY  of  THE  WORLD

 

 During an Interview with Business Line ( 16 April 2016 ) , the then CEO of Infosys

 , Vishal Sikka , said :

 

“ We have to re-imagine the notion of services “

In support of my belief  in the potential re-imagination of this “ Service Sector “ ,

allow me to quote Peter Diamandis 

  {  https://www.diamandis.com/blog/topic/web-3-0  ]  :

 

 The Spatial Web is also giving way to “virtual company headquarters” and

 

 completely virtualized companies, where employees can work from

 

 home or any place on the planet

 

·        Delocalize with VR, and you can now hire anyone with Internet access ( right

         next door or on the other  side of the planet )

                  

·        Web 3.0 is changing the way we work, where we work and who we work with.

 ==================================================

With regards,

Hemen Parekh

hcp@RecruitGuru.com  /  17  NOV  2022

 

 

Related Readings :

Ø  Can Indian IT Re-invent itself ? ………………………………….[ 03 Feb 2017 ]

Ø  Will Holograms beat H1B Visa Ban ? …………………………..[ 31 Jan 2017 ]

Ø  THANK YOU FOR YOUR VISION …………………………………..[ 24 Jan 2017 ]

Ø  Idea whose time has come ?................................... [ 16 Feb 2017 ]

Ø  Wormholes Across the World ? ………………………………….. [ 03 Mar 2017 ]

Ø  Ready to be Ridiculed …………………………………………………..[ 23 Aug 2017 ]

 

Ø          Vindication  must  wait …………………………………………………[ 18 Mar 2018 ]

 

Ø  Betting on BPOs ? …………………………………………………………[ 19 Dec 2018 ]

 

Ø  India BPO Promotion Scheme :  V  2.0………………..       [ 11 Apr 2018 ]

 

Ø  Gaining Ground : Virtually…………………………………………… [ 01 Mar 2021 ]

 

Ø  Services Export : the Saviour ……………………………………….[ 14 July 2022 ]