The earthquake-stricken Japan’s over $108-billion IT services market may continue to remain elusive for India’s top-tier software services companies for the time being, with the ongoing crisis likely to slow down deals and hit plans to grow inorganically after years of trying to establish a foothold in the country’s closed market.

Globally the second largest IT services market after the US, Japan currently contributes to less than 1.5% of revenue for the top players in Indian IT sector and some 2% to India’s total IT exports revenue of $50 billion. The minuscule size of the offshore outsourcing business and language hurdles are the major hurdles in penetrating the market. But the share of business has been gradually increasing over the past couple of years as Indian firms have climbed up the value chain and are now scouting for Japanese acquisitions, according to industry watchers.

Japan has traditionally remained a closed IT market with nearly 92% of its IT services handled by a few Japanese conglomerates that form the top tier of the market and which sub-contract to the secondary and tertiary levels where Indian and Chinese players have a presence. China garners a bulk of the remaining 8% that is outsourced directly to non-Japanese players and India comes second with around $1.8 billion worth of business annually.

“There has been a change to this in the past few years and Japan is looking at alternatives to China,” said Kumar R Parakala, head, IT advisory, KPMG. “In order to cut the chain short, Indian players have set up operations in Japan itself and are focusing on localising by improving their language capabilities, which is one of the biggest barriers for doing business in Japan.”

Both Infosys Technologies and Wipro have 400 employees in different parts of Japan, and Tata Consultancy Services has about 100 people in Yokohama city. Wipro has BPO operations in Okinawa, sales and development work in Yokohama and a sales office in Tokyo. Among the 100 people employed by Mahindra Satyam for sales and delivery, 70 are locals. IT firm Cognizant also has about 98 sales employees but does not operate a development centre.

With the recent crisis in Japan, analysts don’t see much of an impact in terms of revenue for the Indian IT companies as most of the top players have very little exposure to the Japanese market. And of this, the maximum opportunity comes from the banking, financial services and insurance or BFSI and manufacturing verticals, which account for 40-45% of IT business in Japan. Other areas such as system integration and ICT constitute 8-18% of IT consumption. Overall, Wipro has an exposure of 1.5%, TCS close to 1% and HCL 1%.

“Our exposure to Japan is only 1% of our revenues, so it will not have any material impact. We have to see how the whole thing evolves,” said V Balakrishnan, CFO, Infosys. “In immediate quarters, there will not be any material impact because the exposure itself is very small.”

Indian IT firms have responded to the crisis by shifting work to offshore centres and allowing employees to return to India. “Extensive business continuity measures have been put in place, so that our customer operations are not impacted,” said Saurabh Govil, senior vice-president (human resources), Wipro Technologies. However, industry watchers feel that with a priority budget coming in for the next two quarters new deals will take a back seat for now. Sanjeev Hota, senior research analyst, Sharekhan, said: “All these things, acquisitions or getting new clients, getting more deals, will now take some time. It will get delayed at least for a quarter or two.” Smaller IT companies Nucleus Software Exports and Tata Elxsi have a large chunk of their revenue, 37% and 26%, respectively, coming from Japan, he said.

The larger Indian companies have started getting direct orders in recent months as against Japan’s hierarchical business model for services, an indication of their climb up the value chain. These firms have been looking at acquisitions as the preferred approach to offset the language hurdle. They also see their China bases playing a major role in the same. “The language skills are similar to Japan so people do use the China base for the Japanese customers. We have a China centre, it caters to some of out Japanese customers, not many,” said Infosys’ Balakrishnan.

Besides, Japanese companies are also eyeing acquisitions in India in a bid to have an offshore IT-base as well as win more global customers, said Pradyumna Sahu, associate director, technology sector, PricewaterhouseCoopers. “The very fact that Japanese IT companies are looking for targets in India indicates that they are open to offshoring.”

While low labour cost, cultural affinity and language work to the advantage of countries such as the Philippines and Vietnam in catering to the Japanese market, India will still retain an edge because of the quality of work it handles. “The threat lies, if at all, in the BPO sector where the dependency on language capability is extremely high,” said Parakala.

Source:http://www.indianexpress.com/news/japan-leaves-it-cos-shaken-and-stirred/764153/0

Japan has for long been a frontier that the Indian technology industry has yet to conquer. We have left our mark on the world IT map catering principally to the software outsourcing needs of major clients in the USA, Europe and, recently, Australia. These are all, by and large, English speaking or, at least zones where English for business is very acceptable. India’s twin decades of software development experience has empowered its IT industry to become the number one software outsourcing destination in the world.

But, going forward, the Indian IT industry will have to look beyond its comfort zone. That process has begun, albeit tentatively. I speak of Japan and China. The latter is a nation with which we have begun engaging more actively. This engagement, however, is limited to services for export rather than penetration of the national market.

Japan continues to be the second largest IT market in the world after the US. This market has its own unique sets of rules and manners of engagement that are often radically dissimilar to our comfort zone.

Today, for India, Japan constitutes less than 2% of the IT services exports. Penetrating the second biggest IT services market in the world continues to be a challenge for Indian IT companies—both, culturally as well as in terms of creating a sound Japan centric policy to penetrate the Japanese market successfully.

Further, as the Japanese IT industry opens its doors to long term investors, there will be greater opportunities for the Indian IT industry. The important aspect is for software outsourcing companies to aim for long term investment sans immediate returns expectation in order to benefit. The obvious challenge that companies/corporates face is that of the language barrier. Japanese businesses prefer to conduct their work in Japanese, rather than English. To overcome this impediment we would need to look at allocating more resources to train its workers on Japanese language and culture.

Indian companies looking to de-risk themselves from dependence on a single market have long tried to establish themselves in this market, but with nominal success. With its large technically qualified manpower base and IT service delivery expertise, India definitely has a big role to play as the aging Japanese economy makes choices to stay competitive in global markets.

As per Nasscom’s Japan reports, a key element for Japan to retain its competitiveness in the global market is that it would need the proactive effort by Japanese government and industry to break the traditional models and they would have to reach out.

From the Indian side, Nasscom’s president, Som Mittal, has said in the past, “With (a) shortage of technical skills in Japan, and urgent need for business transformation, Japan would be a large market. While Indian companies have been targeting this market, a new concerted approach needs to be taken by both sides.”

During and post recession, the Japanese companies are leaving no stone unturned in their pursuit to pare costs. If this is not an opportunity to penetrate this $108-billion IT services market, I do not know what would be. Troubled auto-makers Toyota and Nissan are putting out outsourcing deals worth $100-$200 million; Japanese electronics majors are re-looking at existing contracts as they seek for more cost-effective ways to maintain and support their global IT systems. Opportunities are there for the taking…

However, for our Indian companies to score a home run in this new, promising scenario, they would need to convince the Japanese to look at changing options in their choice of outsourcing destinations. Only then may we begin to see a shift from China and Korea towards India. If a Japanese company sees better service at a lower cost then you will find cooperation. The good news is that, once three or four companies see value and commit, then the foot in the door pretty soon forces it ajar. Japanese business networking is among the best in the world and success is often sought to be emulated through an element of basic copying.

The China connection

Today, Japan outsources the majority of IT development to China’s software industry. Despite an element of historical animosity dating back to the second World War and which is always remembered in China, the fact is that these two nation states are geographically and culturally closer to each other. Many Chinese software professionals know Japanese (language) and this has helped them immeasurably. Finally, once you have built trust with the Japanese, you are generally there to stay.

In light of such connectivity, the Indian technology industry would do well to look at China very seriously and in a holistic manner. That country today offers a lucrative market for Indian software development companies, their government is now more focused on developing their IT industry having declared 21 regions in China as tax-free up to 2014 to boost its offshore IT industry.

We aren’t entirely blind to this. Wipro already operates a global IT delivery centre in China. Other players among the big 6 have a presence there from ‘large to could do better’.

Basically, you ignore these two economies at your peril. Not only do they offer bright opportunities in the coming years, the fact is that the traditional lucrative western markets are beginning to head rather rapidly in the general direction of a plateau.

Speed is of the essence here—the early bird catches the worm. Further, emerging IT economies like Vietnam and Thailand are not sitting idle. This is their immediate sphere. Leave this wide open and their bite will be deep enough to keep us out for good. The time is now.

Source:http://www.financialexpress.com/news/china-and-japan-are-the-future-for-indian-it/711126/0

Japanese and Chinese companies are ready to set up outsourcing operations in the Philippines where they have to opportunity to polish their English and take advantage of the advanced commercial banking services at lower cost, Trade and Industry Undersecretary Cristino L. Panlilio said.

Panlilio told reporters that during his earlier trade and investment mission to Japan some Japanese call centers have expressed their intention to relocate here.

“The Japanese are interested in establishing call centers here,” he said. Two Japanese companies with multi-products are ready to relocate into the country.

According to Panlilio, the Japanese strategy is to put up a call center operation here with an initial staff of 50 representatives to handle their Japanese clients.

During their operation here, Japanese firms are planning to train the locals to handle some of their clients by learning Nihongo and for them to learn English at the same time.

“It’s hitting three chicks in one stone,” said Panlilio, who is also managing head of the Board of Investments (BoI).

Panlilio also said that BoI is organizing a delegation of local BPO firms and the investment banking community in the country to participate in the BPO/IT Conference in Shanghai on Nov. 18-20.

He said the BoI has enticed investment bankers to participate in the Shanghai conference because Chinese banks need to upgrade their systems, procedures and processes.

The Philippines commercial trade offices in China are arranging parallel one-on-one meetings with Philippine commercial banks and Chinese banks.

Chinese banks have been interested to outsource their investment and banking processes as they are upgrading their reach but they don’t have the right skills.

“They are delayed in their banking modernization program and in order to catch up they have to outsource some investment and banking services. We are pretty advanced in the commercial notes and other investment, and financing instruments,” he said.

He said the Philippines is known for its expertise in the commercial and financial services sector that during the 70’s local firms lent their expertise to countries such as Malaysia and Indonesia.

Source:http://www.mb.com.ph/articles/284565/japanese-chinese-companies-ready-set-up-rp-outsourcing-operations

n an online version of the old three shell game, Yahoo, Google and Microsoft have been shuffled around in Japan with Google uncovered as Yahoo Japan’s new search partner, leaving Yahoo Inc. (USA) in the lurch.

Microsoft, which partners with Yahoo in the U.S., is also out in the cold. Yahoo Japan’s president Masahiro Inoue announced the decision Tuesday after his firm concluded that Microsoft’s search technology was not strong enough for its needs in Japan, according to the Reuters news service. Yahoo Japan is 35% owned by Yahoo Inc., but that percentage wasn’t enough to override the 40% stake owned by Softbank.

To complicate matters further, Yahoo Inc. has been outsourcing some of its search capability to Microsoft.

A possible antitrust problem — Google and the new Yahoo search capability could represent as much as an 80% search market share in Japan — has been cleared with the Japanese government, according to media reports.

Yahoo Inc. will remain associated with the Japanese affiliate as a strategic partner and will continue its financial stake in the Japanese unit.

Last year, Yahoo Inc. signed a 10-year agreement with Microsoft to shift web indexing to Microsoft while Yahoo improved its search capability. Still earlier Microsoft had offered by purchase Yahoo Inc. outright, but Yahoo’s management at the time rejected the offer and Yahoo stock has still not recovered from the pre-offer price.

Source:http://www.informationweek.com/news/storage/data_protection/showArticle.jhtml?articleID=226300081&subSection=All+Stories

In October 2008, when the world was reeling from the collapse of Lehman Brothers and job markets were freezing up everywhere, Akane Natori waltzed into a new position she liked. “Things went so smoothly after applying online, and before I knew it, I had the job,” said Ms. Natori, who was then a 26-year-old sales assistant at an import-export company in Tokyo.

There was just one catch, one that speaks volumes about the Japanese economy and the challenges younger Japanese face in a country where college graduates used to count on lifetime employment with the company they joined right out of school. Ms. Natori’s new job — working in a call center answering queries from customers in Japan — was in Bangkok.

Under fierce pressure to cut costs, large Japanese companies are increasingly outsourcing and sending white-collar operations to China and Southeast Asia, where doing business costs less than in Japan. But while many American companies have been content to transfer work to, say, an Indian outsourcing company staffed with English-speaking Indians, Japanese companies are taking a different tack. Japanese outsourcers are hiring Japanese workers to do the jobs overseas — and paying them considerably less than if they were working in Japan.

Japanese outsourcers like Transcosmos and Masterpiece have set up call centers, data-entry offices and technical support operations staffed by Japanese workers in cities like Bangkok, Beijing, Hong Kong and Taipei.

Such outposts cater to Japanese employers who say they cannot do without Japanese workers for reasons of language and culture. Even foreign citizens with a good command of the Japanese language, they say, may not be equipped with a sufficiently nuanced understanding of the manners and politesse that Japanese customers often demand.

“If you used Japanese-speaking Chinese, for example, the service quality does not match up with the expectations of the end customers,” said Tatsuhito Muramatsu, managing director at Ms. Natori’s employer, Transcosmos Thailand, a unit of Transcosmos, which is based in Tokyo.

Statistics on exactly how many Japanese have taken jobs outside the country at lower wages are hard to come by. But according to the Japanese Ministry of Internal Affairs and Communications, there was a net outflow of 100,000 Japanese in the year that ended in September 2008, the most recent for which statistics were available. It was the highest number in the past 20 years.

While the number of workers sent overseas by Japanese companies on traditional expatriate packages fell 0.32 percent in the same period, the number of “independent businesspeople” and freelance contractors like Ms. Natori rose 5.69 percent, according to data from the Japanese Foreign Ministry. Many of those workers were headed to cities like Shanghai and Bangkok, where net increases of Japanese residents have been recorded in the past several years, according to the ministry.

Many large Asian cities — including Bangkok, Hong Kong, Jakarta, New Delhi, Shanghai and Singapore — have three to four Japanese job placement agencies each. Four Japanese outsourcing companies run call centers in Bangkok, which is a particularly attractive city for such operations because it has low costs but good amenities, offering a living standard that young Japanese enjoy.

Transcosmos runs the largest Japanese call center in Bangkok, having nearly tripled its staff from 60 workers in late 2008 to 170 now. “We see ourselves growing to as large as 500 workers here,” Mr. Muramatsu said.

Transcosmos pays a call center operator in Thailand a starting salary of about 30,000 baht, or $930, a month — less than half of the ¥220,000, or $2,500, the same employee would get in Tokyo. That means a saving of 30 percent to 40 percent for customers, Transcosmos said.

Masterpiece, another Japanese outsourcer, has operations in Bangkok, Beijing and Dalian, China. Its workers handle jobs like mail-order service requests, processing of time sheets and other salary paperwork, and following up on e-mail inquiries. The company has Japanese and Chinese employees, and according to its Web site it is hiring people to establish another call center, in the Philippines.

Japan lost 240,000 jobs in May, government statistics showed, bringing the seasonally adjusted number of people with work to a two-decade low. The unemployment rate rose to 5.2 percent. Although exports have picked up since the end of 2009, economic growth remains slow. Gross domestic product expanded 1.2 percent in the first three months of 2010 from the level in previous quarter.

Source:-http://www.nytimes.com/2010/07/22/business/global/22outsource.html?src=busln

Patni Computer Systems Ltd. is shifting focus to the nascent outsourcing market in Japan to perk up its revenue growth, as the Indian software services exporter looks to cash in on the increasing need for companies in Asia’s biggest economy to cut costs.

“We would like to grow faster in non-traditional markets beyond the U.S. and the U.K.,” Chief Executive Jeya Kumar said in a recent interview.

“Its (Japan’s) stagnating growth and declining profitability creates a ripe environment for outsourcing…Japan will increase outsourcing.”

The New York Stock Exchange-listed company’s foray into Japan comes at a time when major markets–the U.S. and Europe–remain cautious on technology spending, mainly due to the slow pace of recovery from the global economic turmoil.

Japan is a $110 billion outsourcing market, with only 8.5% of the work being moved out of the country, Kumar said, indicating that there is still room to penetrate into this market.

Source:http://online.wsj.com/article/BT-CO-20100624-702296.html

The Patni brothers are likely to offload a large chunk of their combined stake in Patni Computer Systems, while private equity firm General Atlantic plans to sell its entire holding in the software company to Japanese systems integrator NTT Data, according to people with knowledge of the matter.

The three brothers, who together hold 46.5%, are expected to retain a combined 10% stake in the firm. Ashok Kumar Patni holds around 15.5%, Gajendra Kumar Patni owns 15% and Narendra Kumar Patni has 16% stake in the company. General Atlantic, which holds 17.7% in Patni Computer, will sell its entire stake, said an investment banker requesting anonymity.

“The talks are progressing well and are at a fairly advanced stage. The way the deal is envisaged currently, General Atlantic will sell its entire stake in Patni Computer, but the brothers could continue to individually retain a small or token percentage,” he said. NTT is likely to pay between Rs 650 and Rs 700 per share for a controlling stake of 51% in the company, said another person with knowledge of the transaction. With General Atlantic’s 17.7% stake and 33% from the Patni brothers, NTT stands to acquire a 51% stake in the firm. A Patni Computer spokesperson said: “We do not comment on market speculation.”

Shares of Patni surged 10% to Rs 623.90 before closing at a new high of Rs 608.60 on the BSE on Wednesday. The transaction, if it goes through, will be one of the largest in the history of the software industry in India, valued at nearly Rs 4,300 crore to Rs 4,600 crore. It will also result in an open offer for the shareholders of the company.

For General Atlantic, this will be one of its first exits from the investments it made in the early part of the decade in a number of outsourcing providers. ET was the first to report that talks had re-started between NTT and the stakeolders in Patni Computer in early April. It was also the first to report of differences between the Patni brothers way back in 2005 with two of the brothers, Ashok Patni and Gajendra Patni, wanting to sell out.

This will be the first time a Japanese systems integrator is getting such a significant footprint in India, allowing it to better compete with the likes of IBM and Accenture. “Japanese IT service vendors have a relatively lower exposure to offshore resources as compared to American and European majors.

In this context, NTT’s interest to acquire a stake in Patni is driven by the aim to partake greater exposure to offshore supply base and correct the lopsided onsite offshore ratio that NTT currently posses,” said Alok Shende, principal analyst, Ascentius Consulting. “This investment equally reflects a greater legitimisation of offshoring as a strategic trend in the traditionally conservative Japanese firms and this will in turn attract other Japanese IT services vendor to acquire IT services companies in India,” he added. Since 2005, there have been several attempts to sell stake in Patni Computer Systems.

Last year, after a long search, the company was eventually able to hire a professional CEO, Jeya Kumar, a former Sun Microsystems executive, paving way for fresh negotiations with potential buyers.

Unlike five years ago, Narendra Patni, who is no longer actively involved in the management of the company, is also selling.

Source:http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/Patni-promoters-PE-co-plan-to-sell-stake-to-Japans-NTT/articleshow/5895722.cms

India’s top third party business process outsourcing (BPO) firm, Genpact, has announced a multi-year contract with the Tokyo-based Hikari Tsushin Inc, expanding its footprint in Japan.

The outsourcing firm did not disclose the value of the contract, but CEO Pramod Bhasin said that like most contracts for back-office functions, it would start small and then scale up.

The contract covers three types of services — finance and accounting, IT infrastructure support, and customer service. It also includes China, where Hikari is expanding.

Hikari, a fully owned subsidiary of Hello Communications, is in the business of distributing products and services such as mobile phones, subscription to long-distance and international call services. The firm hopes to lower its operating costs and decrease time to market through the deal, according to Shigetaro Toyoda, CEO of Hello Communications.

“Japan is the second-largest IT market. It is opening up, but still not very significant. The Hikari deal gives us a greater foothold in Japan and the very important China market,” said Mr Bhasin. The back-office services provider expects to potentially open more centres in China in coming months. It currently has centres in four cities, Dalian, Changchun, Shanghai, and Beijing.

Genpact employs about 3,500 people in China most of whom are servicing the Japanese market. “About 75 percent of the services we offer from China are Japan-facing,” admitted Mr Bhasin. Genpact was one of the earliest India-based outsourcing firms to set up a delivery centre in China and has been present there for around 10 years.

Source:http://www.tradingmarkets.com/news/stock-alert/htlwf_genpact-cuts-deal-with-japan-s-hikari-tsushin-886868.html

Fujitsu Ltd (6702.T), Japan’s biggest IT services firm, has appointed the head of its system products business as its next president, after months of deadlock that halted restructuring.

Masami Yamamoto, currently a senior vice president, will take the helm of the firm starting in April, Fujitsu said on Friday.

Analysts have said Fujitsu needs to cut costs further if it is keep pace with heavyweights IBM (IBM.N), Hewlett-Packard (HPQ.N) and Dell (DELL.O). Fujitsu, despite efforts to expand abroad in IT outsourcing services, remains tied to a sluggish market in Japan.

“I want to make Fujitsu a truly global IT firm,” he told reporters at a news conference, at which he steered clear of details, saying that he had more studying to do first.

Chairman Michiyoshi Mazuka has been running Fujitsu ever since former President Kuniaki Nozoe abruptly stepped down in September, citing illness.

Mazuka’s provisional status weakened his ability to cut money-losing operations or pursue mergers to boost sales in IT services, company officials and investment bankers said.

The delay may be costly in the rapidly transforming IT services sector, where hardware, software, and services firms are coming together to become more competitive, such as Oracle Corp’s (ORCL.O) planned acquisition of Sun Microsystems Inc (JAVA.O) and HP’s deal for network equipment maker 3Com Inc (COMS.O).

Yamamoto, 56, began his career at Fujitsu designing a Japanese word processing system and working to expand the company’s PC operations overseas. In his current position he is in charge of Fujitsu’s server business.

“Fujitsu has been relatively speedy in restructuring, but some still remains,” he said. He declined to comment on which operations required restructuring, but said he wanted to keep the company’s shrinking chip operations for now.

Fujitsu has been scaling back its chip business, outsourcing development to TSMC (2330.TW). Yamamoto said said it was more important to bring the unit back to profitability before looking for potential partners or buyers.

Shares of Fujitsu ended down 2.2 percent at 578 yen, underperforming a 1.5 percent fall in Tokyo’s index of electrical machinery stocks .IELEC.T.

Source:http://www.reuters.com/article/idUSTOE60L06V20100122?type=marketsNews

Sony announced that it will outsource a part of the human resources and accounting operation services of Sony and certain of its subsidiaries in Japan to IBM Japan.

The companies said that Sony is undertaking steps on a global scale to execute structural transformation to achieve profitability improvement and optimize business processes.

In connection with the above-mentioned outsourcing decision, Sony, IBM Japan and Manpower Japan Co. have agreed to establish a joint venture. The joint venture will be formed by splitting a part of the human resources service operations from Sony Human Capital, which currently undertakes human resources service, business travel and insurance operations mainly for Sony Group in Japan.

IBM Japan will provide its human resources
and accounting operation services to Sony Group in Japan using the new joint venture as its base in Japan and IBM Global Delivery Center in Dalian, China as its base outside Japan.

Source:http://www.tradingmarkets.com/news/stock-alert/ibm_sony-to-outsource-part-of-its-business-processes-to-ibm-japan-716887.html

The Japanese market, hitherto rather closed, could soon open up for Indian IT services firms.

“We are creating an operating system between our two nations. It is in its final stages. This is necessary to address various concerns that industry, especially IT industry has, regarding our both countries. We are keen to do this at the earliest,” Haraguchi Kazuhiro, the Japanese minister for internal affairs and communications, said at a ceremony at Aamby Valley near Mumbai.

“Last month, our Prime Minister met Indian Prime Minister Mr Manmohan Singh in New Delhi and signed several joint collaborations. Now that I am here with this delegation to follow those up shows how seriously and quick are things going to happen,” Kazuhiro said.

The minister is leading a 25-member Japanese delegation to the country.

The delegation includes the CEOs of firms such as NTT Docomo, KDDI Corp, Kyocera Corp and Softbank Mobile Corp.

Japan’s $3 billion worth of annual IT services outsourcing forms just 3% of its total IT services market.

Local IT players have long been complaining about Japan being an orthodox market and closed to outsourcing.

“Japanese firms work in their own way. They do not prefer outsourcing. They still maintain a lot of legacy systems on which skill set availability becomes an issue. Japanese prefer less documentation, which makes service level agreements difficult. Besides, they prefer local service providers,” Girish Wardadkar, president and executive director of KPIT Cummins, a firm which provides IT services to Japanese firms such as NEC, Fujitsu etc.
But nobody doubts the huge potential of this market.

“Japan is the second-largest IT services market. We estimate that by 2020 India will export about $175-225 billion worth of IT services. However, if Japan market opens up, that size is going to be much bigger,” said Nasscom vice chairman Harsh Manglik, who is also the chairman for Accenture India.

As a part of confidence building measures, Japan will participate in the Delhi Mumbai Industrial Corridor (DMIC).

“We shall use DMIC to put some concrete actions in place. We shall also be actively involved in Aamby Valley,” Kazuhiro said.
At the same time, Japan is looking to increase its investments in India.

In 2008, the country had invested about $8 billion in India and “that is going to increase significantly now,” Yamazaki Yasuyo, advisor for Japan’s ministry of internal affairs and communications, said. “The last government invested mostly in US and Europe. We shall now focus on investing more from our 140 trillion yen asset of pension fund into India.”

Source:http://www.dnaindia.com/money/report_japan-beckons-local-code-writers_1332578

IBM today announced a nine-year strategic outsourcing agreement with Chugoku Bank, a major Japanese regional bank.

As part of the agreement, IBM will manage operations and maintenance of Chugoku Bank’s information technology (IT) systems, including host computer and servers. A primary goal of the IT services provided by IBM is to enable the bank to enhance client experiences with secure and stable services for customers. At the same time, IBM will optimize business efficiencies for Chugoku Bank by stabilizing and streamlining the IT systems and reducing IT costs for the bank.

IBM was selected by Chugoku Bank as its outsourcing partner based on rich experiences and achievements in operation and maintenance of information systems. IBM will introduce best practices and enhance governance of Chugoku Bank based on its broad experiences in operating and managing business processes and information systems.

The contract was signed in October 2009.
Source:http://money.cnn.com/news/newsfeeds/articles/prnewswire/200911100130PR_NEWS_USPR_____NY08076.htm

Provincial and municipal officials from China and Japan agreed to promote regional cooperation with each other at the Fifth Beijing-Tokyo Forum yesterday.

“By exchanging ideas and experiences cities in both countries can improve their management systems a great deal,” Hiroya Masuda, former Japanese minister of Internal Affairs and Communications, said at a sub-forum in the port city of Liaoning province.

“Most cities face similar problems and the problems can only be solved by learning from each other’s experiences and mistakes,” Masuda said.

He added that the forum should promote more detailed projects in various aspects of bilateral cooperation, such as environment protection and public facilities.

Tao Siliang, vice-president of China Association of Mayors, said city-level ties, with proper communication between mayors, should remain unaffected even when ties between the two countries are going through a turbulent patch.

Tao said the mayors in China have a strong sense of responsibility now. “They have started paying attention to the impact on environment while striving for higher GDP growth.”

Dai Yulin, vice-mayor of Dalian, said his city had cooperated well with Japanese cities and enterprises, adding that there were nearly “4,000 Japan-backed companies and eight offices of Japanese autonomous prefectures” in Dalian as of May this year.

The city’s software and service outsourcing sector, which exported goods worth over $1 billion in 2008, is mainly Japan-oriented, thanks to the software park Dalian set up in Japan last year, he said.

Dai said Dalian will continue to cooperate with the autonomous prefectures and set up a platform for Japanese companies to enter the Chinese market.

Kyoto Prefectural Governor Keiji Yamada said that his city had a long history of friendship with China, especially with regard to tourism.

“Kyoto is one of the most popular destinations for Chinese tourists,” he said. “Of the nearly 1 million Chinese tourists to Japan in 2008, 370,000 visited Kyoto.”

Yamada said bilateral communication should not be limited to economics.

“For example,” he said, “Kyoto is home to many famous universities. We hope to promote educational cooperation with Chinese cities as well.

“The cooperation should be further extended to a comprehensive level from the existing fields of economy, tourism, and education,” Yamada said.

Source:http://english.people.com.cn/90001/90776/90883/6801874.html

‘Japan used to work on a very cooperative system, to give workers certainty and stability.

It operated a seniority-based, lifetime employment system. Many workers stayed in one company throughout their work life, and their pay was based on how long they had spent in the company.

In return, the company looked after the workers, and down periods, they held on to them.

In the services sector, Japan kept protected jobs for Japanese workers who were not so productive…but it was not sustainable.

The Japanese are outsourcing, hiring more temporary workers who accept lower pay and few social benefits.

As a result, unemployment has risen, incomes of less skilled workers have fallen, and income inequality has increased.

It is one of the reasons that Japanese voters became fed up with the Liberal Democratic Party (LDP) and have just elected a new Democratic Party of Japan (DPJ) government.

Now, the new government has to grapple with the same difficult issues, but will not find any easy solutions either.

If the world’s second-largest economy cannot protect its workers with a closed system, Singapore with a small, open economy has no hope to do so successfully. The only way for us is to push for constant transformation, to create new economic space for us to grow and prosper.’

Prime Minister Lee Hsien Loong, who visited Japan last week, on the challenges that governments face and the importance of economic restructuring.

This article was first published in The Straits Times.

India has piped China to become the world’s fastest growing telecom market, thanks to the various “innovative” ways such as infrastructure sharing and network management outsourcing adopted by it that has also helped operators keep the service charge low, says a report.

Terming India as “world’s fastest growing (telecom) market”, global rating agency Moody’s today said in the past 18 months, “India’s net additions of 10 million (subscribers) per month have far outpaced China’s monthly rate of increase, now below eight million”.

About two years ago, China was having the highest number of new subscribers on a monthly basis.

“Although emerging markets with relatively low penetration continue to have above-average rates of increase in new subscribers, those numbers tend to be slowing, except in India…,” Moody’s said in a statement.

The agency said that Indian telecom players were using “innovative means such as outsourcing network management and sharing mobile infrastructure to keep costs low in extending services to under-served rural areas”.

Moody’s said mobile operators in India frequently shared base stations and partner with other firms or independent cell-tower firms in expanding coverage to under-penetrated rural areas from where much of the growth was coming.

The agency said divestment of non-core assets like selling or sharing cell phone towers as a way to control costs and optimise capital expenditure had helped Indian operators in expanding coverage.

For the telecom sector in the Asia-Pacific region, Moody’s has assigned a “stable outlook” and noted that this market presents attractive investment opportunities.

The agency said the revenue growth for the region would drop sharply by year-end 2009 from the double-digit growth rates of last five years.

However, the full-year revenue growth for the industry this year will remain marginally positive.

Revenues from voice service and SMS are expected to fall but data revenue should continue to grow, Moody’s said.

The outlook is based on expectations from telecom operators in the Asia-Pacific region across Singapore, Japan, Australia, Hong Kong, New Zealand, Philippines, South Korea, Thailand, Pakistan and Indonesia.

It did not include any Indian operator, though NTT Docomo and Singapore Telecommunications (SingTel) which have partnerships in India were included.