"We are now looking into a trading agreement with India. This already includes mutual benefits for ICT and other sectors," said Trade and Industry Secretary Juan Santos in an interview.
Although there is no formal timetable on when the Philippines will push for this trade agreement with the Indian government, Santos said this initiative will follow immediately after the country finalizes its trading pact with Japan possibly this year.
"Many people think that we are competing with India. But actually we can do a lot of complementation with them, especially in the field of ICT," he said.
Santos’ move to forge a partnership with India, which is considered a threat to the Philippines’ IT and IT-enabled services sector growth, came about after Kiran Karnik of India’s National Association of Software and Services Companies (NASSCOM) encouraged collaboration between the two countries to strengthen their niche in ICT.
Karnik was a presenter during a panel discussion on "Opportunities and Threats for Asia’s Emerging IT and ITES Industry" on the first day of the recently concluded ICT International Conference and Exhibition here.
Karnik said the Philippines can take advantage of the $17-billion IT-enabled services market, thus immediate collaboration is highly encouraged.
Karnik suggested specific steps which both countries can take such as formulating a framework on how their IT companies can get together and work in synergy.
Making the Philippines as a site for the recovery centers of India-based IT companies is one of the potentials, he said.
"You have good IT talents in the Philippines which we don’t have in our country. We, too, have good IT professionals whose talents are also needed in your IT sector," Karnik said.
"We may compete in other areas in IT, but we can work together and grow together," he said.
For his part, Santos said that once the Philippines starts negotiating a trade agreement with India, it would (raise) some important points such as easy mobility of people, transfer of technology, investments and tariff relief, among other things.
Santos admitted that India has made significant strides in the IT field since it started ahead of the Philippines. However, he boasted that the Philippines is "running" faster than India.
IBM Phils. general manager Joaquin Quintos agreed to the proposed Philippine-India IT sector collaboration, saying that in today’s business environment, a sector such as IT cannot survive if it will not forge partnerships and that working with India is a smart gesture.
India’s strength is in software development, thus more and more multinational companies are setting up their research and development centers in India.
The Philippines, on the other hand, is carving its niche in offshore customer services, the reason why call center and business process outsourcing (BPO) jobs have increased by 100 percent in one year’s time, the fastest growth rate compared to other countries.
During the first quarter this year, figures show that the number of call center seats increased to 45,000 from 20,000 during the comparable period last year.
Santos said this growth is considerably higher than elsewhere in Asia. India has posted 65 percent growth; China, 41 percent; and Thailand and Malaysia, 15 percent.
Joel Mari Yu, managing director of the Cebu Investments and Promotions Center, said the best way for the Philippines to climb up to the top of the IT field is to hasten a formal collaboration agreement with India.
"We can exchange opportunities with India, and complement each country’s strength in IT," Yu said.