CHINA TO BECOME SOFTWARE LEADER IN TWO YEARS- N R NARAYANA MURTHY

India's neighbour and economic powerhouse China is building on its English-language skills and will emerge as a serious competitor to the Indian software industry, says Infosys Technologies Ltd chief mentor N.R. Narayana Murthy.

Indian information technology (IT) firms will now have to be more aggressive in markets abroad and hiring there, Murthy said in an interview.

The challenge for Indian companies is to demonstrate leverage. In other words if the customer gives us $1 (Rs46.20) we should give back $2-3-4 to the customer. As long as we focus on increasing their leverage, they wouldn't mind spending.

At this point in time, India is still the leader undoubtedly, though the Philippines has been a little bit more aggressive in the BPO (business process outsourcing) space. But in the software area, definitely the US and India are the clear leaders.

I think this will continue at least for the next year or two, by which time China will perhaps become a significant competitor because China has done a very good job of improving their speaking skills in English.

In terms of infrastructure, China is about 100 years ahead of ours. So give another two years and China will become another serious competitor.