This article is just my thoughts and not really from a business savvy person, I am a not-so-bad developer with a stupid business brain.
It has to be accepted with a crossed finger that the US Dollar is indeed declining its value, specially in India. I have seen the worst decline like INR 42 per Dollar, not to mention that there was once a happy times when it gross about INR 48 per Dollar. With the trend of the Dollar in the past 12 to 18 months, the average psychological value had been around INR 44 per US$ and recently during the last 1-2 months, it had gone down to about INR 42.50 to 43.00. I am sure mega corps usually have a INR/US$ cap calculation fixed for a year or so but for smaller companies, this affects really really hard and is very distinct. And to the best of my knowledge there is no remedy or a way to equalize this in any way. Look at it this way, for every $1000 earned from outside, change of one rupee (INR) on a particular trading day of your bank will set you back by INR 1000; well then the multiplication is rather simple maths, the more amount transferred on an unfaithful day will set you back by many Rupees enough to have paid an average developer’s salary.
Another itchy feeling that I have is the fact that Individuals cannot have dollar accounts if you don’t live outside (as far as I know, please prove me wrong). Now, what happens with this phenomena? Well, you earn US$ at such cheap rate, like INR 43 per dollar but then when you sell, the banks will buy at about INR 48 per dollar. So, if for instance I have to buy/import anything in US$, I lost that INR 5 in between for each dollar. Is that how the ex-chequer squander from us; the hard working people? People say, there are lotta incentives for the IT industry, Internet Related service industry but I am sure, things are yet to be streamlined much much more than what we have right now. I wish I knew how does this system behaves in other nations, how are the Chinese doing on this, how are the Canadians faring, the Mexicans etcetera.
And about streamlining of the current system, definitely there are red tapes and loopholes everywhere. May be that is why India is best with supplying educated economical labor but not really with being super-powers in many areas where it could have been! Isn’t that China that took over IBM’s Computer Hardware (Desktop, Notebooks, Servers) business; shouldn’t we wish that was us. After all, the all-time high influx of Foreign Investment was recorded just last month (Nov 2004) and isn’t dollar investments overflowing, as if it is coming out of our ears.
Not just in the online wired business, it is seen in other sectors too. We were happy about Laxmi Mittal, an Indian, taking over the biggest Steel Firm in US and being a Steel Hot Guy, but is he really in India, for the Indias; I don’t think so. I always thought the Tatas and the Reliance Steel were the biggies in Steel, are they still? Some are busy trying to solve their family problems, eh!
Recently, at the Mumbai Domestic Airport, I saw their Security Baggage x-ray scanner under the canopy outside the airport lobby. I almost burst in laughter, “What the Heck?”. Later on, I realize the 94+ crore (INR) renovation is underway to make it bigger, better and more airy. With airplanes taking off and down almost every coupla minutes, I think that is the need of the hour. Someone have rightly asked me on phone “Is there some preparation for a war at your place?”. Well, I live close to the airport and I can hear the plane roaring most of the time and it becomes rather loud during early day-break. But is the Indian Air business growing big time, I doubt that too! Can more tourist be flown in and out, and around the country and make more earning. But then, to the best of my knowledge, none of the Airlines in India are majorly Privatizable and will go through eons of processes to improve fast enough to keep pace with the fast changing world. Things reminds me of politicians who think for about 5 minutes to utter a 5 seconds words. Damn slow!
Is is for the fact that I am in the IT industry, that I feel more better things are happening fast in this area. The Tatas have promised on expanding their overseas turnover to $5 billion in a short time. Infosys are aiming to make themselves 10 times that size sooner than later. Inspite of all these, there are many regions, states in the country which are still shrouded in their own-make-up world of seclusion and separation and will take them lots of decades, if not centuries, to come up even to the competition field.
So, should we deal an agreement with the client that our market price will vary according to the forex rate on that day? I don’t think so! Or, should we start hiking our price and review our market value quarterly, bi-annually or annually? Hmmmm, I am not sure how to make up my mind on this one either.
Have I uttered lotta crap for today? Well, I think so …