Lack of skills to handle transitions means Indian IT service providers will not stand a chance to win large deals in government, despite significant spending cuts likely to be announced later this month, a senior IT executive at a departmental user in Whitehall told Computer Weekly.

According to the source, who did not wish to be named, the biggest concern around working with Indian companies is the skills transfer between the incumbent supplier and the new partner.

"A lot of the work we do requires suppliers to work very closely with the customer and the problem is, [Indian suppliers] do not have the capability onshore to meet these demands," the source said.

"Also, with [local suppliers] you are able to do TUPE transfers, but such transfers do not exist in India. It would be one thing to offshore the software work around a new project, for example, but if you have 200 people working on an existing project, where do the skills go?"

Most major Indian suppliers are bidding for some very large public sector deals, but the source added that it would be difficult to favour them rather than a local or European player, where local resource is more widely available.

Developing a talent base in the UK is something that Indian firms such as Tata Consultancy Services (TCS), Infosys and Wipro have attempted to do, with varying levels of success.

Wipro, for example, has said it has tried to recruit staff in Europe but it is struggling to fill the roles. Widespread opinion is that these companies have not managed to hire locally due to their overall model of paying lower wages than market average.

Another much-discussed disadvantage of Indian suppliers when it comes to taking over public sector deals is not having a delivery track record in the UK.

"It is all very well to say that they have delivered in India, but managing a transition between two countries is something quite different. I need to see that they have been able to deliver [in the UK]," said the IT executive.

However, many experts agree that offshoring cannot be ruled out as an option to reduce government spending. Currently, there are no Indian firms among the top government IT suppliers.

Source: http://www.computerweekly.com/Articles/2010/10/05/243177/Indian-suppliers-unlikely-to-win-public-sector-deals.htm