The north-eastern state of Meghalaya has a thriving IT market, though it is
concentrated mainly in and around Shillong. There are more than 40 resellers
doing business in the city. Among the prominent ones is Lifeline Enterprises,
which was started way back in 1989 by Sarad Bawri. Apart from running Lifeline,
he is also the President of Meghalaya Information Technology Business
Association (MITBA), which is the umbrella body of the channel community in
Meghalaya, formed about five years back. Parinita Baroowa of The DQ Week caught
up with Bawri recently to get an insight into the IT business in the state.
Can you give a brief overview of the IT scenario in Meghalaya with
specific reference to Shillong as a growing hub of IT activities?
As far as Meghalaya is con-cerned, all the IT activities are concentrated in
Shillong, main-ly due to the fact that it is the capital city. Besides Shillong,
there is no other major town. Although Tura is coming up, but there is no direct
road link between the Shillong and Tura. People from Tura are in close vicinity
to Guwahati and find it convenient to go there. The same is the situation,
vice-versa. Primarily because of that, the major activities which inclu-des FTUs
and the education institutes, are concentrated in Shillong.
The government is a primary buyer of IT products, because lot of funds are
coming for the development of IT infrastruc-ture in the state. Due to a good
literacy rate and quality educa-tion, there is awareness amon-gst the locals. At
the same time, defence is another important sector, which consume a major chunk
of IT products. But with all these positive factors are attached certain
drawbacks. What we really lack is the corporate world. We really don’t have
any corporates to speak of. Because the number of industries are very limited
and the corporate culture is yet to develop in the state. So basically, we have
four major sectors pertaining to IT–FTUs, educat-ion, government and defence.
How effective have been the state IT policies for the
growth of IT?
Unfortunately, in Meghalaya the focus on IT has really seen a downcurve.
Inspite of the presence of an IT ministry, the state of IT has gone down.
Meghalaya was one area where IT could have done a lot of difference, had it been
given proper impetus.
Then, the local tax is at a standard four percent all across
the country, while in Megha-laya, it is eight percent. So in a way, business is
flowing from Shillong. It is not being concen-trated here. Everybody,
especia-lly the local resellers, are losing out on business. Added to this, the
government is also losing out on tax. Besides this, what-ever development is
taking pla-ce, is not the result of govern-ment initiatives, but inspite of
What are the major problems encountered in business?
The biggest problem faced is the competition from outside the state, because
of the high local tax. Secondly, the price is a dominant factor and rules the
margin in the market and this is common to all resellers. Healthy margins cannot
come in only when there is a monopoly situation, which is absolutely not
possible in an open economy. Prices are so transparent of late, that it is only
IT that can possibly have an open policy. Thirdly, the entry barriers are very
low. There is absolutely no criteria as such to enter the market. But at the
same time, it is a matter of pride for the Shillong reseller community. Around
30 percent of the resellers are although not trained, but have at least passed
through the practicalities of the trade and have gradually developed an expert
hand in business.
Since the times I entered into business in 1989, there have
been a mushroom growth of non-serious players. Ironi-cally, today any person
without the bare minimum establish-ment experience can sell an IT product and
earn his living. But at the same time, when the question of service arises, the
customer is left in the lurch.
Which are the popular brands in the market?
When we talk of MNCs, Compaq is the upcoming leader in this market. IBM at
the same time is doing quite well. As far as Indian brands are concerned, HCL
and Zenith have quite a number of dealers. Besides these four brands, it is the
assembled segment which is really doing exceedingly well.
How conscious according to you are the consumers in
Meghalaya about IT?
The ratio is 50:50. There are some intelligent customers who keep us updated
about the latest trends in the market, while the second half seems to be equally
naive about IT components.
How effective has been MITBA in addressing the problems
and grievances of the resellers?
MITBA was started around five years back. After the initial set-up, the
association was practically deferred for almost two years, as there were no
major activities undertaken in that period. But this was not a positive sign in
an era of cut-throat competition. So the policy was revised. As far as the
activities are concerned, we are trying to get favorable response from
government of Meghalaya, which has unfortunately failed to materialize.
Next we are in the process of organizing seminars, by holding
tie-ups with different kinds of organizations. The purpose to address different
issues pertaining to vendors have been successfully resol-ved. At the same time,
we are still lagging behind in resolving the issue of sales tax and this has
been partly due to the circumstances and partly due to the lack of interest on
the part of the resellers.
By and large, efforts are being made to resolve the issue for
better business. We have also approached NACIT for support and are planning to
change the outlook of the association as well and spread its wings to other
regions, apart from Shillong. Efforts are on to establish tie-ups with leading
brands like Canon and IBM in order to organize roadshows and events for
publicity and awareness.