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"Government is not helping the cause of IT"–Sarad Bawri

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DQW Bureau
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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.

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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

that.

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.

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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.

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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.

 

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