Re: Fw: India's Software Exports: Reply to Mr. Aggarwal (addendum)

["Raju Agarwal" <krantikari@hotmail.com>]

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>I am sure this is right.  Now consider for example
>
>--- "to modify the client's existing applications"....
>
>Is "the client's existing applications" something being recorded in the
>accounts of the Indian software company as an input....

No.

>
>expenditure?  So for example, the existing application is recorded in
>the
>accounts as worth $x million, to which $y million value addition occurs
>by
>way of e.g. new code being written in India?

This example is absurd.  The existing application is not recorded in the 
accounts because the Indian company has not purchased it (does not own it).  
The original application resides in the client's production environment and 
copies of the application are transferred to development and test 
environments, which may be physically located at the client site or 
offshore, to enable the Indian company to develop the requested 
functionality. The Indian company does not at any time own the original 
application, and must sign a lot of legal agreements to this effect.  The 
original application need not be transferred to India at all, if the 
development environment is at the client site.  The Indian programmers, are 
provided with remote access to the client's development environment.  The 
only amount recorded in the accounts is the fee paid to the Indian company.



>I am admittedly ignorant
>of
>precisely what is happening here,

Agreed.

but so is, I believe, everyone else,
>including McKinsey/Nasscom.

No - I think it is just you.

>This is a point I have also made to my students and also one I made in
>Bangalore and also in Hyderabad in the last few months;

God help your students!

>if I am right
>in
>pointing out a fallacy which has been widely broadcast in the country
>and
>elsewhere, and some alleged management consultant then steals it and
>broadcasts it for himself/herself, remember folks where you heard it
>first....

Right, when pigs fly!

>Subroto Roy
>
>
>
>
>
>
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